10 Uncommon Reasons to Outsource B2B Lead Generation

By: Jack Reamer |
 January 26, 2023 |
Deciding whether or not to outsource lead generation might be on your mind. Why? Because without qualified sales leads, your business isn’t going to be bringing in huge amounts of cash; which in turn will lead to tons of stress. You need stronger qualified leads to close your deals.  Besides this, studies also show that NURTURED leads increase sales and business opportunities by 20%; the same study showed that these nurtured leads lead to 50% more sales.  One thing that might stop you from taking the plunge from outsourcing a lead generation team is the money involved. You might be concerned that hiring a lead generation agency is expensive. How much will it cost?
Money can sometimes be the biggest reason why companies decide not to outsource lead generation But… is it really more expensive outsourcing lead generation? Do studies show that in-house b2b lead generation is cheaper? What are the facts, stats, and proof that hiring a sales team of professional business development reps is, in actual fact, more affordable than having your own in-house team? This article will discuss 10 reasons why you should outsource a lead generation team in 2023, as well as the pros and cons of doing so. 

What does it mean to outsource lead generation?

 Hubspot defines lead generation as: “the process of attracting and converting strangers and prospects into someone who has indicated interest in your company’s product or service.” So we know what lead generation means, but what exactly does it mean to outsource lead generation This means that instead of training up someone who is already part of your business, you will hire an external company to build your company’s sales by nurturing clients until they are ready to purchase your service or product. (We will discuss the pros of outsourcing in further detail below.)  This “nurturing” of the client is exceptionally important because stats show that 96% of website visitors are not ready to purchase from the first-page visit.   Therefore, keeping tabs on these potential leads is key to your business’s growth, and personalization has a huge impact on closing the deal quicker. The graph below shows that you will have a 26% faster closing rate when content is personalized.  Sadly, this is where many businesses fail; generating quality leads is the lifeblood of any business, and when this is done incorrectly, it’s like flushing money down the toilet.  Notice this graph from Hootsuite and what they found about personalization when it comes to B2B marketing. 

What would a lead generation team be in charge of?

(Image depicting stages of sales pipeline by FitSmallBusiness) A lead generation team will be responsible for, but not limited to:  However, one thing that is important is choosing a company that truly develops a genuine interest in your potential customers. Spam-type emails don’t work and eventually frustrate people. Often when we receive hundreds of generic bot-generated emails, we click either unsubscribe or spam it.  Therefore hiring sales reps that have a personal touch will ensure a higher sales rate. Stats show that 79% of marketing leads never convert into sales. And the reason is because of a lack of nurturing potential clients. Therefore you would need to find a lead generation company that really goes the extra mile when it comes to nurturing potential clients. 

Here’s Why Should You Outsource Lead Generation..

There are many reasons why outsourcing a lead generation team is worthwhile, from saving money to allowing yourself to have more time for your business. Instead of worrying about finding leads, you can concentrate on making the sale. Lead generation outsourcing is also 43% more efficient than generating leads in-house because lead generation companies have more expertise (source Hiring an outbound lead gen team will also get you quicker results than waiting for inbound results, such as SEO or social media marketing. 

1. You will actually save money

According to Glassdoor, the average salary of hiring a sales development representative is $48,418.00 a year. This means that you will be paying $4,034.00 on average per month.  Outsourcing lead generation services is 63% cheaper than hiring someone in-house; This is based on hiring, for example, a BDR from San Francisco, whose annual salary is over $56,000.00. On top of this, you might also need to pay bonuses, and benefit costs, such as medical and training costs.  Other costs that you might also incur when hiring an SDR is :
  • Employer taxes
  • Software licenses
  • Management and admin costs
  • Training costs
  • Human resources 
  • Data costs 
You might also need to rent or buy extra office furniture, computers, and not to mention things like extra milk, coffee, or tea if this is something that you offer to your employees.  This is an excellent infographic by Sales Hacker which shows the actual cost of hiring an SDR in-house:  So as you can see, you might end up paying someone a total of $150k per year. 

2. You won’t have to stress about training a new SDR

Training someone in-house takes time. On average most trainees take at least three months to really find their footing. And in some cases, it might take even longer for your trainee to really develop the skills they need to be proficient in your business.  By outsourcing a professional prospecting team, you won’t need to spend valuable time training up someone new.  Professional lead generation teams deal with finding new leads every single day. This ensures that they know exactly what they are doing and that they can focus solely on your business.  They can jump on board immediately and get you the leads you want from the word go. This also means that you will have the extra time you need to close more deals.

3. Outsourcing Lead Generation = more flexibility

Flexibility is a big positive for outsourcing lead generation. If your business is expanding rapidly, outsourcing allows you the flexibility to choose how big a team you want. If your business is quiet, then you can also downscale on your outsourcing needs.  By being open about your company’s needs, the lead gen service you choose can adapt to your business changes. Whether your needs are hiring a bigger lead gen team or scaling down to a smaller one. 

4. You will close more deals faster

When you outsource a lead generation agency, you are hiring a team of professionals who dominate their niche. Which inevitably means that your number of leads will increase. If you are a startup company, you can’t afford to waste time because time equals money. Therefore when you hire done-for-you-lead generation services, you are allowing your business to flourish from the start. The best part is that these leads are valid leads that are checked before going to the sales department. So there is no time-wasting, just genuine nurtured prospects which will lead to sales. 

5. A lead gen agency can handle high pressure in sales

If your business is flourishing exponentially, a qualified outsourced lead gen team will be able to handle the pressure of mounting sales and leads. They are used to handling large accounts and dealing with different prospects every day. In some cases, these lead-generation companies have been around for years; Therefore, they can handle the pressure of companies that have an excellent growth rate.

