Construction marketing: Effort, money and relationships

Which is the most important element in construction marketing success: The effort (work) you put into the process, the amount of money you spend, or the quality and nurturing of your relationships?

The 25 cent answer is: All of them count.

The $25 dollar answer is: If you work on two of them, you probably can cut back on the third.

But I wouldn't "rely" on just one, unless you are ready to go to extremes, a highly risky approach. And if you can balance all three, you are virtually assured of success.

For example, lets say you are like most people in this industry right now, and don't have much (if any) money to spare. By focusing your efforts, you probably can raise market awareness through hard personal work (for example, door knocking or phoning potential clients yourself) and if you are really smart, focusing your efforts to enhance and build the quality of your relationships, both with current and referred clients, and community/business centres of influence.

Lots of money and lots of effort: You can really blitz the advertising and pound the pavement. People may hate you and your business, but you'll still do enough through sheer force.

Lots of money and great relationships: You are behaving like you've "made it" already -- and you can take it easy as the cash rolls in. (For everyone else, isn't it nice to dream?)

But when we get down to earth, I suppose the ideal combination incorporates something of each element.

You'll want enough money to pay for effective, targeted advertising, fair wages and commission for your sales representatives. You are ready to put enough work into the process to ensure your money is spent properly and relations are properly maintained. And you of course enjoy great and rewarding relationships, with people and organizations who could care less about how much money you actually contribute. Probably, ultimately if you are great at relationships you can reduce the money and effort without too much harm. (But I'd reduce the money before the effort!)

The Construction Marketing Paradox: Easy work or hard effort?

One of the most important paradoxes in sales and marketing is that you are most likely to succeed if you need to put the least amount of effort into the process.

In other words, if your marketing or selling are hard to do and require much thought, time, and physical and mental energy, you will more likely fail than if you can achieve your results almost without trying.

Yet, almost inevitably, unless you are very intelligent about it, when you give up (fail to persevere) because things are too hard, you fail.

I've seen this paradox countless times over the past few years. Here are some examples:

The great feature or the crappy one

Most of our revenue arises from special printed advertising features profiling businesses and organizations. Suppliers are invited to support their client with advertising. The great features almost seem to sell themselves -- we send the notification to potential advertisers, and they call, email, or fax in their order right away.

My sales reps are jubilant, of course. I tell them: Put some extra effort into that feature for anyone who doesn't respond. It will seem like a lot of work, but you'll sell more.

Conversely, some features just don't work. The company isn't well respected by its suppliers, and they are simply not interested. Sometimes out of many calls and much effort we can coax a few sales. But the whole thing is more a waste of time than anything else.

The fast yes or the slow 'no'

Similarly, in setting up the features, some companies who qualify for the service say "yes" quickly (Others who don't qualify also often want the service -- we need to know when to turn these potential clients away to avoid the bad results in the first example above). Others who qualify hem and haw, finding one excuse after another. Sometimes these difficult potential clients are worth pursuing, but I often see the extra effort produces diminishing results.

Who is more responsive?: The inbound referral or repeat business call or the outbound sales call or blind RFP submission.

You know the answer to this one already. When someone calls you (sometimes out of the blue) and asks for your services because they have done business with you before, or been referred, your chances of success -- at your price -- are high; when you have to seek out the business, they are low. This is why things are often frustrating to established businesses with backlogs who have been relying on repeat and referral business and now have to begin marketing and selling their services. What had been easy becomes hard, and expensive.

So you may be tempted to give up. And that leads to the second part of the paradox: If you don't try hard enough -- if you fail to persevere -- you will often fail as well. This is because, if you trace the roots of your success, you can see seemingly easy business links to genuine perseverance in difficult conditions.

As an example, one of our major ongoing contracts originated during the height of the early 1990s recession. It was an easy call -- the organization representative phoned me -- but only occurred because I had remained in business through some really hard times, doing really sloggy work and selling, just to scrape by. If I had closed my doors before the easy call had arrived, I would never have received it.

Is there a solution to the paradox? Yes, and the answer can be summed up in this phrase:

"Do what you love doing, and do it really well."

The idea is to create circumstances where what would be hard and risky work to others actually is both easy and enjoyable for you. You simply need to align your personal interests and passions with your market's and then you will find it easy to attain great results.

This blog is a great example: I enjoy journalism and writing (and although I can use some excellent editing from people around me, including my wife) I am reasonably good at the writing craft. This passion led me into the publishing business and allowed me to keep going, even when things got really tough, when I needed to roll up my sleeves and write even more intensively and competently. In hard times, people have called and done business with me because of this ability and passion.

If things are getting difficult for you, take a few minutes to think about the activities, experiences and hobbies or vocations you really enjoy. You should build your business and marketing around these interests.

Your challenge is to then find ways to connect your passions with your potential clients. This is why I like association-based marketing so much because in any sizable group, at least some members will share your interests, and you can participate in (or even better, start) a committee or sub-group to express them.

If you follow this simple suggestion, your hard effort will actually become easy -- and you will have learned the answer to the Construction Marketing Paradox.

