New Year, New You: Setting Sales Rep Goals
It’s January 2022, the first month where we can finally start fresh from last year’s approach. When things don’t go as planned, we look back at the previous year’s events to see what we can do in the coming year. While January may not provide us with a clean slate, we can still make good personal and professional resolutions.
In fact, according to a Mckinsey study, B2B decision-makers overwhelmingly prefer remote human interactions or self-serve sales processes over in-person ones.
The lockdowns had the unexpected benefit of forcing reps to prioritize actions that prospects preferred anyway.
Remote Selling Culture and its impact on the manager/rep relationship
Sales reps and sales managers have a delicate relationship. They need each other to survive, but can often have a tenuous relationship.
The heightened stress of the pandemic, the lack of visibility, and inability to meet in person certainly didn’t help things.
But forward-thinking businesses know that remote sales teams are the future — as is remote coaching and visibility.
It’s more important than ever for sales managers and reps to have clear expectations, open communication, and frequent touchpoints. It’s not enough to go over your forecasts by the water cooler. You need concrete systems and processes to see rep activity and help deals find their way to the finish line.
How do I set myself up for success?
Without insight into what your team is actually doing and how effective those efforts are, it is impossible to create a goal that isn’t arbitrary. Check out our upcoming webinar to learn more about the data sources you need access to, the metrics you should be tracking, and the different ways you can leverage those insights.
How settings goals for the post-pandemic world may be different
We’re still on the new frontier when it comes to the post-pandemic world. Many would even argue that we’re not out of the pandemic yet.
Therefore, it’s tough to make iron-clad predictions when it comes to goal-setting in this era.
While our 2022 goals may look similar to our pre-pandemic goals, how we achieve them will look totally different.
For example, you may still retain traditional KPIs of appointments, demos, and closed-won deals. But you’ll likely have to radically change the way you arrive at those milestones.
Consider this example. It’s no secret that the pandemic has normalized video conferencing. Before 2020, hardly anybody even knew what Zoom was. Now, it’s the standard — and that fact is proven out by data.
Again, from the McKinsey study, prospects are 41% more likely to prefer a video meeting and 52% less likely to prefer a traditional or in-person sales appointment. Furthermore, in almost all cases, prospects prefer a video chat over a phone call.
Is your team well-versed enough in selling over video to meet your appointment goals?
And in case you thought in-person meetings were essential for closing high-ticket deals, 32% of prospects are willing to spend up to $500k without ever shaking your hand.
So while your goal format in 2022 may stay the same, the manner in which you achieve those goals will likely need a complete overhaul.
Still in the dark about what goals to set? Let’s start with the basics.
What are Sales Goals?
Before we dive into some of the most common sales goals examples, let’s talk about what sales goals are.
Sales goals, in the simplest terms, are data-driven objectives you want your sales team to hit. They’re often focused on specific key performance indicators (closed deals, demos booked, leads contacted, and so on).
Common sales goals generally involve increasing these numbers. The closing 25% more deals, increasing customer retention by 15% or reaching out to 10% more of your leads.
Setting Sales Rep Goals the Smart Way
Goals are most effective when they are specific, measurable, attainable, relevant, and time-based. But how do you create SMART goals for your team and avoid creating something arbitrary?
You have to start by getting a complete insight into your sales activity and buyer engagements. Without that, there is no way for you to see what your team’s actually doing or how effective their efforts are.
If you find yourself wondering why a sales professional would need a list of goals about selling (“isn’t selling their job? Shouldn’t they be aiming for these things already?”), understand that goals provide tangible signs of progress.
Yes, your team should always have the goal of selling more of your product or service. But, goals show us if we’re actually gaining traction.
Goals help us work smarter, not harder. Moreover, they provide opportunities for training and problem-solving.
Why Big Goals Often Lead to Failure
The key to successfully implementing sales goals involves setting your objectives in stages. Individual goals, team goals, and multi-stage goals increase the chances of success.
Too often, we create one giant goal or resolution. Goals like “sell a million dollars worth of product” or “lose 100 pounds.” We tell ourselves it’s noble to aim high and “go big or go home,” but the reality is that these kinds of goals fail.
It’s not because we’re not committed to achieving them – but that the road to achieving them is too long and arduous. As a result, it becomes easy to give up at the first sign of adversity.
Big goals are great. But an effective sales plan objective should be able to give yourself and your team a real chance of succeeding.
To do that, we need to break those goals down into stages. Incremental progress makes the road feel less challenging and psychologically manageable.
Think about it – generating a million dollars in sales in a year may seem daunting. But breaking it down to generating $85,000 a month or $20,000 per week feels attainable. Breaking down sales goals and objectives minimizes the feeling of overwhelm.
