In this video, I share a statistic that proves cold calling doesn’t work like it used to.



Video Transcript:
This transcript was auto-generated. Please excuse any typos or grammatical errors.

Why is cold calling still the most taught strategy to grow your business in 2023?

It’s a question that puzzles me, and especially in the insurance industry. It’s a question that I have played with and asked myself for for many, many years. With all the tools and all the technology we have available today. Why is cold calling still the number one strategy type to grow your book of business? I can recall working with an Advisors about a year and a half ago and she was one of the top producers in her agency and we sat down, I think it was about November 2021, and we were getting her ready for 2022.

So I was helping her create her game plan so she could have a big year. And at the beginning of 2022, she sat down with her management and this was the meeting where you sit down, set your sales goals with your management, talk about how the heck you’re going to achieve that goal. And I remember following up with her and having a conversation after she met with her management.

Now, mind you, this was when we this was after we already had built her game plan, her business plan to go grow her business exponentially in 2022. You’re going to learn some of the things today in this episode. She sits down with her management team and they assign her a sales goal of $500,000. Now she goes after big accounts, so hitting 500,000 is not out of the ballpark for her.

However, it’s how they were going to support her to get to that half million dollars. That blew my mind. When she laid out her business plan as to how she was going to hit the half million dollars, which was the plan to create exponential awareness that she and I had created for management, did not know what to do with it.

In fact, if I were sitting in that room, I’m guessing her management looked at her cross-eyed because the only strategy they had for her to hit a half a million dollar sales goal was to rate for it. Track her cold calling. Yep. In 2021, the only strategy they had to help a producer hit a half million dollars was to track her cold calling.

So this leads us to today. I was on a coaching call with a client just last week. As of the date of this recording. Recording this on February 26th, I was sitting in a coaching call with a client and he pulled up a slide deck that his agency had gathered from some sales training that they had performed or had provided to them by another outside contractor.

And there was one stat on this PowerPoint slide that drew my attention, and it was that today it takes 18 phone calls, 18 dials to reach one prospect. So if you’re going to try to reach one prospect, you’re going to have to dial that prospect on average 18 times before you reach them. So what conclusion can we come from that?

Can we can we deduct from that? Well, let me give you the conclusion. This agency deducted from the fact that it takes on average, 18 dials to reach a prospect. Well, boys, just make more phone calls, if that is our only tactic today, to grow our business, we’re not going to grow. You’re in a relationship business, especially if you’re in the insurance business.

You’re in a relationship business. If all you’re going to do is pick up the phone and smile and dial in 2023, it’s not going to work. It takes 18 dials on average to reach a prospect. So what are you going to do? Just pick up the phone more. Now, let me tell you why this isn’t as effective. Cold calling is a form of linear awareness.

What does that mean? Well, every time I pick up the phone, I can only call one person at a time. I can only try to get one message in front of one person at a time. So in order to reach ten people, let’s use the math from the statistic I just gave you on average, it takes 18 dials to reach one prospect.

If I want to reach ten, I’ve got to pick up the phone. 180 times. Oh, now we could continue doing the math and saying, okay, if it takes one minute, it’s called 2 minutes per phone call. Sort of dial the phone number, pick up the phone. If you’re going to leave a voice message, it takes 2 minutes. It now takes 360 minutes to dial 180 phone numbers.

We’re talking 6 hours to dial 180 times. You see, when you create linear awareness, you can only get one message in front of one person. It’s the same concept. When I was taught 20 years ago to go door to door, I’ve shared this story on a past podcast episode. I started my career at a captive insurance company and they gave me two strategies Pick up the phone, smile and dial and go park my car in an industrial park and go door to door drop off marketing materials so I could only knock on one door at a time.

So if I wanted to hit the entire industrial park in a day, it took damn near a whole day. You see, when you create a linear awareness, it takes a ton of time to try to get a hold of anybody. And the one thing you don’t have right now is time. You’re busy. This is why you have to create exponential awareness.

And the last reason, the last argument I have as to why cold calling cannot be your only mode of transportation anymore is because smartphones changed everything. We don’t talk about this enough. The fact that smartphones has had presented a huge hurdle in the world of cold calling. So let’s think about this. Since the pandemic, it is true more people work from home than they work from the office.

I should say. More people work from home than they ever have before, not more than the office. But more people are working from home than they ever have before. So if you’re the only phone number you have of of of a prospect, is there office number and you’re constantly calling the office, are you ever going to get is their voicemail and they don’t even report to the office anymore.

Now let’s imagine you have their cell phone number because it is easier to get somebody’s cell phone number today than it’s ever been. Right? Because many of your prospects are putting their cell phone number in their email signatures. Here’s the problem with that. This is where smart phones have presented a little hurdle. Number one, if you dial your prospect and they don’t recognize your number on their smartphone, what are they going to do?

Yeah, they’re going to let it go to voicemail. But here’s where smartphones have really put a hindrance on cold calling. If that phone doesn’t recognize your number, there’s a chance it may even tell your prospect that you are spam. Think about that for a second. So you’re trying to call prospect. You can’t get a hold of them at the office.

You’re lucky enough you have their cell phone, so you call their cell phone. But nine times out of ten, they’re going to let it go to voicemail. If they don’t recognize your number. But even worse, that the phone might tell them you’re spam. What are the odds you’re actually going to get a hold of somebody with a phone?

Yeah, not very good. See, this is why cold calling can’t be your only mode of transportation in the world of prospecting any more. Because if this is what you want to focus on, even if you argue with me that Andy, I’m damn good on the phone and I close business when I get on the phone, I go have at it.

But what I’m telling you is it’s taking you more time than it’s ever to get a hold of the same number of prospects you maybe got a hold of five years ago. And there’s one thing I know about prospecting, and that’s you’ve got to be efficient with your time.