Question: Can you predict what your sales numbers will be this month? Next quarter? Next year? No? Well, keep reading. This is for you. We’re going to get you right for 2022.
First: This is a post to read when you’re ready to commit some brain power to it. If that’s not right now, save this post for when you’re ready. And when you do this, let me tell you !! this will change your business.
Let’s get into it.
First, you need a sales goal. If you have to pull a number of the air because you’re just starting out, that’s perfectly fine. It’s a starting point. For this example, we’re going to say our sales goal is $6k/month.
Next, you need to know your conversion rates. Ideally, you have some data already to inform you. For example, you have documented with Google Analytics how much traffic you had throughout the year and how many people “converted” by way of completing a form (this is a lead conversion rate) or made a purchase (this is your sales conversion rate). You need the conversion rate for each of those activities.
If you’re just starting out, start out with something between a 1-3% conversion rate. If your goal is a 3% conversion rate for leads and a 1% sales conversion rate, that means for every 100 people who visit your website you can predict 3 new leads and 1 sales.
You want to also calculate the conversion rate for Instagram, TikTok, etc. First, what is your average number of accounts reached or views in the last 90 days? Then, how many people on average click through to your website from your link in profile? If you are pretty active on all platforms within Instagram (stories, posts, reels) you should also dig into the numbers for each one. I know, it’s time consuming. But soooo informative.
Also, as you’re putting these numbers together, do it Google Sheets so you can keep track of this data. This is not a one time deal.
Alright, you have conversion rates set. Next step is to figure out your average customer value (ACV). The simple math is to divide your sales by the number of customers. For this example, we’re going to say the ACV is $1500.
These three numbers will define what activity and how much of each activity you do to achieve your sales goal. This is where we get into the marketing funnel. If you’re a visual person (as we are) drawing out a funnel can be really helpful here.
* this is a typical representation and your marketing funnel may look different
Top of the funnel is the widest part. Think of this as your wide net where you have the largest quantity of people’s attention. This is where Instagram, TikTok, Pinterest, YouTube, Podcasts, etc belong.
Let’s use Instagram as our example. Let’s say you’ve been posting 3x a week and the average number of eyes on each piece of content is 100 (in Instagram language, this is Accounts Reached) and the average number of website clicks from a single post is 2. That means you have a 2% conversion rate. If your goal is to double your leads, you now know that the way there is to double your activity. You could also set a goal to increase your Accounts Reached, Engagement, and Website Clicks by .5%. This incremental increase will make a big impact over the course of several months. Now, you’ll need to define how you’ll achieve that increase and that’s a problem to solve when you define your content strategy.
Okay, so you can predict that for every post (on average) you’ll get 2 people on your website. Let’s say increase your posts to 6x a week. That’s an average of 12 people on your website every week from posts. The next step is how many sales can you predict. Do this by looking at your Google Analytics data: how many people visited your website and how many of them made a purchase? Do the math to figure out your website conversion rate - divide the number of visits by the number of purchases. If you don’t know, start at 1.5%. At that rate, you’ll get one sale from your website every 10 weeks from posts. Do this math for your other top of funnel channels. Will it get you to your sales goal?
If not, you’ll need to explore other avenues that you employ to get more people on your website. For example, how’s your search engine ranking? It may be that you can really focus on SEO to get more organic traffic to your site. Mentioned earlier, maybe you can make some adjustments to your content strategy to improve your reach on social media, Pinterest, Youtube, etc. If your website is converting well, then consider an ads campaign. Ads is a smart avenue for you because you have a great conversion rate and can predict what your return on ad spend (ROAS) will be.
At this point, you can predict how many sales you’ll get. If you sell more than one product or service, you’ll need to factor in your average customer value (ACV). Let’s say it’s $1500. That’s 4 new customers every month to reach your sales goal.
This is a higher ticket item so expect website conversion to be lower than someone who sells $20 items. People will come back more than once and linger before they put down this chunk of change so let’s say our conversion rate is 1%. That means we need 400 website visitors every month to expect 4 customers.
Let’s back into that number now. How are you going to drive 400 people to your website each month? How many posts, reels, tiktoks, Pins, YouTube videos, whatever your channels are do you need to do every month to get 400 people to your website? This is where you begin to see a clear definition of where you post and how often. You see a clear purpose for the time investment. (btw, you also want to know your sales and profit number. Factor in your overhead related to posting content.)
If you made it this far, your brain might be hurting. Stick with it. This stuff is the difference between a so-so business and running your business like a CEO boss. You can do this.
Want some help as you work through this? Book us for a 1:1 coaching session! We’ll dig into your numbers, get you set up with a spreadsheet to track your numbers, set a goal for 2022, and set a content schedule to have a record year in sales. Pop us an email at email@example.com.