Marketing objectives and SMART goals
From aims to objectives
- Marketing aims say what the business wants. Marketing objectives say exactly what this plan will deliver, in numbers, by a date.
- Every objective must be traceable upwards to a corporate objective and downwards to activities in the action plan. If it is not, it does not belong in the plan.
SMART
- The standard names SMART goals directly. Each objective must be:
- Specific — one clear outcome, not a general direction
- Measurable — a number, from a source that actually exists
- Achievable — possible with the resources the plan has
- Relevant — it serves a corporate objective
- Time-bound — a date by which it will have happened
- Compare:
- Not SMART: "Increase awareness of the product in Australia."
- SMART: "Achieve stocking in 60 premium grocery stores across Sydney and Melbourne by 31 March, and $400,000 in Australian sales in the twelve months to 30 June."
- Measurable is the one that fails most often. Before writing a number, ask where the figure will come from. "Increase brand awareness by 20%" requires an awareness survey before and after — if the plan does not budget for that survey, the objective is not measurable.
What to set objectives about
- Different objectives drive different strategies, so choose deliberately:
- Sales revenue or volume — the most common, and the easiest to measure
- Market share — harder to measure, but it accounts for the market growing or shrinking
- Distribution — number of stockists, or percentage of target stores carrying the product
- Customer acquisition or retention — new customers, or repeat purchase rate
- Awareness or consideration — needs a survey, so it needs a budget
- Margin — protecting price, which matters for a premium product
- Three to five objectives is usually right. More than that and the plan cannot be steered.
Worked ExampleWriting SMART marketing objectives
Puhoi Peak Chocolate (invented business, illustrative figures) is launching a single-origin bar into Australia. Its corporate objective is to grow revenue from $2.1 million to $3.0 million within three years, with at least half the growth from outside New Zealand.
Write a set of SMART marketing objectives for the first year.
Step 1 — Work out what share of the corporate objective this plan carries
The business needs $900,000 of growth over three years, at least $450,000 of it offshore. Australia is the only offshore market in the plan, so the plan must deliver roughly $450,000 over three years. Loading the growth towards the later years as distribution builds gives a first-year target of about $150,000.
Step 2 — Set the sales objective
"Achieve NZ$150,000 in Australian sales revenue in the twelve months to 30 June."
State the currency. The corporate objective is in New Zealand dollars and the sales will be in Australian ones, so an objective that does not say which is being measured cannot be checked.
Step 3 — Set the objective that makes the sales objective possible
Sales cannot happen without shelf space, so distribution is the leading indicator.
"Secure stocking in 60 premium grocery and specialty food stores in Sydney and Melbourne by 31 March."
Step 4 — Set a margin objective, because the mission rules out competing on price
"Maintain a gross margin of at least 42% on Australian sales across the twelve months, with no promotional discounting below A$7.50 retail."
Step 5 — Check each against SMART
Each names one outcome, carries a number, has a date, is within the capacity the plan budgets for, and serves the corporate objective. The measurement sources are the business's own sales ledger and stockist list, both of which exist — so no additional research budget is needed to know whether the plan worked.