The Single, Powerful Marketing Principle That Can Change Your Business

Relationships compound, based on familiarity.

You can’t “skip a step”. To be rewarding, it must be earned.

It’s called “Funnel Marketing” and it takes the “old” Contractor Marketing model of “Let’s put every dime we’ve got into the Yellow Pages and see what happens” (a model I openly despise) and makes a more intelligent, rational, less costly but more results-based marketing plan.

We’ve advised it for the last 7 years with roughly 1,200 contractors, but now in its 3 generation of results, with help from the phenomenal volume of trackable data from websites, we see even more power behind it.

Here’s why it works.

One of the biggest mistakes contractors make is in assuming that all your customers are in a single group. Think about it.  You have strangers, acquaintances, friends, family – varying degrees of relationships, varying levels of communication.  And your customers aren’t any different.  If you – like much of your competitors – ever feel “a customer is a customer” you’re finished before you ever got started.

Tell your wife or husband they’re just like every other male or female and see how well that goes over.

In a business relationship, your job is to steadily “funnel” or advance customers through your company to achieve the maximum benefit for them and maximum profit to your company.  And it goes like this…

Your 5 Part Marketing Funnel

For marketing success, you’ve got to narrow your target audience from “everyone” to “those most likely to buy.” Funnel marketing is a proven way to make that happen.  Just like a kitchen funnel, the Marketing Funnel is broad at the top and narrow at the bottom.

The simplest way to explain it is that this form of marketing automatically and systematically “graduates” your customers from cold prospects to active customers.  It’s the process that enables you to move your message through a “funnel” that narrows to a tighter audience – and with more controlled media. 

Think each of these five funnels through as your message and means of delivering it narrow: 

1. WHO is your intended target market?   This is your most valuable funnel, by far.  “Who” goes from cold prospects at the top of the funnel, to contacted leads, to inactive or old customers, then to referrals, down to the active, spending customers. Fewer of them but the highest prized of the group.

The current and tragically flawed marketing model for contractors goes from “everybody” spending to “customer” spending in one huge step. And most companies don’t even separate that. It’s just “marketing” and one size fits all.

In other words, all the people who didn’t buy after the first contact, go right back into the “everybody” pile… where you get to pay for them again, just like they were never a prospect.

This also divides the world into only two groups: the entire general public and your customers. That’s the same as saying all people are either total strangers or close friends. If you follow this rule in your marketing model, it’s costing you a fortune in sales and a fortune in wasted advertising.

2. WHAT are you saying? This is your ad message according to your familiarity with the group. “What” you say is your biggest challenge. I critique hundreds of ads every year for contractors and I can tell you these almost never say the right things, in the right order, or in the right way. Many of them are offensive, hokey, or just plain amateur.

Take all your leads inwardly through your messaging. Advance your prospects from a big-market, broad message to narrower “follow up” message, to “reactivation” message, to “retention, upsell” message (Newsletters, Maintenance Agreements) at the bottom of the funnel.

3. HOW do you send your message?  This means media, from the broadest to the most personal. Understanding this can slash thousands of wasted dollars out of your ad budget.

Start loading your How Funnel at the top with broad market media such as Yellow Pages for all purpose ads and broad market newspaper ads. Your next level could include community newspapers and direct mail. Each level works toward a more personal form of communication. Just like in the Who Funnel, each level gets more specific. 

4. WHEN do you run these ads?  YP ads run year long. Some newspaper may run 26 times a year. Radio is seasonal. Direct mail can be 4-8 times a year per promotion. The frequency decreases right along with the number of people you contact as your messages become more specific.

Your contact rate would drop gradually throughout the funnel until it reaches its lowest point at the customer level of 4 contacts per year. If you’re not contacting customers at least 4 times a year then you’re begging them to leave.

5. HOW MUCH do you spend as a percentage of sales dollars? Contractors fear spending money on something yet to be realized, and this kills planning in its tracks. Aggressive marketers spend 8-10%, Moderates 6-8% and a Conservative 3.5-5%.

Yet, with the marketing funnel, the only totally “cold” marketing dollars are spent acquiring leads in the upper levels of the funnel, largely through direct response. As you work through the funnel, these dollars are spent following up or working in tighter, less expensive media with fewer and fewer marketing dollars.

The results of following the funnel are an instant increase in closing ratio at fewer marketing dollars.  Unfortunately, most contractors let warm prospects linger on the vine…letting them get perfectly “ripe” for buying… from their competition! This brings me to a startling revelation that ought to make you a little mad. Without a proper funneling sequence…

You’re marketing for your competition!

So don’t make that mistake.  Focus your marketing down the funnel, so more customers and sales will funnel your way. Who knows, you may end up with a Marketing Merit Badge for your trouble. You’ll be brave, reverent, and truly amazed at the results.