How To Set Marketing Goals Based on Business Goals
A step-by-step guide to connect your inbound marketing goals to business goals and revenue growth.
By Bob Ruffolo
By setting clear SMART marketing goals, you and your team will know exactly what you are working towards. Below are 7 steps for setting well-defined marketing goals that are in sync with the goals of the business.
Goal setting is one of the most critical challenges for any business leader.
Your entire team is watching: If you set goals that are too ambitious, you’re seen as an unrealistic tyrant. Goals that are too small can make it seem like you lack vision or direction.
Even perfect goals without the right plan in place will leave your team feeling confused and frustrated.
In our company’s work with clients of all shapes and sizes, we’ve helped hundreds of business leaders set goals and develop plans for growth. What we tell our clients is this: Start with the end in mind — and then plan backward to spell out the necessary steps to get you there.
When it comes to marketing goals, follow this same approach. Start with where you want to go, then plan the steps that will get you there.
Even if you have a great inbound marketing plan, if it’s not connected to specific goals, it’s difficult to measure your success and course-correct as needed.
In this article, I’ll set you up for goal-setting success by sharing:
- How to set well-defined goals.
- A step-by-step plan for setting marketing goals based on business goals.
By setting SMART goals — that is, goals that are specific, measurable, attainable, realistic, and time-bound, you and your team will know exactly what you are working toward — with no questions.
Here’s how to begin.
How to set well-defined goals
It is often said that a goal without a plan is just a wish — but a plan without a goal is equally incomplete. To move your business forward, you need both: goals that are well-defined and articulated plans to get you there.
Poorly-defined goals are well-intentioned, but they often aren’t very helpful.
Examples of poorly-defined marketing goals
Here are some marketing goal examples that need more work:
- I want more website visitors, leads, and sales.
- We need to generate a larger email list.
- Our goal is to rank No. 1 in Google.
You can see that these are vague.
It's easy to say that you want to generate more leads, but how many more leads do you need to achieve your goal? 10 more? 100 more? Thousands more? How many contacts do you want on your mailing list? What do you want to rank in Google for?
Examples of well-defined marketing goals
Here are the same goals turned into well-defined marketing goals. What’s more, these marketing goals are based on the overall goals of the business.
- We need 20,000 visitors, 500 leads, and 12 customers within the next 12 months from our inbound marketing efforts to achieve our revenue goal of $600,000 from inbound marketing.
- We would like to generate two customers from our current client list using email marketing. We would also like to add all qualified leads to our mailing list, allowing us to keep these leads warm for future sales.
- We want to rank No. 1 for the keyword term "Reliable snow removal in Denver,” since we estimate that it will generate 300 visitors to our website per month.
When it comes to marketing goals, specifics are your friend. It’s better to start out with numbers in mind, even if you have to adjust them over time.
At IMPACT, we set goals and then determine a range of outcomes that we regularly update along the way. Red means we were way below our target. Yellow is closer, but not actually on target. Green means we reached our goal. Super green means we surpassed it.
How to set marketing goals based on business goals
Below are seven steps for setting well-defined marketing goals that are in sync with the goals of the business:
1. Identify how much revenue you need to generate from your inbound marketing efforts
This is easy, but it’s a critical first step. Say your business did $2 million in sales last year. Your CEO just said he wants to grow the business by 30% next year.
You know you already have $1.8 million on the books for next year and expect another $200,000 from other marketing efforts, such as trade shows and events. That leaves you with a gap of $600,000 that you need to close within the next 12 months.
2. Determine how many sales you need to hit those revenue goals
Take your revenue gap and divide it by the value of your average sale. For example, if the revenue needed is $600,000 and your average sale is $50,000, then you need 12 new customers to achieve your goal.
3. Identify your closing rate and how many opportunities you need
Continue working backward to identify how many opportunities you need. Say that your close rate is 25%. So, if you need 12 new customers, you’ll need 48 opportunities (or 'ops' for short).
4. Identify how many SQLs you need
A sales qualified lead (SQL) is a lead that is ready to be passed to your sales team. Some will become ops, some will not.
If this is your first inbound marketing campaign, then you may not know this number, so take your best estimate. I often find that 50% is a good number to start with. In other words, half of all SQLs that you pass over to sales will become legitimate opportunities. Your number might be higher or lower, so start with 50% and adjust it over time.
