Occasionally, I will get on a consult call or free information call and will blow someone’s mind with the idea of reverse engineering. While I am no numbers girl, I do know the value of taking your income goals and breaking them down so that you know exactly what it will take to reach those goals.
So, just in case you aren’t quite sure how to hit your income goals every month...let me introduce you to the concept of reverse engineering.
Setting an income goal
There are various ways to set an income goal and each individual will do this differently. Some will set their goal based on how much they want to give. Others will set their goal based on a desire to replace either their full-time income or their husband’s full-time income. Whatever your goals are in terms of the why behind your income goal, it is incredibly important that you have a clear income goal for each month.
Next, you have to consider your product flow or streams of income. What is bringing money in each month? You have to know the price breakdown for each stream of revenue as well.
Okay… so what does this look like?
Let’s say that your income goal is $5000 per month and you provide 4 product services:
- A passive eBook ($50)
- A group online program ($199/month)
- VIP 1-on-1 program ($250/month)
- Membership Site ($35/month)
Now, let’s say your goal is to sell 10 eBooks ($500), and you have 5 VIP’s ($1250) and 20 members for your membership site ($700). Your total income is $2450, leaving you with $2550 to make your income goal of $5000 for the month. $2550 divided by $199 is 13...which means you need to get 13 people signed up for your bootcamp this month.
Why this matters…
Knowing how many people you need to sign up will help you figure out your marketing strategy. Many entrepreneurs grossly overestimate how many of their followers will actually convert to paid clients. Because of this, it is incredibly important to know exactly how many clients you need to meet your goal, so you can cast a sufficiently wide net in terms of leads. It is a good idea to bring in at least 10 times the number of clients you need, in terms of qualified leads, through your lead generators and social media posts. Once you know that number, you can effectively plan Facebook ad targeting and social media posting strategy.
Reverse engineering might be a little more number-y than I like, but it is truly the most effective way to figure out how you will meet your income goals each month. Every time I hop on a consult call, I ask my clients to tell me their income goal, then we walk through their product flow and exactly what they will need for the month. If you haven’t planned out your income this way in the past, I highly recommend you give it a try! Seeing the breakdown can be incredibly motivating and help you focus your efforts on bringing in exactly what is needed to hit your goal each month!