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that's how you doing it's Ryan here at digital plumber coming next today on the whiteboard with something else that this is a topic that a lot of people seem really interested in when we start talking with our clients we talked about this idea of the conversion funnel a lot of guys this is the first time they've heard about it so this is something that when you're sitting marketing like at a college or an NBA level this is kind of a process which helps you understand what your customer goes through so it's important to understand how the funnel works because it affects how your customers buy and what things you do to reach them so it's a little bit academic it always works though and when you're trying to talk about a marketing strategy or growing a business understanding the funnel is really it's really important it's really essential to actually making a marketing strategy that works for a company so for you guys that are HVAC companies your plumbing companies your electrical companies understanding how the conversion funnel works why it's important for your business and lets you make good decisions and it lets you help monitor if things are working or not so I've got markers here raise the whiteboard and this is basically what it is so the idea is with conversion funnel you have this so every decision that you make if it's buying a car if it's getting an umbrella you go through the steps of the conversion funnel every single time so how it works it breaks up into four sections so this top section here most are online this is called awareness let's see the stop part is awareness so it sounds it sounds simple it sounds obvious and in some ways it is the idea what this section is you can't buy something from someone if you don't know that they exist right you just can't do it the next section down is what we call interest so the idea with interest so awareness is okay cool you sell cars or you're a plumber or your HVAC got it but right now my water heaters fine my air-conditioning is fine don't don't need you right so there's a lot of awareness that doesn't apply to you right now with interest now it's going oh okay you you have a great reputation in my town or you have services or pricing or coupons and promotions there's something about you that I like okay I'm gonna keep you in mind so you're moving them down they're still not ready to buy but for some for some reason you're starting to stand out and get attention in their in their mind the next section down is actually I would argue one of the most important ones so in this section we're going to be talking about preference so with preference I describe it this way I've got two young kids preference says that they would rather me drive five miles away to a McDonald's rather than one mile away to a Burger King so in in our case the preference my kids had from McDonald's is saying that they would rather go to McDonald's even if it's less convenient even if it's not as good even if whatever all those inconveniences aside they would still prefer to go to McDonald's this is a great spot for company to be in preference it's very powerful and it influences everything else the bottom part of the funnel is largely what's for business this is really where you make your living this is where it really impacts your bank account and this is ultimately I'm just going to do a dollar sign this is conversion so this is where they turn from a person who's on the outside looking in and aware of you do now they're giving you money they're a paying customer the trick is we think right as an HVAC company is a plumbing company we think that all of your customers are paying customers but they're not the people you're talking to are not always ready to give you money so here's I'll change colors up see that was blue and so the red works yeah so let's take this next step further everyone going through these stages of the buying funnel before they're ready to make a purchasing decision it doesn't matter again if it's a tire or if it's a water heater they're going through this process this process influences how you reach these people out to various stages of the game right in marketing terms we have what we call channels of marketing channels the idea of this is that you have different ways of getting your message to customers and meeting them where they are and those channels are dependent on where they are on the buying fall so something like a billboard so in my town there's a company they do HVAC and plumbing services and I kid you not I think they're on every other billboard on the entire kind of inner loop that's around the entire city I think between my office and my house I probably go through 12 of these billboards now some of you guys go that's awesome 12 billboards think of all that exposure here's the problem if billboard converts at 1 to 10,000 now let me make this fixins 10,000 is how many eyeballs have to see the billboard before one person notices it so for every 10,000 eyeballs the drive by one person notices that means for a billboard 9999 of those people don't care and they don't even see it and you get one person as a response to that so as it relates to the conversion funnel this whole funnel typically in a marketing sort of calculation we like to say that the funnel has a 1 to 10 sort of conversion rate so basically for every 10 that comes on the top you get one down at the bottom and we try to maximise and measure that at different ways and there's different ways to do that but that's kind of a rule as a baseline we want to say 10 coming in the top equals one paying customer at the bottom so for these billboards for these billboards that I've dried by if it takes 10 eyeballs to make them work that means we need 10 billboards to create one customer does that math make sense because we can't get the 10 unless we multiply this 10,000 by 10 and then all of a sudden the one at 10,000 ratio gives us 10 which is good since one customer now and a lot of markets that billboard is not the cheapest thing in the world to do right it's not uncommon for a traditional billboard to be about let's say 2k a month or for some digital billboards and some really dense markets it give me upwards of five or six grand a month per billboard so that means in order to get one paying customer with a billboard you need ten of these and at two grand a month you're starting to see where this starts breaking down for most businesses like yours right if you are flush with cash if you are a multi-million dollar company a year doing billboard is not a bad idea it's really not the problem is it's really hard to get these sort of numbers to make sense for most people one billboard won't get you the math make it think you're not