2nd Base - Reach Product Market Fit

SDR vs BDR: What’s the difference?

Let's compare the terms, SDR vs BDR. With sometimes conflicting definitions and different use cases, learn how to define and set them up for success.


Do you have both of these roles? Do you need both?

If you don't know, it helps to first understand what they are, how to set them up for success, and hold them accountable. Learn about hiring, training, role description, the playbook, OKRs, and KPIs for SDR and BDR roles in sales and marketing.

UPDATE: Following the huge popularity of this article I added some updates, and a couple of deep-dives, that you can quickly find in the deep dive menu to the left. I also want to link to the excellent piece on the same topic by ABM Leader Gabriela Benitez.

B2B SaaS Sales roles

You have three sources of leads and new business in your marketing funnel:

  1. Your existing sales executives and Account Managers find new business with existing customers and existing relations who sometimes switch employers, or provide a referral.
  2. Get “hand-raisers” from your Content funnel and Brand Awareness (i.e. your website)
  3. Prospecting (knocking on doors) of people who have never heard about your brand.

All three, when done correctly, can lead to the type of growth that scales startups and breaks the plateaus of established organizations.

Sales team titles: the difference between SDR vs. BDR

The term Business Development Representative, or BDR, and Sales Development Representative, or SDR, are used in different ways, and sometimes with conflicting definitions. Usually, both BDR and SDR mean sales roles, but that's about the only consistency. The SDR often reports to Marketing, and not Sales.

So let’s get the definitions straight first… Here's how the top search results in Google define the two roles:

Source
Inbound Follow Up
Outbound Prospecting
SalesForce
SDR
BDR
LeadFuze
SDR
BDR
Sales Talent Agency
BDR
SDR
SDR
BDR
Vendasta
SDR
BDR
G2
SDR
BDR
Treeline
BDR
SDR
Factor 8
SDR
BDR

 

The final score? 

Sales Development Rep/Inbound, Business Development Rep/Outbound: 6
Business Development Rep/Inbound, Sales Development Rep/Outbound: 2

The final SDR and BDR definitions

While the opinions are all over the place, and there is no one official definition, we at Kalungi will stick with the roles that Salesforce originally defined:

  • A BDR focuses on prospecting outbound leads
  • An SDR focuses on qualifying inbound marketing leads

Neither one is responsible for closing the business. Instead, their aim is to move qualified leads through the pipeline to those who have more experience closing business.

While the name SDR, includes “Sales”, in most SaaS Companies they are not really selling. The name is used mostly for Inbound Lead Qualification roles.

For most B2B SaaS Companies that are not above $50M in ARR, these roles will be the same. SDR/BDR will be the same for them.

More SaaS sales team titles

Here are examples of different titles being used across the sales funnel:

Inbound

  • SDR – Sales Development Rep
  • ISR – Inbound Sales Rep
  • LDR – Lead Development Rep
  • LRR – Lead Response Rep
  • MQR – Marketing Qualification Rep
  • MDR - Marketing Development Rep
  • MRR – Market Response Rep
  • LDE - Lead Development Executive

Outbound

  • BDR – Business Development Rep
  • ADR – Account Development Rep

Closing

  • AE – Account Executive
  • EAM - Enterprise Account Manager
  • SE – Sales Executive
  • ISR – Inside Sales Rep

