Most small to medium-sized companies try and tackle marketing on their own. By that I mean, they appoint someone in the office to handle the “marketing stuff” and then they go back to the daily work of their business. In this post, I’m going to show you three of the most common mistakes we see companies make when it comes to marketing and what you can do today to fix them.
Not Educating Your Prospects
Do you find yourself frequently competing on price alone to close a deal? If so, STOP DOING IT TODAY. Seriously, competing on price is a loser’s game; it’s a race to the bottom. There will always be someone willing to do the job for less. The secret that we know is that someone working on tiny margins has to do huge volume to make it in the business. The reality is, if you run into competition that runs that way, they aren’t going to be able to do as good of a job as you, simply because they have to do 3 jobs to make what they should make on one job. Rather than racing to the bottom and letting the customer fixate on price, you must differentiate yourself from your competition by educating your prospect on the value and customer experience that you provide. Here’s a list of questions that you can address in your presentation that will help position you as an expert worth their wage:
- Why should I buy from you over someone else?
- What will buying from you do for me?
- What guarantees do you offer?
- How are you better than your competition?
To get someone to buy from you, you have to accomplish these three things:
- They have to know you and what you’re selling
- The have to want what you are selling more than your competitors
- They have to know that the sooner they make a decision, the sooner life will get back to normal
When you educate the prospect, you demonstrate expertise and the prospect recognizes that. They realize that they are dealing with a professional. You don’t have to pitch them, they will want to work with you.
Not Tracking Your Marketing/Advertising ROI
“The money I spend with Google Adwords is blackmail money.” That what one local roofer said. Why? He had no idea what he was actually getting from his campaign because he didn’t track it. Does that sound crazy? How about this: another local roofer ran a TV commercial for $10,000 per month with no real call to action. After 4 months he stopped it because he couldn’t determine how many deals he had received from it. Upon examining his account later, we discovered he had closed 3 roofs (34,000 total revenue) off his $40,000 investment. Believe me, he wished that he had tracked his ROI.
Do you know your numbers? Do you know which marketing works best for you? Do you know which marketing source costs the least per lead? Do you know what percentage of your leads come from online advertising, referrals, or door knocking?
For every $1 you spend on advertising, how many gross dollars do you generate?
I speak with business owners all across the US and it is extremely rare to find one that has any of these answers at all. Why? Most of them have someone internally run their marketing efforts and that person has no idea how to track (or even that they should) or they are letting their “web guy, SEO guy, IT guy, nephew, .etc” run their marketing and they have no idea how to properly track it.
So, business owners will spend thousands of dollars a month on SEO, PPC, radio, TV, Yellow Pages, Facebook, door knocking, bought leads and telemarketing without measuring it. All they will know is at the end of the month if they are positive or negative.
Why do they do this?
Most business owners look around to see what their competitors are doing and they just copy it. For example, have you ever stopped to ask why 99% of roofing yard signs say, “FREE ESTIMATES”? Have you ever met a roofer that charges for estimates? Probably not. The signs all say it because roofers look around, see that another company put it on their sign, so they better put it on their’s too.
You must focus on the methods that bring you the best return. The best way to do this is the Pareto Principle. You may not know that name but maybe you’ve heard of the 80/20 rule. A guy smarter than me, economist Vilfredo Pareto, figured out that 20% of input will be responsible for 80% of the results. This is why it’s critical to know what is working in your marketing.
If you had data that showed that 50% of your deals came from Google Adwords, would you cut your spending or increase it? What if you discovered that canvassing team you were spending big money on was only generating 5% of your deals. Would you want to keep the dollars going to the canvassing team or move them to something more profitable?
Underestimating The Power Of Online Advertising
In the Dallas/Fort Worth area, right now, there are nearly 100,000 searches for custom home builders performed on Google every month.
People aren’t searching these terms because they’re bored. They are thinking about building a home or at least, they researching some options so that when they are ready, they will have a short list to contact.
If a home builder had just a 2% click through rate on 100,000 searches, that would be 2,000 clicks. If just 5% of the 2,000 converted into leads, that would be 100 leads. If you then closed 10% of those leads, that would be 10 custom homes sold. If their average home is $350,000, that’s 3.5 million in gross sales. That means that each one of those 100,000 searches is worth 35 in gross dollars to the builder. Each click is worth $1,750 in gross dollars to the builder.
How many people are searching in your area?
Targeting people through Search is one of the easiest and most direct ways of getting in front of potential customers. All of these searches are at different points in the buying cycle. Many of them are trying to learn more about a product or service, customer reviews, what makes a good contractor etc. Think about it; you probably don’t go spending thousands of dollars on things you know nothing about, right?
This is why education is important because it will help move people through the buying cycle. It will take browsers and turn them into potential customers. Buying behavior has changed over the last decade. Most consumers look you up online, see what others say about you, see what you offer and how you interact with people socially before they are willing to contact you. Knowing this gives you a huge advantage over your competitors.
Now comes the hard part. You have to look in the mirror and address these three mistakes. Are you educating your potential customers? How? If you aren’t, what are you going to do to start? Are you measuring your marketing ROI? What are your numbers? If you aren’t, how will you start? What are you doing to generate leads online and how can you improve it?