If the current state of B2B sales was a movie, it would be an eighties horror film.
Picture it: GTM teams running down the creepy, dimly lit hallways of some abandoned hospital, tripping over each other as the quickly gaining blob (i.e. quotas, budget cuts, layoffs…enter your own flavor of stress here) inches toward their neon sneakers.
They use every tool at their disposal to try to open the right door, the door that will get them out into the light and back to safety.
“Maybe it’s the outbound key!” a sales rep yells as they fumble with the key ring.
“No! No! It’s gotta be the inbound key!” a marketer screams as the blob gurgles and wretches behind them.
Okay, this might be a tad dramatic, but it’s not too far off. We have to be honest with ourselves: the state of sales is not a pretty one at the moment.
Sales teams from every corner of B2B are struggling to meet objectives. Ebsta and Pavilion recently shared in their
2023 B2B Sales Benchmark Report that:
Only 29% of reps made quota through 2022
Win rates decreased by 15% in 2022
Average deal values dropped by 32%
The length of sales cycles increased on average by 32%
The latest data from
RepVue provides additional insight provided directly from sales professionals. Over the last 12 months, the number of AEs who reported hitting their goals dropped to 39.5%.
So,
what gives? And more importantly,
how do we work together to win?
We recently sat down with the industry’s top sales leaders Scott Leese, Tom Slocum, Leslie Douglas, Judd Borakove, and Saad Khan to get the answers.
(Spoiler alert: nearbound is the only way forward)
Why is B2B sales declining?
Here are some key insights from the experts on what is causing the steep decline in sales.
Darin Alpert
I think there are a lot of factors at play with quota attainment numbers dropping year after year. First and foremost, are the macro conditions such as the COVID pandemic. COVID started in March 2020, and a lot of companies quickly had this shift to go remote. There was a lot of digital technology that needed to be put into place in order for that to quickly happen.
Zoom is an example of a company like that, that people brought in from a digital transformation perspective. So, the demand for digital tools went up, which then led to a need for more salespeople and account managers and just revenue professionals, in general, to help fulfill the demand that was being that was there. The problem was that salespeople were not getting ramped up as quickly as they needed. There was a lack of sales enablement for these new reps who were just getting onboarded quickly and getting thrown out into the field because there was so much demand.
As things started to slow down, there were still salespeople who were just not being ramped up as quickly. So then you factor in the drop in demand for some of these digital tools with the cost being increased, as well as the state of the economy.
Now we have a mix of companies pushing the brakes on spending and growth. The focus went to sales rep productivity and more productivity per rep versus just throwing as many bodies as possible—focusing on top-line growth versus profitability.
Profitability has now taken over. Companies can still hit their revenue targets without reps hitting quota. We talk about that a lot. A lot of times, you can hit your revenue target and cut the number of people that you need, or had needed previously.
Tom Slocum
When you’re looking at the average sales quota attainment right now in the space, we do see that decline, right? It was before just north of 50%. And now, as you mentioned, it is dropping. And it’s two things.
First, most of the products and companies out there are positioning themselves as nice-to-haves when going to market. They’re not meeting their buyer’s expectations. It’s just more of a want or a, ‘Oh, this would be great if we were raging like we were in 2017 and people could put money into things.’ In the SaaS world right now, it’s about what’s a need—how do I do less with more?
That leads to the second point: companies are so stuck with the traditional methods that they’re not adapting. They don’t even know how to adapt. And so they’re meeting buyers with the old ways of buying where the buyer is not at the center of the process.
This is creating dysfunction and friction in the buying process, and people aren’t buying because they’re turned off by it. There’s a different expectation now with buyers, whereas in the nineties, cold calling and going outbound were actually important. It really was because that was the only way people got information—by you making noise.
Leslie Douglas
To say things have changed is an understatement, right? The market has changed a lot, but roles like sales roles have changed quite a bit too. I think we exited this really cushy period of time where a seller was sitting with this nice stream of inbound leads. A lot of companies had some sort of PLG, they had marketing, they had an SDR, a BDR—all of these things that were feeding their pipeline.
Now, that role has become more about relationships and conversations. It has completely shifted its focus to full-cycle selling. Everything’s slowing to a trickle. We have to set salespeople up for success in a different way. We are having to learn how to walk again.
Before, the mindset around quota attainment was that it came from many different sources. Now, those sources are decreasing or have been cut altogether and we’re forced to look for other ways to come up with the same number.
