How to multiply your leads in a weak economy

Oct. 1, 2008
It's always been the case. Since the dawn of time or around the time my children think I was born businesses have sought lead generation. The first heating contractor sold fire door-to-door; the first plumber offered ways to get rid of that musty smell in the cave. You know the rest: As soon as those first jobs were completed, the first collection agency began. The life-blood of business is lead generation.

It's always been the case. Since the dawn of time — or around the time my children think I was born — businesses have sought lead generation. The first heating contractor sold fire door-to-door; the first plumber offered ways to get rid of that musty smell in the cave. You know the rest: As soon as those first jobs were completed, the first collection agency began.

The life-blood of business is lead generation. Our most commonly heard request in marketing coaching calls is, “How do I generate more leads?” They've heard all sorts of advice, gotten all sorts of prices from various media and seen a variety of approaches, and they even get a sermon from me on the topic.

It doesn't matter — they feel “stuck,” confused or overwhelmed. So depending on the contractor, we occasionally list the steps, but just as often we teach you how to do it for yourself (the “teach a man to fish” approach). Not long ago, we got an e-mail…

“… kind of hesitated to ‘get started.’ But I'd like others to realize they don't have to feel stuck. Starting with a few changes can reap immediate benefits that can help them make other changes that will reap further benefits. It's momentum.

Since generating more leads, I'm now a better salesperson, closing a higher percentage. But the biggest factor is having more leads to work with. And I wanted to say, ‘Thanks for all your help’.” — Steve Scott, Comfort Technology, N.Y.

That was very nice of him to say, but the most important word in his e-mail was “momentum.” Yes, that was a marketing lesson.

You see, he started off “stuck.” But Steve is the guy I mentioned a few articles ago who is getting six to 10 leads a week from a $54 ad. He closes half of those for a maintenance agreement. He also invests in direct response when the leads slow down, plus he sends all customers a newsletter - like clockwork - and follows up his leads, referrals and sales regularly. He's so “unstuck” now, he can't even remember it.

So, how do you get a dose of marketing momentum when the leads are down and the economy isn't helping?

First, if you're going fishing, it'd be nice to know what was biting right? How about where, when, on what and how often? Same thing here, so your very first clue to better lead generation is…

Track your incoming leads

Would you put your money in a bank that couldn't tell you the interest rate? How about a watch with no hands? I mean come on, you're investing in marketing for results, so think in terms of measurement.

Your receptionist can keep up with this in a number of ways. I've seen very effective companies use a tick mark system of noting an ad's response that is then fed into a weekly results sheet for leads and sales. I've also seen sophisticated contact management software that had a field for incoming leads per media type. Any method is better than no method. The essence of tracking is to find what works and how well it's paying you back.

How are you going to figure an ROI if you don't look at the R and the I?

Look who's buying. Your customer list shouldn't be viewed simply as one large category, but as multiple levels of information. Avoid the frustration of making offers to the wrong group by taking your full list and dividing it to select the best targets.

How do you determine your most valuable customers? Here's a quick list segmentation method I like called recency, frequency and transaction size — RFT.

Recency: Those who have spent money with you in the last 24 months.

Frequency: Those who have used you with the greatest frequency in the last 24 months.

Transaction size: Those who have spent the most with you in the past 24 months.

First, rank the best candidates according to the above and determine how big a list you can effectively contact.

Then assemble your RFT list for a post card offering $20 off any service call, plus a $20 gift certificate for referrals who get service work done within the next month (or whatever time period you determine).

Oh, I can hear the cries from some of you already: “I've got to pay $20 for each new customer?!” Actually, you're already paying more than that. The average customer acquisition cost is $275, so this is mighty cheap by comparison, and you only pay when they pay you.

The gift certificate can be for a lunch or dinner, which is a nice gift. (A wise restaurant owner will sell you blocks of 10 or so certificates for as little as half the face value to put more diners in the seats. They may have certain night limitations.)

Now, not only will you generate leads and nearly free referrals with the right offer, but you'll determine the value of this list to help find commonalities for a much broader contact list later. Bear with me for a sec.

Third, make the call. Follow the post cards with a call saying, “Did you get our money-saving postcard in the mail?” (If the answer's is “no,” check your records.) “Great, our technician will be in the area on Thursday and Friday. Which would be a better day to stop by to evaluate any plumbing needs?” This is an alternate-choice close and not pushy if said by a pleasant, smiling voice. Modify for your taste, but you get the idea.

If your caller runs into a person who doesn't need any work and can't think of a referral, but says nice things, jot it down and request to use it as a testimonial.

From your customer list, a 1.3%-2.5% response is the range depending on quality of list and offer. Getting 50 leads from a 1,000-2,000 piece mailing is not a bad result for an hour to get the mailing ordered. (We had a direct response piece get 11%, but that was freakish, and not to be expected. Of course, we brag about it endlessly, like I just did again.)

This is a small mailing, to a high quality list. As you generate appointments, sales and referrals, you'll have made some money to keep the momentum going. Since you tracked your leads (Remember? You did track them, didn't you?), you now have a guide to what's working.

Once the commonalities of your list are determined to be profitable, go get a list that has similar demographics. A mailing list broker in the dreaded Yellow Pages or at can create a list based on the best respondents using combined income, age of home, education and other parameters. This is a simple list to obtain.

In fact, this whole list is simple to do, doesn't cost a bunch and can generate a flood of leads when you need ‘em most, like now. Can you think of a reason not to get started? Let your marketing momentum begin!

What else can you do? For a few pennies you can…

  • Ask every single service call you get for referrals politely and without pressure.

  • Put door hangers on every adjacent home where you do service work. (There are eight 12 designs in the PowerPack.)

  • Use a yard sign on every service call you get. Top of Mind Awareness works.

  • Make a “happy call” to every service call within two days of the visit. This opens the door for good will, additional contact and referrals.

  • Send a thank you card, telling them you'll contact them to see if things are okay. You'll also ask for a referral on the later card.

  • Compile all customers into your database for a customer retention program. These are not transaction-based, but calendar-based, meaning two to four times a year. Top level contractors send newsletters. I'd love if you chose ours, but that's not the point. Just choose a good one that enhances your professional image and speaks to your dedication to providing quality services. (Get a free sample and retention report below.)

Free thing this month: Get our list of Top Retention Methods for Contractors, plus a free customer retention newsletter sample. Simply make your polite request to [email protected] or fax your letterhead to us at 334/262-1115 with your polite request and mailing info.

Adams Hudson is president of Hudson, Ink, a creative marketing firm for contractors. For a free sample of our customer retention newsletter, call Hudson Ink at 800/489-9099 or visit for many free marketing articles and reports. To receive a free newsletter sample, fax the request on your letterhead to 334/262-1115.

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