The ROI of B2B Cold Calling
The Ultimate Guide To B2B Cold Calling
Find Your ROI Below
See what happens to your ROI when you add more SDRs, raise the average contract value, and increase the closed-won rate percentage.
What Is The Formula Behind Cold Calling ROI?
Before you can improve your cold calling efforts, it’s important to benchmark the ROI of your existing cold calling efforts.
We’ve created a handy calculator that you can use to figure out where you currently stand and then you’ll learn about industry-tested methods to boost your KPIs.
As with any element of your B2B sales strategy, the fundamental starting point is setting objectives. The key is to understand what KPIs you need to measure, what represents success, and how to determine ROI against spend.
A single SDR working full time can make 8,400 cold calls per month which will result in about 432 conversions per month. More conversations lead to more meetings per month, and more meetings will increase the number of closed deals per month.
You can use our Cold Calling ROI Calculator to figure out how many SDRs you can afford, and run through scenarios to determine what your lowest close rate threshold and contract value should ever be.
How The Cold Calling Calculator Works
Cold Calling SDRs
This is the amount of full-time sales development reps that you have dedicated to cold calling. These reps call 6-8 hours per day and have a dedicated role as a cold calling specialist. They are managed by a team lead that reviews activity and call recordings.
Cold Calls Per Full-Time Rep Per Day
The average calls per full-time cold calling SDR is 400 calls per day. This metric can vary depending on how your list quality, answer rates and how talkative your prospects are. Some buyers are happy to have a 10 min conversation with a complete stranger and some people just want to get off the phone as quickly as possible.
Avg Working Days Per Month
For the point of this calculator, we use an average of 21 working days per month, which also account for the 10 federal holidays per year.
Cold Calls Per Month
It really is important to zoom out and look at ROI from a monthly perspective, so we take the average calls per day and extrapolate the average monthly dials per rep by multiplying it by the average working days per month.
Cold Calls Per Month = Cold Calling SDRs * Cold Calls Per Full-Time Rep Per Day * Avg Working Days Per Month
Avg Call-to-Conversation Rate
For the purpose of this ROI calculator we set this to a constant of 4.0%, which is a bit lower than the average of 4.5% but we prefer to be a bit more conservative when projecting ROI. This rate represents the percentage of conversations divided by the amount of calls.
It is important to look at this metric over at least a month long period so there is a large enough sample size to get an accurate number.
Formula: Call-to-Conversation Rate = Conversations Per Month / Calls Per Month
Conversations Per Month
This metric is found by multiplying the number of calls per month time the average call to conversation rate. This represents the amount of people a cold calling talks to live on the phone in a month.
Formula: Conversations Per Month = Cold Calls Per Month * Avg Call-to-Conversation Rate
Avg Conversation-to-Meeting Rate
This metric represents how many of your conversations are turning into meetings. This metric can vary greatly depending on the quality of the pitch and the persuasiveness of the cold caller. For this number we use a constant of 4% which is a conservative average of b2b sales prospecting meetings results.
Meetings Per Month
This is the estimated number of sales meetings set by the cold calling reps. To calculate this we simply took the number of monthly conversations and multiplied it by the average conversion-to-meeting rate.
Formula: Meetings Per Month = Conversations Per Month * Avg Conversation-to-Meeting Rate
Closed Won Rate (Varies By Company)
This is number of closed won deals from cold calling / by the total number of meetings set from cold calling reps. It is important to factor in no shows and unqualified calls.
Closed Won Deals Per Month
This is where the magic happens! Enough said. This metric is found by multiplying the number of meetings by the Closed Won Rate.
Formula: Closed Won Deals Per Month = Meetings Per Month * Closed Won Rate
Avg Contract Value (Varies By Company)
This input varies on your product and client lifetime. Typically we recommend to take your average client lifetime value, but other people prefer to put their monthly recurring revenue.
Won Contract Value Per Month
This is the expected amount of future revenue from a given month of cold calling. It is calculated by multiplying the amount of Closed Won Deals Per Month by the Average Contract Value.
Cold Calling Cost Per Month
$5000 for first half-time caller, then $4500 / half-time caller after that
Cold Calling ROI
Cold Calling ROI = (Won Contract Value Per Month – Cold Calling Cost Per Month) / Cold Calling Cost Per Month
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