really moving the needle to get one single kind paying customer so from a marketing strategy standpoint we try to try to keep this thing in mind we try to make it make sense for your company now let's look into the other side right the best type of marketing for any company in any industry and this is especially true for you guys who are plumbing your HVAC your what electrical companies is what we call referral marketing now the reason these are important it sounds that sounds like well yeah I get referrals are big usually our customers don't understand how big this is a referral will almost always convert at one to one what that means is for every referral you create you just made yourself a paying customer it's that easy ten thousand eyeballs for a billboard doesn't get you one paying customer by referral get you one paying customer a single referral now some of you going I don't think that's true I don't understand it let me put it this way god forbid something happens to you and you need heart surgery or maybe you've had heart surgery and so you're in the process of okay where do I go for medical treatment for my heart right I need a surgeon I need a doctor who is respected around you bet your bottom dollar you're gonna go to someone else you know who has had heart surgery and ask them where did you go and what did you think what did you think of your doctor whatever that person's opinion is if they said that doctors saved my life I would go there again if I had to you just picked up the phone and called that doctor to see if you can get an appointment with them one-to-one referrals nearly always works so that's why if they're clients we focus a lot of reviews a review is not quite the same as a one to one there's some different measures on what we think a review comes back at but for 30% of the people they say and for lack of a single person that they knows how to direct experience a review that they read online from a third-party source so from a Yelp from Google my business those can take the place of a referral and those 30% of people are willing to pay 30 percent more for that peace of mind so we want to maximize as much as we can these wonder what referrals and we want to create the synergy bakery which means getting reviews from your customers about how great your company is one the one referral is amazing now if you're not doing referral marketing if you're not doing if you say hey I've got a website and that's all I want to do that's a good starting point here's the deal if you do a website only sort of approach creating a website and launching it and saying hey here's a one page or here's a five page website for my business a website is going to converge about one the 250 so it's it's not quite as high as a billboard it's not quite as good as referral marketing it's kind of in the middle 1 to 250 so that means that they're looking for a company they're looking for a solution to the problem their HVAC sout they're their Plumbing's on the fritz something left to its own devices and nothing else influencing it you have that two hundred and fifty people to create one person who goes in the top of this bottle okay so that starts becoming the math if you have a traffic that's generating a lot of website or a lot of leads a lot of traffic a lot of interest this number can go up but left its own devices it's 1 to 250 now there are tricks in what we call search engine optimization which says that you try to find people where they're looking right so if you're a plumbing shop people aren't necessarily always looking for a plumber in fact what are the most searched for terms on Google is how to fix my toilet so the idea of SEO is you say how do I fix my toilet we take that search and we connect them to your company that's moving this 250 much closer to the 1 the 1 because we're reaching people right where they are looking and they're we're not advertising to them weird trying to solve their problems just like they're trying to solve their problems so this is how this works out there are tricks right so keeping my little red marker here there you guys have probably heard it maybe even dabbled with it of what's called pay-per-click advertising so this is ad words this is Bing ads Facebook boost you could call pay-per-click but for the sake of this we're gonna say pay-per-click is Bing ads and Google ads Google AdWords what those sort of channels do which makes them very effective for service industries so for HVAC companies and plumbing companies it's to keep in mind likely your customer is not looking for you until there's a problem right if you've talked to us once you've heard us say this we're trying to help solve your customers problem so your customer is not looking for a plumber unless their toilet is clogged or less than a new water lines or the water heaters broken if your HR company your customers not looking for you unless they need a new heater or furnace or something's not cooling right that's the only time that they're looking for you now what's great and powerful about AdWords and Bing ads is it focuses almost exclusively at this bottom portion of the funnel these people they know they have a problem they're interested in somebody that can solve it they don't really have a preference yet they haven't made at that part through all they know is they've got a problem they need somebody to pick their dollar so AdWords Bing ads it's really powerful because it lets you reach those customers quickly right where they're ready to give somebody a dollar it's gonna be you or it's gonna be your competitor somebody's getting the dollar it's just a matter of you now here's what's really great about using Adwords or Bing ads as a part of your marketing strategy we can actually focus the people who are most urgent so we can actually prioritize spending on mobile devices so if somebody's sitting down on a desktop and they're searching for a plumber the inference we make is well they're doing more research they're not quite ready they're not quite to this point in the funnel so their interest in trying to establish who has a preference so that's important we're not going to discredit discredit that but if they're in their mobile phone and they're doing a search that probably means that they're outside looking at their compressor and going this isn't working I need help or they're in a closet they're looking at their toilet and it's overflowing and they're trying to solve the problem right they are more action oriented they mobile users gonna be here a desktop user is likely going to be up here so with AdWords with Bing ads with those pay-per-click channels we can actually focus all of our efforts or most of our efforts on these people who are most likely going to become customers for you quickly or