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    04/18/2024 |

    You Missed Your First-Quarter Sales Goals, Now What?

    By now all the first-quarter sales results are in. Booked revenue is locked and you missed your first-quarter sales goals. While I’m sure you and everyone else at your company are disappointed, rest assured you’re not alone.

    Last week, I did a session at the EOS® (Entrepreneurial Operating System) Conference in San Diego and took an informal poll of over 100 CEOs and operational leaders. Only 10% reported being able to consistently hit their sales goals.

    Now I’m more of a look forward than a look back kind of guy. I was taught that being successful in life is about how you recover. What you do next is going to set the stage for whether you have a better second quarter or repeat the mistakes from the first quarter.

    Let’s come up with a better plan for the second quarter and get it installed ASAP. This is going to ensure you fix anything not working correctly, add or upgrade tactics that might be missing and perfectly deploy your strategy so that you hit your goals and maybe even make up for the first-quarter shortfall.

    There’s a particular sequence to how we think about revenue generation. First, you have to get people interested in your company. They need to visit your website, have a great experience, engage with your content and then, when they’re ready, reach out to a sales rep.

    You need sales reps who have the skills, experience, tools and sales process to turn those leads into sales opportunities, new customers and new revenue.

    You need to continuously train those sales reps so they practice the same sales process and use sales techniques proven to engage prospects. Having the right sales culture is critical to aligning the effort so that it’s highly efficient and effective.

    Finally, you need the marketing and sales technology to automate and analyze all aspects of your marketing and sales execution. This effort is highly complicated, and it’s almost impossible to do it well without technology that’s configured properly. People need to be trained on it and use it religiously.

    I’m going to unpack each of these four areas in more detail and provide some specific action steps you can take today to ensure the second quarter is a winner.

    Marketing Strategy and Lead Generation

    Here are some simple questions that directly relate to how you did in the first quarter:

    • How many leads did you generate?
    • How many of those leads turned into sales opportunities?
    • How many of those sales opportunities closed and became new customers?

    You need to know these numbers. Next, you need to know if these numbers are high enough for you to meet your second-quarter goals. Do you know how many leads you need to hit your numbers?

    Marketing is a science, not an art. It’s about math. You need to run enough marketing programs to generate enough leads to produce enough new customers and enough revenue to hit your goals.

    Remember that most organizations, especially those with sales teams, are generating leads from other areas besides marketing. Examples include trade shows and conferences, speaking engagements and referrals, and repeat orders from past customers.

    Take all these sources into consideration when you build your Revenue Cycle model. This model shows how many leads are coming into the organization and then uses math to calculate the flow of those leads through your sales process.

    At each stage there’s a conversion rate that breaks down your numbers. Here’s a practical example:

    Each month, the company generates 100 leads from several sources. Since all those leads are not qualified or ready to talk with a sales rep, only about 30% or 30 of them make it to the sales team. The sales team then qualifies about 50% of those into the sales process.

    That means each month this company gets 15 sales opportunities. About 75% of them or 11 progress into proposals. The team closes 50% of the proposals, which equals around five or six new customers each month.

    Each new customer spends around $100,000, so that’s $500,000 a month from new business. But the company’s new business goal is $2 million per quarter, not $1.5 million. You can see the issue.

    Here are the real numbers the company needs to hit or even exceed its goals.

    In reality, with all the sales metrics staying the same, this company needs 130 leads a month. Here’s how the math works: Running the same conversion metrics, 130 leads a month would produce around seven new customers a month for $700,000 a month, and for the quarter the company would actually exceed the quota by doing $2.1 million in revenue.

    This company needs 30 more leads a month to hit its goals.

    Sales Reps

    It’s possible you don’t have the right sales reps or have enough. We see some companies with no sales reps at all. The owner or CEO might be handling all the incoming leads.

    Recruiting, hiring, training and managing sales reps can be a daunting task. Even after you find who you think might be the right person, it could take months to get them producing results. What about the reps you hired who are struggling? If you fire them, you’re short on reps to follow up or generate leads.

    Once you get your reps settled, you have to mentor them, monitor their activity, create rewards and recognition programs, coach them, arm them with the right sales tools and technology, teach them your sales process and hope they close enough business to get you to your goals.

    Unfortunately, hope is NOT a strategy.

    A much better approach is to consider a proven system that finds reps quickly, trains and ramps them up even faster, manages them for you and properly motivates them to be productive in a few weeks instead of a few months. 

    Today, companies can spin up productive sales reps for your company, and you don’t have to worry about carrying them on your payroll either. Once they start performing, you can consider moving them over to your company payroll and backfilling the team with new fresh talent.

    It’s a new way to think about sales talent, but it’s quickly becoming common for many different types of companies.

    Sales Training

    You can see from the numbers above that hitting the sales numbers has a lot to do with the efficiency and effectiveness of the sales reps handling these leads.

    Are your current reps skilled enough to hit the conversion numbers we’re using in our calculations? Are they moving these opportunities along fast enough? Are they prioritizing the best opportunities? Do they have a sales process that they all follow? Do they have a sales methodology they’re applying to your sales process?

    We had a bunch of questions in the marketing strategy and lead generation section, and we have a similar set of questions here. You should know the answers to these questions too.

    In the first section we uncovered we need 30 more leads a month to hit the numbers, but we could also work to improve the performance of the sales reps. For example, the company has a 50% close rate. We also know we need to go from five new customers a month to seven new customers a month, so if we improve our close rate from 50% to 70%, we can get $2 million that way too.

    This can come from improving your sales process, asking better questions during the sales process, using a sales framework that provides the sales reps with more direction and providing guidelines around how to move people through your sales process.

    All this works to improve the efficiency of your sales efforts and ultimately can improve your close rate, getting you to your sales goals with the same number of leads as you have right now.

    Marketing and Sales Technology

    If you want your marketing and sales effort to be more scientific and you want to create a scalable, repeatable and predictable revenue generation system, you’re going to need a marketing and sales technology platform that helps you automate and analyze as much as possible.

    If you don’t know what’s working, you can’t do more of it. If you don’t know what’s not working, you can’t stop doing it and shift that budget over to what is working. There’s so much to do that you have to make sure your resources are working efficiently.

    Your sales reps need to follow a process that is documented in your CRM system, and it should help them follow it because it adds value, not extra effort.

    If you missed your first-quarter sales goals, there’s likely an issue with one or all the areas we discussed here. Some of these might be obvious to you, like a lack of leads or quality leads. Others might be more obscure, like your reps needing more training or not having the right reps to reach your goals.

    The first step in any challenge like this is being open to hearing ideas, suggestions and possible solutions to fix this for good.

    We’re happy to do a full revenue assessment of your company and your current situation to share some ideas that could go a long way toward fixing these types of issues for good. You want to start thinking about revenue as something that can be systematized, and a revenue generation system is a great place to start.


    Mike Lieberman, CEO and Chief Revenue Scientist headshot
    CEO and Chief Revenue Scientist

    Mike Lieberman, CEO and Chief Revenue Scientist

    Mike is the CEO and Chief Revenue Scientist at Square 2. He is passionate about helping people turn their ordinary businesses into businesses people talk about. For more than 25 years, Mike has been working hand-in-hand with CEOs and marketing and sales executives to help them create strategic revenue growth plans, compelling marketing strategies and remarkable sales processes that shorten the sales cycle and increase close rates.

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