Beyond that, it gives us goalposts to aim for so we stay focused. It’s easy to lose sight of a goal six months to a year away. You’re much more likely to stay focused with one that spans a shorter time frame, like a quarter (or even a month).
The key takeaway here? Don’t be afraid to have big goals. Set yourself or your team up for success by breaking those big goals down into smaller, more achievable steps. It helps you see the importance of setting sales objectives because, in the end, you are achieving your desired outcome.
How to Set Sales Goals
All too often, we create our sales goals solely by looking at last year’s (or last quarter’s) numbers and upping them slightly. This is not the best way to go about setting goals (especially in light of our post-pandemic economy). This method doesn’t factor in the state of your business (and the new world your business operates in) or your sales team.
Instead, we suggest using this list of questions to help you determine what your goals should be, and if they’re what you need to be focusing on.
What do I hope to achieve?
The first and most important question to ask is what you hope to achieve in the upcoming year, or quarter, or whatever period you’re planning for. If you don’t know what success looks like – in detail – you can’t possibly create a roadmap to get there.
Where, How, When?
We’ve lumped all these questions into one heading because they all go together in the planning phase. Beyond knowing what you want to achieve, you need to examine the strategies of how you will hit those goals.
This means thinking about the big picture of where you focus to hit your targets. How will you execute strategies to achieve success, and when that success should happen.
Remember what we discussed at the top of this post. The strategies that worked pre-pandemic (traditional sales meetings) will likely not fly today.
It’s important to know who you’ll need to achieve goals. If you’re setting individual goals, will you need help from other people to get to the finish line? This is where you figure that out.
If you’re making plans for a team, who will be involved at each stage of the process? Planning prevents poor execution. Knowing who you need to help you achieve success at each stage of the planning process, reduces the issues on the road to success.
SEE ALSO: THE IMPORTANCE OF ALIGNING IT AND SALES ENABLEMENT GOALS
Identifying Limitation and Obstacles
Next, it’s important to think about any limitations or obstacles you may have to overcome to reach your goal.
Is your company lacking a piece of tech that could help you improve revenue? Is there some competitor or market condition creating an obstacle that you’ll either have to go over or around?
This is the time to play Negative Nancy and think about worst-case scenarios and potential pain points on the way to your goal.
You’ll invariably encounter issues you didn’t expect along the way (that’s just how life works).
But understanding the big issues you may encounter on the way to your goals in the planning process can help you find solutions. Or maybe you can decide that the goal isn’t realistic given the roadblocks in front of you.
What Does Success Look Like? What Happens if You Fail?
You’d be amazed at the number of people and companies who set goals with no idea of what successfully hitting their marks would look like. Meanwhile, there are even more who never take the time to consider what happens if they come up short.
It’s critical to take the time to define success so you’ll know when you achieve it. Setting sales objectives helps you define the success that you want your company to achieve.
What key performance indicators will you need to track? What will show you you’re on the right path? You need to know the destination before you start the journey.
By the same sentiment, it’s important to understand what the stakes are if you come up short. This is how to meet targets at a certain roadblock. They are the things that you should look out for with your team.
Will missing a revenue goal cause you to cut staff? Will it cause you to scale back production? Will it jeopardize your business as a whole?
Understanding the parameters of success and failure is important. Don’t skip this step!
Sales Goals Examples
By following the steps above, you’ll be able to create your own unique sales goals for the coming year. But, sometimes it’s not necessary to reinvent the wheel. With that in mind, here are some common sales goals you could execute for the coming 12 months to help take your business to the next level.
1. Increase Monthly or Yearly Revenue
We start with the most obvious goal – revenue growth.
Every company wants to make more money and revenue is an easy metric to track. Keeping with the points made in the previous section, it’s best if you set monthly, quarterly, and yearly revenue goals.
Simply setting a yearly goal doesn’t create any real sense of urgency in those first few months. So the quantifiable goals examples work in a way you’re better served by breaking things down into chunks.
This way, you can see if you’re on pace or not. Moreover, you can get a glimpse if everyone has an objective that looms in the near future, rather than a year away.
Beyond that, you can also set revenue goals for the team or company as a whole. You can also add individual sales revenue goals for each member of your team.
Personalizing the stakes in this way often leads to better buy in from your sales department. Everyone knows now that they’re part of the bigger picture and will be less likely to want to let their coworkers down.
You can break this down even further if it feels too overwhelming. Come up with a roadmap of how everyone might meet these goals. You can start by highlighting how much revenue they should try to generate per week or some other period.
Beyond just breaking down the numbers, this can also help your team understand how they might actually achieve their goal.
