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Monday, June 15, 2009

Why does construction marketing (seem) to need to be difficult?

In several postings, I've observed the frustrating reality about construction industry marketing.

If you feel you have to market to find new business, you find it hard to do (and often frustratingly expensive).

Conversely, when you seem not to need to market, simply because your order book is full from repeat, referral and inbound inquiries, you are on the top of the world.

The problem is in part that no form of marketing success is easier to achieve than the natural success of your reputation bringing in inbound and repeat business. In fact, it gets even better if you are in this position, and so overwhelmed with business that you need to turn clients away or demand a long wait time to serve them. Because of your "scarcity" you are even more alluring -- and potential clients want to do business with you even more. (Marketers often fake scarcity to create this effect, but it really works, all the time, when the scarcity is real!)

This is fine enough in good times, but in a recession, when business drops off, you have two choices. You can shrink your business down to nothing, or you can start learning how to market.

The former choice isn't entirely irrational, especially if you have some control over your overhead and costs. If you can lay off most of your employees, and focus on maintenance and service for existing clients, you might just make it through. I know of some contractors who took long, enjoyable vacations in warm and sunny places during the last recession. Of course, this solution simply won't work if you can't curtail your overhead or you are burdened by debt obligations.

So, then, if you decide suddenly you need to "market" you are in trouble, because you now have to complete a rapid learning curve and you run into the problem that paid marketing and advertising is an incremental rather than magic, instant, solution.

This is why successful larger contractors, especially contractors serving consumers, never stop advertising, even in good times. They have enough experience and metrics to manage their advertising costs, media, and budgets, and can shift gears during hard times, perhaps altering their media mix or increasing their marketing budget even though they know it will produce less satisfactory results.

In previous posts, I've advocated that you get to know your current clients really well, to understand which media they read and what interests them, and then build out your marketing strategies from this information (while of course enhancing your referral and repeat business processes).

Long term, I believe the best way to market your business is to combine your passions and interests with those of your clients and potential clients, and build relationships through the process. For example, I am always most successful at marketing when I practice journalism, like writing this blog, but you may be better by sponsoring association golf tournaments -- if you enjoy playing the game, and your potential clients are there, as well.

The important caveat with this passion-centered approach is to remember that you must not focus on your passions at the expense of direct relationships with current and potential clients.

If you really enjoy doing stuff that has no relevance to your business, go ahead. You may be able to cross fertilize some ideas you can apply in your own enterprise. But don't get lost in the side-track. I've done that in the past, at great cost!

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