Table of Contents Hide
- What are Sales Goals?
- What are SMART Sales Goals?
- Different Types of Sales Goals
- How to Set Sales Goals
- Examples of Sales Goals
- Goals for Sales Managers Examples
- Examples of Sales Rep Goals
- #1. Invest in ongoing sales training.
- #2. Follow the lead of high-performing team members.
- #3. Increase your prospecting efforts.
- #4. Contact further prospects.
- #5. Plan a certain number of qualified sales conversations.
- #6. Plan a certain amount of discovery conversations.
- #7. Shorten the time it takes to convert a lead into a customer.
- #8. Increase the closing ratio.
- #9. Achieve a significant income figure.
- How to Track Sales Objectives
Growth in top-line sales metrics will likely be modest without direction and guidance in the form of the correct sales goal examples to employ as a sales organization. As a result, there can be no bottom-line results.
Setting SMART sales goals is difficult when you are just starting out. You must identify product/market fit, perfect your lead acquisition strategy, and create a qualified sales funnel to convert those prospects into leads and, eventually, customers.
How can you set the most effective sales goals? We have all of the information you need to get started.
What are Sales Goals?
Sales goals are specific aims intended to help individual salespeople and sales teams improve their performance. When done correctly, they can remedy frequent faults and poorly executed methods while also providing a road to increasing good sales results.
Creating a sales goal that drives your team, on the other hand, is difficult. You can’t just say, “Let’s sell more items this quarter” or “Let’s make more money this quarter.” To achieve better results, you must define goals that are appropriate for your current circumstances and provide a roadmap to your team.
In other words, you must adhere to the SMART formula.
What are SMART Sales Goals?
Sales managers and C-suite executives develop SMART sales goals to drive sales teams and departments. These goals, which use the SMART acronym, use five criteria — Specific, Measurable, Achievable, Realistic, and Time-Based — to provide a clear target for employees to work toward collectively.
Here’s how to use the SMART goal-setting method:
- Specific: Don’t just state you want to enhance your consumer base or sales revenue; describe how you intend to do so. For example, you may say: We’re planning to use consultative sales to raise the revenue of our primary product.
- Measurable: Determine the specific number you want to achieve (e.g., raise revenue by $1 million) so you can benchmark your performance, and have your tools and software set up to track your progress toward the goal (i.e. new deals closed, repeat purchases, and customer churn).
- Achievable: While stretch goals are a terrific way to push yourself and your staff, you don’t want to establish unattainable goals. If you only made $700,000 in revenue last year, you shouldn’t set a goal of $5 million this year. Instead, define a goal that you and your team know is attainable.
- Realistic: Goals must be tailored to your present situation and sales plan. If your organization has never done social media selling and your customers avoid Instagram, you should not establish a goal of generating 100 new clients using Instagram selling. Context is important in all forms of goals.
- Time-Based: When you set sales goals, you must ensure that there is a finish line. Otherwise, you risk slogging along for years with no change or growth. Quarterly and yearly sales goals are the simplest to define because they easily correspond to fiscal start and end dates.
Different Types of Sales Goals
Sales goals are divided into layers, and each influences the ones below it. Let us start with the highest,
#1. Annual sales goals
Annual sales goals are what you wish to achieve for the entire year. It could be the income you want the company to generate in a year, the number of new clients you want to recruit, or something else. Looking at the previous year’s performance is one of the finest methods to set one. If you made a 20% profit last year, you might consider increasing it by 10% this year. Other elements, though, come into play. For example, a competitor may have entered your arena, making it impossible for you to meet the previous year’s goals.
#2. Team Sales goals
An annual goal is difficult to track, which is why your sales staff should focus on a monthly or weekly goal. Team goals are monthly or quarterly goals for the entire sales team. That is, for monthly team goals, the annual goal is divided by 12 and for quarterly goals, it is split by 4. However, what is the point of having a team goal when you can assign goals to reps individually? Because even if reps are unable to meet their individual goals, they may contribute to the broader team goal and remain engaged.
#3. Individual sales goals
Individual sales goals, as the name implies, are set for each rep. While setting these goals, keep in mind that the success rates of sales agents selling to different industries or markets will vary, so keep that in mind when assigning goals. A sales representative who sells to major corporations can generate more money for the company than one who sells to small firms.
Looking at historical data, customer profiles, and your market share can help you develop smart sales goals. They will work together to assist you to give difficult goals to reps.
#4. Individual activity goals
There are numerous aspects of sales that salespeople may influence. Individual sales goals may be jeopardized if reps depart, consumers change their purchasing habits, or they turn to competitors. You have an activity goal to assist reps to achieve control. You may optimize sales emails by quantifying them, such as the number of emails sent or phone conversations made. They can even guide reps and keep them on target.
