Even in the best of times, when the economy is strong and business is booming, you need to have a plan in place for how you are going to reach your revenue and profit goals. And in order to do that you need to understand the relationship between revenue, profit, and the tactics that you will employ.
First, let’s take a moment to assess where you are on a scale of 1 to 5 when it comes to your revenue and profit planning. Take a look at the graphic below and think about where your business is on the scale. Are you closer to level 5, or are you sitting at level 1? Wherever you are, this is important to know, because you can’t make improvements until you know where you currently stand.
Now, I’ve created a spreadsheet tool that will help you create a Revenue & Profit Plan to move your business up the scale towards level 5, where you will truly understand how much you need to bring in in order to take home your desired net profits at the end of the month. This spreadsheet walks you through reverse-engineering the revenue you need, the number of transactions and customers that will get you to that revenue, and all the way up the funnel to the volume of leads you need to convert into paying customers. This spreadsheet makes simple work of questions that can seem daunting and complicated.
Once you have a solid understanding of the numbers you need to be bringing in to reach your profit goals it’s time to create a Tactical Marketing Plan. This won’t replace your overall Strategic Marketing Plan, but instead offers you guidance as to what are some actionable tactics you can use right now to start hitting those lead generation, conversion, and revenue targets from your Revenue & Profit Plan.
Again, I’ll ask you to take a brief pause and assess where you are on another 1 to 5 scale, this time in terms of where you are with your tactical marketing.
Now, to start moving up that scale towards level 5 where you have an aggressive, measurable plan in place to reach your target goals, you need to lay out tactics. Tactics like advertising, networking and forming strategic alliances, developing a solid referral program, offering incentives for return customers, better utilization of social media, creating lead magnets and building a strong email marketing list, etc. The possibilities are vast, but what I suggest you do in this case is choose ten. Ten strategies that will each contribute about 10% of what you need to do in order to hit your targets. And remember, any strategy has a cost. So when you think about this you need to be careful to strike a balance between the cost and the reward. Create a blend so that you are spending some time, some money; executing some hunting strategies (things like pay-per-click advertising) and some farming strategies (think more along the lines of email marketing to your existing database). Don’t put all your eggs in one basket! My spreadsheet tool walks you through this process as well.
When you start using my spreadsheet to create your Revenue & Profit Plan as well as your Tactical Marketing Plan, if you have never done this sort of thing before, you will definitely feel like you are pulling numbers out of thin air. And that’s fine. Start with numbers that feel reasonable to you and your business, and then adjust as you go once you start to see and analyze your real time data. For example, you may start off thinking that you can close 30% of your new leads into customers, but two months from now you may find that it’s more realistic to use a 25% conversion rate in your calculations, or perhaps it’s the other way around and you end up closing 35%. This spreadsheet is meant to be a live tool, so keep updating and tweaking the numbers as you go.
To download the Revenue & Profit Plan and Tactical Marketing Plan spreadsheet and get started on your planning, click below.
After reviewing the spreadsheet, you are likely in one of 3 spots:
- You’re good to go, you got everything you need. Hey, that’s great!
- You have a question or two. In that case, book a free 15-minute call here.
- You really want some help with this. I’d be glad to help! In this case I would encourage you to book a single (paid) session of coaching with me so that we can dive into your business and you can really learn to leverage the spreadsheet to create strong plans. Learn more and book your session here.