How can I ensure my business will be successful?
This is a question that every business owner must answer. And even though each business’s path to success is different, the starting point is the same.
What is that starting point?
Consider these numbers regarding goal setting:
- 14% of those who have goals are 10 times more successful than those without.
- 3% of those with written goals are 3 times more successful than the 14% with unwritten goals.
Why is goal setting so important?
Because you are defining success for your business. If you look at the path to success as a journey, setting goals means you are specifically defining where you want to be.
When you know where you’re going, you become more efficient in how you work because the road to those goals becomes clear. You can better analyze your work efforts because you can determine if you are on pace to reach your desired destination. If not, you can course correct.
This is just as true when you market your small- and medium-sized businesses as it is for other areas of your life.
In this blog, we will look at how you can set appropriate goals for your marketing.
Understand Your Revenue Goals
The first thing that you need to do to set the correct marketing goals is to understand how much revenue you want to generate over a given period of time. Generally, you start with the year and break it down into quarters or by the month.
Knowing how much revenue you must generate is important because it is a marker of success. When you set revenue goals you are saying, “We need to bring in this much money for the month, quarter, or year to be successful.”
Once you set your revenue goals, you have defined what success means for your organization. Now you can focus on how to reach success.
How Will You Meet Your Revenue Goals
Once you have determined how much revenue you need to generate, you can begin to determine how you will meet those revenue goals. To do this, look at the products and services that will help you reach your goals.
We have seen a lot of businesses that want to focus on EVERYTHING when it comes to marketing. There are two problems with that:
- Promoting too many products/services runs the risk of confusing your audience. You want your messaging to be precise and to the point so your potential customers know EXACTLY how you help them.
- Not all of your offerings generate the same revenue. You want to focus your marketing efforts on the products/services that are most appealing to your audience while generating the highest profit margin.
Set your revenue goals, then determine the products and services that you sell are most likely to get you to your goals. This is the first step towards effective and efficient marketing.
Note: We are not suggesting you strip down what you sell or that you offer fewer services. For this exercise, we are determining where you should devote your marketing efforts so you can maximize your results.
Do the Math
Now that you know which of your products and services you need to focus your marketing efforts on, the next step is math. Do the following:
- Determine how many sales are needed to reach revenue goals – Take your revenue goals and divide it by the cost of the products and services you will be focusing your marketing efforts on. If you are focusing on multiple offerings, then do this several times to come up with the ideal mix of offerings. This will tell you the number of sales you need to have during the month, quarter, or year. The key here is to challenge yourself and your organization while remaining realistic.
- What is your closing rate – What is the likelihood of someone making a sale? Is it 10 percent, 25 percent, or 50 percent? This will help with the next step.
- How many leads do we need each – If you need to make 10 sales a month to meet your revenue goals and you determine that your closing rate is 25%, then you need 40 leads per month.
Everything we have done up to this point is to understand how many leads you need. The purpose of marketing your business is to spread the message of your business, so you can generate the leads you need to be successful. By understanding your revenue goals, knowing which products/services you need to focus your marketing efforts on, and doing a little math, you can determine exactly how many leads you need to generate.
You now have a marker of success by which you can evaluate your marketing efforts. And now you can determine EXACTLY which marketing actions you need to take to generate the leads needed to meet your goals.
We are not done, though.
Write Your Goals Down
Knowing how many leads you need to generate over the course of a month, quarter, or year is only part of the work. You need to actually write this down. Remember the stats above—the 3% of people who wrote their goals down were 3X more likely to reach them.
This is because writing down your goals makes them real. It can be scary, but saying and then writing down how many leads you need is like a promise to yourself and your organization. That promise can have the power to grow your business in ways you have only dreamed of.
Spread the Word
Last, but not least, spread the word. Let your team know what your goals are. You do not have to get into the nitty gritty, but letting them know that you need to generate X leads and close Y sales each month or quarter can be a motivating factor if done right. You can bring your team together under a shared purpose.
When you set goals for your business, you are stating how you want your business to grow. Setting goals for your marketing efforts allows you define how you intend to take your business from where you are now to where you want to be. Doing this will allow you to better answer the question posed at the start of this blog.