#5. Ambitious goals
Sales teams can outperform their goals, which can benefit your company. However, you should not exaggerate their goal since it will not be realistic, and if they achieve it, it will no longer be tough. Stretch goals are available to assist you, and they provide additional benefits to representatives who exceed their aims.
How to Set Sales Goals
Anyone on the sales team, as well as upper-level and c-suite management, can set sales goals. They occasionally involve the financial team. Sales managers are frequently in charge of developing team-wide goals, and individual sales representatives are encouraged to develop personal sales targets as well.
Creating sales goals for yourself or your team follows the same goal-setting approach.
Step #1. Identify Potential Growth Areas
The first step in developing new SMART sales goals is to carefully examine your current sales data and KPIs to identify your greatest strengths and opportunities for improvement.
To the best of your ability, try to identify the source of any problems you notice. The better you can pinpoint where deals are going wrong, the more effective your goals will be.
Step #2. Decide what is most important… and realistic
Almost all sales targets are worthwhile, provided they are written in the SMART framework. Most sales teams desire to continuously achieve new heights of success in order to help their company develop. And it would be ideal if every sales team had enough time to pursue every target they set for themselves.
Unfortunately, anyone who works in sales understands that this is not the case. There are only so many resources — including time — available to develop and achieve goals.
With this in mind, it is critical that sales representatives and sales teams properly prioritize their possible targets. Determine which will have the greatest impact and/or produce the quickest outcomes.
If you’re just getting started with goal-setting, focus on cash flow, transparency, and productivity. These are all excellent places to begin.
You’ll also need to assess how well your current resources are matched to achieving specific goals. If you set a target of generating more leads, for example, you may need to hire new or more business development representatives (BDRs) to free up time for more senior representatives to finalize agreements. Not every organization, especially in its early stages, has the money or cash flow to commit to something like that.
Step #3. Select a goal and write it in the SMART format.
It’s time to lay out the specifics of your new sales objective after you’ve chosen your highest priorities and narrowed them down to only those that are attainable given the resources available to you.
Remember to strictly adhere to the SMART framework. It does take some practice, so keep track of your progress. You’ll get better at it as you use it more.
It should be noted that activity goals are often easier to work toward and attain than outcome-based goals. Consider the following two SMART sales goals examples:
- Activity-based: Sales representatives will close 40% of the prospects who hear their sales presentations.
- Outcome-based: The sales staff will increase revenue by 50% over the previous year.
Do you detect a distinction between these two? The sales reps’ action is obvious in the activity-based goal: sales proposals that close deals. They know exactly what they need to work on to reach the deadline.
However, the revenue, the outcome-based goal may be modified by a number of circumstances. An outcome-based goal gives salespeople significantly less control than an activity-based goal.
To be clear, both forms of objectives are absolutely legitimate and extensively used. Every business wants to improve its revenue, and it’s logical (and good practice) to create targets to do so. There’s nothing wrong with setting goals based on outcomes. It’s just something to keep in mind if you’re new to goal-setting and anxious to see results.
Step #4. Educate and Motivate Your Sales Team
Even the best-written SMART goals will be rendered ineffective if your team is not informed and inspired about how to achieve them.
If you’re setting a team-wide sales objective, make sure to allow enough time to convey it to your sales reps. You’ll also want to make sure they have access to all of the training, tools, and other resources they’ll need to achieve their objectives.
Finally, consider if your present remuneration or commission structure is correctly matched with your current SMART goals. If your SMART goals are tied to lead generation, for example, you could offer a little bonus or an increase in commission to salespeople who exceed their lead goal.
That’s not to argue you should give out bonuses based on every performance metric. You are not required to make any changes to your compensation plan. However, if your staff is constantly hitting their targets, you should assess whether you’re adequately compensating them.
Of course, motivation should be intrinsic as well as external. To properly drive sales reps to exceed high expectations, sales managers must foster an environment of trust, accountability, and gratitude.
Step #5. Track and Monitor Your Progress
How carefully stakeholders monitor the achievement of successful sales targets is the foundation of their success.
If possible, include in your SMART objective the intervals at which you want to collect data on your goal progress. If this is a collaborative goal, make sure there are clear expectations about how and when to gather and store goal-related data.
Examples of Sales Goals
There is no limit to the amount of sales objectives that a team can set. Follow the steps in this article to identify the ones that are most relevant to your team.
Here are a few samples to get you started. Make sure to update or adjust the numerical details (such as the timeline and expected outcome) to meet the demands of your team.
- Increase monthly revenue by 10% in a year.
- Increase annual income by 10% in a year.
- In six months, reduce customer churn below 1%.
- Increase quarterly unit sales by 20%.
- In a year, increase customer lifetime value (LTV) by 12%.
- In six months, reduce customer acquisition costs (CAC) by 5%.
- In six months, increase the number of marketing qualified leads (MQL) by 15%.
- In three months, increase the number of sales qualified leads (SQL) by 15%.
- In six months, you can cut the sales cycle by 8%.
