Cold Calling vs. Warm Calling: What's The Difference?

Can you guess the difference between the two scenarios below?

‍Scenario 1: A new number tried to sell you a service or a specific product.

‍Scenario 2: On a different day, your phone buzzed from a company whose website you visited, and they were checking if you would need their services or products.

In situation one, you received a cold call, while in situation two, it was a warm call.

Sales professionals use various strategies to increase their customer base and discuss the benefits of their products or services with potential customers.

Every salesperson has a daily quota to meet.

Knowing how and when to conduct these calls can assist a company in generating more revenue and increasing its telemarketing or sales representative capabilities. 

This article will talk about cold calling versus warm calling in detail, including their differences, values, and the appropriate time to conduct each.

Also, we shall present tips for conducting cold and warm calls and provide instances of both types.

Read on!

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What is Cold Calling?

It is a sales method in which sales representatives call potential customers who have not interacted with their brand.

Like cold emailing, it involves contacting potential customers who have yet to show interest in the goods or services you offer but might be interested.

The customers may be in the proper location and sector, but they must know your company.

Sometimes, you need to make an average of 18 phone calls to get a buyer's attention. (HubSpot).

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Once a potential client is on the line, the sales representative gives a brief sales pitch to clarify the call's purpose and then proceeds to probe the prospect's needs.

Most cold sales calls do not aim to close deals.

Finding out about potential clients will help you set up follow-up sessions if there is a fit.

Once a sales representative gets past the first call, they can begin to promote their goods or services seriously.

This should motivate you to keep going even when your first cold call bears no fruit. 

The good news is that 82% of buyers consent to meetings when approached by salespeople.

Cold Calling Challenges

Cold calling is a viable method that sales teams have used successfully for decades. 

But that doesn't mean it's without obstacles.

‍Here are several examples:

Misconceptions

Cold calling is a type of telemarketing with a poor reputation.

This is the basis for how people perceive this sales tactic.

Some believe it is unlawful, while others think it's the same as robocalling.

Both of these are untrue, particularly in light of the Telemarketing Sales Rule, passed in 1995, which requires salespeople to explain why they are calling but also keep off clients who advise them to stop calling them further. 

Getting Past Gatekeepers

If you call a company's CEO, there is a small possibility of speaking with them.

Why?

Because 9% of B2B marketers confirmed that decision-makers never respond to cold calls.

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Gatekeepers frequently check calls for top decision-makers.

Therefore, you must overcome these barriers to speak with real decision-makers while cold calling to succeed.

Time and Expense

Gartner estimates that 22.5 dials in a cold call are necessary for one meaningful interaction.

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In other words, a successful cold call requires a lot of work.

It's also important to note that most salespeople detest making cold calls.

A higher-than-average staff turnover rate may arise from making them perform this task daily, particularly without using sales development representatives (SDRs') cold-calling scripts or other tools that simplify their lives.

Cold calling has drawbacks, which you can avoid using warm calling techniques.

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What is Warm Calling?

Calling prospects who have previously shown interest in your business or your offering is known as warm calling and is similar to cold calling.

This is how warm calling happens:

‍Company G posts many optimized blogs for SEO every month.

‍Customer XYZ reads one of these articles via Google and subscribes to Company ABC's email newsletter.

‍They show some interest, at least.

‍Then, a sales representative for Company G notices the updated email address, investigates the lead on LinkedIn (yeah, for social selling! ), and decides to get in touch.

‍What is next?

‍The sales representative converses with the lead over the phone and inquires about their interest in purchasing.

Minor adjustments can have a significant influence on conversion rates.

Warm leads come in different varieties and often convert at various speeds.

• Lukewarm leads: These leads have heard of your business but have yet to demonstrate a strong interest in your items.

Perhaps they went to your website or saw an advertisement.

• Toasty leads: This category belongs to those who have learned about your business and expressed interest by downloading an eBook or whitepaper or acting differently.

• Red hot leads: They have heard of your business and are directly interested in purchasing your goods or services. An example is an internet user who read your blog and visited your pricing page.

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Spoiler alert: If you have warm leads, you are more likely to set up upcoming appointments and close transactions.‍

Isn't it accurate to say that warm leads are worth following up on?

Yes, but categorizing it into cold, warm, and hot is more significant.

Therefore, you should focus much more on hot calling or speaking with leads who have already indicated they are interested in buying.

