How to Calculate Your Lead Generation Goals

Crafting a winning strategy starts here! Learn the steps to calculate precise lead generation goals. Drive your business forward with a targeted plan designed for success.

"Setting lead generation goals is like charting your course to success – a well-calculated destination ensures a smoother journey."

To achieve your sales objectives, it's vital to have a clear grasp of the precise number of leads required in your sales pipeline. Without this knowledge, reaching your sales targets becomes a challenging endeavor. Establishing an accurate lead-generation goal and assessing your team's performance are essential steps in this process.

In the following discussion, we'll delve into the methods for calculating the necessary lead count, explore the utility of a lead goal calculator, and uncover the advantages of adopting the Bottom-up approach when setting sales goals.

What is a lead generation goal?

A lead generation goal isn't just a number; it's a roadmap to acquiring potential customers within a specific timeframe, provided you have the necessary resources at your disposal.

By understanding your marketing team's capacity for generating new leads and your average lead-to-customer conversion rate, you gain the power to predict your future sales with confidence. This foresight becomes even sharper when you implement closed-loop marketing, allowing you to meticulously track the sales stemming from leads acquired through various channels.

The process of setting an effective lead generation goal involves several critical steps:

  1. Define Your Objectives: Determine whether you're aiming to measure the quality of leads, the quantity, or a combination of both.

  1. Identify Key Platforms: Keep a close eye on your lead sources to identify the most effective lead-generating platforms.

  1. Alignment with Business Goals: Ensure that your lead-generation goals harmonize with your broader business objectives.

  1. Team Involvement: Share the newly set goals with your team and inspire them to strive for success.

  1. Progress Tracking: Monitor and measure your progress, using tools like a waterfall graph to keep a close watch on your journey towards your lead generation goals.

This strategic approach empowers you to not just set numbers but to create a roadmap for success in lead generation, ultimately guiding you to achieve your business objectives effectively.

How many leads do you need to generate to meet your sales goals?

Marketers entrenched in lead generation often grapple with a pivotal question: How many qualified leads are the right fit for your sales funnel? The path to a fruitful lead generation process hinges on striking that perfect balance.

Too few qualified leads, and you risk falling short of your revenue targets. Yet, generating an excessive quantity of unqualified leads can be a futile drain on your time and resources. To unravel the mystery of how many leads you need to meet your sales aspirations, four critical numbers come into play:

  1. Average Sales Quota: Typically calculated on a monthly basis, this figure forms the foundation of your lead generation goals.
  1. Returns per Deal: Knowing the returns you can expect per closed deal or order provides essential insights into your revenue potential.
  1. Sales Reps' Unassisted Allocation: This denotes the portion of sales generated by your representatives independently, which could stem from repeat business or referrals.
  1. Lead Pipeline Conversion Rates: Understanding how effectively your leads move through the sales pipeline is paramount.

You'll source the initial three numbers from your sales management and financial teams, tapping into their expertise. For the last metric, a collaborative effort between your sales and marketing teams is instrumental.

By weaving these numbers into your lead generation strategy, you'll unlock the secrets to attaining the perfect lead balance for your sales funnel, steering you toward success.

Note: Setting and calculating lead generation goals is a critical aspect of your marketing strategy. It helps you quantify and work towards achieving your business objectives systematically.

Steps to calculate your lead generation goal?

Step 1: Uncover Your Revenue Objective

Begin at the very core of your business - your sales team. Engage in conversations with your sales management to ascertain the exact revenue target you're aiming to achieve. Dive deeper into understanding what portion of this goal will be realized through inbound marketing. For instance, if your revenue goal stands at $150,000, with 60% originating from inbound marketing, the equation becomes clear: $150,000 (goal revenue) x 0.6 = $90,000 (inbound marketing revenue).

Step 2: The Customer Quotient

With your revenue goal in hand, progress to estimating the number of customers required to fulfill this objective. Take a step further up the marketing funnel, and find out how many leads are needed. To compute the number of necessary customers, divide the value from step one by the average revenue each customer generates - Revenue goal / average sales per customer. Let's say each customer contributes $15,000, then the math is straightforward: $90,000 (inbound revenue) / $15,000 (per customer) = 6 customers. Hence, to reach your inbound revenue goal, you'll need to seal the deal with approximately six customers each month.

