A point about advertising: You don’t need to spend a fortune to achieve results

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It makes sense to advertise, even when you don't "need" the leads, says Michael Stone. Local media such as Ottawa Renovates can be effective but you should appreciate that call volume will likely not be high -- but can still be highly profitable

Michael Stone in a recent eletter reminds residential contractors that they should always be advertising. He means “advertising” in the broader sense — including online marketing, and ensuring they have an effective website, as well as more traditional media. The argument: Effective advertising can generate a critical mass of leads, allowing you to be more selective about potential clients, and therefore retain the capacity to set higher prices in good times. And when things turn south, if you have an effective advertising system, you can dial up the volume and gather the leads you need even when things get tough.

However, there is another element to the story and that is how online advertising (specifically Google AdWords) can supplement and support your organic or natural listings, especially if they are reasonably good but not at one or two spot on the search engine.

The ads, says SEO consultant Brian Javeline (myonlinetoolbox.com) can provide a critical “impression,” so when viewers see your organic listing, they are more likely to click. (A bonus is that in this situation the ad is essentially free, if the click is on the organic rather than the ad listing.)

A contractor may be surprised how they can spend a little money on keyword advertising to supplement their organic (Free) listings. I’ll share a secret. Make believe your website is appearing somewhere on Page 1 or Page 2 when someone types in “Kitchen Remodeling Contractor MyTown”. You can pay a very small amount to be in position 3 or 4 (not position 1 or 2 which is the most expensive). Your goal for the advertising section IS NOT TO GENERATE A CLICK, but simply for someone to see your name (for Name Recognition Branding). Many people may skip the advertisements to see what is in the organic (free) section. Hopefully they see your company name for a 2nd time (since they quickly scanned it on top) and now will click on your listing below simply because they saw the company twice. That is a strategic form of advertising simply for Brand Awareness. Advertising is a component of Marketing; and you should have it supplement your online activities to drive traffic to your own website where possible.

An important aspect of advertising is getting over the hurdle of seemingly ineffective results. Depending on your product/service, your call volume from any advertisement may be quite low, but still, over time, profitable. Consider for example, if you are a renovator and your average job size is $50,000 to $100,000. Assuming a 2 per cent marketing/advertising budget, you should be able to pay $1,000 to $2,000 for a single client. Assuming you convert one client for every three qualified leads, then you would reasonably have a budget of more than $500 per lead.  How many paid clicks would lead to one solid lead? Or how many calls should you realistically expect from a specialized publication such as Ottawa Renovates magazine? (This is a local magazine of which I am a partner. There are similar opportunities in other cities and regions.) You need some patience and willingness to spend money without immediately measurable results to gain the payback you need from an effective advertising campaign.

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