I love the first of the year — a fresh slate, a new opportunity to set new goals and do amazing new things in business!
But I know that a lot of people can feel overwhelmed when it comes to setting goals. Maybe you’re not sure what your goals should be. Or if you have a big goal in mind, you don’t have any idea how to reach it.
I find the best way to approach goals in that situation is to work backwards — that is, reverse engineer your goals so that they lead exactly where you want to go.
If you were going on a trip, you wouldn’t just start driving and hope you ended up where you wanted to go. No, you pick a destination and then map out the route to get from point A to point B — and that’s exactly how you set great goals for your business.
Why goal setting is so important
If you’ve never had a formal goal you might not think that goal setting is really that important. You’ve gotten this far, right?
When it comes down to it, women in general are less likely to get specific with their goals and attach a number to it. You might set a goal that you want to grow your business next year and pay yourself more. But it’s more useful to put numbers to it; say you want to grow your business revenue to $250,000 and give yourself a 20% raise, for example.
Setting goals increases your motivation, but only specific goals. Research has shown that giving people specific goals to achieve — instead of just telling them to do their best — increases motivation.
In addition, setting goals increases your success rate and your achievement. Hundreds of studies show that setting goals increases success rates.
That’s why it’s vital to not just set goals, but get specific and put numbers to those goals.
Start with the end in mind
Knowing that, let’s start with the end in mind and set your big goal for the year. For most business owners, that big goal is going to do with revenue and/or sales.
So put a number to it! Decide how much you want to earn next year. Dream big!
Do you need some help figuring out what that number might be? Ask yourself what kind of lifestyle you want to live. Think about your expenses and your nice-to-haves. Do you want to fill up an emergency fund? Buy a second home? Make sure your kids’ college funds are topped up? Retire your spouse?
You may not be able to accomplish all of that in one year, but thinking in those terms can help you pick a number.
Map your plan to that number
That number goal is your destination — your French chateau or beach vacation. Now you can plan your path to get there.
The first step is to ask yourself how many sales you need to get to that number. You can just divide your gross revenue goal by the price of your offer. If you have a lot of different offers or tend to have people buy multiple things, it will be more accurate to figure out your average customer value. (Divide your total revenue from last year by the total number of customers you served.)
Once you know how many sales you need to achieve your goal, you should ask yourself: How many leads do you need to get that many sales? This is how many people need to see the offer. You can calculate your own conversion rate by dividing your total number of email subscribers by your total number of sales — or you can go with the standard conversion rate, which is 1–3%.
So, for example, if you need 30 sales, you need approximately 3,000 people to see your offer.
To recap, here are the numbers you need to know:
Make a plan
Once you know those numbers, it’s much easier to make a plan. For instance, if you know you need 3,000 leads in order to make the sales you want, you can figure out how to get those leads. Maybe you know that you get 200 people to sign up for a webinar, on average. That means you need to run 15 webinars over the course of the year.
Hmmm… 15 webinars seem like a lot? Maybe you need a different plan of attack…
And so on.
It’s much easier to make a workable plan when you know exactly where you’re going. This is like the road trip part of our metaphor: Are you going to take the expressway all the way to your destination, or take some of the smaller roads to see the tourist attractions?
The point is, there are probably dozens of ways you could reach your big goals, but working backward from the numbers helps you choose the best route for you.
I’d love to hear what your big goals are! Share on social and tag me @MelanieDuncan77!