How an Electrical Contractor Benefited from Internet Marketing

You don’t need a website if you’re already rolling in customers and money. For a contractor, the primary purpose of a website is to attract new customers and make more profit. That used to be what the Yellow Pages did. Every year, however, fewer customers turn to the Yellow Pages to find a local business:

Customers Looking for a Local Business* 

Annual Decline in Percent Who Use Print Yellow Pages

2007                                                                            8%  Decline

2008                                                                            3%  Decline

The Internet now beats print Yellow Pages by 2 to 1 when it comes to looking for a local business to patronize: 

Customers Looking for a Local Business – July 2008*

Internet   60%                          Print Yellow Pages  30%

*Source: TMP Directional Marketing, sponsoring company for a series of in-depth studies of the media habits of 3,000 Americans.

As an electrical contractor in Los Angeles, I experienced not only the decline in the effectiveness of print Yellow Pages but also the rising costs. I’ve been in business since 1979 and over the last 30 years have built a 25-person company, The Electric Connection. Most of my customers are repeat and referral, but to really expand I also need to advertise. For years, I used Yellow Pages.

In 2004, I began suspecting that my Yellow Page ads were costing me too much. I have a computer information system that allows me to track where my customers come from. So, in early 2005 I did the math:

Cost of Print Yellow Page Ads vs. Income, Mid-2003 to Mid-2004, L.A.

Gross Income from ads                    $95,357

Cost of Yellow Page ads (5 cities)   $29,059

Percentage of Gross Income spent on advertising: 30%

Almost one-third of the gross income from my Yellow Page customers was being eaten up by the ads themselves. Most businessmen figure that advertising costs should come to only about 10% of gross income. When I saw these figures in January 2005, I decided that I would not renew my Yellow Page ads.

That was a scary decision as I had relied on them for over 25 years. Fortunately, I had built myself a website in the mid-90s, so I could switch to Internet marketing. In my first year, 2005, Internet marketing alone yielded $258,677 in Gross Income.  This was more than double the previous year’s Yellow Page income of $95,357. I was able to minimize costs of Internet marketing so that advertising ate up a lot less of my income than Yellow Page ads did.

As a note, income generated by my contractor website has increased each year. In 2010, it was $502,499.

I am able to maximize income and minimize costs of Internet marketing because I’ve been on the Internet since 1995, when I first built my own company website. I’ve had time to learn Internet marketing because I have a relatively large electrical company. My Computer Information System has also been very helpful in telling me what isn’t working and what is.

When I proved to myself that Internet marketing works, I started HappyContractor to help contractors around the country do what I have done – find new customers on the Internet. Please don’t hesitate to contact me to discuss your marketing or ask questions. Or look around the HappyContractor website for more information about Internet marketing for contractors.