Dear
Friend:
June is one of my favorite times of the year. The weather is often great, and we can look forward to the whole summer ahead of us. A summer full of outdoor activities, vacations, swimming, spending more time with the kids, or just lazing in the backyard hammock on a Sunday afternoon. It is a time of year that seems full of possibilities.
Now is the time for you to take advantage of summer’s possibilities by planning a great marketing program. If you start planning now, by the fall you’ll be ready to jump in and give your business the boost you’re looking for. This month’s article will help you get started.
This month I would also like to introduce to you the Executive Editor of HomeTech Business Building Ideas, Mitch Lapides. I am excited about having Mitch as part of the team. He is managing our Web and online marketing as well, so I’m certain you’ll be hearing more from him. Please add MitchLapides@hometechonline.com to your email address book so his emails to you won’t get treated as junk email.
- Walt Stoeppelwerth, HomeTech Information Systems, Inc.
P.S. If you would like to contact Mitch, you can also reach him at feedback@hometechonline.com. He’d love to hear from you about your business successes and challenges. Please share your stories with him and so we can share them with your peers in this newsletter.
In This Issue
News Flash (June 1, 2006): Twenty-five (25) of this Year's REMODELING Big 50 Winners
have been HomeTech Clients!
Congratulations to every one of you for a job well done.
Develop a Winning Marketing Program
An effective marketing program is necessary to any growing company. You may have the best remodeling firm in your area, but if nobody, or not enough people, know about you, then you won’t see your sales grow.
An effective marketing program has 3 critical components.
- It creates an image for your company that is informative, accurate and appealing.
This means that your marketing program will be clear about who you are, what you do and why people should call you. It should also make them want to call. - It reaches your target audience.
Now, this may sound like a no-brainer, but sometimes this is the hardest part to achieve. In order to reach your target audience, you need to know who they are and how to find them. What newspapers or magazines do they read? What radio stations do they listen to? Be careful in your research so that you don’t waste precious marketing dollars in the wrong places. - It generates qualified leads.
If you’ve done the job well with 1 and 2 above, this should be the result you achieve. If this is not the case, then you need to reevaluate and redirect your program. (See the section on tracking your results below, including a great bonus download for newsletter subscribers.)
Remember, marketing is all about relationship building. The goal is to turn strangers into prospects, prospects into leads and leads into sales. And, once you make a sale, your marketing program should maintain the relationship so that person becomes a long term friend to your business.
Establish Marketing Objectives
The first step to creating an effective marketing program will be to establish your objectives. Your marketing objectives will be based upon your overall company goals for the year. Look at your sales volume target and then compare that to your current sales. How much of an increase are you looking for and how many jobs does that represent?
Take a look at the example below:
Joe's Remodeling Company
In this example, Joe’s Remodeling needs to sell an additional 8 jobs at the existing company average of $25,000 per project to meet their new sales goal for the year. The next step is to determine how many additional leads will be needed in order to close 8 additional sales. To do this, Joe will need to know his close ratio.
The close ratio is the relationship between the number of leads that have come in and the number of jobs sold. Generally full-line remodelers achieve a close ratio of 1 sale out of 4 or 5 qualified leads, which means that 20 to 25% of sales calls result in a sale. With a close ratio of 25%, Joe’s Remodeling Company would need to generate 32 more qualified leads to reach their sales goal for the year.
Generate More Leads
There are two basic types of leads which each require a different type of marketing to reach. These are 1) pre-sold or referral leads and 2) new prospects.
Pre-Sold Leads
Pre-sold leads are those that come from within your circle of influence. These are people you’ve sold to in the past, people who get your name from someone they know and trust, or people who see your jobsite signs in their neighborhood. In other words, these are the people who already have a direct or indirect connection to you. These are the leads you should go after first. You already know who these people are and they know you, so they are pre-qualified. They also cost less to reach, and the close rate will probably be higher with this group.
The following types of marketing can be used to generate leads within your circle of influence:
- Mailings to previous clients
- Jobsite marketing (signs, take one boxes)
- Neighbor marketing (mailing to homes around a job site or canvassing neighbors)
- Encouraging referrals from previous clients, employees, business associates and suppliers (always send a thank you for a high quality referral)
The one drawback to marketing for pre-sold leads is that the pool is limited. Joe’s Remodeling can’t expect to generate the additional 32 leads they need to reach their goals from this type of marketing alone. Therefore, they must also market to new prospects.
New Prospect Leads
Marketing to new prospects is more costly and more challenging than marketing within your circle of influence. Here, you are trying to reach out to people who have never heard of your company before. Therefore, it is critical that you have a very clear message and target it to your ideal client as well as you possibly can.
One of the most difficult parts of marketing to new prospects is actually finding and reaching the people who are your company’s ideal clients. Whatever marketing vehicle you choose to use, be sure that you thoroughly research the audience that you will be reaching to be sure that it matches your requirements.
Some of the marketing tools that you can use to reach new prospects are:
- Direct mail
- Advertising (newspapers, magazines, etc.)
- Yellow pages
- Home and Mall shows
Be careful to screen your leads so you don’t waste time following up on those that don’t fit your client profile. - Publicity
Send newsworthy information to local publications. Anything they publish is free advertising for you. - Networking
Join local groups or get involved in local charitable events to meet new people. - Internet
There are so many ways to use the Internet to help market that we are planning to devote an entire article to this. Look for this information in your July issue!
Budget Carefully
Once you know how many leads you want to generate and you have an idea of which marketing vehicles will achieve your goals, it’s time to establish a budget and create a plan. A full-line remodeler should expect to spend 2-5% of projected yearly volume on marketing while a specialty remodeler should expect to spend 10-15%. And, remember, if you are planning to achieve significant growth this year, you may need to spend even more.
For more information on creating a marketing budget and for a sample budget, click here.
Track Results
Finally, you’ll need to track the results of your marketing. Once you begin to learn what works you can be more effective with future marketing programs. In order to track your results, you’ll need to know the source of every lead you receive. If you can tie each lead to a marketing source, you can determine the cost per lead from each source. Other important measures to consider are the conversion rate of sales from each source and the average value of the jobs from each source. All of these figures will help you to better target the use of your marketing dollars in the future. We have created an Excel spreadsheet that you can use to track your leads and sales. Click here to view (open) or download (save) the spreadsheet.
Much of the content for the article above was adapted from:
Mastering the Business of Remodeling by Linda Case and Victoria Downing and was provided courtesy of:
Remodelers Advantage, Inc.™
Build a New Estimate from a Saved One
An existing estimate can be used as a ‘template’ to create a new estimate which will save you even more time.
Using the “Save As” feature you can create a ‘Carbon Copy’ of an existing estimate with a new name. Then you just need to make modifications to meet the specifications of the new project instead of starting from scratch. For example, you already created an estimate for Mr. Smith for a basement remodel. Now, six months later Mr. Jones wants you to estimate a basement remodel for him that is very similar to the scope of work in Mr. Smith’s project. You can use Mr. Smith’s existing estimate to create a new estimate for Mr. Jones. The result is a huge time savings for you and a happy prospect who receives their estimate quickly.
Click here for detailed instructions on using the “Save As” feature.
Let us know how you liked this article by writing to us at feedback@hometechonline.com. We also want to hear about your greatest challenges and successes. If you've got a great story to share, send it to us. And, we'll all learn something.
HomeTech Information Systems, Inc. - 5110 Ridgefield Road, Suite 410 - Bethesda Maryland 800-638-8292
www.hometechonline.com
(c) Copyright 2006 All rights reserved.