One of the most positive outcomes from the past year was the swift adoption and embrace of technology for sales and marketing. As teams moved out of the office, they learned quickly how to stay aligned and hit their targets without face-to-face interactions.
As a result, many sales technologies saw rapid growth, and sales teams shifted their priorities and strategies. We recently surveyed 450 top sales dev leaders to evaluate their teams and technologies and learn what’s changed in the sales development world.
Here’s what we learned about the top sales organizations and what they’re doing to drive success.
Lead Quality and Account-Focused Strategies Dominate
The goal for any sales rep is to have a full calendar of highly qualified prospects to speak with each day. Sales development is the critical link between marketing and sales to develop and pass leads to sales reps.
Since our last State of Sales Development study in 2017, we’ve seen a significant shift in the ratio of account executives (AE) to sales development reps (SDR). In 2017, 2018, and 2020, the ratio has declined from 3.0 to 2.5 to 2.0, with 2020 marking an average of 2 account executives for every 1 supporting SDR.
As more sales teams adopt account-focused strategies and improve their lead quality, we expect to see this number continue to decrease. Implementing targeted programs that qualify leads quickly, efficiently, and with a standardized process will cut down on the amount of time SDRs spend with leads that aren’t driving pipeline. CRM and sales engagement (like Playbooks) will better guide SD reps’ time and activities.
A lower AE/SDR ratio has other benefits. When this ratio is too high, SDRs can get too many irons in the fire and find it more difficult to operate efficiently. AEs benefit from having more interaction with their SDRs and SDRs get mentorship and coaching more consistently.
SD Teams Under Sales More Likely to Hit Quotas
One of the most important implications for an SDR team is where they report: marketing or sales. This decision is based on several factors, including which team has the budget and resources to hire, train, and develop SDRs; the qualification strategy; lead management; and more.
From 2017 to now, we saw a significant increase in the number of SDRs rolling up into the sales organization and away from marketing. In 2020, 75% of SD teams now report to sales, 15% report to marketing, and 10% report to revenue or sales ops.
Many factors are driving this shift, but as the handoff from marketing to sales improves, SDRs in most organizations have found better alignment within sales. And in some organizations, SDRs are an important recruiting pool for future AEs, so the more SDRs understand the needs and priorities of AEs, the better prepared they’ll be for that next role.
Our data also shows that when SDRs report to sales, they are more likely to hit their quota. In 2020, these teams were 15.2% more likely to hit their quota than those that reported to marketing—62.5% of SDRs who reported to sales hit their quotas, as opposed to only 47.3% for marketing reports. That 15.2% difference is a major contributing factor in revenue for any organization.
What makes the difference in performance for SDR teams? Even though the lines between sales and marketing increasingly overlap, the SDR position is rooted in sales-centric principles. Sales leaders build a culture of measurable revenue outcomes that envelop SDRs while marketing leaders tend to drive more leading revenue indicators (lead to contact conversion, stage 1 to stage 2 conversion, pipeline creation, etc). This small shift makes a significant difference in the outcomes of your SDR teams.
Account-Based and High-Velocity Sales
The composition of sales development teams has changed as many sales organizations implement tools and technology to understand more about their customers. Thanks to innovations related to digital and data technology, SD teams have more information now than ever before about their customers’ buying behaviors and communication preferences, and now have automated processes to match.
Between 2017 and 2018, the industry rotated towards exclusively account-based models (47.7% of respondents indicated it was their only model). However, since 2018, sales organizations have realized the mistake of turning away from speed-to-lead and the high-velocity that support them. Today, a majority of teams use a hybrid model to find a balance based on the types of leads and accounts they’re engaging.
As teams become more sophisticated and precise in how they generate and nurture their leads, create and refine their processes, and keep a watchful eye on their metrics, they’ll be able to incorporate more high-velocity techniques into their teams.
How you structure and manage your sales development team has a significant impact on your entire sales organization. Sales intelligence is driving significant changes in sales teams and allowing sales development teams to spend less time on rote manual tasks and more time developing leads and their skills to improve the handoff to AEs.
Sales leaders who implement these changes quickly are seeing large gains in their attainment and can do more with less budget. Playbooks by XANT includes the tools sales development teams need to be successful in 2021. Schedule a demo here.