Are you ready to crush your sales goals in the new year? Watch the sales goal setting video demo embedded with this post. Learn how to focus on each stage of the sales funnel and set smart sales goals.
In this video demonstration for sales goal setting, I’m going to show you the combined effect of improving conversion for each stage in the sales funnel, so you can close more deals and grow your revenue.
Sales Goal Setting – Video Demo
Related video: Increasing the average order value to increase sales.
Setting Stage Wise Goals
It is common for businesses to focus on the final outcome – total sales, total revenue etc. However, a sales lead goes through multiple stages in the sales funnel before the final yes or no.
The reason for losing a sale at each stage is different and may be in control of a different department or person.
For example, the count of new leads generated may be the KPI for your marketing team. On the other hand, converting qualified leads into sales is the accountability of the sales team.
Hence, focusing on only the final outcome while reviewing performance and setting goals does not help the sales planning process.
Set stage wise improvement goals!
Example: Sales Goal Setting for the New Year
Given below is sample data for sales for a small business for 2023.
This company generated 1000 new leads for the year and managed to convert 10% leads into paying customers.
|Total new leads||1,000|
|Leads converted into sales||100|
|Average Order Value (AOV)||2,500|
Scenario 1: Setting a 30% improvement goal for overall conversion
A 30% improvement in the final sales conversion will increase the conversion from 10% in 2023 to 13% in 2024. Given below is the expected sales summary for the new year.
|Total new leads||1,000|
|Leads converted into sales||130|
|Average Order Value (AOV)||2,500|
Scenario 2: Setting a 10% improvement stage for stage wise conversion
In this example, there are 5 stages: New leads generated, qualified leads, discussion of scope of work, proposal submission and final closure (win or lose).
In the second scenario, the team decides to set a 10% improvement goal at each stage. Given below is the expected summary:
Look at the net increase in revenue – 77% instead of 30%. Even if the average order value remains the same, the company can expect an overall increase of 61% in sales revenue instead of 30%.
|Total new leads||1,100|
|Leads converted into sales||161|
|Average Order Value (AOV)||2,750|
Don’t focus on the final outcome when setting goals. Review each stage of the sales funnel. Identify reasons for success and failure and address each root cause to increase conversion at each stage.
Minor improvements at each stage of the funnel will produce a greater combined increment in overall sales for your business.
Common Questions People Ask About Setting Sales Goals
How do I set SMART sales goals?
Setting SMART sales goals is a way to improve your sales performance and achieve your desired outcomes. SMART stands for Specific, Measurable, Achievable, Relevant and Time-bound. Here are some steps to follow when setting SMART sales goals:
- Specific: Define your goal clearly and precisely. What do you want to achieve? Who is involved? Where and when will it happen? Why is it important?
- Measurable: Determine how you will track your progress and success. How much or how many? How will you know when you have reached your goal?
- Achievable: Make sure your goal is realistic and attainable. Do you have the resources, skills and time to accomplish it? Is it within your control and influence?
- Relevant: Align your goal with your overall vision and mission. How does it fit with your values and priorities? How does it contribute to your long-term objectives?
- Time-bound: Set a deadline for your goal. When do you want to achieve it by? How often will you review and adjust it?
By following these steps, you can set SMART sales goals that will motivate you, challenge you and help you grow your small business.
What are some examples of sales goals and objectives?
Sales goals and objectives are measurable targets that help sales teams and individuals track their performance and progress. Some examples of sales goals and objectives are:
- Increase revenue by a certain percentage or amount within a specific time frame.
- Acquire a certain number of new customers or accounts within a specific market segment or industry.
- Retain a certain percentage of existing customers or accounts by providing excellent service and value.
- Cross-sell or upsell additional products or services to existing customers or accounts.
- Improve customer satisfaction or loyalty by collecting feedback and implementing improvements.
- Enhance sales skills or knowledge by attending training, coaching, or mentoring sessions.
- Expand sales territory or reach by entering new markets, regions, or channels.
How do I align my sales goals with my company’s vision and mission?
Aligning your sales goals with your company’s vision and mission is a key step to achieving success and satisfaction in your role. Here are some tips on how to do it:
- Review your company’s vision and mission statements regularly. They are the guiding principles that define what your company stands for and what it aims to achieve. They should inspire you and motivate you to work towards a common purpose.