6. Increased data optimization

When you outsource a professional team of sales development representatives, you are also taking on a team that knows how to manage data.  They might offer other services that your business would find helpful. They could create new potential client lists or clean up your existing database. If you need to know your company’s conversion rate, then an outsourced company can do this for you. Did you know that 25% of marketers have no idea of their conversion rates?  By knowing and understanding your conversion rates, you will be able to develop a marketing plan that leads to success. 

7. You will have more time to focus on what you enjoy

Let’s be honest. Lead generation isn’t everyone’s favorite pastime.
When you know that your business is in safe hands, it frees up time for you to focus on the aspects of your company that you enjoy.
You don’t need to micromanage an in-house team of lead generators but rather sit back, relax and allow the done-for-you-lead generation service to bring on the deals. 

8. Your employees will also have more time

If you decide to use someone in-house as a sales rep, you might be increasing pressure on them to perform when it comes to finding leads. When you outsource a lead gen company, you free up time for your current employees to focus on their current roles and customer relations. 

9. You will have access to specialized tech

Instead of buying specialized programs for lead generation, the company you choose to find your prospects already has access to all the specialized tech you will need. You also won’t need to pay licensing fees, as they will cover the costs. This saves you money and allows you to leave everything in the capable hands of your outsourced team. Zoominfo – Which is used for prospect data   Price: On average, $18,321 a year  LinkedIn Sales Navigator – Which is a tool used for outreach and sales data Price: $79.99 per month, or $134 a month for a team package.  Crunchbase.com – Is a specialized form of tech for account data and targeting. Price: $29 per month for the pro versions and higher for the enterprise version Expandi.io – A tool used for Linkedin outreach Price: $99 per months Quickmail.io – This is used for email follow-ups Price: The starter plan is $49 a month, and the pro version is $69 per month Zapier.com – Will be used for automating and reporting Price: There are various plans available from $20 – $600 per month. If you had to purchase these tools for your in-house team, it could cost you a pretty penny. Most of these programs have different plans that you can choose from, but having to purchase all of them can eventually add up even for their basic plans.  For example, Zoominfo costs on average $18,321 per year for small startups; this is why outsourcing lead generation also saves you money. 

10. Quick growth and more leads

One of the best reasons why you should outsource lead generation is that it ensures the quick growth of your business. The metrics are proof that you will get quality leads with the right lead-generation strategy With a specialized team behind you, all you need to do is wait for new business to come in and close those sales. 

What are the negatives of outsourcing lead generation?

As with anything in life, there is always a negative to a positive. When it comes to outsourcing an SDR team, you will need to choose one of the best to make it really worth your while.  For example, if you choose to hire a less experienced outbound lead generation company, you might get a negative outcome. Brand new outsourcing companies might lack the experience and resources to get the right leads. Because there are so many different b2b lead generation companies out there, they might lower their costs to have a competitive edge, but remember that cheaper doesn’t necessarily mean better.  If you find yourself unsure of who to hire, take your time and interview a few different lead generation companies Instead, take your time and choose the right company, because if you choose the wrong one, you could end up losing money.  You could also find out if they do appointment setting, as this will also be an added benefit.   Some outsourced lead gen companies also lack transparency. Ensure that you understand the process, and if you need to sign a contract, read through it carefully.

Cons quick list

  • Cheaper doesn’t always mean better. There are a few bad companies out there, so spending time researching the right lead gen company is critical. 
  • Some companies don’t offer transparency, which might mean that information could get lost. Sales Development reps know a lot of details that could be used against competitors. They deal directly with potential customers, so see if they will provide the extra info for you to get a competitive edge.
  • “One size fits all” might also be the go-to for some outsourced companies. Unfortunately, this does not work. Hire salespeople who have a personal touch and who recognize your business’s individuality. 

What are the differences in cost when it comes to outsourcing and in-house?

Did you know that expertise in lead nurturing results in a 50% increase in sales leads, along with a 33% decrease in its cost (source)? This is true and might make you wonder how much does it actually cost to hire an outsourcing company? The quick answer is almost as little as $3000.00 a month, with no hidden costs; With no need from your side to pay bonuses or benefits.  If we compare this to what the above stats showed for starting an in-house sales development department which could cost you over $150,000.00 per year, you can see that you will really be saving.   For a more detailed article on hiring sales development representatives’ cost, please click here for our article that discusses salaries of SDRs in 50 different cities across America.  According to Cloud Task, the average cost per lead in 2019 was $198. Prices differ greatly depending on the industry and target market. This infographic by Clutch explains it perfectly:
The prices in the above infographic are pretty hefty, but in some cities like San Francisco, for example, a qualified sales development representative will cost you $56,000.00 a year. Some cities pay lower salaries, but all in all, the proof from various stats shows that an in-house lead generation team is more costly. 

….But does this mean that in-house is always going to be a bad idea?

Nope, it doesn’t. Starting with an outsourced lead generation team and then moving in-house eventually is the perfect balance. When you are a start-up company, outsourcing initially would be the best option because it is more affordable, but as time goes on and you hit your financial targets, you could afford to start your own in-house lead gen team.   You also get the shortened learning curve and immediate results of hiring an expert team outsourced. Over time, once the system has been built, tested, and fine-tuned, you can bring the process in-house; This gives you control, a slight cost savings, and the ability to scale as large as you want to. 

In conclusion

So whether you decide to outsource lead generation is totally up to you. Still, the facts show that doing so (even if it’s just initially) for your business, will be the best way forward to generate genuine leads that convert to sales.  We guarantee 1 qualified sales leads per day. Contact us today for a consultation; we would love to help your business reach its goals.

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