How to improve your Sales by setting Sales Targets the SMART way
It’s not actually easy to set targets with no basis. It’d be like talking about how high you’re going to build a tower, without knowing how much material you have or if the foundations are secure.
Everybody thinks they do it, but the reality is, when I ask to actually see managers’ sales targets? They’re fluffy and lack substance. As a result, sales teams end up either stressed or complacent with unrealistic or unambitious targets.
Salespeople roll their eyes when I ask them if they use SMART.
“What you gonna teach me on Day Two?“ they ask sarcastically.
“Nothing, until you’ve learnt Day One properly!” I answer.
SMART (pictured) works for me (and has always done) and I still see this method as the most effective way to set targets.
Let me walk you through the FIVE steps of how I set sales targets for sales teams, with the SMART system in mind.
Set Sales Targets Bottoms Up
This phrase, which you may have come across in sales, means to me, to build from both feeling and reality.
- You should have 80% confidence the sales target is set right.
- It should feel like a stretch. But not too comfy and not too tough.
- It should be based on your current situation, completely grounded in reality.
Data is Your Friend
Don’t be consumed by data, but find and focus on the key data that drives your business forward. You also need data to:
- Review performance history
- Break performance history down into easier chunks
- Create a visual guide of these chunks. I’ve found making it visual helps greatly.
- Know the maths of selling – what are your metrics? (important bold font alert) examples:
Phone calls to appointments?
Sales pitches to quotes?
Quotes to sales?
If you don’t know these facts, your targets aren’t based on reality.
Think Small to Achieve Big
This one really works for me.
Big dreams and ambitions are great…be the biggest, best etc. But then the pragmatic reality of getting after that can be daunting.
Instead, break things down to the smallest meaningful level and ask yourself things like:
- Can this target be broken down to a daily / weekly / monthly target? The yearly thing just doesn’t translate into action.
- Can I control the outcome? Am I directly in control of all parameters? If not, is it even right to set a target?
Make them Inspiring
Yep, I did say inspiring. Are your targets pushing you forward, out of your comfort zone, asking you to do something different?
Think about it – as an example, can you push yourself through your targets to increase demonstrations or presentations to a senior level?
Whilst sales targets are predominately about numbers, be creative and make them inspiring by giving them a place in personal development.
Now, Hulk, Smash!
Smash your targets is a bit sales cheesy, so let’s just meet or exceed targets shall we?
The key for me here, is it’s all in the planning…So take the time to PLAN.
- Do you know the barriers to success?
- Do you have the right skills?
- Have you put enough resources to it?
- Do you know your market?
As Ive already said to set sales targets isn’t easy.
It’s a lot easier said than done, but it’s so critical that you invest the time to do the planning right.
If you have concerns about how effective your sales targets are then why not contact me to see how Setting your sales targets correctly?
The 5 Principles of Sales Excellence are:
Business Strategy – Leadership has a genuine commitment to develop Sales Excellence.
Growth Management – Meaningful targets are set and the performance of the business is made visible.
Sales Leadership – Managers spend their time on business performance and people development.
Sales Execution – Sales standards are clear & consistency in Sales Execution is achieved.
Pipeline Management – Sales pipeline and lead management practices are in place and are effective.