2. Increase Profit Margin or Units Sold
Increasing your number of units sold per specified period (or the profit margin on each unit sold) can help with the revenue goals mentioned in the previous point.
Typically, companies aim for a 10% increase in this category for any given year. You may want to be more (or less) aggressive depending on trends in your industry. But from our standpoint, 10% seems to be a pretty reasonable number most years.
The obvious goal here is that selling more units or increasing the profit margin on each unit sold increases revenue. Beyond that, looking at units sold can show you which of your products are popular so you can focus on them.
The increasing profit margin allows you to not only generate more income but also help you realize how your pricing strategy works. If you can sell more units without discounts, it might be time to consider a price increase.
3. Reduce Customer Churn
In sales, we spend an inordinate amount of time chasing new leads. New customers and new markets are the shiny toys we all covet.
But, chasing down new business costs money. You will need more money in generating leads, in marketing, and in hours spent trying to cultivate the leads so they become customers.
Far too often we forget about our current and previous customers as we chase after new business. This is a mistake.
It costs less money overall to sell to your existing customer base. They already have a relationship with you, they’ve already purchased a product or service, so you don’t have to spend a lot of time or money selling them on the idea of doing more business with you.
Set a goal for your team to generate a certain amount of revenue from existing customers. Set goals for upsells or cross-sells.
Beyond that, Software as a Service (SAAS) sales teams are often forced to contend with customer churn, wherein customers will leave for another company. This is even more dangerous for your business.
By reducing churn and making it a priority (alongside potentially selling more to the customers you already have), you can increase revenue and grow your business while saving money by not having to constantly be chasing new business.
4. Increase Customer Lifetime Value
Building on the last metric, you can also set increasing the lifetime value of your customers as a priority and goal.
Again, you already have an established relationship with these customers. It’s easier to upsell them more products than it is to convert a brand new lead into a paying customer.
To achieve this goal, you’ll need to figure out the average lifetime value of your customers. Next, you will then spend time figuring out what products would go well with things they’ve already purchased from you.
This will require your sales team to do some research and then spend some time reconnecting with those customers. This may seem extra, but the rewards are worth the effort.
5. Gain More Qualified Leads
We’ve talked a lot about your existing customers, who are often an untapped source of potential revenue. But, you should always have an eye toward acquiring new business as well.
Keeping your pipeline filled with new leads is vital for any business’s continued success. With this in mind, why not set a goal wherein your team will try to qualify a percentage of new leads every month?
Your sales team should already be on the prowl for new customers, so all you’ll really need to do is start tracking how many new leads enter the pipeline each month.
Spend time finding qualified prospects. You don’t want junk leads here, because that defeats the purpose of doing this in the first place. Make it a daily focus for your sales team – give them an hour or two per day to spend just tracking down new business. Create parameters for what kinds of leads you’re hoping to find.
The time and energy investment are worth it. Your existing customers are great, but new leads are the lifeblood of any business looking to reach the next level.
Key Strategies for 2022 to help sellers reach their goals
As stated above, the format of your goals will likely stay the same. The means by which you achieve them — your processes, systems, and strategies — are what will need to change.
Nobody knows for sure what 2022 will hold. Another resurgence of the virus? A doubling down into remote work or a reset of office culture?
Two things we do know, thanks to McKinsey’s data, is that video and self-service selling strategies have exploded in popularity — and show no signs of stopping.
So the simple question is: how will your team leverage those strategies to achieve your goals in 2022?
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The beauty of goal-setting is that you can literally turn anything you’re trying to achieve into a goal with a little creative thinking and a way to track it.
Sales pros are goal-driven employees with highly competitive natures (at least the successful ones are), so odds are they’re already setting personal goals of their own.
Adding team goals and specific goals for your individual sales professionals can only serve to help them be more successful by allowing them to focus on what matters most to the company and providing a roadmap to reach their objectives.
Whether you’re creating custom sales goals or relying on some of the set sales goals examples we’ve shared here, it’s important to remember that you need to set realistic, achievable goals.
It’s great to dream big, everyone wants to achieve them too. Yet, creating goals that are unattainable or unrealistic defeats the purpose of doing any of this.
Goals shouldn’t be impossible. To make them happen, select things that will require effort, dedication, and creativity. Make sure that they are still in line with your real-world numbers and you’ll find your team will go above and beyond to find success.
And remember, sometimes you’ll come up short. It’s entirely possible to miss the mark but still find success. Don’t make goal-setting a zero-sum game where any effort that falls short is considered a failure. Sometimes, incremental improvement over time can lead to even bigger wins.
Now, get out there and set some goals for yourself and your team. This could be your biggest year ever.
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