- Increase the win rate by 8% by the end of the year and the number of hours spent on sales rep mentoring by 15% in six months.
- In three months, increase the number of sales training opportunities by 10%.
- Reduce rep turnover by 8% in a year.
- In three months, increase the number of leads generated by 20%.
- Increase the number of booked sales demos by 15% in six months.
Goals for Sales Managers Examples
#1. Lower customer churn.
As a sales manager, you are in charge of the sales department of your organization. Some of your primary objectives should be to increase customer retention and decrease customer churn.
The pace at which customers discontinue utilizing your product or service is referred to as customer churn. So, the higher your churn rate, the more probable your company has areas for improvement in order to delight customers — and there are many different measures managers may take to reach that aim, the most important of which is to only sell to best-fit prospects.
#2. Increase the average transaction size.
The only thing better than closing a deal is closing a big one. Managers who set goals to enhance average transaction size position their sales staff to develop profitable connections with high-profile, target customers.
Bundling more products or services into a contract or rewarding client loyalty with exclusive prices are two ways to enhance deal size.
#3. Increase the lifetime value of your customers.
Customer lifetime value is a business metric that evaluates the overall revenue that a customer can earn over time.
Managers that establish this type of target can improve the performance of their sales team’s strategy and build longer-lasting client connections, extending the business value to customers.
#4. Increase the average win rate.
The average win rate is the percentage of last-stage prospects who become customers. As a sales manager, you want to develop a good plan and coach your team members on how to close more deals with their clients.
#5. Lower the expense of acquiring new customers.
As a manager, you want to keep costs as low as possible while yet allowing your team to achieve. A sales manager could collaborate with reps to better source qualified leads based on the types of leads that have shown to be the most successful.
Examples of Sales Rep Goals
#1. Invest in ongoing sales training.
Investing in your sales education is one of the finest ways to advance as a rep. Increasing your product expertise, negotiating skills, or commercial acumen.
#2. Follow the lead of high-performing team members.
You can run this target by your sales manager to see who they believe is the greatest fit. However, following someone who routinely outperforms their sales stats could be exactly what you need to help you meet your sales targets and improve your talents.
#3. Increase your prospecting efforts.
If yyour organization is looking to expand into new markets, why not assist them by prospecting a number of potential clients per target industry? You’ll not only wow your boss, but you’ll also be helping the company break new ground, which will give you a sense of success and fulfillment.
#4. Contact further prospects.
Some sales representatives struggle to keep in touch with new customers. If this is you, make it a goal to contact each of your new clients by phone or email at least once a month, then once every two weeks to maintain ties.
#5. Plan a certain number of qualified sales conversations.
Are you fed up with wasting time on prospects that aren’t interested? Set a target for yourself to arrange qualifying sales conversations with prospects who are more interested in or value your offering. After all, you want to devote your time and energy to individuals who are actively seeking a solution.
#6. Plan a certain amount of discovery conversations.
It’s time to set a goal for yourself if you’re having problems discovering prospects and scheduling discovery calls. The more you do them, the better you’ll grow at matching client goals and needs to your service.
#7. Shorten the time it takes to convert a lead into a customer.
Setting a goal to enhance your lead conversion rate might possibly save you time and money. Shortening the conversion cycle is another term for this.
#8. Increase the closing ratio.
Perhaps you’re a sales representative who contacts a lot of leads but doesn’t close many of them. The closing rate is one of the most significant metrics to track since it identifies the most successful sales team techniques. You should gradually increase that number. If necessary, you should seek extra training and keep yourself accountable for your percentages.
#9. Achieve a significant income figure.
Giving your team a monthly or quarterly income goal can encourage sales staff to work toward a more reachable objective. For added motivation, this form of goal setting can be complemented by incentives such as bonuses or even more PTO.
How to Track Sales Objectives
A sales dashboard is the most effective approach to track sales targets. Many sales software systems have dashboard and reporting capabilities. Your sales dashboard should, at a minimum, present all important sales data. Some, on the other hand, are capable of more than just displaying metrics and can actually combine and analyze data to indicate progress toward your goals.
If you don’t have a sales dashboard platform and won’t be able to get one soon, it’s up to you to develop a clear and organized method — as well as the expectations that go with it — for gathering, maintaining, synthesizing, and evaluating sales data.
Tracking your progress toward sales targets, whether you utilize technology or not, is one of the most crucial components of the process – even more important than meeting or exceeding them. Sales teams and reps will struggle to know how to improve or what to continue if activities and results connected to the goal are not carefully monitored.
Setting effective sales goals for your team is difficult, as any sales boss worth their salt will tell you. It involves careful preparation, and you must strike a delicate balance between the company’s needs and the capacity of your sales reps. However, by being “SMART” about it, you can pinpoint the correct goals for your firm. When combined with proper coaching and training, this can make or break your performance and long-term success.
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