Construction marketing: Metrics that matter

An intriguing challenge in architectural, engineering and construction marketing is determining metrics that truly indicate success.  Some are obvious:  Your cost per lead and conversion rate (lead to sales), your "hit rate" on proposals and so on.  These are useful, but each business often discovers metrics which indicate other things.

For example, HMC Architects in California discovered that the success of proposals directly correlated to the amount of time principals put into the process.  If the leading architects simply tried to dump the work on the marketing department, the proposals would fail.  If they spent hours of non-billable hours in preparing for the proposals, they would succeed.  So the practice included in its go/no go matrix a consideration of the pre-qualifying time the principals spent (it could do this because of comprehensive time accounting tools at the practice.)

As I researched the metrics topic for a series of articles for the SMPS Marketer magazine, one glaring quality came right to mind -- most practices don't even bother measuring their marketing effectiveness.  The argument is that the practices "know" what works and what doesn't, and the creative process determines what to do and what not.

Despite the strong arguments in favour of measuring marking effectiveness, I can see some reasoning in the nay-sayers.  Sometimes metrics are abused; sometimes the numbers are 'gamed' and sometimes you are simply measuring the wrong things.

As well, perhaps marketing metrics need to be considered within the overall business model.  Consider this blog posting:  "The only two business metrics that matter"

Here are the two business metrics that matter at Scout:

1. Income per employee

1. Employee happiness

Intriguing.  If we boil these metrics down to the basics, maybe you don't need much more --- if your employees are happy and productive, and the trends are in the right direction, you will be profitable, and your marketing will be successful.

Measuring passion

You can download the first in the part of the SMPS Marketer article on Metrics at the Wordpress version of this blog at http://www.constructionmarketingideas.com.

I'm working on the second of a series of articles for the SMPS Marketer about the effective use of metrics in architectural, engineering and construction industry marketing. Yesterday, my ears perked up when the marketing representative for a highly successful West Coast architect said her practice had discovered a way to measure "passion". (I don't have permission yet to share who the architect is, but hopefully will soon.)

She said every project and pursuit is coded into the architect's accounting and project management systems. Once the "go" decision is made, the time and cost of pursuing the project is calculated.

She said the practice has discovered that the more time the Principal in Charge spends on the project at the pursuit stage, the greater its chance of success. In other words, if the PiC simply hands the file over to the marketing department and tells junior staff to use boilerplate material to get the proposal ready, it will likely fail. If the PiC engages and spends significant time, it will succeed.

This metric makes a lot of sense even if it doesn't come to mind immediately. After all, why would a Principal spend a lot of time on the pursuit of a project unless it really mattered and the principal really wanted it to succeed? The conclusion, also, is that Principals who spend more time on individual pursuits are likely to be much more aware of the importance of success of the project, and unable to blame its failure on external forces. This is the classic quality vs quantity story.

The practice only recently implemented strong metrics systems, but is noticing changes. Note that this type of measurement requires a robust interface between marketing and accounting/time management systems, and clear rules requiring participation -- Principals cannot sluff off their responsibilities by saying "this isn't my way of doing things."

Nevertheless, I think businesses of all sizes can learn from this example. If you are the person in charge of the project, takes time to get involved and uses delegation as a support but not as a replacement for real energy and commitment, you have discovered your passion for success.

Metrics; The SMPS Marketer article and survey

After several months, my story: Marketing Metrics: Measuring Your Results has been published in The SMPS Marketer.

You can read it by clicking on this link, or by visiting the Wordpress version of this blog at http://www.constructionmarketingideas.com.

The article makes the point that measuring your marketing methodologies is an important element in achieving business success, but acknowledges that this isn't always an easy thing to do (and that some highly successful architectural, engineering and construction businesses don't have formal measuring programs.)

P.S. Can you catch the typo that might really impact my ability to measure the results, and figure out how I solved the problem? You can email your observations (and I'll measure how many answer.)