When it comes to their marketing campaign, one common mistake made by small businesses, including building and remodeling businesses, is to be too passive. Builders may place an ad or two, create a few social networking pages and then put up their feet to call it a day.
But if your remodeling business isn’t developing the volume of leads that you would like to see even months after your marketing has been implemented, the answer may be more proactive than you would think. More often than not, spending more time and money on your marketing campaign might be the difference between red ink and black ink at year’s end.
How Much Should You Spend on Marketing?
The first step to determine how much money your business should be spending on marketing is to turn abstract marketing questions into concrete ones. It’s important that you have very specific and concrete objectives as to what you want to achieve. This means that “more sales” isn’t a suitable objective. How many more sales do you expect from your marketing? Are these sales expected to be more for some products and services compared to others? The more specifically you can define your objective parameters, the better.
Time is another important parameter that’s often forgotten by those new to marketing. Not only is it important to have a clear idea of when you expect these goals to be achieved in order to keep tabs on the success of your campaign, it’s also crucial because it allows you to have an idea of when your marketing’s effectiveness begins to decline. Even the most successful marketing campaigns have an expiration date, and that’s no less true for small remodeling businesses.
How To Measure Marketing Success?
A major part of being proactive in developing your marketing campaign demands that you have more specific metrics for your success and failures. One objective of your campaign may be a 15 percent increase in renovations during the next three months, but an increase in the number of sales made during a particular period of time may not be the best metric to use depending on your true objectives. Improving your website’s search engine rankings or raising regional awareness of your services are both goals that will provide you with long-term growth that can’t be measured by looking at sales increases over a few months. That’s why it’s crucial that you consider which metrics you’re using before you deem a marketing campaign successful or not, and you should evaluate the success and failures of your current campaign long before you throw more money at it.
The Bottom Line
Conventional wisdom holds that you should spend a fixed percent of your business’s total revenue on marketing. While many remodelers seem to spend around 1 percent, some of the most successful marketing-driven remodelers spend closer to 4 percent or higher. Additionally, if your business mostly takes on jobs earning you $10,000 or less, you may need to double that number again in order to develop enough leads. If your remodeling business is relatively new, some experts suggest spending as much as 15% of your budget on marketing efforts. This number may seem frighteningly high, but it may be necessary in order to deliver the sustained growth you want from your marketing campaign. Determining just how necessary it is begins with creating realistic goals and carefully tracking your performance metrics, and ends with making an evaluation about the success and failure of your campaign to date.