The Power of Community and Consistency in Marketing
Every eight episodes, we here at "Beers with Contractors" take a step back to engage with our audience's most pressing questions. Episode 24, our final session in the current studio, served as a prime example of the invaluable knowledge that can be shared through a simple Q&A. Joined by Drake and Terry, we delved deep into various facets of marketing, operations, acquisition, and team management. Below, we'll revisit some of the key points and practical advice that were shared.
Investing in Your Marketing Budget
Understanding Your Budget and ROI
If you're starting with a modest marketing budget of $5,000 to $10,000, the first thing to keep in mind is your business's scale and the expected return on investment (ROI). For a business generating $50,000 annually, committing $10,000 to marketing might seem excessive. Conversely, for a business pulling in $100,000 or more, such a budget may be just right.
Key Steps to Effective Marketing:
- Optimize Your Google Listing: A basic, yet crucial step that helps customers find you.
- Leverage Digital Ads: Platforms like Google and Facebook offer highly targeted marketing options that are beneficial even on a tight budget.
- Utilize AI for Ad Creation: Save costs by using AI tools for creating basic ads.
- Diversify Across Multiple Channels: From PPC to home and garden shows, try different formats to see what works best.
- Home and Garden Shows: Sending non-sales staff to these shows can increase leads significantly.
Harnessing Low-Hanging Fruit
Yard Signs and Specific Phone Numbers
Yard signs are an incredibly economical way to generate leads. By placing signs at every job site and using specific phone numbers to track them, businesses can efficiently monitor and tweak their marketing efforts. This approach not only saves cost but also increases the visibility within the community.
Back to Basics: The Importance of Branding
Building a Solid Image
Branded gear goes beyond uniforms; it fosters a sense of unity and professionalism among your team. Investing in good quality, comfortable branded gear ensures that employees are walking advertisements for your company, enhancing brand visibility and creating a sense of pride among your workforce.
Office Attire: Branded Gear or Business Casual? While not mandatory, encouraging staff to wear branded gear can reinforce company culture and brand identity. Comfortable and stylish options make this more likely.
Acquisition: Knowing What You Want
Finding the Right Business to Buy
Acquiring a commercial property or a home service company requires a clear understanding of what you’re good at and what's essential for your business. Having a clear set of criteria can help in making safe and profitable investments. Building a network where people know you're in the market to acquire can significantly increase deal flow.
Key Criteria for Acquisition:
- Scalable Systems and Processes: Ensure the business has strong, scalable processes.
- Strong Operations Manager: An embedded operations manager can ensure business continuity.
- Network and Tell People: Let people know you’re looking to acquire. This can open up off-market opportunities.
- Evaluate Cost and Revenue: Understand the financial health and potential of the business.
Performance-Based Pay Systems
Implementing performance-based pay systems can boost productivity and morale. However, to make it effective, it must be forward-facing, simplified and transparent enough for the spouse at home to understand.
Three Essentials of Performance Pay:
- Forward-Facing Pay Projections: Employees must see potential earnings in advance.
- Clear Adjusted Hourly Rate and Total Income: Transparent communication regarding earnings can ease anxiety and confusion.
- Simplicity for the Spouse: Ensure that the spouse understands the pay structure easily.
Utilizing Modern Tools for Financial Management
The Power of a Good Business Credit Card
Using modern financial tools like Bill (formerly Divvy) allows for better expense management, cashback on essential purchases, and seamless integration with accounting software. It also provides control to cap spending by department, adding an extra layer of financial prudence.
Lessons from the Past: Biggest Screw-Ups
Everyone makes mistakes, but learning from them is crucial. Whether it’s sending a misplaced email or not having all the facts before making decisions, these experiences shape better future practices.
Understanding Costs and Value in Marketing
To contextualize marketing spending, consider the Average Dollar Per Appointment (ADPA). ADPA helps measure the average income generated per sales appointment, which can then be weighed against marketing expenditures to determine cost-effectiveness.
Calculating ADPA:
- Total Sales from Appointments / Number of Appointments=ADPA
- Percentage of ADPA for Marketing Budget: Helps determine the allowable cost per lead.
Continuous Monitoring and Adaptation
Lastly, always look at marketing as an ongoing effort rather than a one-time fix. Constantly monitor, adapt, and optimize based on performance data to refine your strategies. Investing continuously, even if it’s a trickle, allows for ongoing improvement and better results over time.
Conclusion
Marketing, acquisition, performance pay, and financial management are interconnected gears driving the success of a business. Clear strategies, consistent efforts, and understanding your strengths can significantly improve your operations. By leveraging the power of community, transparency, and modern tools, businesses can create a strong foundation for growth and success.
Remember, it all starts with understanding your market and engaging with it consistently. Whether it’s through direct interactions like home and garden shows, visible community presence with yard signs, or efficient internal processes with branded gear and performance pay, every step counts towards building a reputable and profitable enterprise.