Outbound is more challenging today because it’s noisy. There’s a lot of people. There’s a lot of players at the table. There’s a lot more information at our fingertips and our buyers are more knowledgeable. They’re going to look in different places than they did 5, 10, 15 years ago.
We see a ton of information around intent data, and the positive impact of having some sort of an introduction or utilizing your network in a different way. Whereas before, you could just push to the masses. You could throw out that net and somebody was going to get caught in it and be interested.
But there’s just too much noise for that these days. You have to be different—and not in a cheesy way, but different in your process, the way that you approach things, and your strategy.
Judd Borakove
The best performers are not following a standard process like everyone else, and nobody’s monitoring that. So, you don’t even understand what they’re doing right or wrong. And then, incorporating that knowledge back into your process, you might say, ’Hey, we’ve got a Superman or Wonder Woman over here. Let them keep going because if they don’t close their deals, we’re in trouble, and they don’t want to rock the boat.’
That’s something we need to think about, not just playing the numbers game. For example, one-third hit or exceed the quota, one-third fall below. When you build that model, you’re anticipating failure, and I believe that’s the wrong approach. If we look at it on a macro level, anticipating failure isn’t what we want. While there are times when it makes sense to learn from failure, in this instance, you’re setting up a system that is designed to fail.
Key takeaways
According to Darin, Tom, Leslie, and Judd, the decline in the larger industry can be attributed to a few key factors:
The shift in how business was done in the COVID-19 pandemic
The economic downturn post-pandemic
The poor onboarding practices for sales reps
Companies not positioning themselves as a necessity
Using old-school methods to go to market, methods that are in a steep decline due to the noise of the wider market
The way companies are structuring their metrics
Can nearbound save us?
Can a nearbound GTM strategy get us out of this horror film? Here’s what the leaders had to say.
Saad Khan
The trust is there because the relationship is there. The relationship comes first, then trust, and then you find a way to convert. That structure suits my style well. I’m a people person. I don’t like the idea of old-school sales methods. So, for the new generation of sellers, I think that nearbound fits our personalities—the personality of the modern seller—really well. It’s more human.
And it’s clearly working. Within less than a year—maybe six, seven months, or less—some of the most prominent sales leaders are talking about it and using the word nearbound, not ‘partnership’ or ‘referrals’ anymore.
Darin
The biggest deal I’ve ever closed used, if you want to call it, “nearbound”. It was a great time and we upsold them, as well. None of it would have been possible without the insight that I had from tapping my network. I used one of my close friends to help me get some intel on what needed to be done to get that account.
I think what I love about nearbound is the fact that it’s not just shotgun-blasting a bunch of messages and cold emails and calls, etc. I think the buyer’s journey gets so overlooked by an internal sales process - you know the checking this activity box in the CRM and making sure that you go through that specific sales stage to get a deal moving to discovery from the first call, et cetera. That’s a
seller’s journey.
I think more companies need to focus on the buyer’s journey—how, when, and who they learn from—versus the internal sales process because the buyer ultimately has control. They’re the ones that get you to your number.
It goes back to all these companies that sell these various solutions that are on these G2 grids, and you’ve got to really differentiate your buyer’s process. And I think that’s the beauty of what nearbound is. It creates an experience that a buyer loves versus just spray-and-pray selling.
Leslie
Tom
What excites me about nearbound is I see that the future of selling is all about the people. We had the one percenters, top sellers doing that model in the shadows for so long, but now it’s amplified across the board.
When you look at that evolution, you’re bringing in nearbound. You’re activating partners, you’re diving into the community. Scott Leese talks about GoToNetwork and what he’s doing within GTM United is exactly of that nature, and it shortens their deal cycles.
Let’s be real. The point of the nearbound and the real point of partners and warm intros is it shortens sales cycles. It builds trust and even gets you bigger deal sizes.
Because there’s credibility. You’ve come in with an intro. Somebody’s vouched for you at the end of the day. Word of mouth has always been a thing—it’s just now even more amplified through the community.
Judd
Let’s just start with the nearbound lens. What I find particularly powerful about it is its role in how purchasing behavior has evolved. We all desire someone to assure us that it’s safe to make a purchase we’re considering – someone who can alleviate our fears and mistrust, enabling us to confidently say, ’Okay, I feel good about my purchase.’ What Nearbound excels at is utilizing influence within an account; it fosters an inherent level of trust right from the start.
Honestly, I’m a strong believer in this approach right now. Trust is currently our most significant challenge. Matt Dixon, the author of ’The Challenger Sale,’ conducted an analysis of 2.5 million sales calls and discovered that the most significant barrier is the fear of making a mistake. This means that without trust, people are reluctant to buy.