Statistics confirm this: Selling to an existing customer has a 60-70% probability of success while selling to a new prospect has a 5-20% probability of success.

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That will nearly always increase the likelihood of success.

Warm Calling Challenges

Did you know that if a lead is familiar with your brand and your products, they are more inclined to believe in you?

It's like starting a marathon when you are halfway there.

However, the warm calling approach has a few drawbacks, such as:

Time Spent

To determine if a prospect is interested, research their problems.

It may be a waste of time if they decide not to purchase from you.

Reaching Leads

Potential customers may know your business but still need to answer the phone when you call.

Warm callers are salespeople who have mastered leaving a compelling message, which can take some practice.

Splitting Leads

In the example above, Company G's marketing department used organic search to generate leads.

Sales must designate a representative and ensure that up to one salesperson contacts the same lead.

That can cost you the sale and irritate the lead!

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What is Hot Calling?

A sales representative will hot call a lead who is intensely interested in your product.

Since the prospect is awaiting your call, this is a hot call.

It is an example of a hot call when you meet a potential customer at an event, and they ask you to call them to schedule an appointment.

Or when a potential customer has interacted with your inbound marketing by visiting your website and submitting a form.

You would use a hot call to call a hot lead in each of these situations.

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Differences Between Cold Calling, Warm Calling, and Hot Calling

Salespeople may employ cold, warm, or hot calling techniques to contact potential customers.

Each approach has its own efficacy. 

However, they vary.

Making cold calls entails contacting individuals who have never interacted with your company.

On the other hand, warm calling entails contacting potential leads who have expressed interest in your company but have not yet purchased it.

Last but not least, hot calling entails getting in touch with consumers who have previously made a purchase or have expressed a lot of interest in your good or service.

Understanding and skillfully using the variations between these approaches is essential for sales success. 

Here are a few instances where these distinctions significantly impact sales outcomes.

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Lead Awareness

When you cold call a lead, there is a chance they have no prior knowledge about your business or the products or services you provide.

For warm calls, that is not the case.

Warm calls are made to those aware of the company the sales representative represents. 

They might be acquainted with the goods or services as well.

This degree of lead awareness is crucial, particularly in B2B sales, where the price of goods and services is frequently much higher than in B2C sales.

Prospect Trust

Trust is a big player, even in prospecting.

For instance, would you trust the cabin crew with your bags or the passenger sitting next to you?

The cabin crew wins this despite having very few details about them. You also assume they are trustworthy since they work for your chosen airline.

It's similar to sales calls.

If prospects are familiar with you, your company, and the products you sell, they will be more likely to trust you.

Why?

‍Because you are not a total stranger.

Therefore, you are more likely to be trustworthy because you are more familiar with the prospects' objectives and problems.

Furthermore, statistics have proven that 84% of buyers want to purchase from someone they know and trust.

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Sales Rep Effort

Cold calling is a common strategy sales representatives use to interact with prospects and increase sales.

For this reason, several businesses have entire call centers set up for cold calling.

Although it requires different efforts, warm calling is also labor-intensive.

Sales representatives must locate chances for inbound lead generation, gather contacts, and deal with rejection.

However, compared to cold calling, warm calling has a substantially better success rate.

Data shows that warm calling yields more outcomes than cold calling, where it can increase your prospective success rate from about 2% to over 30%.

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Further evidence supports the claim that sales personnel work less hard on warm calls than cold ones.

(But that depends on how much work you put into cold calling!)

Customer Expectations

This is the most significant and evident distinction between cold and warm calling in telemarketing.

Salespeople can better navigate their needs during sales by understanding what customers expect.

When a salesperson calls about a subject they have already discussed, instead of randomly picking up the phone, there is a significant difference in the customer's expectations.

A study shows that most Americans (67%) said that when an incoming call is from an unknown number, they generally don't answer it and instead check the voicemail if one is left.

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Warm calling is more effective in this situation.

Volume of Customer Contact

Cold calling is not cost-effective based solely on the sales hours necessary before a deal is achieved.

Although the basic idea behind cold calling is to establish connections and gauge the likelihood of a sale, either close the deal or move on when there isn't a compelling reason to call in the first place.

Also, in this case, the number of hours can quickly increase when the staff members look for even the slightest indication of a convertible sale.

You can significantly enhance the calling efforts by ensuring you are reaching out to the right people using phone number carrier lookup, checking the phone numbers, and targeting them at suitable times.

