Construction marketing: $1,500 or $15,000: Which offers better value?

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completion web studio pageYesterday had more than the usual number of marketing and business challenges.  As we prepared to “close” August issues of several publications, two people communicated their marketing challenges/questions to me.

In one, a consultant wanted to see if I could refer business his way for web design work.  He said he is completing a project for a contractor, and knows he could do more.  He would pay a referral commission.  I asked him his rates.  ”$15,000,” he said.

A few minutes later, I went for lunch with a manufacturer of specialized electrical components.  He sought some ideas and breeze-shooting about how to promote his business.  He had introduced me to the Dan Airley, whose “irrational choice” option is worthy of considering in your marketing materials.  He said a sales representative for a major newspaper had called him to see if he would be interested in doing business again.  His total spend (over a number of years) when he advertised in that publication:  About $35,000.

That sum presumably seems large to him today because his annual sales volumes right now are less than $100,000.  ”I’m not drawing a salary,” he said.  I think not.  He said he proposed to the newspaper ad rep that the publisher might consider a pay-for-results deal.  I told him, flatly, that the newspaper probably wouldn’t take the deal, and if he thinks he is a “major customer” of that national publication, he is living in a dream world.

Meanwhile, this morning, I’m preparing for a Skype conversation with Nick Piscitello at Completion WebStudio, who is ready to design websites for $1,500, not $15,000.  In exchange for promotional considerations from me, he offered to build a site for free.  I gave him an assignment:  Rebuilding our corporate website at www.cnrgp.com to something more useful.

Nick has 100 per cent fulfilled his side of the bargain, but if you look at cnrgp.com today you’ll see gibberish, Greek, and quite a mess of fonts and graphics.  This is because it is now our turn to populate and organize the site and get it in shape for public viewing.  I’m daring to even reference it here, because we’ll come to the point in a second.

Remember the other consultant who offered to design and build web sites — for $15,000.  He said he would be happy to show us the site he’s built when his client finishes providing the information he needs to complete the job.  Seems at $1,500 or $15,000 — if the client doesn’t do his part, the job doesn’t get done.  No amount of delegation and hand-holding can replace the fact that, for some things, the client, not the vendor, has responsibilities!

The next question here is about value.  Who offers the better deal?  Is the $1,500 offer better than the $15,000 one — or are there differing needs for differing circumstances.  The business person who thinks $30,000 in advertising over several years is a major expense is of course correct, based on his actual current sales volume.  But he wasted his time proposing a trade-out pay-for-performance deal with the major newspaper, which probably has clients who spend $35,000 — in a day!

In fairness, the marketer offering the $15,000 website package will undoubtedly deliver a top-of-the-line site to his clients.  He is quite clear about qualifications standards, using one of the simplest measurements available to any business-to-business service provider.  ”Generally, I need clients who are doing at least $750,000 to $1 million in sales each year,” he said.  I doubt the person with whom I had lunch could justify this consultant’s fees, or, for that matter, Nick’s.

The question arises, as well, whether our business (which produces annual revenues in the range of the more expensive consultant’s threshold) could justify spending more money on websites than we do.  There are real strengths in our sites, and real weaknesses, but I doubt we would ever even contemplate spending anywhere near $15,000 — or even $1,500 — for a website. Of course we don’t have to do that, because we are offered other options.

And this leads me to the final observation, and the first and last communications of the day.  In the morning, struggling in my mind with the cost of maintaining and updating website content and managing social media and SEO, I thought of the high school student who had assertively approached me to propose providing photographic services for our business.  His “shot fees” were well on the high side (especially for a person going into Grade 12.)  I used him for one photo.

Then, my thick brain clicked into action.  This student is entrepreneurial, outgoing, sales and marketing oriented — a rainmaker — and he is only in Grade 12.  Why not offer him a contract to work on our websites while finding advertisers for them?  I could certainly pay him a generous hourly wage on these conditions.  He said yes.

In the end, value is a matter of perception, opportunity and how use the services which are available to you.  Obviously, if you can get a $15,000 website for $1,500 (or free) you are doing well, but you aren’t doing anything if you don’t complete your end of the deal (so I really need to finish the work at my end on the cnrgp.com site!)  Sometimes the best opportunities arise when you look a little beyond the surface.  However, you should always be realistic.  If you aren’t a “big fish,” putting on airs or hoping for something wonderful to happen on your terms is less-than-likely unless you can provide relatively high value and importance to your counter-party.  Nick did that with me, as has the more expensive consultant (from whom a single referral connected to several thousand dollars in business.)

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