The Seller-Doer Paradox

I’ve had the distinct pleasure to train many seller-doers. These are people who are typically very smart, hard-working and have achieved some level of recognition in their field.  Many remodelers are perfect examples of seller-doer – they sell the work, then they do the work.

Their biggest challenge is usually keeping the pipeline full with new opportunities or engagements while still doing the actual work for the client.

“Chip, I’ll get to the business development work after I finish working for the client.” Intelligent seller-doers tell me this all the time, and they don’t see that it’s circular logic – a paradox. The only way their belief will work for a seller-doer is if

A) someone else brings in the new business for the company.

B) The seller-doer may tolerate extended periods with no work while they look for the next engagement.

Here’s the thing, A) indicates they are a doer, not a seller; and B) reveals they are either a seller or a doer, but never both at the same time.

Fixing the seller-doer paradox may require multiple strategies:

  • Address the possibility that client work is used as an excuse to not do business development activities. Procrastination is rarely the overt refusal to do a task. It usually occurs when the procrastinator finds other things to do instead.
  • Identify business development activities that are effective and enjoyable for the remodeler. Good seller-doers don’t make cold calls all day, but they do attend networking functions, give speeches at conferences and have a large network of colleagues that all refer business to each other.
  • Insure business development activities are on the remodelers calendar. Sounds simple yet I’m shocked at how few seller-doers make appointments with themselves to do the prospecting and business development which will insure their pipeline of projects remains plump.
  • Give ample recognition to the successful seller-doer, especially when they succeed at selling. A seller-doer culture embraces business development.
  • Sell while servicing the client. There’s always an opportunity to ask questions and identify an upsell opportunity or a referral. I’ve never had a remodeler receive a complaint for spending 90 seconds asking a few questions of the client during working hours. In fact, most clients want their seller-doer to look out for them and stay informed. Asking questions is a natural part of customer service.
  • Selling comes first. After all, we don’t call them “doer-sellers!” I realize that there will be a client crisis requiring immediate attention occasionally. But every week, attention must be paid to the selling aspect of the job. Create systems for accountability around business development just as you do for time cards and chargeable hours.

Good Selling!

How Remodeling ‘Big Dogs’ Earn More and Spend Less

Do you have a plan in place for when it’s time to retire? Will you be able to sell your remodeling business or pass it on to a family member? Since you’re probably the most valuable player in your company it can be impossible just to take a vacation, attend a conference, or even take a sick day.Continue reading

The Myth About Repeat and Referral Leads – part 2

In the last issue, we discussed the simple secret to capturing business from repeat customers. This week, I’d like to focus on the second source of your database goldmine — referral leads.

The Importance of Referral Leads

According to a survey conducted by the National Association of Home Builders (NAHB), professional remodelers attribute 37 percent of their leads to client referrals. You may find the percentage to be far greater in your own company. A national survey by Remodeling magazine supports the notion that a majority of remodeling business comes from personal referrals. In the survey, homeowners were asked to list the sources that they used to find a contractor. Some 70% counted on either direct remodeling experience or their friends or relatives to help them find a contractor.

Because this source of business is so important to your company, make it a top priority to create a program that encourages referrals.

Referrals are win-win. They assure the homeowner that the remodeler they are contacting is professional and delivers what has been promised.  For remodelers, they deliver a prospect who typically values more than just price and is much more likely to buy than the random lead from the phone book or a newspaper ad.

There’s no argument that the highest quality lead is a referral. Remodelers have found that:

  • The close ratio on these leads far surpasses that of any other source.
  • The cost of a referral lead is the least expensive of any other.
  • The referrer often gives the prospect a lot of information about the company, which sets the tone for the remodeler to make the sale.

By speaking to their friend or neighbor about their project, a prospect probably knows:

  • You’re not the cheapest remodeler in town, but you offer good value.
  • You deliver what you promise.
  • Your personnel are pleasant, friendly, and courteous craftspeople.
  • You keep the job site clean and neat.
  • You have worked for others who are similar to the prospect, and those other customers are happy with your work.

Remember, referrals come from a larger group of people than just your previous customers. Friends, social acquaintances, and business associates also can send referrals your way.

We call this extended group your Circle of Influence. This includes not only previous customers, but also business associates like suppliers, your insurance agent, and the director of your local association as well as personal contacts like the PTA president and the parents you’ve met through your child’s Little League.

Stop now and create a list of these influential people. Then create a program that will help these people think of your company when they’re presented with an opportunity to refer you.

What about you?

What programs and systems do you have in place to ensure your customers are spreading the word about you? I look forward to hearing your comments below.

Keeping Your Eye on (The Right) Ball!