For our example, we can estimate that we need to pass 96 SQLs to our sales team in order to get 48 opportunities (and 12 customers).
5. Identify how many MQLs you need
A marketing qualified lead (MQL) is a lead that is qualified, but not sales-ready. MQLs need more education before they’re ready to talk to sales. This could mean they get enrolled in a lead nurturing campaign to learn more about your offerings so they become sales-ready over time. Or, they might opt out, seeing that they’re a bad fit to do business with you.
So, how many will be ready to become SQLs? Again, 50% is a safe number to assume. If you have no experience with inbound marketing, start with 50%. You can always adjust this later.
To continue with our example, we'll need to generate 192 MQLs within the next 12 months, which will turn into 96 SQLs that enter the sales process.
6. Identify how many leads you need
We define a lead as a visitor that has converted on one of your offers. Remember, not all of your leads will be MQLs. Some will be too early in their buyer’s journey, others may just be gathering information. So, when it comes to estimating the number of leads you need, keep all of this in mind.
First off, how are visitors converting on your site? What are you offering them in exchange for their contact information?
The more attractive your content is for your qualified leads, the higher your conversion rate from lead to MQL will be. To generate 192 MQLs, in this example, I would estimate that we’ll need to generate 500 leads.
As you get started, monitor these numbers closely and make the necessary adjustments over time.
7. Identify how much traffic you need to achieve your goals
How much traffic will you need to capture 500 leads? Based on our experience, we would estimate a traffic-to-lead-conversion rate of 2.5% over the next 12 months.
At first, this rate will be lower as content gets created and rolled out. Then, it will climb as rankings improve.
In our example, you'll need 20,000 website visitors within the next 12 months.
And there you have it: 20,000 website visitors will turn into 500 leads, who will become 192 MQLs, who will become 96 SQLs, who will become 48 ops, who will become 12 customers, who will spend an average of $50,000 and bring in $600,000 to your company.
Obviously it’s not always a perfect science. But you can see how a revenue goal can translate into a marketing goal, as long as you go backward and take it step by step.
Next, set quarterly benchmarks
As you're just getting started, remember that results will take some time. You'll get a lot more traction in the fourth quarter than you did in the first. Set your benchmarks for the fourth quarter much higher than your benchmarks for the first quarter. For our example, our quarterly benchmarks may include generating 1,000 visitors in the first quarter and 8,000 visitors in the fourth quarter.
Set benchmarks for every metric you’re tracking, from traffic all the way down to new customers. This way, you can continually tweak and make updates to your formula. If you’re struggling to hit a benchmark, don’t panic. Work with your team to figure out ways to improve.
Make sure you include metrics for your other key business goals as well.
Remember to implement your other key business goals
These goals are not supposed to be an exhaustive list. Most likely, what we’ve spelled out above will represent only one aspect of your business. Don’t forget to set up similar formulas for other goals you may be tracking. For example:
- Sales for a particular product line
- Revenue from existing customers
- Retention rates from current customers
- Number of job applicants (which may be important if your business is growing)
- Downloads of a high lead-to-customer converting offer
As with the example above, make sure you clearly define these goals and make them SMART. Then, work backward to determine the steps to take to get yourself there.
Take the first step and get started
In his book Scaling Up, author Verne Harnish recommends focusing your business around what he calls a big hairy audacious goal (or “BHAG” for short). This is sort of a “where do you want to be in 10 years?” type thing. Your BHAG might seem far-fetched today, but that’s okay. It’s going to take a long time to get there.
Any goal you set will remain forever in the distance if you don’t plan the steps that will get you there. Whether you’re talking about a goal that’s 10 years or 10 weeks away, break it into smaller chunks so you know how to move forward.
Remember, your goals will not be perfect.
Don't waste hours upon hours tweaking numbers and then never getting started. Gather accurate data about previous time periods, define the capabilities of your team, and make smart decisions on where you want to go with your marketing. Then, get started and begin tracking your progress. You can always course-correct along the way.
Build your marketing strategy around these goals, and after one quarter ends, take a step back with your new data. Adjusting goals (whether you overshot or undershot) shouldn't be perceived as negative — it's something that's completely necessary to keep moving forward.
Remember, you don’t have to do this alone. We’ve helped hundreds of businesses plan goals and track progress. Speak to one of our experts to see how we can guide your business to a more profitable future.
Wondering where to begin?