Sales Goals

What are Sales Goals?

Sales goals are specific objectives businesses set to measure their sales teams’ performance and gauge the effectiveness of their sales strategies. They are quantifiable targets that sales personnel aim to achieve within a set period — often monthly, quarterly, or annually.

Companies can set sales goals in terms of:

  • Revenue
  • # of units sold
  • # of new customers acquired
  • Profit margins
  • Market share
  • Sales cycle time
  • Conversion rate

They can also be expressed at the individual level through sales KPIs like the number of meetings booked, calls made, deals closed, or revenue/new pipeline generated.

These goals serve multiple purposes: they provide a clear benchmark for success, motivate sales teams, help in forecasting future sales, and facilitate the alignment of sales efforts with the broader business objectives.

Synonyms

  • Sales objectives
  • Sales targets
  • Revenue goals

Importance of Setting Sales Goals

For the sales department, goals provide clarity, direction, and focus. Without specific targets to strive for, sales representatives may lack motivation. Or, they might be unaware of what they’re working towards and the impact of their contributions. This turns into missed opportunities and unachieved potential.

From a company’s perspective, sales goals are essential for assessing the health of the business, identifying areas for improvement, and creating a roadmap for growth. They help in budgeting and resource allocation decisions, making predictions about revenue generation, and understanding the effectiveness of different sales strategies and tactics.

Goals also create a measurable standard for success. By comparing actual sales performance to the targeted numbers, businesses can evaluate their progress and make informed decisions about how they can improve. Assuming they’re realistic (while still being ambitious), meeting sales goals is an essential driver of business growth.

Types of Sales Goals with Examples

Sales Performance Goals

Goals for sales performance are concerned with the overall success of a business’s sales process. They are expressed in terms of revenue, the number of units sold, or the results of specific sales activities.

Examples include:

  • “Achieve $10 million in annual sales.”
  • “Generate $750,000 in new pipeline over the next quarter.”
  • “Grow revenue by 10% MoM, QoQ, or YoY.”
  • “Close 100 new deals within the next year.”
  • Increase average deal size by $5,000.”
  • “Shorten the average sales cycle by 12 days.”
  • “Improve win rate by 5%.”

Sales performance goals are typically created through a collaborative effort between sales leadership and operations. They are crucial for setting expectations, measuring performance, and aligning the sales team’s activities with the company’s broader goals.

Sales Enablement Goals

Sales enablement is the process of equipping sales teams with the tools, resources, and information they need to close deals effectively. These goals are designed to optimize the sales process by improving the efficiency, knowledge, and skills of the sales team. This involves a strategic mix of training, content provision, and tool usage to ensure salespeople have what they need to succeed.

Here are a few examples:

  • “Create and distribute new sales collateral (e.g., case studies, brochures).”
  • Develop a new sales playbook to improve rep performance.”
  • “Boost lead conversion rate by 5% in the next six months.”
  • “Increase the volume of leads generated from outbound campaigns.”
  • “Provide sales reps with sales training on handling objections and closing techniques.”

Sales enablement goals are typically developed by a cross-functional team involving sales and marketing, with inputs from product and customer success teams. They aim to improve the effectiveness of sales activities and provide reps with the resources they need for success.

Sales Operations Goals

Sales operations (or sales ops for short) is the function responsible for managing the sales process internally and making it more efficient and effective. Sales ops goals are primarily concerned with streamlining processes, reducing costs, and maximizing sales productivity.

Examples include:

  • “Implement a new CRM system to improve lead and data management.”
  • Deploy CPQ to streamline sales processes and improve quote accuracy.”
  • “Reduce CAC by 10% through automation, efficient lead acquisition, and improved qualification processes.”
  • “Automate communications to improve follow-up and lead nurturing processes.” 
  • “Boost rep productivity by implementing a sales enablement platform.”

Sales operations goals are usually created with input from sales managers and reps, in collaboration with the operations team. Although they can sometimes be KPI-based, many of them are process-focused and aim to improve efficiency and effectiveness. Measuring their ROI requires a closer look at sales team goals and overall achievement (and whether they facilitated it at all).

Individual Sales Rep Goals

Also called sales targets or quotas, individual goals are specific to each sales rep and are based on their previous performance, potential, and responsibilities. They’re generally some sort of revenue goal, a specific number of deals, or units sold. For sales development reps who aren’t closing deals, their goals might be around the number of qualified leads they generate or meetings set up.

