Ask any sales manager and they will tell you how important it is to track sales KPIs and how every sales representative is performing. But knowing what to track is just as crucial.
Instead of setting one big sales goal for the next two or five years, you can break it down into smaller and easier to achieve goals for your sales team. This can in turn help in boosting morale, increasing productivity, and tracking the overall performance of your sales team.
In this article, we discuss how sales goals are effective in improving your bottom line along with the top sales goal examples you can use.
What are sales goals?
Sales goals are the main sales objectives set for a sales team in the company. Goal setting for salespeople gives them a clear roadmap about what they need to do in order to achieve the expectations set for them. Each goal for sales comprises of measurable and actionable items that help sales managers ensure that their team, as well as individual goals, are achieved.
In most cases, sales goals are long-term benchmark goals that are in turn made up of shorter steps.
Why do you need sales goals?
Motivate your sales team
The biggest benefit of setting a sales goal is that it helps motivate your team. When your sales team members understand what they are working towards, it becomes all the more easier for them to focus all of their attention and put all of their best efforts into achieving the goals.
Enhance the sales process
Setting sales goals in advance also helps streamline the entire sales process in your organization. When you know the end results that you need from your sales team, you can better assign different roles and responsibilities in advance and ensure everything aligns, without any kind of roadblocks.
Set clear expectations
When you have clearly defined goal setting for your sales team, you are also able to set clear expectations. And when your sales team knows what is expected of them at the end of the year or quarter, it increases their productivity and efficiency.
Steps to set sales goals for your team
1. Create goals for the organization as a whole
Before you create goals for your sales team you need to establish goals for the organization as a whole to better understand the overall vision. Where do you see your company one year down the line? How do you want your prospective customers to perceive your company? What is your long-term revenue goal?
2. Take a bottom-up approach
When setting a sales goal, you should always start by listing out the results that you would want to see. These can be monthly results, quarterly results, or even yearly results. All you should do is ensure that the goals align perfectly with your company’s overall vision.
Once you have the results, you can work your way backward. The idea is to identify the outcome and then work out a path that can help you achieve that outcome.
3. Assess the current situation
Now that you know where you want to be and the outcome you want, you need to assess the current situation and your company’s current sales strategy. Consider the current metrics and visualize them to better understand whether they have been increasing or decreasing in the last few months. Visualizing your past performance and historical trends can help immensely in setting realistic sales goals.
4. Establish goals that are SMART
Just setting goals is not enough, you need SMART goals for your sales teams.
Here's what SMART stands for:
Specific: A goal should be specific and quantifiable in nature. For instance, just creating a goal like 'increase customer retention’ is not enough. You need a more specific goal like 'increase customer retention by 30% in the next 6 months.'
Measurable: The goal that you create should be easily measurable and trackable. In other words, your goal should be quantifiable, making it possible for you to track the sales team's progress.
Attainable: The goals should be realistically attainable in nature by your sales team following the normal work ethics. For instance, you can't just create a goal like ‘increase leads by 300% in 2 months’ when your team has only been able to increase leads by 20% at the most in the past year. Setting unrealistic goals can not only make your sales team feel pressured, but it can also make them feel that their efforts aren’t valued in the organization and there is no work-life balance left for them.
Relevant: The goals should be relevant to your company as a whole. No matter what your competitors are doing, you need sales goals that align with your company's requirements as well as your target audience.
Time-bound: All the sales goals should be time bound in nature. After all, without a deadline in place, the goals may not end up motivating the sales team members in any way.
5. Start assigning goals to sales representatives
After you have made a clear list of sales goals, it's time to start assigning them to the team. When you assign goals to individuals, make sure you have provided them with a clear brief detailing how and when you expect the goals to be achieved. Make sure to keep the goals attainable and time-bound.
6. Provide help and support to your sales team members
It's also a good idea to keep the door open for discussions and negotiations with the sales team to better understand how you can help them accomplish your goals.
In most cases, your sales team will need resources like historical data, automated sales tools, sales training, and other equipment to successfully achieve all the goals set out for them.