Excerpted from a  From the Business Leaders podcast – a series exclusively for Remodelers Advantage Members.

If you’re like me, you’re busy! You don’t have time to watch every single area of your business to make sure that things are on track for a profitable year. So, take a page from our top members, remodeling company owners like Gary Marrokal, President of Marrokal Design and Build, San Diego, Ca.

Gary knows that a small number of statistics can “tell the company story.” He doesn’t bother looking at pages of statistics that could be reported. Instead, he focuses on consistent review of seven major success indicators. A flash report containing this information is delivered to his desk every single week.

  • Cash Flow—Money In/Money Out
  • # of Leads
  • # of Preliminary Agreements Signed
  • Produced volume for that week and that month
  • Produced volume per Project Manager
  • Cost per Lead
  • Cost per Sale

Because of his intimate knowledge of the way projects flow through his business, Gary knows what steps to take if any of these statistics drop out of alignment with the company goals.

For example, let’s take a look at the Preliminary Agreement number. Because recent history has shown Gary that 83% of the Preliminary Agreements that are sold convert to construction contracts, he can accurately predict the future production load by keeping a close eye on the level of Prelims brought in the door. Starting to slip? Time to ramp up marketing to generate more leads and more opportunities to sell the Prelims.

“Watching these predictive indicators give me a very accurate picture of where our company is at any time,” Gary said. “I think that some business owners spend too much time looking at too many numbers, trying to understand what’s going on. We’ve found that a strong focus on this specific list of statistics tells us what we want to know.”

When Gary and his team monitor revenue produced within a time period, they’re also looking for ways to increase the speed and efficiency at which the job is produced. “We know that if we can produce a job faster, 90% of the time, we will beat our budget and have a delighted client—a raving fan. So we work very hard to beat our schedule whenever possible.”

Marketing stats are monitored to quickly suss out which tactics are producing the qualified leads the company needs. “We’ll test new tactics constantly,” he says. “Marketing is always changing so we are more than willing to invest in new lead generation avenues for three, six or nine months to see if it will deliver. The key here is to give the tactic the time to really work. If it doesn’t, we pull it and try something else.”

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Remodeling is a Service Business, First

Sometimes remodeling companies put all of their efforts into building the product. However, to be successful in the remodeling industry, your focus should be on offering top-quality service to your customers.

When you begin a remodeling business, you have entered a service industry that depends on referrals and repeat business. The amount of business, and the loyalty that you’ll generate, will greatly depend on the way you treat your customers. Building loyalty and generating repeat and referral business is the primary purpose of customer service. It pays to treat your customers as though they are long-term assets to your company—because they are!Continue reading

Setting Marketing Goals for Success

Do you know where you are going?

A wise man once said “If you don’t know where you are going, any road will take you there!”  Yet business experts agree that goals power businesses. By defining your business goals for the coming year, you’ll be able to target your marketing efforts to reach them.

Carefully aiming your marketing efforts has two wonderful benefits:

  1. You’ll need to invest much less money in your marketing program because you’re not wasting dollars by scattering tactics all over town.
  2. The leads you generate with a targeted program are higher quality because they fit your definition of exactly what kind of prospect you want as customers.  This makes for much easier sales!

So, what are the long and the short range goals of your business?

Start by answering these questions:

Where you are today:

  1. Who is buying my services now?  One audience (homeowners only) or more than one audience?  (homeowners, commercial management companies, architects)
  2. My primary customer is: (include age of home, household income, occupation, single or married, etc.)
  3. My customers are located:
  4. They would say that they are buying from our company because:
  5. Who else do I want to sell my services to?  Why?
  6. The type of work that is most profitable for me is:
  7. The type of work we enjoy doing most is:
  8. The type of person I most enjoy working for is:
  9. My closest competitors are:
  10. My company is different/better than my competitors because:

Where you want to be:

  1. If I envision my company five years into the future, what do I want it to look like?
  2. How big will my business be?
  3. What will my role in the business be?
  4. What services will I offer?  (Design, construction, etc.)
  5. If I walked up to someone on the street of my town and asked them what they knew about our company, what would I like them to say?
  6. How far am I today from achieving what I want?

The answers to these questions will open up an entirely different view of your company. If you’re not sure of some of the answers, ask your clients! A simple phone call-survey may uncover advantages that you haven’t been taking advantage of.

This information about your company will help you see a larger picture which will be a great help in deciding on the direction you’d really prefer to take.  Take the time to reflect a bit on how you want your company to affect your future. Then create the marketing plan that helps you get there.

What About You?

Have you done this exercise before? Are you stuck answering any of the questions? Let me know!

The Marketing Tactic Remodelers Don’t Use Enough

Overlooked Marketing Tool

When I ask remodelers what marketing tactics they most rely on, I usually get the same answers. Number one is almost always Referrals. As it should be.

