Measuring marketing success: Another perspective

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Michael Johnson
Wisconson plumber Michael Johnson "gets" the construction service concept. He's with a client here.

Michael JohnsonThe Contractortalk.com forum continues to provide an environment where residential-focused contractors can share insights, challenges, and adventures. There’s a Marketing and Sales section and, these days, one contractor — Mike Johnson of Madison WI — has so much influence that when someone posts a question asking for some succinct advice, others will pipe in suggesting the inquirer wait for Mike to provide an answer.

I interviewed him a while ago, and posted the observations in an earlier blog posting. However, today, I noticed another answer that both has me excited and scratching my head.

The thread-starter asked what to me is a simple, and extremely important, question: “How do you measure marketing success?” This is a topic I’ve studied quite extensively, including writing a series of articles for The SMPS Marketer magazine (you can request some of this material by emailing buckshon@constructionmarketingideas.com.)  So, with some anticipation, I waited for Mike’s response. And his bottom line conclusion:

Think big, think “big picture”. Think about the total package.

You simply can’t measure the results. It’s impossible.

Oh.  In greater depth, of course, Mike explains that marketers need to think about improving every aspect of their operations, creating an aura of incredible service and relationships. (He described earlier how he built his business by connecting and sharing with community groups where he could meet and build personal relationships with the centres of influence in his city — an idea that works, every time.)

Mike’s concepts echo the late Sonny Lykos, who observed that most contractors fail to understand the basics of building incredible reputations by building service and community — and not bragging with the cliches like saying “We provide great customer service.”  When the customers say that, in testimonials, yes, but when we say it, bah, humbug.

I think Mike is partially right in that many of us measure the wrong things, or spend too much time trying to “game” the measurements to get the results we are seeking, while avoiding the underlying challenges. However, there are some measurements we can use that may be effective and still serve the purpose.

The net promoter score

How many clients are ‘really’ ready to refer us to their friends and colleagues? You can ask it in a survey. (The best surveys are simple, and combine with a testimonial-seeking objective, as Mike Jeffries has applied in the survey reflected in a recent Construction Marketing Ideas blog posting.

How passionate are we about the opportunity, challenge and  business?

This can be measured by measuring time. It is most relevant to AEC practices assessing “go-no go” decisions. The argument is the more non-billable hours a principal (not a junior) spends on a proposal before submitting, the greater the chance of success. You’ll need disciplined billing code rules for this one to work, but it can be highly effective for medium-to-larger sized practices with several principals and a good accounting and job costing/management process.

Inquiries/leads/sales — and recurring sales ratios

The standards of marketing measurement but rather important, especially if we are spending money on marketing. You can allocate costs for projects and initiatives, track the leads, see where the sales result, and (over time) measure recurring sales to ascertain the true life-cycle value of the marketing initiative. At the simplest level, you can track trade and home show effectiveness. The challenge here is to determine whether it is the show that is the problem (if things aren’t working) or how you handle things outside the show.

A/B testing

The magic of A/B testing cannot be underestimated, especially for online advertising and marketing. You test two variables side by side, and within a reasonable time, gather enough statistical data to decide which is most effective. Then you test that idea against others. This can work to build a relatively reliable model. The challenge is in getting started, when you have no baseline — and you are seeing your marketing dollars seemingly disappear into the ether. (I know, because I’ve dropped tests before they got too far, wondering if the whole thing is worth even trying.)

I agree with Mike about one thing. While I think measuring is more important than he seems to suggest, I also agree that we can focus on the wrong priorities. The measurement is a tool, not the conclusion — and a real branding success; that is truly earning the trust of current and potential clients, may require nothing more than to really think hard about how we can focus on improving the customer (and our community) experiences.

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