Traditional Marketing Budgets
No business has unlimited resources with which to generate leads.
At iMarket Solutions we understand that you need to set and follow a marketing budget and constantly review it to make sure it’s getting the results you need.
During our 40+ years of experience in the HVAC industry, we have learned how to help service companies set marketing budgets that are both affordable and effective.
There are no hard and fast rules for marketing budgeting. Every company’s situation is different, and company owners all have different goals for how much and how fast they want to grow. But here are some general things to consider as you determine your advertising and media objectives:
- What is your company’s business plan calling for in terms of growth?
- How well-known is your company? Another way to ask this is “do you have brand equity?”
- Is your company seeking to grow into new markets?
- Are you launching any new products?
- How much of your company plan is built around existing customers and leads?
- What kind of market are you advertising and marketing in? Are you in an expensive market?
Once you’ve answered the questions above, you should assemble the following data:
- Your average number of lead opportunities generated from demand service
- Your average upgrade sales for the past year in service
- Your average closure rates for upgrade sales leads (this varies by month)
- Your financing decline rates (if any) on consumer sales (credit card or financing company related)
- Your ratio of leads that come from demand service – and from service agreements if you have them
- The average W2 of your field production for your service and installation personnel
- The sales forecast for your company (by market segment if possible)
- Company costs by each cost-of-sale category
Once you know how many sales you currently make and how many you want to make in the future in each market segment, we can then think about what kinds of marketing expenditures you might need to meet the lead and sales plans.
First, you need to determine what your overall marketing budget should be. If you do not already have this number, you can use our downloadable Budget Template to develop your company’s budget.
Once you know your overall budget, you will be able to establish your marketing budget.
First, you should decide what type of marketing plan you want. The plan you choose will depend on how fast your company wants to grow:
|Reserve Funds (for emergencies)||3%||3%||5%|
What should each of these marketing styles look like in practice? It will vary depending upon your local media environment – in some places, for example, radio stations have a better reach than in others; in some places, the local newspaper has a greater readership percentage than in others. You need to determine which local media will be the most cost-effective for you.
Here is an example of how an aggressive campaign might be structured:
|Direct Mail 40%||Newspaper 10%||Broadcast 20%||Yellow Page 20%||Internal 7%||Reserve 3%|
|Continuing Prospect Model||
Letter Campaign – varying offers -SA 1
Contest for leads, monthly, for friends and family leads!
To determine the specific message for each of the campaigns you’ve selected, use the marketing chart like the one below. This will help focus the design/creative aspects of the campaign.
|New Customers||Existing Customers||Continuing Prospects|
|Target market||Demand Service||Demand Service Prior use||Demand service|
|Products/services offered||Warranty Coverage Agreement||Warranty Coverage Agreement||Warranty Coverage Agreement|
|Target Audience||Emergency Service Customers||Female – single family home||Female – Single family home|
|Awareness Vehicle||Yellow Pages||Direct mail Letter||Direct mail Coupon|
|Trial Method||Discount off of service call Promotion||Special Price Offer||Discount on an upgrade Free Service Call|
|Timing of Campaign||Jan - April||March, April||March, April|
|Consumption Patterns||Yearly SA||Yearly SA||Yearly SA|
|Repeat Behavior||3 a year inspections||3 a year inspections||3 a year inspections|
Sometimes, after you have determined your overall marketing budget and your marketing objectives, you find that your objectives cannot be supported by the financial realities of your company. You may have grand plans, but if the financial position of your company does not support the dream, you have to go back, readjust your company marketing goals, and start the process over.
Remember, though, that no matter how you allocate your marketing dollars, your primary focus should always be on generating leads. This is true for almost all small companies until they reach a very mature stage.
However, at the same time you create leads in the short term, your advertising is having a longer-term effect on the way people view your company’s brand. It’s important to balance these two objectives carefully.
Want more help with budgeting? Download our comprehensive budgeting spreadsheet - absolutely free!
Here's what people say:
I have been so impressed and pleased with our new website and the entire process of launching the new site. iMarket Solutions handled every detail with a complete thoroughness and a high degree professionalism. Change is usually never easy, but Wendy and Nadia really took the time answer any questions and solve every issue. The end result has been a new site that we love and more importantly, our customers love it too.
The new design and the attention to SEO has been paying off. We used to average 3 to 4 leads a month on our old site. The first month with our new site, we received 12 and that was during mild weather in our “off season.” Thanks to the detailed reports we receive from iMarket, we now have the information needed to improve our marketing and zero in on the consumers in our local area. Also our rankings for Google and other search engines keep climbing if they are not already in the first position.
Our social media is now working hard for us, improving our relationship with our customers and generating traffic to our site. iMarket handles all our Facebook, twitter, and blog posts. We still have the option to post something ourselves if we choose but its not necessary as there are 3 posts a week, like clockwork, on our social media accounts. Our social media used to be a chore, now it is trouble-free.
Overall, my entire experience with iMarket Solutions has been effortless and now we have a finished product that is proving results and driving sales.
Apple Heating & Cooling
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