Sales is defined as the activity or business of exchanging money for goods or services. Zorian Rotenberg, the VP of Sales and Marketing at InsightSquared, expanded on that statement by saying, “it’s the process of actively listening to people about their pains and needs and then helping them solve that pain and need with your help.” The best sales reps know that offering solutions to your prospects is the winning strategy. But, not all sales roles are the same, especially when it comes to inside sales vs outside sales.
If you are wondering what the difference is, you are not alone. To become a successful sales professional and determine which realm is best for you, it is important to understand the distinct differences between inside and outside sales.
In this article, we’ll give some clarity and break down some of the key differences when it comes to inside sales versus outside sales. But first, let’s dive into the definitions of both of these types of sales.
What Is Inside Sales?
Inside sales is the business development and sales activities that occur from behind a desk — either by phone, email, and/or the internet.
During the 1980s and the rise of selling over the phone, there became a need to differentiate between telemarketers and those who are in sales. Telemarketers are essentially just using scripts that can be read by anyone from anywhere and rarely involve more than one touch per person. In fact, most telemarketing today is performed by computers.
Inside sales, on the other hand, is a position that requires specific sales skills. Performed over the phone, through email, Zoom, and through chats on the company website, an inside sales representative brings their sales skills online.
Largely due to the surge of remote work and social distancing over the last 2 years, inside sales continues to surge in popularity. Inside selling has seen 15x the amount of growth of outside sales over the last 7 to 8 years.
What Is Outside Sales?
On the other hand, outside sales, also often referred to as field sales, is the face-to-face approach to selling that requires travel. With outside sales, a field sales representative will visit customers and prospects in person at their home or place of business.
While inside sales continues to grow, it still does not replace the importance of outside sales for many companies. With more careful and strategic prospecting practices and quality facetime, an outside sales representative can cultivate stronger and more profitable business relationships. Businesses and products that demand more time, attention, and setup are typically ideal for outside sales.
Outside sales means spending more time with customers directly, but the line continues to blur on what exactly that looks like in comparison to inside sales. The rise of remote communication requires outside sales reps to offer the flexibility of both meeting in person and speaking over the phone or through email. In fact, the average outside sales rep spends 45% of their time selling remotely. However, the emphasis is still on creating individual solution-focused relationships over the more fast-paced nature of inside sales.
What Are the Differences Between Inside and Outside Sales?
Before you can decide which type of sales work best for your business, you need to understand what their differences are. Both inside selling and outside selling offer distinct advantages for companies. Here are some of the most significant differences between the two types of sales:
#1 – Where the Selling Takes Place
One of the biggest differences between inside sales and outside sales is where the actual selling is taking place. Most sources define inside sales as the act of selling goods or services to customers over the phone or online. With advances in technology now making video sales calls possible, inside sales is sometimes also referred to as “remote” or “virtual sales”. When you are working from inside your company’s physical location and not meeting with prospects face to face you are doing inside sales.
This is the opposite of the definition of outside selling. According to the US Department Of Labor, an employee is engaging in outside sales when they are “customarily and regularly engaged away from the employer’s place or places of business.” Outside sales professionals spend most of their days traveling and meeting prospects and clients (usually C-level executives) face-to-face. As an outside sales rep, you’ll work autonomously outside of a formal office for the majority of your time.
#2 – The Skills Needed
While there are similarities between the two roles, there are distinct differences between inside and outside sales and the skills that are required to be successful.
When it comes to inside sales, to be successful:
- You must be comfortable in a fast-paced selling environment making dozens of phone calls each day.
- You must be good at multitasking since you will probably be constantly switching between accounts and software, more so than in outside sales.
- You must be articulate, have a solid understanding of the importance of terminology, and be able to verbally articulate your product or service engagingly without having to be face-to-face.
- You must be ok with working in an office environment that sees little variation in day-to-day activities.
- You must be good at collaborating and interacting with teammates frequently.
- You must be confident and outgoing in social and face-to-face situations, especially when it comes to meeting with CEOs and other executives.
- You must have high emotional intelligence (or EQ) since you will be interacting with people in person.
- You must be comfortable working alone in the field and have a high level of independence.
- You must be able to easily adapt to changing surroundings since you will be going to different places every day. According to our 2021 Annual Field Sales Benchmark Report, reps spent an average of 22 hours a week on the road.
- You must be able to be flexible in your daily schedule. If a meeting gets canceled or delayed, you have to be able to think quickly and make effective use of that time.
- You must be willing to prospect independently and set all of your own appointments.
