Before we begin: Click here to download the worksheet and watch a video walkthrough of this exercise.
In this post, I’m going to take you through a marketing goal setting process that you can use to double your leads and sales over the next 12 months. Christmas and New Year is a great time for reflection and planning, although this is an exercise you can do at any time of the year.
This is the exact process we’ve used each year in Exposure Ninja to double our revenue each year since the business started in 2012. We use elements of this exercise either consciously or subconsciously with all marketing campaigns.
The ‘Profit First’ Approach to Goal Setting
This goal setting exercise is unashamedly focused on increasing revenue and profit, as that is the most common goal of running a business. Of course, there are other goals that you will set for your company, such as contribution, impact, market share and even status/recognition, but all of that is funded by revenue and profit, so we’ll stick with those elements today.
Profit is the oxygen that your business will use to survive and thrive, so it’s important that the goals you set are profit generating. If there’s one thing I’ve learned about running a company, it’s that in order to survive and thrive, you have to have a focus on profit equal to the intensity of a baby presented with cake:
Business should think ‘profit first’ as a baby thinks ‘cake first’.
The Three Ways A Business Makes More Money
Before we begin, it’s important to remind ourselves that there are only three ways for any business to make more money:
Get more customers
Increase the number of sales to each customer
Increase the profit of each sale
The fastest results usually come from a combination of all three, as this leads to a compounding of results. If we can improve each one by 2X, that gives us a combined profit increase of 8X.
In this guide we are going to focus purely on option 1, getting more customers. It goes without saying that you should definitely focus on the other two, but the purpose of this guide is to allow you just to focus on new customer acquisition.
Step 1: Set your 12-month destination
Any successful goal setting plan begins with a clear view of the destination. We can then work back from this destination and figure out what the journey to get there looks like.
Imagine you are at this day, one year from now. How much profit do you want to be making per month? We like to use monthly profit as a target because it allows you to see fast improvement. If you wait until you have the full year’s numbers, the feedback loop isn’t fast enough to allow for you to make the sort of changes that lead to significant growth.
What’s your monthly profit target for this time next year?
For example, “my goal for this time next year is £50k profit per month”.
Obviously, the size of this profit goal will depend on your business. Whether your monthly profit goal is £5k or £5M, it should do two things:
Your monthly profit goal should excite you. You’ll need to feel motivated and excited by the destination in order to put the required work in
Your monthly profit goal should be believable to you. If you don’t believe you can achieve it, you’ll subconsciously disregard the plan you build to get there (“I knew I wasn’t going to hit that target anyway”).
Working out target revenue
Next, we need to calculate how much revenue is required to hit this profit target.
Do you know your profit margin? If you do, you can use this to calculate your total required revenue.
E.g. “My profit margin is 33%. So the total revenue required to hit my £50k per month profit target is £150k/month”
If you don’t know your profit margin, then by gosh go and find it out.
Step 2: Identify how many customers you need under current conditions to hit this goal
Hitting a profit target is tricky without knowing what this means in real terms: i.e. how many customers you need to be getting to achieve it.
To know this, we first need to understand your average 12-Month Customer Value (12MCV). In my opinion, lifetime customer value is a bullshit term for goal setting because we can’t afford to wait a lifetime to find out how much our customers are worth or to collect the money we spent attracting them. Instead, let’s simply look at our customers’ value over 12 months, and anything we get longer than that is a happy bonus.
Finding your 12MCV
To calculate your 12-Month Customer Value:
What’s your average order size?
How many orders, on average, does each customer make per year?
Multiply these to give your 12MCV
For example: “My average order size is £500 and, on average, our customers buy from us twice per year. Therefore, our 12-Month Customer Value is £500 x 2 = £1,000
Remember: You can download the accompanying worksheet to help you with this exercise.
Finding your target monthly customers
To calculate how many customers you need in order to hit our revenue and profit goal, you simply divide your monthly revenue target by your 12MCV.
For example, imagine that your monthly revenue target is £150k and your average 12-Month Customer Value is £1000. You need 150 of these customers, per month, to hit your monthly revenue target. That’s 5 per day.
You know, therefore, that if you’re hitting 5 new customers per day, you will hit your profit goal of £50k/month. That’s the number that you need to pin up on your wall and work each day to hit.
Now we know your target revenue and customer numbers, it’s time to understand what your website traffic numbers need to be to get you there.