What Nearbound does exceptionally well is help the seller establish a trusted relationship, whether it’s through intelligence gathering, gaining a deeper understanding of the customer, leveraging their influence within the account, or facilitating a direct introduction.
The TL;DR?
Nearbound makes us better humans and salespeople, and is more aligned with modern sellers’ values
Many GTM leaders have fully adopted the nearbound concept in a short time and are implementing it in their own companies because it’s based on trust and credibility
Nearbound leads to shorter sales cycles and larger deals
Nearbound is buyer-focused, and that is the only way we will change the current state of sales
People don’t trust you, and they are terrified to make a mistake; nearbound puts trust back into the equation and, at the same time, alleviates fear
What mistakes are B2B Sales teams making?
GTM teams have a lot to (un)learn when it comes to using nearbound. Here are the downfalls the experts say you need to avoid.
Darin
Let’s say you’re selling an email marketing tool. If you go into the email marketing grid on G2, you’re going to see dozens of vendors out there and these vendors are all hitting up the same potential buyers with very similar messaging, ‘Improve your app,’ ‘Improve your email marketing,’ ‘Increase your open rates,’ etc.
And it becomes super noisy. You’ve got these vendors all kind of preaching the same messaging and trying to go after the same buyers without a true differentiation.
Customers want to hear from people just like them. They want to hear from prospects just like them. So for us to attract salespeople, they want to hear from other salespeople on how this can be beneficial to helping better their careers.
Saad
I really don’t want to say it but, screw it, I’ll say it. Outbound, is dying as we traditionally know it. There you go. Happy? No, but it’s true.
I don’t think it’s about more, ‘Let’s share more context, context, context’. It’s not dying because it doesn’t work. It’s dying because all the things that supported it, all those controllable variables, are changing.
The very basic thing that I can speak to about on that front is all the changes Google is making to their inbox. Google makes their money by people coming back into their systems into their inboxes, and with all the noise that’s happening with bad outreach, emails aren’t getting opened.
Cold calls are the one thing that works better than any other single thing. That’s not gonna change. Sales teams are crying because there’s no good training for outbound anymore because people are just trying to go for all those validation points and quick wins.
That’s where nearbound comes into play. Nearbound fits our personalities—the personality of the modern seller—really well. It’s more human.
Judd
Well, I heard this from a very smart person, you know, the question was: “Do you believe your team will hit its goal even if they hit their activity metrics?” I would say 98 percent of the time it’s a resounding no. And if you’ve got a CRO who can sit there and say: ‘We’re going to keep doing what we’re doing, even though we know we’re going to fail,’ then we have a bigger problem than me trying to convince them that they should make a change.
I think that it should be quite obvious right now that standard tactics are not working. I mean, we’re watching marketing and sales evolve monthly. It is so fast and what we keep moving more towards is people are not going to buy the way they bought before. We’re not in an environment where they can pull the trigger as a test, right?
Because money is not flowing the way it did before. It’s much more expensive and risks are much higher. So, people have to feel more confident in their purchase. And it really comes down to, if I’ve got a CRO in the room and we’re seeing the old school tactics not working, it’s, ‘What do you think is going to change this? Because you’re already running the plays that you know and they’re not working.’
I don’t believe cold outreach is working at all anymore, especially on any kind of product or service that is past a certain ACV. I mean, cold outreach is the hardest thing. First off, even if you can get in the door, you’re generally late to the game.
Scott Leese
There were a lot of sales trainers out there who taught cold outreach to all the people who were averse to the phone. They started writing email copy and getting really good at that.
But then there were tech solutions out there that wrote better emails and faster email sequences, so we caught up on all that.
These are the motions that sales leaders know. A lot of those sales leaders have not—in the last 10 years—spent time building their own networks. They rely on what’s familiar to them.
So, they actually can’t demonstrate this motion. These are the people who are like, “Some of us are really good at our jobs and don’t build a brand or need connections on LinkedIn.”
But, it’s not about building your brand. It’s about you becoming irrelevant because you have 700 connections on LinkedIn and you can’t teach people how to do this networking motion, this referral motion, because you have no network.
You can’t just get a network overnight. It takes a long time. So, if I were a 46-year-old sales leader who grew up cold calling and cold emailing and had no network, would I be preaching a go-to network strategy? Probably not, because I can’t execute it.
And so those are the people who are the loudest and the most pissed off when people like me start talking about this because I’m threatening their livelihood.
Tom
When I look at sales leaders in the space today and what they should stop doing, what immediately comes to mind is not trusting their team.