For example:

  • “Close $250,000 in new deals for Q3.”
  • “Deliver 10 demos per week.”
  • “Generate 50 leads through outbound prospecting efforts each month.”
  • “Dial 100 prospects per day.”
  • “Boost customer satisfaction ratings by 5%.”
  • “Shorten lead response time to 3 hours.”

Direct managers set annual, quarterly, or monthly sales goals for each member of their team, occasionally with input from the reps themselves. They are crucial for motivating and measuring rep performance, which directly contributes to overall performance. Because of this, rep goals should be aligned with the company’s sales performance goals.

Setting SMART Sales Goals

The SMART goal framework is a powerful tool for setting effective and actionable sales goals. SMART (which stands for Specific, Measurable, Achievable, Relevant, and Time-Bound) provides a structured approach to goal setting that helps sales teams stay focused and attainable.

Here’s how you can apply these principles to sales goal setting:

  • Specific — Clearly define what you aim to achieve. This involves specifying the sales target or performance metric you want to improve. For example, rather than saying “increase sales,” specify “increase sales revenue by 10% in the next quarter.”
  • Measurable — Ensure that the goal can be quantified or measured with specific criteria for achieving success. That could mean setting a numerical target or defining clear metrics to track progress, such as the number of new clients acquired or the increase in total sales volume.
  • Achievable — Set goals that are realistic and attainable within the resources and time you have. This means considering the current market conditions and sales team capacity, and setting a goal that challenges the team but is still within reach.
  • Relevant — Align the sales goals with broader business objectives to ensure they contribute to the company’s overall strategy. That way, hitting the goal will have a meaningful impact on the company’s success.
  • Time-Bound — Define a clear timeframe within which the goal should be achieved in order to create urgency and help in planning and prioritizing tasks.

It helps to also answer the question of how you’ll actually hit the goals. You might hire more sales personnel, expand lead gen efforts, invest in new software, improve team training, or implement new processes. Document your strategies alongside your SMART goals.

Examples of SMART Sales Goals

While sales goals will vary depending on the company’s size, industry, and products/services, here are a few realistic examples of SMART sales goals that can apply to most organizations:

  • Revenue goal: “Increase sales revenue by 10% in the next quarter (Q2) by increasing outbound sales calls by 20% and improving our conversion rate from 20% to 25%.”
  • Closing rate goal: “Improve our sales team’s closing rate by 15% by the end of the year by enhancing lead qualification processes and offering advanced sales training.”
  • Customer retention goal: “Increase customer retention by 20% within the next six months by launching a customer loyalty program and optimizing our customer service response times.” 
  • Product adoption goal: “Achieve a 25% increase in product adoption by the end of Q3 by implementing a targeted email marketing campaign and offering enhanced onboarding support for new customers.”   
  • Lead generation goal: “Generate 100 new qualified leads per month by expanding our social media presence and increasing our advertising budget by 10%.”
  • Sales enablement goal: “Implement a sales playbook and gauge its success on sales rep engagement and performance over the quarter.”

How to Achieve Sales Goals

1. Start by understanding current sales performance.

The preliminary step to knowing how much improvement is needed (and possible) is assessing your current sales figures.

  • How much revenue are you currently doing?
  • What was your YoY growth rate from the year before?
  • Are you a growth-stage or mature company?
  • What are your conversion rates from lead to sale, demos to customers, etc.?
  • How many sales reps do you have, and are you planning on adding any?

The answers to these questions provide critical context to your sales goals, once you begin to set them. As a simple example, 5% to 10% YoY sales growth is perfectly reasonable for a large, established enterprise. But it’s not even close to aggressive enough for a seed-stage startup.

2. Align individual and department sales goals with company objectives.

To achieve sales alignment, managers need to work closely with their teams to set individual goals that tie into team and organizational targets. This involves understanding each employee’s role and potential contributions, and setting goals that are directly linked to the team’s and ultimately the company’s success.

Input from marketing, customer success, and product teams should also be incorporated, especially where sales and marketing goals overlap. In lead generation and nurturing, for instance, content marketing teams and sales development reps (SDRs) might work together to determine the best selling points, ways to use them, and buyer enablement content to share.

3. Create a sales plan with action steps. 

In addition to setting SMART sales goals, creating a detailed action plan outlining the steps and strategies needed to achieve those goals is critical.

The plan should include:

  • Sales strategies (What tactics will be used to hit the goal?)
  • Sales methodology (How will reps sell? Will they use a consultative approach, solution selling, a qualification framework like MEDDIC?)
  • Key performance indicators (KPIs) (Which metrics will you track to measure progress towards the goal?)
  • Implementation and execution timeline (When will each step be executed, and what is the ultimate deadline for achieving the goal?)
  • Resources needed (What tools, technology, or personnel are required to execute the plan successfully?)