sdr meaning sales

Setting SDRs and BDRs up for success

When you have a funnel challenge and need to manage your sales and marketing teams to find the bottlenecks for growth, I like to use the following table to focus my diligence. You start with diagnosing the problem along two dimensions. Do you have a funnel size problem, hinting at activity levels being too low, or do you have a funnel quality challenge, leading to conversions that are too low?
  High activity Low activity
High conversion
  • Consider adding (junior) resources to shadow- and be trained by your best salespeople.
  • Reduce meetings and reporting to a minimum and free up capacity for your team to just sell.
  • Find opportunities to reduce CAC (reduce paid lead sources, shift work-load to lower-cost sales team members) as you have the luxury of a large enough funnel.
  • Increase team capacity no drive sales through training and better tools.
  • Increase efficiency with a high-quality playbook that includes call scripts, checklists, and templates.
  • Improve automation with email sequences, dialers, and potentially outsourced transactional activities.
  • Grow your target lists allowing an increased frequency of calls and emails.
Low conversion
  • Improve the effectiveness of discovery and sales process.
  • Talk to customers. Understand the pain. Consider reviewing call recordings. Improve the discovery questions.
  • Challenge your level of Product market fit by finding reference customers, proven ROI from existing customers, and a well-defined ICP.
  • Train your sales team in Solution- and/or Value selling.
  • Improve MQL and List quality.
  • Use ABM and A/B tests to do extensive Value Prop and Message testing
  • Hold Daily standups or, at least,  weekly sales meetings to get to the root cause of your challenges.
  • Re-consider if you are in the right market with PMF, ready to scale?
  • Increase the talent level of your SDR/BDR team and sales executives.
  • Reboot the team? Find a new sales leader?
  • Review the quality and status of the core sales tools (content, CRM, automation).

Managing SDR sales meetings

Once you've identified your area of focus, a typical next step is to use your sales meetings or daily standups to act on these. Everything you give attention to tends to grow, and based on the above table you now have your list of probing points.

Here are a few basic questions to consider using in your meetings (more here):

  1. What genuine progress has been made since the last stand-up or sales meeting?
  2. What new leads have entered your pipeline since yesterday?
  3. What opportunity in your pipeline is most likely to close next and why?
  4. Finally, do you need any help closing your next deal?

BDR and SDR incentive considerations

As you build your compensation and pay structure, here are a couple of aspects to consider. More details can be found in this article.

  1. Incentivize the right business outcomes (recurring revenue vs. one-time revenue, land vs. expand, sell the right package at the desired price level, incorporate strategic sales vs. tactical sales priorities).
  2. Pay the right amount to get the right people (good salespeople, especially in a more mature category, are worth their high pay requirements, but make sure you hold them accountable).
  3. Support a growing, complex sales structure (consider moving from commission-based incentives to bonus-based incentives to enable paying multiple people for the same booked revenue).
  4. Align the fixed/variable pay mix with the role (some roles have a higher correlation between effort and outcome, and others have more experience/talent and outcome. The first warrants a more variable pay mix vs. the latter.
  5. Support your market segmentation (align sales territories with your ICP and market focus to balance healthy competition and benchmarking between sales reps by giving them enough opportunity to earn and make an impact for your company).
  6. Pay for outcomes, not activities (for example, money in the bank instead of a signed PO, but match the outcomes to what the team member can influence. If they can only impact how many calls they make that result in meetings with a sales executive, consider adding that to the comp plan, in addition to revenue outcomes).
  7. Consider accelerators and clawbacks (optimize for behavior that leads to maximum sales impact, while also planning for salespeople to cut bait and leave your company).

11 books every SDR/BDR can benefit from:

SDR and BDR playbook

Before you invest in hiring SDR or BDR team members, it's critical to have a  playbook that they can be trained on and that they can use to be effective. Here are the elements that I like to see in a basic BDR Playbook for a sales team:

  1. BDR/SDR roles and responsibilities
  2. KPI Examples
    • Daily calls en emails
    • Weekly Sales Qualified Leads
    • Monthly Sales Qualified Meetings
    • Conversion to Opportunity %
  3. Ideal Customer Profile and Buyer Personas
  4. Funnel definitions
    • Subscriber
    • Leads that fit
    • Marketing Qualified Lead (and scoring)
    • Sales Qualified Lead
    • Sales Qualified Opportunity
  5. Call Preparation & Best Practices
  6. Multi-Touch Cadence for Outbound Prospecting
  7. Voicemail examples and email sequences
  8. Objection handling counters
  9. Discovery process and questionnaire
  10. Follow up messaging and content

 SDR and BDR OKR examples

From hiring and onboarding the team to activity tracking and management, lead qualification and scoring to quota attainment, all the things you want to get out of your sales team will improve if you measure them. OKRs are my favorite instrument to do so. Here are a couple of examples, that of course can be different depending on the part of the sales funnel you need to focus on. For example, SDR OKRs can be different vs. BDR OKRs.