7. Evaluate the sales goal progress
After assigning the goals, you need to make sure you review the progress of those goals from time to time. In case some team members are lagging behind, make sure to keep them motivated and ask them if there is anything they need help with.
It's also a good idea to conduct regular sales meetings with the team to get updates or even schedule monthly 1:1 with the sales team members.
Examples of sales goals
Increasing revenue
Revenue goals are essentially targets for increasing the net profits or gross the company. It's the cash flow that the company needs to generate in order to cover the expenses while still making significant profits.
You can set revenue goal targets annually or monthly. Ideally, you would have to set an overall revenue sales goal for the whole team and then break it down into individual sales goals for every sales representative. You can also set revenue goals according to the region, team, and product timeline.
While revenue goals are one of the fundamental sales goals examples, you should always set a fixed timeline and expectation for this goal.
For instance, a sales goal example is to increase monthly revenue by 10% across the different services or products in the company.
Decreasing customer churn rate
Customer churn rate is defined as the total number of customers who stop using your company’s services or products in a specific period of time. While customer churn is an unavoidable factor, you can take steps to ensure the churn rate doesn’t get too high.
In case the churn rate is higher than it should ideally be, you can create sales goals to lower it. Here’s a sales goal example of how you can create one – Decrease churn rate by 20% in the next quarter by significantly improving customer service and hand-offs.
Boost the number of leads
While closing deals and building up revenue for your organization is important, keeping your sales pipeline full of fresh leads is just as important for every sales team. Boosting the number of leads is an investment in your company’s future.
That is why you need to make sure you have numerous high-quality leads as it can help determine your sales team’s chances to close deals with prospects that have a high customer lifetime value.
Here’s a sales goal example for it – Increase the number of leads by 15% in the next quarter.
Increase CLV
CLV or customer lifetime value is the total amount of money a customer spends on your business during their entire lifetime as your customer. The higher the CLV, the better.
Measuring and tracking the CLV helps in making decisions about how much money you should be spending in getting new leads, acquiring new customers, and retaining the existing ones.
It also helps you decide your sales and marketing budget while making sure that you are able to comfortably profit from all the new customers that you get.
After all, retaining customers is always considered cheaper than acquiring new ones. Creating sales goals that focus on steadily increasing CLV help you draw on your existing base.
Sales goals examples of increasing CLV in your organization can be something like – Increase the average CLV from $20k to $30k year on year.
Decrease CAC
Customer acquisition costs or CAC is the total amount of money that you spend in order to acquire a new customer. The lower your CAC, the more profit you make on every sale.
There are several overhead costs or expenses associated with acquiring new customers including calling costs, salaries of marketing and sales associates, costs of tools and software, and other costs – All of these form a part of your total CAC.
As mentioned above, your customer LTV should always be more than CAC for your company to stay in business.
Here’s a typical sales goal example for CAC – lower the average customer acquisition cost by 8% by the next quarter.
Reduce the overall cycle times
The average sales cycle time is defined by the time it takes for sales representatives to get a lead to close a deal successfully. The cycle length can vary according to your industry, the size of the deal, and your target audience as well.
In all of these cases, a shorter cycle is always considered the best. When your sales reps are able to close a deal faster, they get more time to focus on other important leads. On the other hand, a longer cycle length can increase customer acquisition costs and affect your customer lifetime value as well.
The sales cycle in your company can tell you more about your sales process than any other factor. The shorter the cycle, the more seamlessly your sales funnel is set up and the better your sales team is at targeting prospects.
An ideal sales goal for this can be to reduce the sales cycle by over 10% year on year.
Increase customer retention
Customer retention is about retaining your existing customer base. While getting new customers important, retaining the old ones is even more important in order to sustain customer loyalty and increase CLV.
An example would be to increase customer retention by 15% for a particular product or service.
MeetRecord can help you achieve your sales goals
Just knowing these sales goals examples is not enough, you need to carefully assess them in order to create sales goals that perfectly align with your requirements.
MeetRecord can help boost the efforts of your sales teams with features like meeting intelligence, in-depth data driven analytics, sales coaching, and more.
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