If the sales representative of your company has only one objective, meeting the quota, they are selling themselves short. Make sure that your salesperson has a number of goals are it weekly or monthly. Only then you can increase the odds of them meeting a more significant amount in their sales.
Even a smaller goal will allow your sales representatives to build confidence in themselves with their incremental wins. Not only that it will help you track and monitor the progress of your representatives towards bigger goals which will give you more time to think a strategy through to help struggling representatives.
A study done at Harvard University suggests one key factor to increase motivation is to set specific goals beyond solely telling yourself that you’ll do your best. According to the study, students who were goal-oriented performed 30% better than the students without any goals. Now think about what could 30% better performance from each salesperson do for your company?
Below are given some ideas on how to set an individual and team level sales goal. It can look like a lot of work, but the result makes it worth it.
1) Calculate your sales goal every month
Your team or personal goals must align with the annual sales goal of your company. If you work backward from your annual revenue goal, you will be able to figure out the monthly sales target for your business. Once you have your goal defined, the next step is to figure what amount of product does your teams, department and individual sales representatives have to sell to meet the target.
Make sure that you will take staffing and seasonal fluctuations into consideration. If you are planning to onboard three salespeople during the fall, it can be difficult to meet such a forceful goal while Q4. Nevertheless, if you plan this out, you will be able to adjust the goals and go harder in Q3.
2) Set waterfall goals
It is a good idea to budget the ramp-up while implementing new targets and onboarding sales representatives. If currently your salespeople are sending 100 emails per week and you want them to increase it to 200, do not directly double their weekly email target. You may raise their target to 120 next week, 140 the week following, and so on.
This strategy can be useful for morale as missing the goals will make your sales representatives develop squash and fear motivation. Not only this, the waterfall approach will help you produce better numbers and higher quality work. With this you will give your team enough time to ramp up the quality and your team will not feel overburdened from the expansion of their work.
3) Sequence goals
In other words “prioritize your target.” It is essential to make a mental or physical priority list about the goals you are most invested in or the goals that will bring more value to your company when hit. Also, make sure that your representatives are meeting those goals first.
When sequencing targets for a beginner in sales, keep in mind to set the target that helps them get better at it. If the junior salesperson needs to be right in prospecting, make it their goal to increase their outreach calls by about 10% each week.
The meaning of sequencing does not mean meeting every goal. It means to reach the target that brings in much value to your company’s professional growth or bottom line.
Sequencing means even if your reps don’t meet every goal, they’ll meet the ones that matter most to your company’s bottom line or their professional growth.
4) Set activity goals
If your sales need to be close to $4,000 this month, make that your activity goal. Start off by taking the historical performance of your salesperson all through the sales funnel in order to find out how many calls, emails, and meetings they require.
For instance, they need an average of about five deals every month to hit the quota. If 50% of their tryouts change into contracts, that means they have to demo to about eight prospects every month. If only 30% of their phone calls lead to tryouts, they will have to call approximately 27 people.
Working from backward will let you convert an intimidating revenue target to management metrics.
5) Incentives in goals
Money is the biggest motivator! To keep your employees motivated, it is better to give them bonuses or variable compensation. If you cannot afford monetary incentives, take a look at their interest. An employee who likes to travel may enjoy extra vacation time and an employee who enjoys admiration for their work might like an award.
You can also alternate monetary and non-monetary incentives. Promise your employee of either a cash bonus or a round of soccer when they meet their goal.
6) Monitor goal progression
It is very important to monitor the goals of the sales representative as without monitoring, the goals lose their importance. You can track the progress with the use of a dashboard in the VRM or use the traditional way and make your salespeople enter their numbers weekly in an Excel sheet. It is better to talk to an employee who is not hitting their weekly goals before they hinder the monthly goal. Even if monitoring is not a very easy task, it indeed helps you reach the targeted goal.
7) Set stretch goals
This cannot be right for everybody. If your sales representative is unable to meet their target every week, creating a stretch goal will only make them more stressed. However, if your company has a high-performing individual, you might as well set realistic stretch goals. For instance 130% of the goal will not only challenge them but motivate them as well.