The Difference Between Inside and Outside Sales, Explained 

There comes a time when every business needs to decide on its primary sales strategy, which usually means considering inside sales vs. outside sales, or settling on a blend between the two.

It’s no shock that the sales industry landscape has changed considerably over the last couple of years. Buyer behaviors have evolved, and the COVID-19 pandemic pushed the majority of salespeople into selling remotely. The big question for businesses is whether the trends we’ve witnessed in the 2020s so far will stick around for the long haul.

Choosing between inside and outside sales strategies affects your sales teams as well as your bottom line, so it’s vital to have a thorough understanding of both. In this guide, we’ll explain the difference between inside and outside sales, the responsibilities of inside vs. outside sales reps, and discuss which approach may be better for your business. 

 

What is inside sales? 

In short, inside sales is remote sales. Inside sales strategies leverage technology to connect with leads and convert them into customers without the need for either party to travel or meet in person. Possible communication channels include:

Any organization can utilize inside sales, but it has become a particularly dominant strategy among tech and SaaS companies and businesses in the B2C sphere. The specific channels your business uses will depend on the products and services you sell and your pricing strategy, although it’s standard practice to utilize a combination. 

To gain a thorough insight into what is inside sales vs. outside sales, it also helps to know what inside sales are not. If your mind jumped straight to old-school single-strategy methods like cold calling and email tactics, you can relax; it’s not that. Nor is inside sales the same thing as telemarketing. Unlike telemarketing which is scripted, inside sales require skilled salespeople. 

According to career development experts, inside sales is one of the fastest-growing roles in the sales sector, and even on a pre-pandemic scale, inside sales rep positions were growing 15 times faster than outside sales rep roles. The benefit of hiring inside sales employees is that they can be either office or home-based, allowing flexibility for companies that offer remote and hybrid working models. 

 

What is outside sales? 

Outside sales, also known as field sales, is the practice of selling products and services via face-to-face, in-person interactions, and it’s not uncommon for outside sales reps to travel extensively. The primary benefit of utilizing outside sales reps is that prospects receive a personalized sales experience with more detailed product information and demonstrations. Bolstered by the personal relationship fostered by the sales rep, this increases the chance of a conversion. 

There are several places where outside reps meet with prospects. Pre-arranged meetings can take place virtually anywhere, including office spaces, other work sites, cafés, and restaurants. Other common locations include:

  • Conferences
  • Trade shows
  • Industry events
  • Seminars
  • Video (Zoom calls, etc.)

With advanced sales tools, collaboration software, and automated workflow technology at their disposal, it’s now possible for outside sales reps to spend more time at home or in the office than before. In fact, outside reps already spend 89% more time selling remotely. In the last couple of years especially, this has been a vital consideration for reps deciding between outside vs. inside sales roles. Without digital strategies, many outside rep positions would undoubtedly have become obsolete during the global pandemic. However, now that restrictions are lifting, it is more feasible for them to get back on the road. 

 

What is the difference between inside and outside sales? 

As we’ve established, the primary difference between inside and outside sales is how you choose to market and sell your products and services. However, there are a few other key differences to consider: 

  • Sales cycleInside sales typically have shorter sales cycles because reps deal with less expensive products and services with smaller profit margins, meaning it’s a numbers game rather than a matter of chasing “big wins.” With outside sales, the annual account value (AVC) is usually higher, requiring prospects to make a bigger buying decision, which necessitates a more personal approach and relationship building leading up to purchase. Inside sales cycles can be as short as a few days, whereas outside sales reps may spend weeks, months, or even years building up to a sale.
  • Close rate – On average, outside sales have a higher close rate than inside sales. This has nothing to do with a salesperson’s ability. It’s just the end result of a more people-focused approach and the amount of energy and resources allocated to closing a deal. Inside sales is more about economies of scale, so letting a lead go to chase a new prospect usually incurs a minimal loss. With outside sales, reps may have already spent months and thousands of dollars working towards a deal. So it’s not cost-effective to simply let a lead go cold.
  • Customer acquisition cost (CAC) – The travel and time expenses racked up on pursuing outside sales vs. inside sales means the end cost of customer acquisition is usually much higher. 
  • Business type – As we highlighted earlier, inside sales are favored by companies selling modern technology and SaaS products, whereas industries like traditional hardware, manufacturing, and healthcare typically rely more on outside sales methodologies.  

