Friday, March 15, 2013

Online Marketing: Are You Getting Results?

I wouldn't call myself an expert in online marketing. But as a sole proprietor, I do more online marketing and get more results than most of my A/E firm clients. Increasingly, prospective clients are contacting me because they've discovered me on the internet. And that's a good thing, because I don't have much time to make sales calls.

The internet is a great equalizer. Someone as insignificant as me can be read by tens of thousands of people around the globe. Type the phrase "A/E firm consulting" in Google and my website comes up before much better known competitors like PSMJ and ZweigWhite. I'm buoyed by the fact that my next new client might be someone I've never met who's admiring my work somewhere out in cyberspace. Someone like these individuals who first contacted me by email and recently became clients:
  • "He (the firm's president) has been a fan of yours for some time. He frequently forwards your articles to our core management group."
  • "I am a fan of your blog and would love for them (the management team) to consider your consultant services."
  • "I am a fan of your blog and I'm interested in talking to you about possibly doing some in-house training for us."
I share these only to inspire you. To be honest, I don't do online marketing particularly well. I have this blog, a monthly email newsletter, and a resource website. I do a few webinars through professional associations. I dabble in social media like Twitter. I've slacked in submitting articles to various online publications as I once did. And I don't know squat about SEO (if you don't know what that means, you know even less than I do).

Yet I'm getting results. 

What about your firm? How many leads has your online marketing generated? How many new clients first learned about you online? If those questions make you a bit uncomfortable, take heart, there's help available. The marketing consultancy Hinge, for example, knows something about online marketing for professional service firms. They conducted a survey of 500 firms to discover what practices produced the best business results. Here's a sampling of their findings, as summarized in their book Online Marketing for Professional Services:

A/E firms generate fewer leads from online marketing than other professional service firms. Unlike other similar surveys, our industry was well represented this time, with almost 37% of responses coming from A/E/C companies (the largest segment of the survey). But we generated the smallest proportion of leads from online marketing—8.3%. Marketing and communications firms, by comparison, derived 31.4% of their leads from online activities.

Is that a factor of our marketing efforts or our clients? I suspect it's some of both. As noted earlier, most of my clients don't even equal my meager effort in terms of online marketing. Particularly missing from these firms' approach is effective use of valuable content. Hinge also found an inverse relationship between leads produced online and the percentage of revenue coming from government contracts, which accounts for a large share of our industry's income. Since government buyers follow a more formal procurement process, they are probably less influenced by online marketing.

Firms that generate more leads through online marketing grow faster. Those that didn't generate leads online had a two-year median growth rate of 15% (most A/E firms would be happy to have grown at that rate the last two years!). The growth rate increases as firms generate more leads online—to a point. Firms that derived 40-59% of their leads through online marketing had the highest two-year growth, almost 64%. Beyond that, growth dipped a bit, but still averaged above 50%. This may suggest that it's best to employ a healthy mix of lead generation tactics, but you clearly don't want to ignore online.

The most profitable firms are those that generate a large proportion of leads online. Those that generated 80-100% of their leads from online marketing had the highest profitability, a median of 32.5%. That's twice as profitable as firms generating less than 20% of their leads online. The difference probably relates in part to online marketing being a key part of an effective business development strategy. But the lower costs of online marketing also come into play. One recent study found that online marketing costs 62% less than traditional tactics.

So that makes a pretty compelling argument in favor of online marketing. Chances are your firm has considerable room for improvement. Where to start? Next week I'll summarize the best practices that participants in the Hinge study identified. If you don't want to wait, you can download the aforementioned book for free from the link above. Or you might prefer to check out the summary of the study as specifically broken out for our industry.

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