Lead Generation & Revenue Targets: 5 Ways To Achieve Your Financial Goals
Written by Alex Embling
Mar 14 2016
When planning an Inbound marketing campaign, it’s the Marketing Director’s responsibility to ensure the strategy will deliver on financial goals.
To manage internal expectations, defined, realistic goals must be set by aligning Inbound campaigns against financial targets. If Inbound financial goals are unclear and lead generation targets undefined, the campaign won’t be able to deliver on ROI or timelines.
For Marketing Directors to precisely map financial goals and lead generation targets to plan a successful Inbound marketing campaign, the following five steps are crucial.
5 Steps To Mapping Financial Goals & Lead Gen Targets For A Successful Inbound Campaign
1. Know Your Numbers!
Your revenue target is directly linked to your lead generation target and is affected by your retention rates and average order value.
Which type of customers do I need to gain more of (your campaign personas)
What products or services do I want to sell to those best-fit customers, and what is their value?
What is my average order value, and lifetime value of my best-fit customers?
By establishing which of your ideal customers have bought your product/service before, you can define the average lifetime value of the customers your Inbound campaign will target. Once you know this, you can establish how many customers you need to win to achieve that revenue target.
2. Consider Your Sales Cycle Length To Identify Timescales
Knowing how many customers you need is one thing, but what timescale is required to gain them and achieve that revenue target?
It is important to be realistic here, and consider the length of your sales cycle. For example, you may need to convert 10 customers to achieve your revenue target. But if you only expect to convert 5 customers a year, you need to be pragmatic with your timescales to manage internal expectations.
3. Define The % Of Total Revenue Inbound Is Responsible For
Will Inbound be responsible for 100% of your revenue target, or are other marketing strategies and outbound aspects a part of your marketing mix?
If Inbound is only one part of your strategy, you need to decide what percentage of your revenue target the campaign will be responsible for. This percentage will affect your lead generation targets, conversion goals and timescales, so must be defined at the outset of the campaign to manage internal expectations.
4. Consider Conversion Rates Throughout Different Stages Of The Purchasing Funnel
Once you know the revenue percentage that Inbound is responsible for and the number of customers your campaign must generate, you can trace upward through the conversion funnel to determine how many leads, MQLs and SQLs you need to start with.
To define each:
A lead is someone who has converted on your site (likely they submitted their details via a form on a landing page) and are in your database.
A marketing qualified lead (MQL) is a good-fit business lead. These are leads that match your target customer/persona definition and have the budget, profile and challenges that your solution addresses.
A sales qualified lead (SQL) is a sales-ready opportunity - an MQL who has been nurtured through the conversion funnel to the purchase stage.
Understanding your conversion ratios between each lead stage will define the total number of lead opportunities you need at the top of the funnel (and the level of site traffic you need to generate to convert enough leads) to result in enough customers at the bottom.
For example, you might find 56% of your leads qualify as MQLs, and only 6% of your MQLs are nurtured through to SQLs. If 25% of those SQLs convert to customers, how many do you need to have (remembering your average customer lifetime value) to achieve your revenue target?
5. Understand How To Attribute Each Digital Channel Source
Once you know how many total leads you need to achieve your customer goal, you must decide which digital channels will be responsible for generating them.
Lead quality and channel attribution are important here as different digital channels (organic, email, social, paid, referral) will deliver differing qualities of lead. If you find that paid channels for example deliver a high percentage of MQLs vs. a low percentage from organic search, you can attribute a greater percentage of your resources to the channels expected to produce the best quality leads. Note that your channel mix will also influence your promotion strategy for the campaign’s content.
To avoid wasted budget, the marketing channel mix must be well balanced. A January 2016 Moz Whiteboard Friday gave a good overview on why and how to audit your funnel to achieve an effective channel mix:
Let me look at my resource allocation and say, 'Oh, maybe I'm putting 20% of my budget to display and 18% to paid search. Maybe I'm putting 15% to offline, and I'm putting 12% to social and 8% to content." Whatever the numbers may be, "Is that the right mix? Does that effectively sound like it's doing the right things over here [at each purchasing stage], or should I be changing this up? - Rand Fishkin
Again, the length of your sales cycle and conversion rates have important impact. Bear in mind how long it takes a lead to become an SQL within the total sales cycle length, and monitor progression to ensure the campaign remains on track to achieve the final revenue goal.
It's important to review time and effort allocation to each channel to make the most of your staff resource. "How many people and hours, not just dollars are going to each? Because a lot of folks, when they look at their marketing budget from a CFO level or a chief marketing officer, they'll look purely at the numbers, not at the people. That can be very dangerous [and leave you with resource gaps for other important actions]. - Rand Fishkin
Realistic Planning For Inbound Campaign Success
Successful campaigns that manage and achieve expectation are always founded on realistic, data driven targets. Without a financial plan mapped to lead generation goals, the rest of the campaign will be in the dark regardless of how well planned it is.
Define your base financial targets, specify the revenue percentage Inbound Marketing will be responsible for, and realistic lead generation and ROI targets will be the result.