The 20 Minute Marketing Analysis

Construction Marketing

Do you know how much you should be spending on advertising your building company?

Do you know how much every lead you generate is costing you?


Once you know your numbers, you can ramp up your advertising whenever you need more sales.


So how do you check that your advertising is delivering results every month?


Watch this video now because will show you the process we use to manage our marketing campaigns in less than 20 minutes a week. 


In this video, we share with you the process we use to identify the marketing channels and the campaigns that are ready to be scaled up....and the ones that have to either be scaled down, or turned off completely.


To Scale Campaigns Up Or Down You Only Need 2 Numbers


The process is simple, and it only requires two numbers.


These two numbers are fundamental to every marketing decision you will make in your business.


The first one is…


How much money is each lead costing you?


Construction Marketing

Simple stuff, but over 92% of the building companies I speak to simply do not know this number.


If you have never calculated this number before, don’t worry, it’s really simple and will only take you a couple of minutes.


Simply take the total amount of money you spent on advertising for the past 12 months and divide that figure by the total number of enquiries you received.


What Is CPA?


That number is your Cost Per Acquisition otherwise known as your CPA.


[CPA = how much each lead costs you]


It’s a really good number to know because once you understand how much it costs to generate each new enquiry, it means you can now look at new marketing opportunities objectively.


[Cost = $2,000]

[Leads= 40]

[Cost Per Lead = $50]


For instance, if your Cost Per Acquisition is $50, and you are considering running an advert in a magazine for say $2,000, then the question to ask yourself is, “will I generate at least 40 new leads from this advert?”


[Cost = $2,000]

[Leads= 10]

[Cost Per Lead = $200]


If you don’t feel that is likely to happen then don’t proceed.


Equally, if you have no way of measuring the results of an advertising campaign, that is another good reason not to proceed!


But regardless of whether you think you can or can’t generate 40 leads from this strategy, there is an even more important question to ask yourself.


“Will I make money from the leads I am generating?”


[EPA = how much you earn from every lead]


And the answer to this question lies in the EPA, otherwise known as Earnings Per Acquisition.


Construction MarketingEarnings Per Acquisition is not a straightforward calculation for builders.


For a building company, we need to look at the net profit and add back the advertising spend.


The reason for this will become obvious later, but for now stick with me.


If you calculate this figure using your gross profit then you’ll end up losing money.


If you use your net profit figure you’ll end up losing an opportunity!


So, take the net profit figure for the past 12 months and add on the total advertising spend from the past 12 months. Divide this figure by the total number of new enquiries your business generated in the last 12 months.


This figure is your EPA.


What Is EPA?


Earnings Per Acquisition.


It’s how much you have earned from every single enquiry your building company received in the past 12 months.


Now, hopefully your EPA is higher than your CPA.


What I mean by that is your earnings per lead are higher than your cost per lead!


Because if it’s not then you are losing money. So if you scale up your advertising you’re probably going to end up losing even more money!


So let’s assume your EPA is higher than your CPA, how much should you be spending on advertising?


Well the answer to that question is dependent on a lot of factors such as:

  • What are your growth plans?
  • Does your building company have spare capacity?
  • What is happening in the market?


But let’s keep this real simple.


If you are looking to acquire more contracts you can potentially spend up to 100% of your EPA without losing money.


Of course, working all year just to break even is not a good strategy so you might want to start out by setting your budget per lead at 50% of your EPA.


What that means is that for every dollar you spend on advertising you get $2 back!

Construction Marketing


It’s like playing on a fruit machine that has been set up to pay out double every time that handle is pulled!


So let me ask you...


If you had an advertising campaign that generated $2 profit for every dollar you spent, how much would you put in it?






Well, not so fast.


Just because you are getting great results from a campaign that is costing you $500 a month, it does not mean you will 10x your results by spending $5,000 a month.


This is where your 20-minute marketing management comes into play.


Scaling Campaigns Up And Down


Scale up your winning campaigns by 25%-50% and then monitor the Cost Per Acquisition.


If the campaign is still profitable a week later, scale up again.


If you have a campaign that is not profitable then you have two options.


You either shut it down…


Or scale it down and only target the most profitable part of the audience.


Either way, don’t carry on with a campaign that is losing you money. Cut your losses quickly and focus on the winners.


If you are a member of the Membership Portal then there is a step-by-step Action Plan that takes you through this process in a lot more detail.


To learn more about the sales and marketing process for a building company, make sure you download the Builders Sales Process.


It’s a free download that takes you through the proven sales process for a building company which is being used by professional builders in Australia, New Zealand, the UK and North America.


You can download it now by clicking here, or on the Download Now button below.


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