Step 3: The Lead Equation

Now, it's time to delve into lead conversion rates. Ascend yet another step up the marketing funnel, and unveil your average lead-to-customer conversion rate - the percentage of leads that make the leap to paying customers. For instance, if your lead conversion rate is 2%, divide the number of new customers from the previous step by this rate (2%). With six customers in mind, the formula stands as follows: 6 customers / 0.02 conversion rate = 300 leads. Voilà, you've now nailed down your lead generation goal for the month.

Step 4: Adapt and Advance

Consider this step as optional, yet incredibly valuable. It's your compass for staying on course. Adapt your goals according to your performance in previous months. Failing to meet your monthly targets can demoralize your team and lead to a less than optimal working environment. Realism is key, and sometimes, embracing alternative metrics aligned with your business might be the smart move. Recognize that a well-structured content marketing strategy, while capable of generating thousands of leads, often requires time to reach its full potential.

Step 5: Vigilant Tracking

The journey doesn't end with setting your goal; vigilant tracking is crucial. Monitor the results closely, pinpointing the most fruitful efforts and identifying areas that require improvement. To make this process more effective, integrate your lead generation goal data into easily digestible graphs and share them with your team. Some marketing automation tools offer automated charts with the added benefit of facilitating comparisons with previous months. Alternatively, craft graphs in software like Excel and manually update them before sharing them with your team. This dynamic approach ensures that your lead generation goals are not only set but also diligently pursued and optimized for success.

Alert: Don't underestimate the importance of lead generation goals. Failing to set clear and achievable goals can lead to haphazard marketing efforts and missed opportunities for growth.

Also read: Top 10 Techniques For Lead Generation Using AI Tools.

How to use a lead goal calculator?

This invaluable tool enables you to unravel the mystery of how many leads your strategy needs to propel you toward your monthly sales target. But it doesn't stop there; the lead goal calculator unveils a world of insights, helping you calculate:

  1. The Number of Leads Required to Achieve Your Goal
  2. The Quantity of Marketing Qualified Leads, Tailored to Your Standards
  3. Sales Qualified Leads, Rooted in Conversion Rates
  4. The True Value of Your Primary Lead Sources

With just a few swift inputs, such as your monthly revenue goal, this calculator steps up and performs the calculations for you. Here's how to put it to work effectively:

  • First, align with your sales team to lock in that all-important monthly revenue target. It's a key piece of the puzzle, so ensure you have your sales targets sorted by region and month, and fill in the corresponding cells in the spreadsheet. And remember, if your goals ever undergo a transformation, don't forget to update your trusty spreadsheet accordingly.
  • Next, it's time to define the value of your average deal size. This little nugget of information is essential in understanding the number of deals you need to seal the deal and reach your sales targets. Leveraging your marketing software and CRM tool, uncover the average selling price for each region. Add these values to the top row for each region, aptly labeled as "average sale price." The calculator then does its magic, providing you with the lead value based on the close rates you've supplied in the previous step.
  • Equipped with these critical figures, it's time to consider the percentage of your revenue pipeline originating from the joint forces of sales and marketing. This percentage is contingent on the dynamic interplay between inbound and outbound strategies specific to your business.
  • Finally, delve into the realm of sales closing rates. Examine, analyze, and meticulously dissect your sales data over the past six months for all channels engaged in generating marketing leads. This critical analysis enables you to determine your overall sales closing rates.

Final verdict:

In the concluding segment of this lead generation goal calculator, you'll witness the culmination of your diligent efforts. As you diligently input your data, the calculator seamlessly tallies up the totals for each region and individual. In essence, your total monthly goal should harmoniously resonate with the potential revenue generated by each region or section per month.

And here's the beauty of it all - this spreadsheet is not a rigid structure; it's a flexible tool that can be tailored to your unique needs. Whether you prefer to dissect revenues on a per-person basis or maintain a regional focus, this calculator adapts to your preferences, ensuring it aligns seamlessly with your specific requirements.