Recently, I chatted with the VP Sales (let’s call him Tom) at one of the startups we worked with on outbound email prospecting. For many months, we tried making this channel work. We had two full-time, ambitious, talented employees dedicated to prospecting, who ran dozens of A/B tests for everything from subject line to images. We diligently tracked results, invested in building targeted lists, and experimented with deep personalization.
The results? Almost nothing. Low open rates, few responses, almost no meetings or Sales Opportunities. After a few months with no new deals, we shifted to other channels that performed better, like conferences, content, and webinars.
Tom shared that they have tried prospecting again, with an SDR team (you may remember I don’t like SDRs). They hired six SDRs that went at it for a year. The outcome this time? Similar. Close to nothing, and definitely not ROI-positive. They’re now trying an ABM (Account Based Marketing) approach, where the SDRs work with sales Account Executives on a small list of potential customers. In short, they gave up on prospecting.
I told Tom we had managed to get prospecting to work in other companies, and he asked whether I thought there were specific factors that made prospecting successful in some companies and not in others. Here are my thoughts.
First off, maybe prospecting just doesn’t work at all?
Every so often we hear that “email is dead,” the inbox is super crowded, nobody reads emails anymore, and prospecting just doesn’t work. Is it true?
Based on our real-life experience, it’s not true. Prospecting is hard; it doesn’t always succeed, sometimes it works for a while and then stops, and you always need to make sure the ROI is there. But this post includes several examples of companies where we managed to make prospecting successful repeatedly and at scale. It worked for a small startup of two engineers building AI models, for a 70-person startup working on Facebook advertising, and for other companies. So yes, prospecting can work.
The variables that determine whether you’ll succeed at prospecting
1. A target persona that isn’t bombarded with emails. Tom’s company sells to senior marketing executives of large US retailers. These people get dozens of emails a day from companies pitching their wares. They don’t even open most of these emails, let alone read and reply. What are the odds they’ll reply to your email?
If your target persona is a “popular” one, chances are you’ll need to use other channels to reach them (like conferences, or introductions through your network). On the other hand, if your target persona doesn’t receive a lot of emails, it’s much more likely they will reply positively.
How can you tell if your persona gets a lot of emails? There’s no one way to know: you can ask around, look into competition, talk to other startups in your field. This is part of getting to know your persona and finding effective channels. One rule of thumb is that the more senior the persona is, the more emails they receive and the less they reply.
2. Differentiation or a less competitive market. Not only does Tom’s company sell to personas everyone sells to, but it also operates in a crowded category with dozens of competitors. Even if their lead opens and reads the email, he’ll think “How are they different from X, Y, Z who emailed me yesterday or met me last week?”
The companies we mentioned before have a concrete, clear competitive advantage. One is the only one to offer video support; the other is the only company helping large publishers advertise on Facebook in a certain way. In both cases, the company’s value and uniqueness can be easily summarized in a short sentence.
Differentiation doesn’t have to be product related. One company we worked with operated in an uber-competitive market, but had a strong differentiator: one of its founders was a renowned MIT professor. When we mentioned him in prospecting emails, we got enthusiastic responses.
3. Clear value proposition that can be written in 1-2 sentences. If it’s easy to explain your product value, your target persona might read it, understand, and want to learn more. If it’s a complicated product to explain over email, it’ll be hard to make your persona curious about it. We worked with a company with a complex technical product, which had real value, but it was tough to articulate it in a few sentences. We couldn’t write a short email about what the product did, and longer emails didn’t get any replies. Ultimately we gave up on prospecting and shifted to channels like content and webinars, where it’s easier to explain complex products.
You should verify that your prospecting email copy is simple and clear to your target persona, who’s not necessarily familiar with your company’s internal jargon. Our advice? Have someone else read your email and provide feedback.
4. Logos. In every vertical or function, people love knowing which products and services their competitors use. One of our clients that experienced tremendous success with prospecting had hundreds of customers, many of them well-known, across multiple verticals. We leveraged that for sending targeted, segmented prospecting emails. We sent fashion leads an email that name-dropped 4-8 names of fashion clients, and so on for jewelry, beauty, home decor, etc.
If you don’t have relevant logos yet, you can get creative and mention partners, pilots, or investors. It’s all “social proof” that strengthens your company’s credibility.
5. Quality content. You have much more control over this variable. It’s not easy to create unique, high quality content, but if you’re able to, it’s a powerful way to differentiate and engage. The small AI startup we mentioned before invests a lot in creating unique, thoughtful content, and reaps the benefits when they use this content in prospecting emails (you can read more about their success here – how to hack content marketing as two Israeli developers).
You probably noticed some of these variables are related. At the end of the day, if you have a differentiated product with real value that’s easy to explain in a short email, you have a good chance of succeeding with email prospecting.
The bottom line
Email prospecting can work, but it can also be a waste of time, money, and morale. Before you decide to invest in prospecting, take the time to do a short analysis according to the variables in this post to understand your chance of succeeding. A good product with clear value (and a few good logos) will make your life much easier.