Step 3: Identify your visitor-customer conversion rate
Important: this is not necessarily the same as your website conversion rate, shown in Google Analytics. Instead, we are looking to track how many website visitors turn into customers (not just Analytics conversions).
How many visitors came to your site in the last 30 days?____ (e.g. 2000)
How many sales (not the amount of money collected or the number of leads) did you make from these website visitors in the last 30 days?___ (e.g. 50)
To calculate your conversion rate, you divide the number of leads and sales by the number of visitors.
For example, “My website had 2,000 visitors over the last 30 days. 50 of these became customers, so my conversion rate is 50 / 2000 = 0.25
Multiply this by 100 to give the percentage conversion rate: 0.025 x 100 = 2.5%
What’s your website conversion rate? ______%
Caution: Additional Freebie For The Hustlers!
We’re going to go slightly off-topic for a couple paragraphs, just because I can’t mention conversion rates without giving you some actionable changes to make to improve yours.
Increasing your conversion rate is as powerful as adding more traffic. Here are some quick tips to do this:
If you don’t have a clear call to action on every single page, adding one in can increase your site-wide conversion rate approx 20%
If you sell services, consider adding a ‘low barrier to entry’ CTA like a free consultation. Explain the benefits of the consultation and tell the visitor what to do to claim it, and in some cases, your conversion rates can double or more.
If you work with people locally, is it immediately obvious to website visitors where you are based? If your location details are tucked in the footer, be aware that fewer than 2% of people ever get to the footer
If you sell products, add extra product images or (better still) video. Do you explain your products in enough detail that someone who can’t see the pictures would still buy? Do you have reviews on your product page? Is your buy button above the fold and coloured so that it stands out from every other element on the page? Do you make it easy for people to checkout without having to register an account? Is your shopping basket clearly visible, and is it obvious where visitors should click after they’ve added a product to it? Do you accept multiple payment processors, including PayPal?
Which of these things can you implement to increase your current conversion rate?
Step 4: Identify your target visitor numbers
Now that you know your target customer numbers and your conversion rate, you can calculate how many visitors you need to bring to your website to hit your revenue & profit goal.
To find out how many daily website visitors you need to hit your goal, simply divide your target daily sales (from step 2) by your conversion rate (step 3) and multiply by 100:
Target daily sales/ conversion rate X 100 = target daily visitors
For example, ” My daily target is 5 sales and my conversion rate is 2.5%. 5 divided by 2.5 is 2, multiplied by 100 = 200. So I need 200 visitors per day to my website to hit my profit goal.
This shows that if you drive 200 visitors to your site per day, you will hit your profit target.
Again, the downloadable worksheet will help you do these calculations if you get stuck
Step 5: Pick your traffic channels
Now we just need to add and increase the traffic channels that will bring in that number of visitors. There are a huge number of traffic channels available and it can appear overwhelming, but like a cheetah attacking a flock of gazelles, you just need to pick off one at a time and focus intently on them.
This cheetah will have more success picking one marketing channel at a time, optimising and moving to the next.
Some traffic channels, like SEO for example, take a long time to build but can bring in a huge number of visitors. Some channels, Facebook and Google adverts, for example, can be relatively quick to get started with but can be expensive to bring large traffic volumes in from.
We’ll look at how to pick off the right gazelle for you below, but first here’s a list of the most common traffic channels:
Long-term channels (these tend to be much cheaper per visitor):
SEO
Organic social media
PR and D-PR
Blogging and guest blogging
YouTube
Amazon
Short-term channels (these tend to be much faster to bring in visitors):
Facebook ads
Google ads
Shopping ads
Twitter ads
LinkedIn ads
YouTube ads
Note that labelling these channels ‘short term’ is not to suggest that they shouldn’t be permanent fixtures of your marketing campaign, but to say that the results, whilst more expensive, will be usually be visible in a much shorter time frame.
Here’s something we’ve noticed after studying thousands of successful and unsuccessful websites
Successful websites have multiple traffic sources (usually 5 or 6), but there is usually one or two which are more successful than the others combined.
For many, ranking well on Google is a ‘game changer’, because this is visibility in front of a target audience searching eagerly for what you provide. For others, scaling Facebook ads or a having strong YouTube presence will be the thing that takes them to the next level.
