Goal setting theory has been used for decades to explain how to motivate people to perform better in work related tasks, but more recently gamification has also gained attention as an alternative method to increase employee engagement and performance at work. However, despite goal setting and feedback being at the core of gameful implementations, there is a lack of literature explaining how gamification works through the lens of goal setting theory or suggesting how goal setting concepts and recommendations can be employed to improve gameful systems. Therefore, we present a conceptual framework that establishes a relationship between the goal setting concepts and gamification concepts and mechanisms. Next, we describe how this framework can help explain the mechanisms behind gamification and suggest potential improvements to current gameful design methods. Finally, we propose directions for future empirical research aimed to apply this conceptual framework in practice.