- Identify how your sales goals contribute to your company’s vision and mission. Think about how your products or services solve problems, create value, or make a difference for your customers and stakeholders. How do they align with your company’s core values and objectives?
- Communicate your sales goals clearly and effectively to your team, managers, and customers. Explain how they support your company’s vision and mission and why they are important. Use stories, examples, or data to illustrate your points and show the impact of your work.
- Seek feedback and support from your colleagues, mentors, or coaches. Ask them how they align their sales goals with their company’s vision and mission and what challenges they face. Learn from their experiences and insights and apply them to your own situation.
- Celebrate your achievements and recognize your progress. When you reach a sales goal, acknowledge how it helped you advance your company’s vision and mission. Share your success stories with others and appreciate their contributions. Celebrating your wins will boost your morale and confidence and inspire you to keep going.
How do I adjust my sales goals based on changing market conditions and customer feedback?
Adjusting your sales goals is a crucial skill for any business owner or salesperson. You need to be flexible and responsive to the changing market conditions and customer feedback. Here are some steps you can follow to adjust your sales goals effectively:
- Review your current sales performance and compare it to your original sales plan. Identify the gaps and the reasons behind them.
- Analyze the market trends and customer behavior. Look for opportunities and threats that may affect your sales potential.
- Set new sales goals that are realistic, measurable, achievable, relevant and time-bound. Use the SMART criteria to guide you.
- Communicate your new sales goals to your team and stakeholders. Explain the rationale and the benefits of the adjustment.
- Monitor and evaluate your progress towards your new sales goals. Celebrate your wins and learn from your challenges.
How do I balance short-term and long-term sales goals?
Balancing short-term and long-term sales goals can be challenging, but it is essential for success. Short-term goals help you stay focused and motivated, while long-term goals help you align your actions with your vision and strategy.
Here are some tips on how to balance them:
- Set SMART goals: Specific, Measurable, Achievable, Relevant and Time-bound. This will help you define what you want to achieve, how you will measure your progress, and when you will reach your target.
- Prioritize your goals: Identify which goals are more urgent, important, or impactful, and allocate your time and resources accordingly. You can use a matrix or a list to rank your goals based on different criteria.
- Break down your goals: Divide your long-term goals into smaller milestones or sub-goals that you can accomplish in the short term. This will help you track your progress, celebrate your wins, and adjust your plan if needed.
- Review your goals regularly: Monitor your performance and evaluate your results against your goals. Celebrate your achievements, identify any gaps or challenges, and take corrective actions if necessary. You can use a dashboard or a report to visualize your data and insights.
- Seek feedback and support: Ask for feedback from your manager, peers, or customers on how you are doing and how you can improve. Seek support from your team, mentors, or coaches if you need help or guidance. You can also join a community or a network of sales professionals to learn from others and share best practices.
How do I avoid common pitfalls and challenges in the sales goal setting process?
Setting sales goals is a crucial task for any business, but it can also be challenging and frustrating. Some common pitfalls and challenges that you may encounter are:
- Setting unrealistic or unattainable goals that demotivate your sales team or create a culture of failure.
- Setting vague or ambiguous goals that lack clarity, direction, or measurability.
- Setting goals that are too easy or too hard, which can lead to complacency or burnout.
- Setting goals that are not aligned with your business strategy, vision, or values.
- Setting goals that are not communicated effectively or consistently to your sales team or other stakeholders.
To avoid these pitfalls and challenges, you should follow some best practices when setting sales goals, such as:
- Using the SMART framework to make your goals specific, measurable, achievable, relevant, and time-bound.
- Involving your sales team in the goal-setting process to increase their buy-in, engagement, and ownership.
- Reviewing and adjusting your goals regularly to reflect changes in the market, customer needs, or business priorities.
- Celebrating and rewarding your sales team’s achievements and providing constructive feedback and support for improvement.
- Communicating your goals clearly and frequently to your sales team and other stakeholders, using various channels and formats.
Do you have any questions about setting sales goals for your business? Please comment below. And, do not forget to subscribe to receive email notifications for new posts. Thank you!