customers for somebody right this is where we focus a lot of energy we want to give our clients really fast results great traction with customers who are ready to buy they've got a dollar in your hand we really struggle recommending for a lot of clients hey little boards are great ahead if you are again million dollar shop that makes sense for you but for most guys they don't have the volume here they can't afford the volume here to get one paying customer out of the bottom so we try to stay away from there now a lot of guys who talk to you also ask questions about well like what about phone books so phone books in some cases are good especially for older age groups right it's still worth being listed in the directories for online benefit with most phone books most people aged 60 and younger aren't going to use it so the most recent stat that I've read is 40% of people so not even most people 40% of people will maybe crack the phone book once a year so once a year they'll open a phone book and that's not even most people that's less than those people so the conversion rate of those they're kind of a little bit spotty it's gonna be probably closer to like one to 1,000 or upwards of that so for a phone book you're paying money for an ad let's say a thousand bucks a year five thousand bucks a year per directory you might not really see a direct result from that you might see one or two you're not seeing very much the same goes through you know if you're at a Mexican restaurant and see those TV is on the side they're cycling through all the ads or if you're at a you know greasy spoon place they've got the table with the ads and the business cards on the top most of those people are nowhere close to this part of the funnel in fact they might not even be here to interest they might not care you're just creating awareness the volume that you have to create reduce awareness is really high so if you want to know if you wanna make the most of your business making most of your advertising dollars look your dollars are precious right you don't have money just flow in everywhere you need to make sure that we're spending the money you're gonna give results and you're spending the money in the right ways for most of our clients they're not sure if they are so by the time they come to us they've spent a lot of money they spent thousands of dollars on websites thousands of dollars in AdWords thousands of dollars on radio or TV or billboard it doesn't really matter they don't know what they're trying to do so we try to do is we try to walk through we'll try to focus a lot of attention here to the bottom part of the funnel to paying customers they've got a dollar in their hand they're ready to hire somebody and then as the company grows we start expanding the efforts to reach different parts of the funnel so recently we did a press release for one of our plumbing clients they did a public fundraiser they're raising a lot of public awareness so what we did was we created a press release that got picked up by local news that created thousands of impressions on the website on their social media thousands those are all people who are thousands up here most of those people aren't ready to hire a plumber those people will become a plumber in time they will I'm sorry they will become a customer in time so it's a great sort of thing to do to get the exposure to start creating the awareness it just takes time for them to filter down so when you're making your decisions when you're trying to plan where your marketing dollars go or how you're violating your strategy it's really important to keep in mind focusing on what stage of the funnel you're trying to get how are you measuring those results right so for someone in awareness you're not going to measure that they're going from awareness to conversion you're gonna start measuring that they're going from awareness to interest so one of the tails for this like for a website is are they coming back to your website they found you one time cool are they coming back and learning more about what you do if you have repeat traffic on your website that's great that means you're starting to move down the funnel if people are starting to spend a lot of time on your website if they're downloading forms that they're watching how-to videos now they're moving on the preference if they're preferring you that they're trusting you that when something goes wrong that they're treating you like the authority that they're going to rely on ultimately when something goes wrong they're going to call you to clean the mess understanding the conversion funnel will change how your company spends its marketing dollars so that's what we want to try to do so hopefully this was helpful this is a little bit long a little bit technical but for a lot of our guys this is kind of like mind blowing thinking oh this is actually the science of creating marketing returns you start taking these conversion ratios you start taking their marketing channels you start targeting where they are in the funnel and you start leveraging these to their best impact so social media largely is going to be between interests and preference occasionally you can get to the conversion side but if you do a coupon incentive or rebate or some sort of discount promotion that gets those trigger points largely what you're doing is curating these two groups are here interests and preference these are people who are trusting in you that are aligned in you it's an important part it's really hard to measure a direct response because it doesn't roll it translate to dollar it's not supposed to does that make sense Facebook social media those things are important they're not supposed to translate directly to dollar they're supposed to directly translate into the next stage down then they transmit to $1.00 so this is a lot I'd love to hear your thoughts so if you have questions concerns if you think this slope bogus if you think that in your experience you've learned something else we'd love to know so in the comments below let us know your thoughts let us know your questions let us know if you learned something else that's better or something else it's helped you like us on facebook follow us on youtube subscribe to this channel and we always try to give more information that's relevant to you so again we say this a lot if there's something that's important to you into your company if there's something you just don't quite understand or looking for help with let us know send us a note and we'd love to be able to do a video like this forever enough comments for it so guys again check us out digital marketing for plumbers comm again i'm ryan like us comment below share this video a lot of such thing that's ever great week and we'll talk to you soon