Imagine if the next time you boarded a plane at the airport, the pilot said: 
“Hey welcome on board! I don’t have a flight plan and I’m not actually sure where we’re going, but just relax and enjoy the flight!”
What would you do?
I’d get off the plane – and I hope you would too!!
Of course, you’d never get on an airplane – or even get in the car – without a clear idea of your final destination and the route you’re going to take in order to get there.
And yet…
Most entrepreneurs are operating without a business plan or a marketing plan.
Every business needs a marketing plan. YOUR business needs a marketing plan.
And it needs to be a written marketing plan.
In this series, I’m going to break-down five of the key questions that your marketing plan should answer. Those questions are:
- What are your financial & personal goals for your business?
- Who is your ideal client?
- What are the key benefits of your products/services and how do you communicate those benefits in a compelling way?
- How do you stand-out from your competition?
- What are the tactical steps you’re going to take to achieve your growth goals?
Today, we’re going to dive into the first key question.
What are your financial and personal goals for your business?
This is the only logical place to start with your marketing plan.
It’s silly to create a plan without knowledge of the final result you want to achieve. It’s like trying to map-out a road trip without deciding where you want to end up.
Most business owners don’t think this through. They just decide that they want to grow as big as they can get.
Well, bigger isn’t always better. More revenue doesn’t always equate to more profit. And a bigger business doesn’t always meet your personal goals, either.
In my case, I made the decision to sell a business that I had built from scratch to $1.3 million in just a few years. I did so, among other reasons, because bigger wasn’t better for my life at that time.
I’m now building a business where top-line revenue isn’t my measuring stick. Instead, these are my priorities:
- I want to do work that I ENJOY and find meaningful
- I want to work with clients that I ENJOY working with
- I want the AUTONOMY to work when and how I choose
- I want quality TIME to spend with my family and pursuing my hobbies
Frankly, I’m making less money now than I was two years ago – but I’m much happier. And yes, I’m working hard to grow my revenue, but I’m not doing it “at any cost” – revenue growth comes second to the priorities I listed above.
But that’s just me.
Your priorities may look completely different. And that’s fine!!
What’s important at this stage is being honest with yourself as you think about your goals. You should include your spouse or significant other in this conversation too.
What do you want YOUR personal life to look like?
How much time do you want to spend at work, versus at home, with friends, with family, or pursuing other hobbies?
What type of home do you want to live in, what type of car do you want to drive, what type of vacations do you want to take?
Then, the key question: How much personal income do you need from your business to support this lifestyle? It’s usually easier to break this into a monthly number.
And this should be AFTER taxes.
What’s your number?
$10,000 per month?
$20,000 per month?
$40,000 per month?
Only you can answer this question, because only you know what you want your life to look like.
And – this is the key point – your business is (should be) a TOOL to support the life you want to live.
Once you’ve decided on your take-home income goal, work backward to figure out how much revenue you need.
For simplicity, let’s say your goal is $10K after tax per month.
Assume 15% taxes (please don’t take this as tax advice! Substitute your own percentage 🙂
That brings us to $11,500 in personal income before taxes.
Now… how much revenue do you need to create in order to take-home $11.5K per month?
To answer this question you need to know your profit margin. You may be a service-based solopreneur with a profit margin of 75% or even higher. Or you may be on the other end of the spectrum with a profit margin of 10% or lower. Look at last year’s tax returns, look at your books, or talk to your accountant to get this answer.
Then do the math. If you have a 50% profit margin, to earn $11.5K per month in take-home pay you need to create $23K per month in revenue.
Here’s the simplified math:
$23,000 Monthly Revenue
– 50% Overhead (Marketing spend, COGS, payroll, etc)
= $11,500
– 15% taxes
= $10,000 Monthly Personal Income Goal
So… to fulfill your personal and financial goals, you need to build a marketing plan that creates these two outcomes:
1) Generates $23,000 per month in revenue
2) Preserves your 50% profit margin.
THAT is a defined goal. And now we can go to work creating a plan to create that outcome.
Plug-in your numbers, do the math, circle your goals in bright red, and stay tuned for the next steps!
Danny Decker
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