Referrals, consistent marketing efforts or both? It seems like a simple question, but it is not. Are you relying solely on referrals to build your business? What other activities are you doing in the charge forward to acquire more business? Do you feel comfortable enough that you do not need to put forth any other effort to help grow your business?
The remodeling business has been strong the last few years, therefore you may feel comfortable relying on referrals as your main source of acquiring new business. But you should consider other options. Of course, during times when the economy is good you may feel like you can take a breath and reduce your marketing efforts. And in the bad times, you may feel that you shouldn’t be spending money but rather cutting expenses where you can. Past studies have shown that marketing should always be a consistent effort for your business, especially during the down times.
A McGraw-Hill Research study looking at 600 companies from 1980 to 1985 found that those businesses that chose to maintain or raise their level of advertising expenditures during the 1981 and 1982 recession had significantly higher sales after the economy recovered. Specifically, companies that advertised aggressively during the recession had sales 256% higher than those that did not continue to advertise.
The idea of ongoing marketing efforts, whether in good times or bad, is to keep your brand equity constant and consistent. When you rely solely on referrals, there is a chance that your reach and awareness is quite limited during the down times of the economy. You will then, find yourself trying to play “catch-up” to competitors who consistently invested in marketing efforts. The “secret” to business growth and success is finding the perfect mix, such as referrals and marketing together.
Why should you want to do more than rely on all referrals for growing your business?
It’s important to keep the momentum of your current success, which will protect you when times are down. The only way to keep momentum of success is to be consistent in the ways you get the word out about your business.
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