By Payal Parikh, Director of Client Engagement at Heinz Marketing
As parents, we teach our kids to set some life goals. What do you want to become when you grow up? What profession do you want to take up for yourself? That’s a pretty high-level goal and I am sure elementary age kids change it every year!
As Angela Duckworth suggests in the Goal Hierarchy from her book GRIT– set up a top level-goal, some mid-level goals and multiple low-level goals. I also ask my kids to set up some goals for the school year, doesn’t have to be all academic. It could be learning a new musical instrument or making a new friend amidst online learning. The top-level goal translates into multiple daily/weekly goals to achieve her mid-level goal for the school year. I haven’t told her that it is one of my goals to make her more social and meet new people for her own emotional growth. What did I do? I just aligned her goal to mine.
Marketing Goal Setting
Let’s put that same thing in context at work. Your President has the vision to grow the company by 20% in FY21. Do you, as a marketing team member, know about the 20% growth target? Did you plan your marketing strategy to support that goal? Did your goals align directly with the companies revenue goals? If you answer “no” to any of this, keep reading.
Cost Center or Profit Center?
Does your organization see marketing as a cost center or as a revenue center? If you think your CFO sees you as a cost center, you need to start taking revenue responsibility. By that, I mean, start aligning your goals with the goals your President has set for the business. In this case, your goals and plan should reflect the 20% growth the company has set.
With the digital transformation in marketing technology, it has never been so easy, yet complicated to show measurable results – revenue generated through marketing efforts. But how do you get started? Ah, easy! Just buy a bunch of fancy tools to build your tech stack. A martech stack with ABM tools, marketing automation software, social listening tools, marketing attribution tools (you need this to show you got that business in) and yes don’t forget the BI tool to show off your fancy dashboards!!
Easy right? Well, this is WRONG!
You get started by the number one step – SET MARKETING GOALS!
Claiming Revenue Responsibility with Marketing Goal Setting
Figure out the revenue goals of your organization in FY21 and how that trickles down to your contribution. Your President wants to see 20% growth in 2021; what does that number look like in dollars and units? $20M for FY21? Now review what you have done historically? What is your win rate? If its 30%, you need $66.6M in pipeline to generate that much revenue. What is your average deal size? You get the point.
Working backward using historical data, calculate what your conversion rates are, what your win rate is, your average deal size, and determine how big of a pipeline is needed to meet that revenue goal. Calculate how many accounts you need to reach in order to generate that big of a pipeline. If you track MQLs, then calculate how many MQL’s are necessary to meet your revenue goal.
Marketing Goal Setting – at the channel level
The next step is to dig into the details, get your hands dirty and make some informed decisions. Identify conversion rates and cost per lead for each channel you plan on using to generate net new leads if that’s your top-level goal. Identify the effectiveness of your nurture programs in converting MQLs for sales-ready conversations.
I know it’s a lot, but this is the groundwork that I want you to do before you start sending out those marketing emails to your audience. Identifying your target audience, determining who is in your buying committee, key messaging, all come into play for your marketing programs to be effective. We call it a Predictable Pipleline framework. If you want to learn more about each component of the Predictable Pipeline framework, you have to read this blog written by my colleague Stephanie on Predictable Pipeline.
Marketing Goal Setting: at the Pipeline Level
Coming back to our Goal Setting task, by now, you have figured out your numbers at each stage: MQLs, Accounts, Pipeline, Revenue Contribution, etc. I encourage you to break this down in chunks (short term targets). If weekly is too much, set monthly goals. Monitor these in your monthly KPI meetings. If you are Red in any of the KPIs, don’t worry. See how you can problem solve, pivot your strategy, and move forward.
How effective is your goal-setting approach? What do you monitor to determine marketing performance? Post your answers in Comments below. I’d love to hear and learn from you.