Of course, there is also a difference between outside and inside sales from a customer perspective in terms of expectation of service. Plus, there are distinct differences in attributes, experience, and skill sets when employing reps for each type of role. Let’s look at the difference between inside and outside sales job roles and responsibilities in more depth.   

 

Inside sales rep responsibilities 

The qualities to look for vary between inside vs. outside sales roles because the way they interact with your prospects is very different. The general day-to-day duties of an inside sales rep include:

  • Identifying new leads.
  • Making outbound contact with potential customers by phone, email, text, social media, etc. 
  • Explaining your unique selling proposition (USP) and describing product features and benefits.
  • Maintaining contact with leads and nurturing sales.
  • Creating and maintaining your customer database.
  • Closing sales and achieving quotas.

Understanding customer needs is vital in both inside and outside sales, but there are several additional must-have qualities for inside salespeople. Here is a list of the main considerations when looking for inside sales reps: 

Product Knowledge – Because inside sales reps have less time to make a conversion and cannot provide physical demonstrations, they need more in-depth product knowledge to convey the value of your products and services effectively. 

Use of technology – Due to the focus on technology utilization, inside sales reps need to be comfortable using a range of hardware and software to effectively chase down leads remotely. A strong and reliable Wi-Fi connection is also a must. 

Research skills – To bond with prospects quickly and facilitate a trusting relationship, inside salespeople need to be confident in gathering information from various sources. The best inside sales reps are social media savvy and can research efficiently on professional sites like LinkedIn to determine customer pain points for which your products and services present a solution.

Flexibility – Although inside sales positions are home or office-based, work hours are not always 9-5. Especially when working for companies with a multinational focus, reps may need to be available to provide information, answer questions, and handle objections across multiple time zones. 

Strong communication skills – Because much of their customer contact is via phone or video conferencing, strong verbal communication skills are essential in making a good first impression and nurturing prospects through your sales pipeline. The best inside sales reps are adept at:

  • Using strong language to shape prospect perceptions.
  • Referencing examples of relevant work in the prospect’s arena of interest.
  • Speaking concisely in a to-the-point fashion that is neither too brisk nor too lengthy.
  • Utilizing silence to emphasize key points.
  • Asking assertive questions.

Non-verbal communication – The ability to pick up on non-verbal buying signals and implications is an essential quality in an inside sales rep, because it allows them to perceive subtle – and even unintentional – hints from a prospect that can help them change tack or steer the conversation in a different direction. 

 

Outside sales rep responsibilities 

While there is inevitably some degree of crossover, there is considerable variance in roles and responsibilities, schedules, and daily tasks when comparing outside vs. inside sales rep positions. The general day-to-day duties of an outside sales rep include:

  • Traveling within various sales territories to meet prospects. Or, meeting prospects via call or video.
  • Attending face-to-face meetings and giving product demonstrations. Or, meeting via video and facilitating product demonstrations remotely.
  • Educating customers about the financial and professional benefits of your products and services.
  • Building and maintaining strong relationships with new leads and repeat customers.
  • Monitoring market conditions, competitors, and new products to maintain a thorough understanding of customer needs.
  • Maintaining accurate records of all leads and customer accounts.
  • Working with your marketing department to help build brand awareness.

Outside sales reps are often the ones given superstar credit for closing big deals. Plus, because the job often comes with perks like attending social events such as corporate dinners, the position tends to be somewhat glamorized. However, it’s by no means an easy role. Here are some of the main criteria to consider when looking to hire outside sales reps:

Autonomy – In an ideal world, you want all of your employees to be strong team players, and outside sales rep roles are no exception. However, because they spend so much time on the road without the support of their teammates, a high degree of autonomy and independence is required.