Prior Engagements With the Lead

Every salesperson knows that if the response to the question, "Have I got you at a good time?" is yes, a lead could turn into a sale.

In telemarketing, the perception of an existing relationship can significantly boost the likelihood that a lead will turn into a sale.

Even if a potential lead has only had the barest of interactions with a company, the very fact that an engagement has been made will elevate the company in the lead's opinion.

Cold calling completely misses this.

A list of additional new people contains a lead for each unique person.

Sourcing of Customer Details

One critical distinction between warm calling and cold calling is that warm calling offers the opportunity to elaborate on a client's concept and provide factual information that could aid businesses in determining their target markets and potential customers.

The goal is to know who wants to buy a product or pay for a particular service.

Warm calling is the only way to get the metrics gained from consumers who have already built relationships with you.

Tips for Cold Calls 

If done correctly, cold calling has a 2.5% success rate.

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A salesperson with experience can anticipate having at least two successful sales calls out of every 100.

To ensure the effectiveness of your calls, pay attention to these six tips before, during, and after them.

Understanding and skillfully using the variations between these approaches is essential for sales success. 

1. Explain the Value

Telling potential clients how much your products or services are worth will keep them on the phone longer and increase the likelihood of a sale.

You can describe how you could meet their needs as you become more familiar with them.

2. Be Patient

By definition, cold calling means making unsolicited calls to potential clients.

When making these calls, be kind and understanding, as this could leave the potential customer feeling bewildered or frustrated.

3. Research Your Contacts

The practice of sales prospecting requires extensive research.

• Who do you intend to speak with?
• Which industry do they work in?
• Who are they employed by?
• What problems do they encounter?
• What are their contact details, too?

You must seek responses to these questions.

Fortunately, it's pretty easy to find this kind of information.

Simply conduct a social media search for your possibilities.

Even if LinkedIn is recommended, Facebook, Instagram, Twitter, and TikTok might offer additional information.

It’s advisable to do additional due diligence on your prospects' companies.

Your cold calls will be more fruitful and effective now that you know about them.

4. Plan Out Your Cold Calls

It's never a good idea to wing it when making cold calls.

Make a plan instead to ensure you lead your sales cold calls in the appropriate direction.

If you're dedicated to the practice, create a sales script for cold calls that can be adjusted for each interaction.

Your sales pitch could sound something like this:

‍Hello, [First Name], I am  [Your Name], and I work for [Your Company]. I'm calling because [Reason for Your Call].

‍This may be a long call, but based on my study, you'd be a fantastic fit for our offer. 

‍Could we arrange a 15-minute conversation on [time and date]?

‍Thank you for your time, and I anticipate our call soon!

You are not required to use your script word for word.

Statistically speaking, when you don’t sound like you are reading from a script, your sales experience improves from  16% to 33%. (See the figure below for details.)

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Therefore, utilize your scripts as a guide to ensure you cover all the essential elements.

5. Prioritize the Prospect

What would you do if a sales professional called you and instantly started talking about their incredibly nifty new item, which you are not interested in?

Let me guess.

You would hang up the phone as quickly as possible.

Why? Because the rep focused on their interest in selling.

Also, they didn't ask about your day or issues and assumed you would like their goods, so they began a sales pitch.

Therefore, it’s advisable to prioritize the prospect of cold-calling success.

‍Ask questions, listen, and customize your conversations.

Doing so will help you create sales-critical trust.

6. Follow-Up

What do you say to a prospective client after a cold call?

Following up with them is straightforward.

Even though it's an essential step, many salespeople skip it. 

According to Marketing Donut, 80% of sales leads require five follow-ups following the initial contact, yet only 8% of salespeople do so.

Also, 

• 45% of salespeople give up after one.
• After one rejection, 44% of people quit following up.
• After two rejections, 22% of people quit following up.
• After three rejections, 14% of people quit following up.
• After four rejections, 12% of people quit following up.
• After five rejections, 8% follow up.

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You could give them another call in a week, a month, or whenever suitable.

Or use other channels and send them an email or text message as an alternative.

Utilizing social media, you could leave a comment on their most recent LinkedIn post.

Make sure you follow up in one of the various ways available.

7. Track Your Results

Assess your cold-calling efforts in the end.

Are you making sales and interacting with prospects? Or are you just wasting time?

