More Marketing Tips for Pool Builders
PAID ADVERTISING – How To Get Your Money’s Worth…
By Brett Lloyd Abbott, MYM Austin Inc.
Last week I gave you some insider tips on how to get “Free & Nearly-Free Advertising.” Today I’m going to help you with “Paid Advertising.” When sales are down, that’s the time to advertise. So let’s make sure your ad dollars go as far as they possibly can.
TARGET THE BELL CURVE – Remember “the bell curve” from math class? In advertising, it means that 80% of the people in a particular market will have the same general attitude and feelings about what you sell. Therefore, you should make sure your message is designed to resonate with the attitudes and feelings of the 80%, as opposed to the weirdoes out on the 10% fringe of the bell curve.
CALCULATE “LIFETIME VALUE” – To know how much you can afford to spend on advertising, you need to determine how much a new customer is worth to you. This is determined by the sum of the profits made on initial purchase plus the profit made on all follow-up purchases. If it’s an annual figure, then multiply that times the average number of years you keep a client. In new pool construction, the follow-up profits may be minimal compared to the initial profit. In the service business, however, your profits are more likely to hold steady through the years. So, if your average client stays an average of three years, then multiply the annual net profit by three to get a realistic lifetime value.
CALCULATE ROI – Before investing in any advertising or marketing, you should calculate how much new business and net profit you’re going to have to win in order to pay for the ad. To calculate this, divide the total expense by the lifetime net value of an average client. That will tell you how many new pools or new clients you will have to win to make this ad break even. For example, should you pay $10,000 for a yellow page ad? Well, if you can sell 30 pools as a result of that ad, that’s only $333 per sold pool. Not bad! But if history says you’re likely to sell less than five pools as a result of that ad, then you may want to consider spending your investment elsewhere.
TEST SMALL – Whatever advertisement you’re planning to run, be sure to test it in a small, low-cost way before investing any significant money. For example, if you’re thinking about sending out 10,000 postcards, try sending out 100 or 500 postcards in a localized test first. See what sort of a response you get. If you get a 3% response rate on 500 postcards, chances are good you’ll get a 3% response rate on the 10,000 postcard mailing also. On the other hand, if you get less than 1% response on those 500 postcards, you can bet you will probably get less than 1% response on the 10,000 postcards as well. Always test small before you spend any big money on advertising.
MEDIA vs. MESSAGE – Keep mind that just because a medium did not work for you in the past, doesn’t mean it won’t work in the future. If an ad failed in the past, take a look at the message you were trying to deliver. Was it interesting? Engaging? To the point? Did you have a low-risk offer and/or compelling “call-to-action”? Or was it just another ho-hum “me too” ad that you would never look at if you weren’t already in the business? Bottom line — Don’t blame the medium until you’re sure you’ve got the right message.
SHOP THE MEDIA BEFORE YOU BUY – This is a great trick if you’ve got the guts to use it. For example, if you’re thinking about advertising in the Yellow Pages, pick up the phone and call 10 of your competitors. Ask them how that Yellow Pages is working out for them. How many calls did they get? Did they sell anything? Call competitors with big ads, and call competitors with little 1/2″ in column ads. If you ask them nicely, they’ll usually tell you all about it. After 10 phone calls, you should start to get a pretty sense of whether this medium is likely to work for you.
Ok, so as I said, if you’re going to spend money on paid advertising, you might as well make sure the money is spent wisely. I hope you find these tips helpful. Next week, I’ll share a handful of tips and tricks that will help you create more compelling ads,
Till then – Good selling!
PS – If you’re looking for a good low-cost source of leads, I can tell you we’ve had pretty good success using FreePoolQuotes.com. The owner just told me he’s offering “One month free leads” for anyone who signs up. I don’t know how long the commitment is, but you can find out by calling 888-766-6821. And for the record, I don’t make a penny off this. I’ve just found it to be a good source of low-cost leads for pool builders.
2009 Brett Lloyd Abbott / MYM Austin Inc. May not be used without permission.