Legendary merchant John Wanamaker once said, “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” Of course, that was back in the nineteenth century. However, many home improvement company owners are still scratching their heads when it comes to the return on investment of the money spent on advertising.
The answer to knowing how well marketing works is to track your lead generation sources. Knowing where prospects came from lets you see what works and what does not. This information gives you the power to spend more on the marketing campaigns that are effective and cut back or even eliminate the ineffective ones.
Back in Wanamaker’s day, the only way to track how well any of his ads performed would have been to ask his customers how they found him. While we have powerful marketing tools that provide detailed analytics, many times we still must rely on that very same human interaction. We must continue to ask, “How did you hear about us?” every time we get a new potential customer.
Even if a homeowner fills out a form on your website, it’s important to ask how they discovered the site. Was it from a yard or truck sign? A Google pay-per-click ad? An organic web search? Social media sites like Houzz or Facebook? What led them to your site to fill out that form?
Whenever your people talk to a brand-new prospect, they must ask how they found your business. Many times, homeowners are not specific so it’s important to ask follow-up questions. So, if a prospect says they found you “online”, your follow-up should be to ask what were they doing online at the time. It might sound invasive, but it’s vital you know these details.
Make it easy for your team to track lead sources. Whether they write down the contact details or enter them into a spreadsheet or CRM system, make sure they gather the lead source detail every time. It must be a requirement. If someone skips the lead source, they should have to reach back out to the prospect for this information. It is that important.
Tracking lead sources allows you to report on the outcomes for each lead. In a spreadsheet or lead tracking software, you can enter the results after every interaction. Did they respond to calls? Did they sit for an appointment? Did they buy? By recording the lead statuses, you can create reports showing how many received estimates but didn’t sell and now you’ve got a list of potential deals to be closed.
With reports full of details on where leads come from, as well as how many deals were won, you’ll know the effectiveness of your marketing efforts. At a glance, you’ll see how many leads were generated, how many sat for appointments, how many sales resulted, and even your cost per lead.
If you track these numbers, you’ll see the return on the money spent on marketing campaigns. You might even eliminate those campaigns that generate leads but result in few sales. More time will be spent collecting this data but it will improve your bottom line by saving you money. If you can, find a quality CRM system to automate most of the steps in this lead tracking and reporting process.
Lead source tracking is the key to improving your profit margins with smarter spending on all your marketing activities. Know what works and what doesn’t and you’ll make smarter decisions.