You may have noticed the poll aside the blog. Not surprisingly, the early responses show that most new business originates from existing clients or referral/recommendations. I'm sure eventually someone will click 'advertising' as a source of business and maybe a few determined people (you can find some of them over at contractortalk.com) will swear by canvassing or telemarketing. But if you follow the 80/20 rule, clearly the most effective place to build your business is close to home, with your current clients and referrals.
Now, my business earns more than 95 per cent of its revenue from advertising sales. Since we've been in business for close to 20 years, do we know something about effective advertising that belies the poll results?
Not really. In fact, we frame our advertising sales to respect, support and encourage the primary and most effective marketing methods -- we facilitate the client relationships and word of mouth marketing, while treating our clients with sufficient respect that they return for more.
To clarify this further, say someone approaches us who is new in business, or new to marketing to the construction sector, with a wish to advertise to get the phone to ring, and potential clients to call. We of course will not turn away the business, but we also make clear that results are not likely to be instantaneous and the greatest value of our relationship may well be the supporting services we provide to facilitate relationships. I will often recommend the potential advertisers use their limited budgets to join relevant associations and will consult with them on other effective strategies, perhaps effectively integrating their business within the supply chain, or connecting with key centres of influence, or (and here we can really help) generating positive publicity in appropriate news media.
Publicity, undoubtedly, is effective -- and if you don't need to pay for it -- truly cost effective. Here, we link some strategic supply chain relationships with the publicity process to earn about 80 per cent of our advertising revenue. We write editorial profiles about interesting companies and projects, and sell supporting advertising to these businesses' suppliers. Yes, we are connecting to the supply chain and touching the hot button of respecting your clients, so these advertisements carry much 'bang for the buck'. We also respect our advertisers who support their clients by providing supporting consulting and advisory services at no additional charge -- this blog is of course part of that set of services.
But what about the remaining 20 per cent of advertisers who contract with us to advertise month after month? What value do they achieve? The answers to these questions are more subtle, but still truly significant.
First, we work with our contract advertisers to reduce costs and increase value. Often, their suppliers have co-op advertising programs to help pay the costs, and our ongoing advertisers never need to pay extra for the feature project and client support advertisers that the other one-time advertisers pay. In fact, contract advertisers have sometimes received two, three or four free ads in each issue.
But there is another important, but subtle, benefit to ongoing advertising. It relates to brand -- the establishment and reminder of your presence in the community -- of your leadership role, and traditional and historical importance among current and potential clients. By the time this type of advertising makes sense, you are solidly entrenched within the market and the actual cost of advertising is a tiny part of your overall operating budget. You simply want everyone to know who you are, what you stand for, and that you are 'there', regardless of the comings and goings of competitors.
I'm sure that other forms of advertising are effective -- especially in the direct-to-retail market -- and some professional services have found that creative and extensive advertising attracts worthwhile new business.
But take a look at the poll (and if you wish, give your own response) . . . advertising should support, not replace, additional business from current clients and solid word-of-mouth recommendations. And, if you choose to advertise with us, we'll help guide you in the best processes to follow to achieve these standards.