Objective and key results for an SDR

Objective: Increase conversions of MQLs generated

  • Key result 1 – Increase MQL Discovery Calls Completed from 50 to 80 per month
  • Key result 2 – Reduce the average time to connect with inbound MQLs from 32 to 16 hours
  • Key result 3 – Complete BANT qualification for 100 MQLs this quarter, increasing the speed of the lead going through the next steps in the funnel.

Objective and key results for a BDR

BDR objective – Improve the quality of SQLs

  • Key result 1 – Grow the Sales Qualified Lead (SQL) to Closed Won % from 20% to 30%
  • Key result 2 – Reducing the Sales Cycle to from 40 Days to 30 Days
  • Key result 3 – Increase Qualified Lead to Quote conversion from 34% to 60%

Objective and key results for a sales executive

Sales Executive objective – Drive ARR sales

  • Key result 1 – Increase Average Contract Value (ACV) to $20K this Quarter
  • Key result 2 – Increase New Bookings commitments to 3 years of ARR
  • Key result 3 – Achieve $250k New Monthly ARR bookings
READ ARTICLE
 

Additional SDR vs. BDR resources

Given the arbitrary results of my research, I thought it helpful to include my sources below:

Salesforce

  • SDR (Sales Development Representatives) are in charge of qualifying all the inbound leads. This is an entry-level position newly hired employees commonly apply for. After 12 months, Salesforce promotes them to the BDR (Business Development Representatives) organization. Their primary duty will switch from handling inbound leads to making outbound sales calls.
  • The SDR usually handles SMBs while the BDR organization commonly contacts prospects from commercial and enterprise segments.
  • SDR sales reps cannot handle inbound leads that the BDR organization previously engaged with. When a prospect previously contacted by BDR goes through their inbound hotline, the SDR directs them to the BDR.
  • Of course, this rarely becomes an issue since the SDR and BDR handle different sectors, prospects, and segments.

LeadFuze

  • Sales Development Representative (SDR): A type of inside sales rep who focuses more on inbound lead qualification, moving leads into and through the sales funnel, qualifying prospects, and setting up sales-qualified appointments.
  • Business Development Representative (BDR): A type of inside sales rep who focuses on generating qualified prospects using cold email, cold calling, social selling, and networking.

Sales Talent Agency

  • A BDR focuses on prospecting outbound leads
  • An SDR focuses on qualifying inbound marketing leads

Vendasta

  • The SDR team is focused on calling inbound and outbound leads in the pipeline assigned to that member.
  • Leads are qualified and presentations are scheduled with our Business Development team. The BDR team focuses on presenting our re-brandable software solution to qualified prospects.

G2 

  • A sales development representative (SDR) is responsible for generating new business opportunities, but they are tasked with doing so by qualifying only inbound leads.
  • This is different than a BDR that is responsible for generating opportunities through outbound sales outreach such as email and cold calling.

Factor 8

  • The BDR role is sometimes broken out to exclude those handling inbound leads, and these are typically referred to as SDR (sales development reps).
  • You’ll find BDR/SDR roles reporting into Marketing about as often as to Sales, but the growing trend is moving them out of marketing and into sales. Primary SDR responsibilities include accepting inquiries (e.g. lead forms or inbound calls), qualifying, and routing them to the appropriate sales channel.
  • The outbound BDR team may call on lead lists, prospect for new customers, or even work internal lists like re-activating old customers. Consider them a bridge between Marketing and Sales, converting tire-kickers to Marketing Qualified Leads or MQLs to Sales Qualified Leads (SQLs).

TreeLine

  • The BDR focuses on inbound leads. They are filtering and qualifying those leads for the Account Executives.
  • The SDR focuses on outbound activity to find net-new prospects. Their job is to gather information, ask qualifying questions and deliver the lead to their prospective Account Executive.

What's next? 

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