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What’s the best way to generate residential and commercial leads for my business?

What’s the best way to generate residential and commercial leads for my electrical services business?

Answer: Customer and professional referrals are generally very effective for building contractors; however, the basic tool to maintain a steady flow of work and build a customer base is a comprehensive marketing plan. We do not know the details of your current customer base, your geographic trade area or the extent of your current marketing and advertising methods, but building business relationships with commercial accounts, professional networking, and call-to-action advertising for residential building contractor services are the more effective approaches for improving sales for electrical contractor businesses. However, marketing methods are influenced by the industry, local competition, brand recognition, target customers, available capital, customer base, and other factors. Also, trial and experimentation is usually required to determine the most effective promotional methods for a particular market. Businesses normally determine by experience which marketing options provide the greatest response with the lowest cost. Business owners test, adjust and measure their marketing efforts to make sure they are allocating their marketing dollars cost-effectively in reaching their potential customers. You typically need to apply this type of approach to any business.

Of course, you know more about your local market demographics and how to market your business than we do; however, in addition to Yellow Pages (print and online), contractors may use referrals, professional networking, print, radio, direct mail, and other forms of advertising. Companies with years of operating and marketing history should periodically review their marketing programs, their target audience, and the status of their competition to determine what has worked successfully in the past and what has changed in their business, industry, and market demographics. The place to start assessing your marketing plans is to review how you have marketed in the past and what has worked successfully. For example, you may only need to increase the frequency or level of your more successful marketing activities to generate more sales. However, you may need to diversify your target audience and/or try new marketing and advertising methods to reach more target customers in your current trade area or to expand into a larger geographic trade area. The following are comments and considerations for marketing your business:

Target audience Review your target customers (general contractors, remodeling contractors, property managers, businesses, government agencies, individual homeowners, etc) and determine the best allocation of your marketing budget to maximize your sales opportunity.

Online referral services: We do not have any experience with any of these services; however, the following are example online lead services for electrical contractors and related discussions:

Direct, or B2B, sales: We do not know to what extent you focus on commercial accounts, but marketing to contractors is typically a different process than to homeowners. Letters of introduction, brochures, resumes, and other methods are used to make initial contacts with commercial contractors, commercial property developers and managers, and other business accounts; however, B2B sales generally requires some level of direct sales activities to introduce business products and services and to develop business relationships. For example, contractors and businesses often have established electrical contractor relationships; therefore, it is important to meet with your target business clients face-to-face in order to explain all of the benefits and advantages of your services and products and try to establish a business relationship. You can locate additional suggestions and tools for developing your B2B sales methods in bookstore and library publications and websites like the following:

Referrals: Customer referrals are the best form of advertising and an excellent way to build a business. We suggest you continue to encourage referrals from your customers and make sure you show your appreciation to those who refer customers to you. For example, we have seen residential building contractors offer customer referral fees up to $100. To develop a better understanding of the referral marketing process and develop a referral marketing strategy for your particular business, you can review websites resources like the following:

Contact lists: Target customer lists can often be compiled for free or for a nominal cost, from various sources: Chamber of Commerce, local government agencies, Yellow and White Pages, business directories, and others. However, the most efficient (time saving, accuracy, etc) source of businesses and residences by location, industry (NAICS/SIC code), income, and other criteria is a commercial list service, though they may cost a few hundred dollars. You can also use the Yellow Pages or an Internet search engine to locate commercial lists and directories that may provide you with target customer information. The following are example websites:

Dun and Bradstreet is another source of list services.

NAICS/SIC codes:

Networking: Networking and marketing with complementary (realtors, general contractors, various construction trades, etc.) businesses, for example, may be helpful for reaching more customers.

Competition: Researching how the competition advertises can be helpful to identify marketing and advertising methods.

Differentiation: Identify the ways that your services are, or could be, different than your competition – years of experience, technician training, etc.

Online marketing: Make effective use of your business website to attract consumers and gather Contact information, including the use of social media marketing tools

Free publicity: There are often opportunities for free publicity or public relations in local markets by providing public interest stories to local newspapers and radio and TV stations that lead back to your product or service. Being a long-term business owner in the area, providing a new, niche, or unique service, being named business of the month and other factors can qualify you for free publicity in your market. Companies should take advantage of press releases and other media public relations that they can obtain for free, by bartering or on an economical basis. You can review free publicity information and suggestions at the following websites:

Signage: You should always use signs on your work vehicles and in the yards of customers wherever possible.

Cross-marketing: Joint or cross marketing with remodeling contractors and other complementary building contractors and services can be effective.

Marketing plan: A marketing budget will be a balance between what print, direct mail, media, and other forms of advertising cost in your market and what you can afford. Unfortunately, there is no silver bullet in marketing. Whether you use a website, coupons, print, or other form of advertising, a business must break though the promotional clutter of many other advertisers to attract the customers’ attention. It is often advisable for business owners to have a written business plan including a marketing plan. A marketing plan can help you evaluate marketing options, formulate a plan, and develop a budget.

Published: June 18, 2013
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Chris Barnes

Chris Barnes is the Director of Business Development at Tarkenton Companies, with a sales and marketing background in a wide range of industries, from sports information to insurance marketing. A jack-of-all-trades, Chris has experience in many aspects of daily and strategic operations for small business.