Your plan should also include how sales leadership plans to communicate the company goals with team members and how they plan to drive success through motivation, training, and performance tracking.

4. Set individual sales targets that reflect company performance goals.

Setting individual and company performance goals is a two-way street. Your potential revenue growth is somewhat limited by the size and capacity of your team. And you should plan your sales quotas around your company revenue goals.

Take your sales performance goals and divide them by the number of reps you have on board. If they add up to unrealistic numbers at the individual level, you may need to adjust the company goals. If they seem relatively easy, you can shoot for higher performance goals.

5. Incentivize performance through commissions and bonuses.

There are dozens of ways to get sellers to increase their output and stay motivated. A lot of it comes down to culture and team dynamics. But, at the core of it is a through a commission and bonus structure.

As far as commission goes, a typical on-target earnings (OTE) for a sales rep is one-fifth of a rep’s annual quota. So, if you want your reps to close $1 million in new business, their OTE should be around $200,000.

Bonuses can be given out in addition to commissions for reaching or exceeding sales goals. You can use them on a quarterly or annual basis to reward top-performing reps. You can also run short-term competitions (e.g., “hit your quota in July for a chance to win a $500 spiff”) to drive quota attainment and potentially reach company goals faster.

6. Celebrate successes and important milestones.

Besides commissions and incentives, recognition and praise are crucial for motivating a sales team to reach their goals. For a major achievement like smashing your Q4 targets, this could be a company-sponsored team outing. Smaller everyday wins (which are equally, if not more important) warrant a quick recognition shout-out during your next sales meeting.

7. Implement sales tools for reaching goals and tracking KPIs.

You won’t know whether your team is on track to hit its sales goals without the right data and insights. You also won’t be able to reach your sales operations and enablement goals without software.

At the very least, you need:

  • CRM to track sales activity, pipeline, and revenue
  • CPQ (configure, price, quote) software to create accurate, professional quotes in seconds and monitor deal cycle efficiency
  • Contract management to create, send, and track sales proposals and contracts
  • Sales enablement software to provide reps with the content, personalization, and guidance they need to close deals
  • Sales engagement platforms that help reps engage and nurture leads
  • Revenue intelligence platforms like Gong that help with forecasting and analysis

Depending on your particular company needs, you might also use sales enablement AI tools or specialized software for industry-specific sales like SaaS, manufacturing, or financial services. 

8. Provide ongoing coaching for the sales team.

The best way to ensure that your reps reach their goals is to provide them with ongoing coaching and training. Managers should set time for sales meetings, deal review sessions, and one-on-one coaching to help reps improve their skills and overcome any obstacles preventing them from reaching their goals.

One of the best ways to improve reps’ skills is by using a tool that records sales calls and demos. Leaders and other team members can listen in on these recordings and provide immediate feedback. Mentors and managers can zero in on areas for improvement and work on them together with the rep.

Training should be provided on new products or services, sales techniques, and industry developments every time they’re rolled out. And they should include details from the marketing team on customer pain points, product differentiators, content to share, and buyer enablement strategies.

People Also Ask

What is an activity goal in sales?

In sales, an activity goal focuses on the specific actions sales reps need to take to work towards financial sales targets. Their purpose is to monitor and improve daily sales activities, making them essential for managing team productivity and facilitating quota attainment.

For example, an activity goal might specify the number of sales calls, emails sent, or appointments set within a certain timeframe. That way, sales reps’ daily on-the-job activities are more likely to result in quota attainment and revenue growth for the business.

What is an example of a sales stretch goal?

A sales stretch goal is designed to push a sales team beyond their usual targets and what is generally considered achievable. For example, if your sales team closed $1 million ARR last quarter, you could set a stretch goal of $1.5 million for the next, or a 50% QoQ growth.

How can sales goals be aligned with overall company objectives?

To align sales goals with overall company objectives, it is important to first consider what’s important in the near term to the company as a whole.

Sales growth and revenue goals will always support the company’s bottom line. But it’s also important to consider specific initiatives or strategies currently being prioritized, like launching a new product, entering a new market, increasing sales headcount, achieving efficiency through software, incentivizing upsells, or improving lead qualification processes.

How can sales goals be used to create a positive and competitive sales environment?

Sales goals foster a positive and competitive environment by incorporating incentivized and stretch goals that motivate sales reps to exceed their targets. By setting clear, challenging yet achievable goals, and recognizing and rewarding accomplishments, you can create an environment that encourages healthy competition and continuous improvement.