A recent Bridge Group study on Sales Development found that the average new BDR hire at tech companies had only 1.5 years of experience. The industry seems to have converged around an ideal profile for BDRs. They are typically young, located in major metropolitan areas, and motivated to grow their career into a field sales role. But just because most companies are hiring that profile doesn’t mean that it is always the right profile.
In my last post I challenged the notion that tech companies should always hire BDRs with only a few years of experience. I have enjoyed a lot of success over the past five years with an alternative model that relies on more experienced, “mid-career” BDRs. These mid-career reps often have the performance and skills to work in a field sales role, but have personal situations that prevent them from traveling extensively.
Mid-career BDRs are not a perfect solution. As with any model, there are both pros and cons to hiring this profile. Mid-career BDRs offer some advantages as compared to the prototypical early-stage BDR, but there are also some drawbacks.
Disadvantages of the Experienced BDR
- Cost – As you might expect, more experienced professionals will expect a higher base salary and overall compensation structure. On Target Earnings for these more tenured ADRs could be 2X or 2.5X the compensation of a junior ADR with 1-2 years experience.
- Location – You may not be able to find ADRs with this profile within commuting distance of your office. As a result, you will not be able to staff the centralized, call center model that has become popular in the tech sector. Instead, you will need to manage a virtual team of geographically distributed ADRs working out of their home offices.
- Recruiting – It is harder to find individuals fitting this profile. They tend not to be job-hoppers, but rather to stay loyal to employers that accommodate their lifestyle needs. Since many of these candidates are not looking for a new role they are unlikely to find a job posting online then apply. Instead, you may need to hire a recruiter to seek them out or more extensively network to find these individuals.
- Volume and Velocity – Many of the mid-career BDRs I have worked with are less interested in the “high velocity, low touch” sales models employed by many software companies. These types of reps may be a better fit for account-based marketing strategies that require more sophisticated pre-call research and post-call follow up with the field organization.
Advantages of the Experienced BDR
- Balanced Performance – Hiring a more junior ADR with little or no experience results in a much higher risk of non-performance. Much of the attrition that exists in the industry is involuntary resulting from performance related issues. More experienced ADRs require less management oversight as well. These individuals are often competitive by nature and self-motivated to perform. Less time is required measuring call metrics, coaching sales techniques, and managing performance issues.
- Job Satisfaction – Unlike many junior BDRs who view time served in the role as a “necessary evil” to make it to the field sales organization, these individuals truly want to do the BDR role. They love to prospect. They enjoy the challenge of trying to get decision makers interested in their company’s products and services. And they enjoy fostering new relationships with contacts in a high volume of accounts.
- Higher Retention – Due to the nature of their personal constraints, these individuals have less flexibility in career choices and employers. And they are well aware of that issue. If you can keep them performing and they are being fairly compensated they are less likely to jump ship to another company.
Making a Business Case for the Experienced BDR
The net result from the three advantages outlined above is a significant reduction in turnover, which is significant, because the attrition rates amongst BDRs are typically very high. The latest Bridge Group study found that 44% of software companies experienced attrition rates in excess of 30%. Another 48% had attrition rates between 10-29%. Every time an BDR leaves there is a three to six month gap in productivity. Why? Because takes between 30-60 days to recruit and hire a new BDR followed by another 60-120 days for the rep to become fully productive and hit quota. By reducing turnover you can achieve a significant productivity benefit through less time spent on recruiting, on-boarding, training, and coaching new BDRs.
The mid-career BDR model will not be right for many tech companies. But it is worth analyzing the economics to understand the pros and cons of both approaches.