In the first installment of our 90-day Marketing Plan we discussed choosing a dollar number to chase. In that example we talked about increasing our revenue in the coming 12 months by 100K. If you missed that posting here’s the link: Developing Attainable, Realistic Marketing Goals.
Now that we have a dollar goal we need to reduce it to measurable numbers and percentages so we can track and adjust our trajectory to make sure we reach that monetary plateau.
The first question we might ask ourselves is, “How many deals do we have to close to generate that 100K?” In order to come up with that number we need to know our average deal size. Let’s say our average deal over the past 12 to 24 months has been $11,000. That means we’ll need to close 10 new deals to reach our goal of making 100K. Nine deals would bring in 99K but let’s not undersell our selves. There’s nothing wrong with making $10,000 more than our stated goal.
Now that we know how many new deals we have to close it’s time to think about how many appointments we have to set to win those deals. Let’s suppose our close rate when making a presentation to a new prospect is 33%. So if we need to close 10 new deals and our close rate is 33% that means we’ll have to sit down with 30 qualified prospects. The emphasis is on “qualified.” Let’s recap our numbers so far:
Goal for the next 12 months = 100K
Number of new deals = 10
Number of new appointments to set = 30
We have some good metrics to shoot for. We’ve used sound logic and the numbers are measurable. We haven’t used any guesswork or gut feelings. What other numbers do we need to develop?
We’ll have to find out how many leads make up those 30 needed appointments, how many opportunities comprise the missing number of appointments and how many people have to be reached to generate that number of leads. Let’s talk about how those numbers are decided upon.
In our example, let’s say 20% of our leads turn into appointments. That means we do a pretty good job of marketing to the right crowd, with the right message and have attractive offers. Now that we know our percentage of leads that turn into appointments we can come up with one more metric that needs tracking. If 20% of our leads turn into appointments and we need 30 meetings then we’ll need to produce 100 leads.
How many opportunities become leads? That’s the next question we have to answer. For this conversation we’ll say 33% of our opportunities turn into leads. That means we’ll need to produce 300 opportunities.
So that we’re all on the same page, let’s define an opportunity as someone who takes an action such as registering for our webinar, subscribing to our newsletter, downloading a white paper or signing up for a free trial. The person, opportunity, has to take some action to move the relationship to the next level. Just because someone follows you on Twitter or connects with you on LinkedIn does not fit our definition of an opportunity. They have to show interest in what we’re selling.
The last number we need to develop is how many people we have to touch in order for them to become opportunities. Let’s say for this metric 3% of the people we market to become opportunities, they take some action when we send them an offer an invite to a webinar, a newsletter subscription, an email blast or some other offer. If 3% of those we touch take action then our marketing campaigns will have to reach 10,000 potential prospects. That does not mean our marketing campaigns just have to reach 10,000 strangers. There 10,00 people have to be “ideal” prospects people that have an interest in what we’re selling.
Here’s a recap of the latest numbers we’ve put together:
Number of leads = 100
Number of Opportunities = 300
Number of those to reach = 10,000
Now we have all the numbers in hand to measure our progress as we move toward our $100K goal. As our efforts miss those numbers we’ll be able to increase our marketing efforts where and when necessary.
