Why top-of-funnel solar ads can produce cheaper leads long-term

▶ 0:00Happy Sunday evening. Today, we're going to talk about why top of funnel advertising can be a fantastic long term play for an established installer that's looking for cheaper solar leads. So when you're advertising solar, typically you're looking for those really hot leads, those active buyers. You know, the typical feedback we get on our leads is it's great because they're ready to buy, they're ready to move forward.

▶ 0:22And for some businesses, this is the right approach in its entirety. That's all you need to do, especially if you don't have the strongest cash flow. So you basically want to recoup your advertising spend as quickly as possible. And that's what you get with those ready to buy leads. The sales cycles are as short as possible.

▶ 0:36So you can turn that around and reinvest those profits into the advertising. However, only 3% of the market is actually actively buying at any one time. So by taking this approach, you're losing out on 97% of the market that is available. Not only is that a very small portion, but you have to also appreciate that almost all of your competition is also bidding for that 3% at the very top, those hottest, most highly qualified leads.

▶ 1:06If you move your targeting slightly further up the funnel, which is basically people that aren't actively buying, but they do have an intent to change, to make a change, whether that is to make some sort of transition to renewable energy. They don't know if it's going to be solar yet. They just know that they want to reduce their energy bills.

▶ 1:21They want to positively impact the environment, etc. That's an intent to change. And they probably won't be ready to, they won't buy within two weeks, within four weeks even, but they will buy eventually. Maybe it's someone that actually is moving house or is going to buy a home in the next six months. They have an intent to change, but they're not ready to do anything yet.

▶ 1:39And then even further up the funnel, it's those that have a need, but they're not ready to act. Maybe it's a cash flow type of thing. It's the amount of disposable income that they currently have available. But in six months time, that could change. So obviously these leads, these ones in this 7% and definitely in this 30%, they are not the same quality of lead.

▶ 2:12So when you run the numbers over a long enough time horizon, it actually starts to check out. So if you're only targeting these ready to buy leads, you spend 10 grand, you get 250 leads. Of that, you get 30 deals, assuming 12% of those opportunities close. You make 240 grand, okay? If you're targeting the top of funnel leads, you spend 10 grand.

▶ 2:52Instead, you get 2,500 leads because it's 10% of the cost per lead. And we've seen this with some of the ads that we've been running. You know, advertising access to get a free guide or something. You can get that very, very cheap. And they're not going to be high quality leads, but that's not the intention here because they're going to go into a separate pipeline to have an entirely different approach and experience than the hot ready to buy leads would do.

▶ 3:16From those 2,500 leads, only 20% of them might ever engage with your core service, but that's still 500 people. And if you close at the same rate, that means you get 60 deals, which is double what you did from the 250 active buyers, meaning you're left with 480,000 in revenue. And this is where the energy companies that can act on a two, three, four, five year time horizon get such an advantage and such economies of scale because they can invest in getting leads as cheap as possible.

▶ 3:46They can, you know, they can even make a loss on things like the solar installation itself because they know they're going to get someone on the tariff, which is where they make their money, right? So how do you actually put this into practice? How do you actually start to attract these less ready buyers without them being just terrible quality that are never going to act altogether?

▶ 4:03So firstly, you want to decrease the barrier to entry. So you want to attract these kind of leads with like free guides, free assets, lead magnets, like non-buying specific ads. You're moving away from guess a quote or book your survey, which is very high intent actions. You're moving away from that to something that takes very little intent.

▶ 4:23It should never really be speaking to a team member because that's quite high friction. They should just be able to access something or download something that has some sort of value to them. Then you want to ensure that there is throughout this entire process, there's an immediate ability to move into the core service pipeline.

▶ 4:39So if you advertise that free energy saving guide, this is what your funnel could potentially look like. You know, the first slide is get your free guide to saving up to 80% and that's where you get the contact details. And then when they enter those details, before you send them the guide, which you should probably send via email because then you can just keep them directly on this page, you preempt the core service that you're actually trying to sell eventually and you ask them the first step of that process, which in our case is first name, do you own your home?

