At the beginning of the new year, your company will dole out your new quota. Your quota is a goal your company sets for you, but it shouldn't be your only goal. You should have a few goals you are pursuing while contributing what your company needs from you.
Why You Must Set Sales Goals
You need to set your own sales goals to prevent yourself from drifting. Your sales goals provide you with a target that is always in front of you, and by keeping your focus there, you remind yourself of the results you are pursuing. Setting sales goals also lets you measure and track your progress. You don't want to realize you are off course when there is too little time to do something about it. Finally, setting your sales goals lets you build a plan to achieve them.
Here are five steps to setting sales goals:
- Identify the reason your sales goals are important to you.
- Set three types of sales goals.
- Plan to achieve your goals in sales.
- Schedule time blocks and act.
- Track your progress towards your goals.
Let’s take a closer look at each one.
Identify the Reason Your Sales Goals Are Important to You
Your sales goals need to compel you, and you will be more compelled when you identify the reasons they are important to you. You need to document what these goals will provide that you don't already have. This exercise by itself provides a greater motivation to do the work that will deliver your sales goals. It will also improve your sales mindset.
Your reasons are your own. It doesn't matter what other people want or what goals they have for themselves, but you might find it easier when the reasons include other people. One of my goals was to make enough money so I could ensure my three children wouldn't have student loans. The thought of my children having enormous debt leaving college increased my motivation. Whatever you do, don't skip this step when you set your sales goals.
Set Three Types of Sales Goals
There are three types of sales goals you need to set: outcomes, activity goals, and performance goals. Let's look at all three and some examples.
- Outcome goals: Most outcome goals measure sales growth. An outcome goal is something like $1,000,000 in net new revenue in the next 12 months. Maybe you did $800,000 last year and you set the goal to do 20% better in the coming year. The other two types of goals help enable your outcome goals.
- Activity goals: Activity goals are true measures of your sales productivity. An example might be to schedule three first meetings every week. Instead of counting cold outreach and touches, you focus on the real activity you need to reach your sales goals. Any week that finds you with three client meetings moves you towards your goals.
- Performance goals: Performance goals are designed around effective selling. A performance goal might be to improve your average close rate from 28% to 42%, meaning you close more deals. It might also be something like converting 80% of your first meetings to second meetings. Performance goals will require you to improve your sales skills.
You can avoid missing next year’s sales goals by setting all three types of goals and making sure they are specific and attainable.
Planning to Achieve Your Goals in Sales
If you don't document your plan to achieve your sales goals, you are less likely to reach them. One of the easiest and best ways to make your plan is to reverse engineer your sales year by writing down what you need to do each week or month to hit your targets.
If you need to do $1,000,000 in revenue for the year, you need to close $83,000 a month. To generate that revenue, you will need to have activity goals that will lead to enough opportunities for you to hit that monthly sales goal.
The reason you set a performance goal is so you can improve your ability to meet your goals. Increasing your sales effectiveness will do more to help you reach your goals than anything else. With your plan in hand, you need to get busy.
Schedule Time Blocks and Act
If you look at the calendar of a successful person, you won't find a lot of white space. Because the successful person is pursuing their goals, they block the time to do the work necessary to reach their goals. You also might notice successful people follow a routine, taking disciplined action every day.
You need to treat each time block on your calendar like it is a meeting with someone you care about enough that you would never miss it. A person who commits to others while not treating themselves and their goals as if they are equally important will have a tough time reaching their sales goals. Block the time on your calendar and do the work you’ve planned.
Track Your Progress Towards Your Goals
There are dozens of tools to track your progress toward the sales goals you set for yourself. A spreadsheet works well enough to track your outcome goals. A habit tracker or a calendar will do the trick for your activity goals. You may have to do a little math to track your performance goals, but a spreadsheet will do the trick for a performance goal of increasing your average win rate.
Progress is better than perfection. By documenting your results each week, you give yourself the gift of making changes as you pursue the outcomes you committed to when you set your sales goals.
How to Set Sales Goals
How you set your sales goals will affect your ability to reach them. When you identify why your goals are important to you at the outset, you give yourself a much better start than those who don't. Using the three types of goals, you build the foundation to pursue and meet your goals. Making the calendar the master of your time and your goals helps you to act every day. When you track your progress, you see it and can make changes that ensure this next sales year is your best sales year ever.