The marketing paradox: The less you 'try', the more you succeed

If there is an irony in marketing, it is this: The greatest results seem to come from the least effort. You pick up your phone, and a former client calls you and invites you to bid on a job -- or even better, you are told a competitor is bidding, and the client really wants you, so could you come in with a proposal of your own, with the expectation that you will win. (In the AEC world, this is called "wired" proposals -- with qualitative as well as quantitative measures, fairness is often in the eyes of the beholder -- and the business that wins (and thinks things are fair) usually has an inside track from the beginning.)

Clearly, you have good reason to feel good about the progress of your business when this sort of thing happens in less-than-buoyant economies. I'm sure it is happening for some of this blog's readers -- others, however, are in a more difficult situation: Their flow of repeat and referral business seems to be drying up; as low-cost competitors and aggressive marketers fight for the smaller pieces of the pie that remain available. "What should we do," they ask, sometimes floundering, sometimes reaching desperately for lead services, or faulty and ill-planned advertising campaigns.

I continue to believe the best approach in marketing, always, is to give value -- to current, former, and potential future clients. In the new environment of Permission Marketing, you need to create resources and services to win and sustain your clients' good-will. But if you have to put food on your table to survive, while you build your package of services and gifts to your marketing community, you may have to get down and dirty -- calling in favours, asking old clients for some special help and, in some cases, engaging in hard-to-do cold calling and canvassing. (In the next few months, I expect to study canvassing closely with canvassing consultant Joseph Needham to gain a better understanding of how to effectively implement this methodology.)

What can you give to your clients that creates value and memories? A simple gift basket on the completion of the work might work wonders (and a hand-written Thank You card is always helpful.) Straightforward and simple to implement do-it-yourself maintenance tips may be worthy; (coupled with marketing where appropriate for maintenance contracts.) Informative, insightful ideas, maybe some humour, maybe contributions to local homeowners associations or business improvement groups; maybe support of relevant trade associations within your commercial marketing community. And of course you can consider the blog and e-letter.

Of course, getting the basics right: Courtesy, respect, and truly competent work will go much further than fancy marketing campaigns. You really win if you connect with centres of influence, community leaders, and others who carry weight beyond their obvious status. But you'll connect with these leaders best if you treat everyone you do business with the same fairness, respect and dignity.

Then, if all goes well, the fun begins. Your phone rings, or your email pings. The caller or emailer is ready to place a huge order, sign on for a major project, or invite you to bid on a job (telling you that you will win it.) It seems just a little too easy and simple -- but of course it isn't -- you've paved the way and prepared yourself for the opportunity. You've found the magic marketing formula.

Great idea -- but forget the "free estimates" part

This posting on contractortalk.com suggests a simple but effective marketing/strategy.

Here is a fool proof idea:

1. Identify what city you want your business to grow in. Figure out which newspaper is the most popular.


2. Find the section where the local Contractors and Tradesmen advertise. Place your ad so that it is in the top one or two spots. Your ad should have your Business name, personal name, Free Estimates and Referrals mentioned.


3. Make sure the number you list is answered by a real person who has an interest in generating leads from 8 a.m. to 8pm seven days a week.


4. Make an appointment within 48hrs at the customers convenience, even if it's 9 p.m. at night after you've been working since 5 a.m. When you go, be professional, dress better than your crew of workers, but, in a manner that says, if I have to jump in and hump it with them I can and I will.


5. Engage Good Selling Best Practices.


6. After a year, your closing ratio should be better than 1 in 4, your goal should be 1 - 3. If it is, keep doing it, or hire someone to do it. If it's worse than 1 in 4, you su*k as a salesman and you need to get better or hire someone better. If it's better than 1 - 3 raise your prices until it gets to 1 - 3.


7. Track who advertises in the paper with you. You'll notice there will be a few that are always there and a whole bunch that come and go. Those that come and go are looking for something easy, there is nothing easy about this.

Ok, this has merit, but can we get away from the "free estimates" nonsense? There is no USP (unique selling proposition) here; if you are going to offer something 'free', why not a report on how to do things better, a list of practical ideas, or a reference to a well written blog or website. Sure, you can talk in terms of ballpark numbers -- you want to make sure that your clients are in the range of reality, and your potential clients have the right to know that you aren't way out of their perception. But a full blown estimate with detailed proposal should come with some commitment in return if the job is of any size or significance.

Other posters on the thread debate the need for this extreme level of work effort. I'm not so sure that you can escape that (though the specific hours/schedule may not apply in your business. Ultimately, you'll have staff (perhaps working shifts and rotating on-call schedules) or reach the point that you can narrow hours of operation to your, rather than your clients' hours of convenience, but this is probably not wise at start-up and I've seen through experience the costs of abrogating responsibility and leaving things entirely to others, even when things seem to be going well.

But I'll give the contractortalk.com poster the final word (actually the beginning of his post) because it is the most solid advice I've seen in a while:

What's most effective in marketing is what you put your best and most consistent effort in. Whatever you do, make a two year commitment to do it and stick with it. All of the ideas you and others mention work, but only if you work them consistently. Throwing money at a one time newspaper ad, mailer, door hangers, lead service, etc. etc. is literally just throwing money away. You are going to be in business a long time, take long term approaches so your customers see you as the guy that is always at the Homeshow, always hangs that cr*p on my door, always mails me those postcards..... people trust who they know.