The truth is that without testing each of these channels for your business, you won’t know which ones are going to contribute the bulk of your traffic.
Which traffic channels are you committed to testing over the next 12 months?
Which traffic channels should you prioritise?
So, the obvious question to ask is, ‘Which marketing channels should I start with first?’
Your priorities will depend on your timelines and ambition:
How long can you wait to get more leads and sales? If you need traffic & sales YESTERDAY, then you’ll want to have some paid short-term traffic in your plan early on.
Are you looking for the highest volume of leads/sales possible? Then SEO will be an important channel to begin cultivating as soon as possible, but be aware that it might take a matter of months to see your leads and sales increase. You’ll need to make sure that you give the long term channels like SEO or Social Media enough time to start bringing results. At the time, it can feel fairly thankless putting in all that time writing awesome posts and building links without immediate payback, for example. Neither Rome nor rankings were built in a day, though. And both, once built, are awesome.
It’s important to note that paid channels will give you an indication as to their potential fairly quickly, but even so, patience is required to optimise your ads and keywords to get the best results possible.
Some other traffic channel considerations
With a little good clean espionage, you can begin to piece together a picture of what your competitors are doing, and this too will help you prioritise your traffic channels.
Which channels are your competitors using successfully? Are they doing a good job of them?? If they’re doing a rubbish job and it’s working well for them, then you probably want to give that channel a go. If they’re doing a really good job and they’re struggling, you’ll probably want to avoid it.
If no one in your market is trying a channel, then usually:
It’s too much work and they can’t be bothered. YouTube, for example, is beyond what most businesses can be bothered to do because it involves video and video is messy.
It’s not even on their radar. For many B2B companies, the thought of someone suggesting Facebook as a marketing channel is about as unlikely as it gets. That doesn’t mean it wouldn’t work for them, it just means they’re not thinking about it
It’s something they’ve tested and they couldn’t get it to work because they suck. For example, they tried Google ads, but they sent the traffic to a terrible page so it didn’t work.
It’s something they’ve tested and they couldn’t get it to work because the channel is unsuitable. This is the least likely of all. Most people don’t stick with marketing channels long enough
Time to prioritise…
Which channels will you target, in priority order?
Beside each channel, write a month over the next year which you will commit to beginning to test it. We recommend adding 1-2 new traffic channels per month to test.
Step 5: Decide NOW how to proceed
It’s important never to leave the site of a goal setting session without committing to at least one action to move towards your goal. It’s all too easy for these things to get swept aside for the ‘urgent’ (but long-term irrelevant) stuff, never to return. I have some suggestions for things to try which can get you on your way quickly:
The first thing you should do – whatever your market or size – is to request a free website and marketing review from us at Exposure Ninja, if you haven’t already. This in-depth checkup is carried out by a real life Ninja and will give you a detailed overview of where we think your lowest-hanging fruit lies. You’ll be invited to tell us your 12-month goal, and we’ll suggest the strategies you can use to get there. This service is offered totally free, and we put significant resources behind it to make it available for anyone who needs it. People on our Facebook page regularly tell us that they expected very little from their review but were blown away at the detail.
Once you have done this, your next steps will likely depend on your budget. If you have the budget to spend on your marketing, then you’ll probably look for a company to handle some of the more specialist elements of the marketing for you, or even all of it. Find someone you trust and who talks to you honestly. If you’re interested in working with us, request the free marketing review first, and we’ll let you know during this if we think that we’d be a good fit.
MarketingU is our digital marketing training platform. Business owners and marketing managers can learn how to generate more traffic and sales online through the video tutorials
If you have a small budget and are taking the DIY approach to your marketing, then it’s worth finding some good digital marketing training to make sure that you’re putting your energy into the right places.
We run MarketingU, which is designed for business owners and marketing staff to learn how to prioritise and run their own digital marketing campaign for their company. The training videos show you step-by-step how to implement each traffic channel so you can copy what’s shown on the screen to run your own Ninja campaign.
Whatever you choose to do, write your next steps and commit to them by signing your name.
Here’s to your business’s best year yet!
I hope you’ve found this exercise useful, and that the next 12 months sees you hit your visitor, sales, revenue and profit targets! Don’t forget to come back next year and tell us how you got on!
The post [Marketing Goal Setting Exercise] How To Double Your Business In The Next 12 Months appeared first on Exposure Ninja.