I know that’s a crazy answer; it might not be one that is common. But so many leaders are micromanaging So many are shoving numbers down their team’s throats. They’re creating pressure, and they’re not actually trusting their team—who are actually on the front lines doing the job every day.
Their feedback loop is so important because you’re able to actually get real-time feedback from the conversations they’re having. You’re able to get some collaboration within the team and some creativity.
Sales leaders aren’t just creating an environment to go test things or go off rails into a micro group of two or three reps and go experiment with something. It’s a very traditional method; they’re sticking to the things they know. They’re not letting reps really make mistakes and fail.
So my advice would be: stop right now. Stop, trust, and hire people you trust, because it’s clear you have a problem within your team. If you don’t have people you trust there to execute and represent your company in a way that you would like them to, then change it. You need to trust and let their wings fly.
That’s when you’ll see an exponential increase in numbers because it’s better to have that environment to be creative.
A summary of what to do instead:
Cut through the noise and differentiate your company by letting buyers and customers hear from people just like them
Show leadership, like CROs, how inbound and outbound are failing, and pitch nearbound as the key solution
Don’t use outbound to go for all those validation points and quick wins; layer nearbound into your strategy to build actual relationships
Don’t listen to the haters, especially those who are close minded to the ways the market is evolving
Trust your team, let them experiment, and let them make mistakes; they are the ones on the front lines
What to expect for B2B sales in 2024?
It’s great to understand where we are, but it’s even more important to understand where we are headed. Here’s what the experts think the state of sales will look like in 2024.
Saad
We live in an era of influence. Who would have thought tech sales leaders would become influencers in their space? So, given that now we have more of these ideas and energy points to utilize, I think that’s where nearbound and referrals are becoming more paramount than ever. The space is becoming smaller as this influence piece grows.
Judd
I just truly believe that we’re in a time where, as others have said, if you don’t have a network, if you don’t have a way to establish a relationship, you’re gonna be in deep trouble really soon.
So, what we’ve really got to start thinking about is long-term perspective of sales. And I think that’s where these relationships are so powerful, where people feel comfortable coming to and having a conversation.
Tom
What gets me super excited about nearbound and where you guys are pushing this is a dialogue that is rooted in the most powerful thing in sales, and that’s relationships. The relationships that are right there without outbound, without outbound emails or phone calls.
You had the inbound industry through content creation, lead magnets, etc. And now what nearbound is doing is enabling sellers to do almost less work. You’re working so hard. Why? Why are you working so hard? You’re able to access intel, intros, and influence from networks of partners and trusted relationships.
It really excites me because we’re going to get back to leveraging those people in a way that is valuable for everybody. It’s just working smarter.
Scott
Right now, people are struggling and missing numbers. Nearbound speeds up the timeline to buy and increases the close rates. It is time for people to re-examine and re-imagine their go-to-market function as more of a go-to network function that still (for the time being) includes cold calls and cold emails, but they should also know that that world eventually has an expiration date.
That’s what I want people to understand and start preparing for. You are going to be in big, big trouble if you don’t have a sizable network, don’t know people, can’t make those asks, and aren’t involved in communities. That’s my soapbox.
What the experts want you to remember in 2024:
The industry is becoming smaller as the importance of influence grows
Lean into relationships; it will help you work smarter, not harder
Prepare for the end of outbound by setting up a nearbound strategy now
Ending thoughts: A new generation of sales leadership
Scott looks to his teenage boys to understand how sales has and will change, and why nearbound is the way companies will survive it:
I worry about the next wave of CEOs and executives. The example I’ve been giving lately is, my kids; I have two teenage boys, they’ll be 16 and 14 later this year. So you’re talking about, let’s say, 5 to 10 years, where they will be in our roles, as executives let’s say.
They do not answer the phone.
They don’t use the phone. They have a phone, but it’s used in every way except talking on the phone. This is a massive behavioral change, a generational change.
I work with early-stage founders, people are in their mid-twenties. They don’t use the phone. They don’t even really use email. So, I’m thinking about what’s coming after that generation is people who don’t use the same tools that we have grown up with for communication.
If you are not actively growing a network, you’re in big, big trouble because I think that networking is the way that you’re going to get a hold of these people. Now, the network and communities are the places that we go to make decisions about stuff. To get introduced to certain people. This is how we’re going to break into opportunities.
Ready to change the state of sales together?
Join Scott and 60+ other speakers on November 6th-9th at The Nearbound Summit, the biggest virtual B2B GTM event out there. Register here.
