Sales Development – How 900 Companies Build Successful SDR Teams
Sales development is one of the most important, and yet one of the most misunderstood sales roles. Sales development representatives (SDR) identify, connect with and qualify leads for the account executives.
They’re the engine that puts fuel in your sales pipeline – day in and day out.
This is why it is crucial to understand and know the structure of sales development, the specific activities for pipeline generation and above all, the people and what they do to guarantee the health of your pipeline
In an effort to understand the sales development role, XANT Labs commissioned a study in partnership with SalesForLife, BridgeGroup, Drift, Datanyze, OneMob, and Tenbound.
The study includes 900 companies and reviews the four elements of a successful sales development team: structure, systems, people and pipeline.
The findings were very telling of where we are today with SDR and where there is a gap in their activity.
Inside vs Outside Sales Development
The lines between inside sales and outside sales keep blurring, shows the research. More and more customers are empowered and contacting companies, rather than waiting to be contacted.
According to the study, there are an estimated 677,479 sales development reps in the U.S.
About 17 percent of sales development reps are inbound sales, while 28% are outbound sales. More than half – 54 percent self-report as doing both inside and outside sales.
Sales Technology Systems
Sales technology has become an extremely important part of every sales development team’s makeup and organization. Companies spend overall on sales development technology is $1.4 billion. This is just a small part of the overall 14.9 billion spent in total on sales technology industry.
In the research, companies reported the average annual spend on sales technology was $3,894 per rep/year.
That’s around 17% less than what they spend on account executives, who seem to get the lion’s share of the budget. Companies have around one sales development rep for every three account executives.
The $3,894 covers an average of 4.8 categories of sales tools per rep. The most popular categories were (excluding CRM):
- Social prospecting (30.3%)
- Data/list services (21.6%)
- Email engagement (20.7%)
- Phone (16.0%)
- Sales Cadence (12.8%)
- Lead/Account Scoring (10.7%)
Sales Development – The People
Companies need to pay market value to retain their top people. The Sales of Sales Development offers a benchmark on sales development compensation.
According to the XANT research, the average base salary for sales development reps is $41,675, with an average on-target-earnings (OTE) of &80,774. While earnings will vary based on the region, there is one aspect which remains constant – and that is variable income.
A section of sales representatives’ incomes are variable to ensure performance and quota attainment. The mix between base and variable was a 60/40 split, with 59.7% for the base and 40.03% for the variable.
Pipeline Generation Activities
As far activities go, sales development reps are certainly not idle – they place dozens of calls and send a host of emails and voicemails every day to generate qualified pipeline.
Sales development reps did an average of 94.4 daily activities including an average of 36.2 emails (38.4%), 35.9 phone calls (38.0%), 15.3 voicemail messages (16.2%), and 7.0 social media touches (7.4%).
They reps had an average of 14.1 meaningful conversations a day, which was around 15 percent of their daily activities.
For all their effort, not all sales development reps are able to reach 100% of their quota.
Why Sales Development Reps Only Report 63% Quota Attainment
The quota for pipeline generated was $658,692, however companies report only 63.5% quota attainment for SDRs.
The report is an eye-opener for sales leaders interested in increasing their team’s performance.
For high-performing teams, the combination of sales training, self-motivated sales reps and AI-recommended lead prioritization can mean the difference between failure and success.
Sales leaders need to see this as an opportunity to make changes – and act on it. We need to enable sales reps to work smarter, rather than harder.
You can read the executive summary of the State of Sales Development 2017 here.