What lead sources are working?

An image from the Sylvain Contracting website. Marc Sylvain says he gets 7.7 per cent of his business from the website -- but why is his referral/repeat business so much lower than industry norms?

Marc Sylvain of Sylvain Contracting in Salem, New Hampshire, has started a Contractortalk.com thread, "What lead sources are working?" with a frank report on his six month stats.

Home Shows $290,569 (38.1%)
Referrals $111,257 (14.6%)
Internet Lead providers $97,861 (12.8%)
Direct Mail $88,714 (11.6%)
Past Customers $59,813 (7.8%)
Our Website $58,920 (7.7%)
Site Signs $28,376 (3.7%)
Newspapers $23,717 (3.1%)

Sylvain's business focuses on vinyl siding, replacement windows and three and four season sun rooms.

Several other contractors responded; some surprised how much his business depends on home shows. Others may be surprised by the extremely open disclosure of business information -- you can quickly calculate, for example, his total business volume over the past six months from these numbers (something some business owners would prefer to keep under wraps). As well, notably this open posting in a contractors' forum on the surface has little 'value' in reaching the end user/home consumer market in New England.

Of course, the numbers show other things -- Sylvain knows his business and has solid measuring and tracking systems; he truly can calculate where his leads are originating and (significantly, though it doesn't show up here) his true cost per lead. With his numbers, he can manage his marketing a whole lot more effectively than others. And of course, he doesn't lose any business by sharing with others in the industry -- even if his direct competitors read and analyzed the numbers, they would be several steps behind him in business development and strategies.

You may also notice a couple of other interesting points here:

• One contributor expressed surprise that referrals and repeat clients generate surprisingly low lead volume.

"Marc, how can you increase your referrals and past clients? I would think this could be easy for you with a special program. Do you have a newsletter? e-mail address?

Home shows are a lot of work and time yes you do show they work but I think with a little polish you could come up with some boost on the other 2.
Just some thoughts. Good luck."

• Another thread contributor explained how he is reaching beyond networking to find business:

"OK, I did only networking to date. Starting two weeks ago I installed a kitchen display in a local bank.

Friday I am buying a 14' cube van and will put a nice kitchen in it, with an espresso maker built in. All the choices I can fit will be in the van, catalogues, quartz, fixture books plus cabinet doors ect.The van will be my billboard and will be parked at busy intersections all over the Twin Cities.

I will bring many choices to the homeowner for kitchen and bath remodeling. I am partnered with a bank for loans, an interior designer, a local appliance dealer and an architect and painter. I have my own line of cabinets for semi-custom and I'm a dealer for the same cabinets.

Either I'm a genius, or I'm an idiot, time will tell. What do you think of that?"

My sense is that Marc is having to work awfully hard to feed the dragon; he has systems and processes in place which result in a steady volume of business and he knows his stuff, so he can maintain a reliable and effective business in hard times as well as good. But I'll share my concern of the other successful contractor puzzled by the relatively low ratio of repeat and referral business. My own ongoing poll (admittedly it isn't scientific, but it certainly 'feels right' from the subjective measuring I do every day), says that contractors overall receive a whopping 77 per cent of their business from repeat and referral sources, compared to Marc's 22.4 per cent.

Could it be the cultural 'push' of selling aggressively at home shows and the like is actually turning off clients; or they aren't 100 per cent satisfied with the value they are receiving? Is Sylvain's product line suited to one-time clients who don't network or communicate with their peers and neighbours? Are there process improvements he can make to achieve more "Wow, this is great" responses among his current clients to attract more referrals and repeat orders? And, finally, is he working on the alliances and unconventional/creative marketing approaches to transcend the obvious and expand/build on relationships, like the other contractor with his fit-up van and banker's relationship?