The Cold Sales Trap
Entrepreneurs who are just getting started often spend too much time figuring out their offering (product, pricing, etc.) and not enough time figuring out their marketing strategy. Some of my most popular pieces reflect this (How to Scale to $1mm and How We Found Our First 30 Clients).
Because marketing is an afterthought, the only go-to-market work these founders do is to set up a landing page and some cold email sequences. So, their first clients all come in through cold outreach. Clients won through cold outreach tend to be the most price-sensitive, fastest to churn, and toughest to please, so the entrepreneur spends all their time servicing these clients instead of building sustainable, inbound marketing channels.
And despite what gurus tell you, cold outreach doesn’t scale well.
If you don’t have extremely specific personas, great messaging, supporting collateral, or good client disqualification methods, most of your outreach will be wasted and contribute to poor deliverability scores. So again, the entrepreneur is stuck on a hedonic treadmill, trying to find new prospects, offering pricing discounts to win business, and neglecting long-term marketing assets.
Finally, cold email and Linkedin outreach will only get harder as the channels become more saturated. The volume of junk I’m getting on both channels has increased markedly in the past year, and because these are non-monetized avenues for the platforms (ie: Gmail and Linkedin don’t make money off cold outreach spam), they’ll inevitably make them harder to use as time goes on (case in point, Google is doing it this year).
Breaking Free of the Trap
There are two ways that service business owners can break free from the cold sales trap I’ve described above. Unfortunately, both require patience and discipline, which first-time entrepreneurs often struggle with. That said, they both work and can be used in combination to close higher-quality, higher-margin clients than cold outreach does.
1. Stop Asking, Start Sharing
Our very first large corporate client at Draft.dev came in because of a Linkedin post I shared about how my small business was enabling me to have more time with my son.
Sharing success stories from clients, the impact you’ve had on employees or the community, and the processes you’ve built will all lead to far better long-term clients than cold outreach will. This can be done on your blog, social media, newsletter, niche communities, etc. The key is to change your mindset about advertising your business and instead of constantly asking for others to help you, start sharing what you know.
Sharing value for free attracts high-trust clients and allows you to have fewer clients that pay you more.
2. Show Up Where Your Client Base Does
Having great content to share is important, but as they say, “If a tree falls in the forest and nobody hears it, does it make a sound?”
Entrepreneurs that don’t know where their prospective clients congregate or have no access to these places have a fundamental business problem that they need to solve before they start. If you can’t find 20 prospective clients to have a conversation with before you launch, you need to go back to the drawing board.
And 20 prospects is really all you need to get started. Assuming you can make $1000+/month from each client, 20 is a great base to build from.
So, if you’re creating great content that would be helpful to your prospective clients and you spend time with them (online, in-person, doesn’t matter), you’ll have plenty of opportunities to share. Then, leverage that sharing into conversations about their needs, and when the time is right, talk about what you do.
It sounds simple because it is. It’s just not easy for many because it involves getting out of your comfort zone. You have to get away from the wannapreneur support communities for a bit and talk to real businesses that can buy from you.
Are Cold Emails Ever Worth It?
Absolutely. We win nearly 30% of our new clients from cold emails at Draft.dev, and plan to continue using it for the foreseeable future. But, it works well for us because we are very sure of our ICP (Ideal Client Profile) and use a very targeted, low-volume approach.
As an established brand with hundreds of clients and thousands of sample pieces published, we also have lots of supporting collateral to bolster our outreach. This means that even skeptical prospects can verify our reputation and previous success.
As a part of a multi-channel marketing strategy that includes content, supporting collateral, and social proof, cold outreach is a fantastic growth lever.
As your only attempt at kickstarting a trusting client base with sustainable margins, cold outreach is a terrible trap.