- You must be comfortable dressing to impress every day. In outside sales, your appearance makes almost as much of an impact as what you are selling.
#3 – Length of the Sales Cycle
Another big difference when it comes to inside sales vs outside sales is the length of the sales cycles. Once you understand the difference between the sales cycles in each environment, you will more than likely determine you favor one over the other.
With inside sales, a transactional sales model that revolves around lower-value deals and shorter sales cycles will be used. You will talk to your prospect fewer times, talk to fewer decision-makers per sale, and not be focused on forming a long-term business relationship. The sales cycle for inside sales is more streamlined and usually happens in less than 90 days. It is more about the volume of sales versus the size of the sales. (More on this in #6, below)
In comparison, outside sales has a significantly more in-depth and longer sales cycle that is often referred to as a relational sales model. The goal is to build rapport and form a lasting business relationship with the decision-makers. For each prospective new client, you will be meeting or speaking with an average of 5.4 stakeholders on multiple occasions, all of whom will have a say in the final deal. This means the average sales cycle for outside sales will usually be over 90 days, even with streamlined processes.
#4 – Sales Technology
Advancements in technology have brought sales software farther than ever before. There are now tools available that integrate automation and mapping to make daily tasks more streamlined and accurate, improving efficiency and productivity. But, the necessary and most effective tools vary differently between inside sales and outside sales.
With inside sales, activity automation is usually the number one goal when it comes to the specific technology used. The foundation is an efficient Customer Relationship Management (CRM) platform where all of the customer information is managed and organized in one central location. It holds every interaction you have with a customer as well as every other important aspect of your sales funnel. Other valuable tools for inside sales include automated dialers with call tracking and email automation.
An outside sales representative, on the other hand, will rely more heavily on technology that optimizes their efficiency out in the field. While they do also use a CRM (a mobile-friendly version, of course) to organize customer data, a tool like a territory mapping software that offers optimized routing is going to be their main go-to. Other important technologies for outside sales include territory prospecting tools to find new possible customers and content sharing applications to provide insightful product information on the go.
#5 – Compensation
There are differences when it comes to compensation and salaries with inside sales versus outside sales. Depending on the sales commission structure, an outside sales representative will normally receive a higher base salary and commissions compared to an inside sales representative, even as an entry-level rep. This is due in large part to the fact that deals closed by outside sales reps are usually significantly higher in value compared to deals closed by inside sales reps. According to ZipRecruiter, as of January 31st, 2022, the average annual salary of an outside sales rep in the US, before commissions, is $53,577. Outside sales reps will also often receive compensation for other expenses, including travel and client meeting costs.
Even though it may be lower, inside sales reps rely on a more stable salary or hourly pay. The average annual wage for inside sales reps as of January 31st, 2022 is $49,116. With inside sales, like outside sales, you will probably also receive a percentage of commission on the sales you sell as well.
#6 – Quantity Versus Quality
When you ask experienced sales professionals what a big difference between inside and outside sales is, you may hear that it is quantity versus quality. Inside sales reps do not have to contend with travel and logistics. So, in that role, you are not as limited to the number of calls and contacts you make in a day as compared to outside sales reps. Inside sales reps make 42.5% more calls than outside sales reps. As mentioned above, with inside sales, the price point of what is being sold is usually lower. You are also not focused as much on building long-term relationships, so inside sales reps do not focus on quality as much as they do on quantity.
In comparison, outside sales reps focus on higher-priced products and services that are often more complex. That’s why client meetings will be face-to-face to meet with the right people. In this role, the outside sales rep will be building rapport and developing strategic relationships, as well as providing solutions to more complex pain points for the customer. In outside sales, it is impossible to meet with the number of people that an inside sales rep would call in a day, so the focus is on higher quality meetings versus a large quantity. This is why, according to Hubspot, outside sales teams have a 30.2% higher close rate compared to inside sales.
#7 – Sales Quotas
Both inside and outside sales teams rarely achieve 100% quota attainment. However, the more of your sales reps that can reach quota, the better your company can run. Plus, the size of the quota helps determine how successful your team is when you achieve it.
According to The Bridge Group, for both inside and outside sales, only 66% of sales reps achieve quota attainment each year. However, what this means is far different for inside sales versus outside sales. Since outside sales teams have a 28.6% higher quota on average than inside sales, their ability to meet quota as effectively as inside sales means greater earnings for companies.
#8 – Daily Schedules and Management
Typically, inside sales reps have a set schedule. Because they are reaching out to their prospects remotely, they don’t require much flexibility day-to-day. This also means that it is easier for leadership to know exactly where their reps are and exactly what they should be doing (i.e., reaching out to customers).