Try to determine the cause of your bad outcomes, try out different strategies, and implement new tactics.

‍Do whatever is necessary to succeed.

Congratulations if your outcomes are outstanding!

However, analyze your calls to assess why your present cold-calling strategy is effective.

Once you understand why, you can build on successful strategies and increase sales.

Tips for Warm Calls

Do you want to use a warm calling sales strategy?

That is a great decision.

Here are seven ideas to help you regularly convert interested prospects into paying customers through your cold calls.

1. Maintain the Customer's Attention

When making a cold call, you must show that you have something worthwhile to offer; therefore, it's critical to pique the customer's interest in your pitch immediately.

Within the first few seconds, you should introduce yourself, state the name of your business, and mention any prior interactions you may have had with the client.

2. Combine your Marketing Strategies

When cold-calling potential clients, you can combine marketing techniques if your business provides additional goods or services.

For instance, while speaking with a potential customer on the phone, you could employ social selling, directing them to your business's social media website to learn more about the product or company.

According to LinkedIn statistics, 78% of social sellers outsell peers who don’t use social media.

3. Practice Active Listening

Any sales pitch must include active listening, which enables you to respond to potential customers' queries or concerns about the product you're promoting.

Additionally, by demonstrating interest in what potential consumers say, you can foster relationships with them and earn their trust.

4. Ask Open-ended Questions

Asking open-ended questions, such as ones that start with how, why, or what, may be more effective than asking the potential client questions more likely to elicit a yes or no.

Open-ended inquiries allow you to find out more about the potential client, provide them with extra information, and make the call last longer.

5. Get the Basics Right

The best technique to increase your sales pipeline is through warm calling.

But it doesn't differ all that much from cold calling.

Thus, you should put a few of the suggestions below into practice.

• Rearch right: Do your homework before calling the person.

Ensure you know as many details as you can about this person so you can tailor your chat.

• Be Prepared: Keep in mind that you shouldn’t wing it.‍

Establish a strategy for your warm calls. Although it requires a little more work, it will improve your outcomes.

• Consider timing: It doesn't matter if your leads already know who you are, so think about timing.

They won't pick up the phone if they are preoccupied with anything else.

Determine the best time to contact your prospects, then call them.

For instance, research shows that the best times to call prospects for sales are between 4:00 and 5:00 pm.

The second preferred hour is between 11:00 am and 12:00 pm when most firms and sectors take a lunch break and have extra time to meet in the UK and US.

6. Provide Next Steps

The last part of every warm conversation should include the following steps so that your prospects know who you'll be in touch with and how to proceed.

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Giving prospects the next steps allows them to opt out of further communication with you.

Although it could be painful, wasting time on unproductive leads is preferable.

7. Assess Your Sales Strategy

Lastly, give your warm calling sales procedure a quick review.

Are you pleased with your outcomes? Do potential customers enjoy your calls, and do they convert?

If not, you need to make some adjustments. You must get to know leads better to warm them up before the call.

You may need more research to prepare for every call and a more effective lead qualification process!

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Warm vs. Cold Calling—Which is Better?

So, which is better: cold calling or warm calling?

There is no correct or incorrect answer.

Many sales teams use both tactics to boost income, brand awareness, and market share.

Invest in a few cold-calling and warm-calling sales tools to boost your efforts.

The solutions listed below will assist you with outreach, social selling, referral sales, and other tasks.

Social Selling

You need LinkedIn in the B2B market.

It's a great tool for communicating with your target audience, establishing deep connections, and deciding who to contact when appropriate.

Customer Relationship Management

Every serious salesperson needs a CRM to monitor prospects along the funnel and keep contact information. 

The CRM should have everything you need to succeed in sales, including an intuitive user interface and robust automation tools.

If the CRM offers a predictive dialer, this will increase your productivity even further.

Referrals

While cold calling is an outgoing sales tactic, inbound leads can also be quite effective, especially if they arrive warm, which referred charges typically do.

Build effective automatic referral programs by using a service like Referral Factory to increase the number of recommendations.

Fire Up Your Pipeline With AIbees

Which is better: cold calls or warm calls? 

Or do you prefer hot calls?

Regardless of your preference, AI bees and our AI-powered solutions, in collaboration with our able team, can help you fill your pipeline with more accurate, ready-to-buy customers. 

‍Schedule a demo with us today to learn more.