▶ 5:11And what we've found is we actually managed to get a higher throughput having asked for these details first for just the guide and then asked for the kind of next steps on the primary service than we actually get on the primary service itself. And these are lower quality because they've kind of engaged with a very different asset.

▶ 5:28But at the same time, you're just getting a higher volume. And this is what it looks like if you actually go ahead and click the link somewhere on this post or in the comments, you're going to have exactly that same approach basically done to you. So you're going to access the solar magnum opus, which is the document you can see on screen right now.

▶ 5:43I will send this to you manually as soon as you enter your details in, but then you're going to go through to a page that says, do you want the implementation? Because this document is already getting absolutely huge and we've only been working on it for a couple of weeks of that. And that do you want the implementation page is basically a carbon copy of our primary funnel that we would normally run ads to.

▶ 6:03So you can start to see how I've kind of got you in the door with the high value asset that is available for free up front. But then I've transitioned you quite seamlessly into, well, actually the asset's great, but this is far better. Finally, you're going to need an automated nurturing process. This isn't an optional thing.

▶ 6:22If you're going to take this approach, you absolutely have to set up a very strong backend to be able to deal with the volume of these leads and ensure that not only are they not wasted, but secondly, and most importantly, they're not wasting your team's time because that's a big danger of this. If all of a sudden you're getting 2,500 leads in instead of 250 and you're using the same process, it's going to set you 10 times as much resource to actually facilitate those conversations.

▶ 6:50You can do this via email, via WhatsApp, via SMS, and they don't have to be like cold messages. They can be a WhatsApp video, for example, and I've got here, you should always share something of value or even if it's a value in the sense that it's entertaining, right? It has to be something that they would actually appreciate receiving as opposed to just a pitch for the course service.

▶ 7:11So when should you actually go ahead and do this? This is not for every solar installer. You should do this once you already have a steady flow of the ready-to-buy leads, the ones that have that short sales cycle that allow you, once you're getting a return on investment on your ads, to reinvest the profit from those ads back into the ads and scale them up, scale those campaigns, get more leads coming in, and then once you basically have kind of got that process nailed is when you should be looking at, okay, how am I going to actually decrease my lead cost and keep quality the same over six months, over the next 12 months?

▶ 7:47How can I start building my pipeline for, you know, if we're in December 2024 right now, how can I build it for January 2026? How can I make those strategic moves that means I can, you know, buy leads for £4 now and close one in ten of them later down the line and not have to buy them for £40 each when it comes to that point and by the way, the cost of advertising is always going up so if you can stack your pipeline now with leads that you've got a long duration of consent to contact and you've got those automated processes in place, that's going to be a huge asset for you later down the line if you've got a huge email list and that email list is all people that at some point expressed an interest in reducing their energy bills that is a major asset and it's not just an asset for you

▶ 8:34but it's an asset if you come to sell the business as well without going on too much of a tangent but that is the kind of thing that really adds enterprise value and if you're looking to sell your installation company to a bigger company or to a private equity firm then you should really consider this kind of long-term strategy because they'll be looking at that when they take on the business and looking at okay what potential have we got to actually reap the juice out of what these guys have created over the next three to five years and if you don't have any sort of email list then that's a real asset that you're kind of missing that they would be looking for finally if you would like to get a copy of this document and experience this for yourself you're basically going to go through

▶ 9:10to a form where you're going to see access the solar magnum opus you enter your details and then you'll go to a page where it will say do you want the implementation at which point we will try to sell you on our primary offer which is of course actually working with you to implement everything that we discuss in these documents and it will essentially ask you a few questions about your business qualify you and that will allow us to dictate kind of how best we can assist you hope you've had a lovely weekend and I will see you in the next one