Outside reps, on the other hand, are often at the mercy of their clients. Their schedule will change day to day based on when and where they need to meet their clients. With reps meeting 31 customers a week on average, their schedule will rarely be set hours like with inside sales. They may start their day later, for example, if they are planning to meet a client for dinner or late drinks.
This also sometimes makes it difficult for sales managers to keep tabs on their reps day-to-day. Without effective team management capabilities and tracking, managers cannot oversee their reps to make sure they are as productive as possible each day.
As a result, outside sales is a more results-based sales job. An inside sales representative can point to the number of calls or emails they make in a day and their managers can easily see that they’ve put in the work. But outside sales reps can sometimes lack the same amount of oversight, accountability, and ability to quickly prove their worth in their sales efforts. It requires much more self-motivation and trust than inside sales.
How to Decide if Inside Sales or Outside Sales Is Right for You
Depending on your business goals, your company may be trying to choose between inside sales or outside sales. Businesses that benefit from inside sales include ones that:
- Have products valued under $35,000
- Have a faster sales cycle
- Are primarily digital
- Have goals that include reaching as many new prospects as possible
Outside sales, on the other hand, works well for companies that:
- Have products valued over $35,000
- Have longer sales cycles with more elite market
- Require in-depth setup and longer onboarding process
- Have goals that include creating ongoing long-term relationships with customers
However, most companies find that they benefit from both inside selling and outside selling. Inside and outside sales teams come with different strengths, and most businesses need both to run a successful sales team. Most companies should harness the assets of both inside and outside sales to complete their team and be as effective as possible.
3 Types of Sales Team Structures You Can Choose From
There are various structures that you can use to set up your sales team to utilize their strengths. Depending on your business and sales goals, you can choose the one that works best for your company. Here are three examples:
Depending on your products and business, a separate inside and outside sales team with no overlap could work well for you. Inside sales and outside sales can have different leads and prospects, quotas, and sales goals.
This structure works well for teams that have very different products. For example, if you have products for both small-to-medium-sized businesses and enterprises, the two sides of sales can take the two different types of deals. Inside sales can easily handle the smaller business side, and outside sales can create the relationships needed for enterprises.
This model frees up your outside sales reps to concentrate on the larger accounts. They have the time needed to cultivate relationships with larger clients and land larger deals than if they had to do everything alone.
This structure still keeps inside sales and outside sales separate, but they work collaboratively. They work on the same leads together and close deals as a team.
Working as a team has a lot of potential strengths, especially for companies that have a longer sales cycle that can be started remotely. The inside sales team can qualify leads and find prospects before a field sales representative visits them. Inside sales can also help identify any pain points and key features that could benefit the outside sales team.
By working together, inside sales can help your outside sales team become more effective at making connections and landing more deals. Inside sales can offer crucial support and outside sales can concentrate on closing deals.
Many businesses are increasingly finding the lines between outside and inside sales blurring. Even before remote work and social distancing became the norm, a good bit of the job of an outside sales representative required sitting at a desk and handling customers over the phone and online. Hybrid sales teams take advantage of this fact. Instead of having one team dedicated to inside sales and another to outside sales, their teams are expected to perform the tasks of both.
Lean teams and teams that have sales areas far from their offices can benefit from a hybrid model. However, they do require your sales rep to have more varied and specialized skills than if they were solely inside sales or solely outside sales.
A hybrid team also requires a different strategy than if they were in separate teams. Hybrid teams need to make the most of their time when they are both at the desk and out on the road. Streamlining their sales process by automating repetitive tasks frees up their time for selling, especially for their outside sales tasks. Likewise, reducing windshield time and other wasted time helps ensure that your team has time for both inside and outside sales.
Inside vs Outside Sales: Deciding Which One Is Better
As you can see, not all sales roles are the same. However, the end goal of providing valuable solutions to answer the needs of prospects is universal. But, when it comes to inside sales versus outside sales, there are some distinct differences. Everything from where you spend most of your day to the skills needed for success to the sales software you use daily.
Some companies find success using solely either inside selling or outside selling. In reality, though, companies shouldn’t be choosing between inside sales vs outside sales. To be as effective and efficient as possible, both types of sales should be utilized. Both types of sales teams offer specific advantages that companies can benefit from.
It is important to have a clear understanding of the differences between inside and outside sales, especially when you are new to sales. This will help you decide which role might be the best fit for you and your sales career goals, as well as give you a better chance of being successful from the start.