Interpersonal skills – Because their success is primarily based on human interaction, outside sales reps must be confident, clear communicators with the ability to blend humor and lightheartedness with harder line sales approaches while maintaining prospect interest and trust. The best outside sales reps are also expert listeners who can accurately read body language. 

Flexibility – While both inside and outside salespeople may need to make calls at unsociable hours, outside reps are often expected to drop tools and drive to wherever prospects and customers want to meet at short notice. Plus, last-minute changes are par for the course to accommodate changing schedules of prospects and customers in fast-moving industries. 

Problem solving – Outside sales reps often need to think on their feet. Unlike inside sales reps who often communicate via email, they don’t have the luxury of time to consider their responses when posed with a question or objection. They must always be ready to give an on-the-spot answer or come up with a solution that meets the customer’s needs. 

Organization – In addition to ensuring they are always in the right place at the right time to meet prospects and customers, outside sales reps need to keep their calendars and client accounts in pristine condition so that information is always up to date. Failing to record a progress update could be catastrophic if, for example, a rep becomes sick and their counterpart doesn’t have all the correct data and an up-to-date progress report to pick up from where they left off.

 

Should you use inside or outside sales?

There has been a noticeable shift toward inside sales in recent years, and the sector continues to expand rapidly. If you were to ask why this is, the stock response would likely be COVID-19 related. And while it’s true that the lockdowns that restricted access to in-person meetings certainly played a part, that’s not the full story. The pandemic merely acted as a catalyst for an already prevalent shift toward inside sales vs. outside sales approaches. 

Today’s marketplace is moving increasingly online, and customers expect instant access to product information, easy price comparisons and customer assistance on a 24/7 basis. However, that doesn’t mean that you shouldn’t consider outside sales at all. Ultimately, the right approach will depend on the products and services you sell, the industry you operate in, and your overall sales strategy. 

Products and services

The type of products and services you sell is one of the most significant factors determining which approach to use. Inside sales are more effective for small, inexpensive products and services that solve an immediate problem. One-time use products and services also sit in this category, along with any other product or service that can be bought quickly and conveniently without a particular need to speak with a salesperson first. 

Outside sales are better for larger and more expensive products and services that solve a more complex problem or offer a long-term solution. In this instance, the decision to buy may take longer, involve many stakeholders, and require a stronger bond of trust between buyer and seller to close the deal. 

Your industry

The nature of your business will always play a role in determining your ratio of inside and outside sales. Inside sales is typically a better fit for companies in the digital sector, with a focus on reaching as many new prospects as possible to maximize sales velocity. Outside sales is better for businesses selling physical products or companies targeting a more elite market, with a focus on creating long-term relationships with customers. 

Sales strategy

The selling method you prioritize should match your overall sales strategy. Inside sales is generally considered a better fit for sales that can be automated through digital funnels. In contrast, outside sales is a better approach for strategies that include or require demonstrations or in-person meetings. 

Remember that however you split your ratio of outside vs. inside sales reps, the end goal of both is the same: to sell more of your products and services and increase revenue. So there’s no hard and fast rule or perfect one-size-fits-all approach. 

Whatever decision you make regarding outside sales vs. inside sales, you will inevitably face challenges that force you to adapt. For example, geographic growth may warrant a switch to a bigger inside sales team since it reduces overheads and spending on facilitating a physical presence. So it’s never simply a case of picking the most suitable method for right now and doggedly sticking with it. You should be constantly monitoring your progress so you can change your practices when necessary to maximize your efficiency and boost your close rates.  

 

Boost your sales with Crunchbase

Could your sales team be performing better? Crunchbase has the sales prospecting tools you need to find the right companies, identify the correct contacts, and get connected with decision-makers, regardless of your preference for inside and outside sales tactics. 

Contact us today to learn more and discover how you can grow your team, sales and revenue with our all-in-one intelligent prospecting software.

  • Originally published June 21, 2022