Referrals are commonly referred to as the lifeblood of a remodeling company. And the reason is obvious: since they come from a credible third-party you are instantly trustworthy.

The only real problem is that they are in large part out of your control. You have to hope someone knows someone that’s going to remodel and remembers to drop your name.

After referrals come the usual suspects: Canvassing, coupon mailers (Valpak anyone?), print ads, direct mail, radio spots, etc.

The benefit here is that unlike referrals, you can get your message to the masses, but they are costly.

Still, these tactics can be a valuable and effective part of your marketing plan. However, to get the full benefit of these marketing tactics you need to commit to long term campaigns.

Few remodelers do this. Many, in fact, will try one once and give up on it.

This is what I call the Casino Strategy.

The Casino Strategy.

Regardless of the tactic you choose, doing it only once is relying heavily on luck. Since it takes repetition to achieve top of mind awareness and brand recall, doing a one-off campaign means you’re hoping your message will hit home with a prospect at the very moment that they:

  • Have a need or desire for your service
  • Have the money to spend on your service
  • Have a motivation to proceed that outweighs the desire to keep their money

Put another way, it’s very much like putting a $10 casino chip on RED-12 at the roulette table. Yes, this number will certainly hit at some point in time. But will it be when your chip is on the table?

Not likely. So your one-off campaign just missed the mark.

In order to make it work, you have to keep putting that $10 chip down over and over hoping this will be the time when RED-12 hits (i.e. your prospect is ready).

This is what makes these tactics so costly. You have to engage in a long-term campaign to be sure you’re “on the table” when the prospect is ready for you.

Quite the quandary.

If only there were a magic casino chip that could sit on RED-12 for the next 30, 50… 100 spins of the wheel without further investment.

Well, believe it or not there is.

The Magic Chip

What we’re looking for is a marketing tactic that:

  1. combines the widespread coverage of casino tactics…
  2. with the trust factor that referrals bring…
  3. at little to no cost to you.

Did you guess the tactic yet?

Email marketing does it all!

It allows you to stay in constant contact (pun intended) with customers and prospects, helps you build relationships and earn trust, and best of all costs next to nothing to send messages over and over again.

So why do less than 10% of remodelers have an active email marketing program in place? My guess is it’s the same reason people would rather put $500 into a casino than into a savings account — immediate return potential.

An email marketing program can take months, if not years, to see big results. But the long term benefits are there to be had.

It’s Easier Than You Think

The biggest obstacle to overcome is the seemingly daunting task of building your list.

But you already have an audience that you’re overlooking! Start with past customers. Then move to the phone calls and emails you receive. Your website gets traffic I assume? How about the the events you hold and home shows you participate in?

Building relationships with this audience will accelerate your growth. And not giving them a way to stay connected with you is a lost opportunity.

I hate to be the bearer of bad news, but your “list” is arguably the most valuable asset in your business. If you’re not actively trying to build a list, then you’re missing an opportunity to increase your company’s value.

Promote It!

You have to get the word out. Promote your subscription email service or newsletter in everything you do.

  • Promote it on your trucks
  • Promote it on your print ads
  • Promote it on your estimates
  • Promote it on your business cards

Don’t be afraid to be agressive and take it offline. Remember I said casino tactics can be a valuable part of your marketing? Consider papering a neighborhood with your newsletter signup as the primary message.

What do you think is going to have a higher response: “Get a free tips in your email” or “Get a free quote.”?

Do’s and Don’ts

In my opinion, you shouldn’t get caught up in the hype of fancy HTML emails and newsletters. You don’t want to make the reader feel as though they are just part of a list. Plus, most email services won’t download images by default. Which means that pretty email is going to look very ugly at first glance.

Great emails start conversations. One good way to do this is to simply to ask for a reply! It reminds the reader that you’re human, that you care about her and you want to help. As an added bonus, email algorithms (like gmail) take note of email addresses that are responded to, keeping your future emails out of the spam box.

A few more tips:

Don’t…

  • Don’t make every issue an advertisement.
  • Don’t miss an issue …ever.
  • Don’t forget your manners.
  • Don’t sound technical/show off.
  • Don’t use a generic email address (like newsletter@…)
  • NEVER use a noreply@… address.

Do…

  • Do provide valuable information.
  • Do support your brand image.
  • Do write in a conversational tone.
  • Do use a personal email address
  • Do encourage reader to share/forward.

Email marketing is without a doubt one of the most powerful tools in the remodelers marketing toolkit. But it’s being overshadowed by shiny buzzwords like SEO, social media and the like. If you are patient and stay committed, you will see great returns in the months and years to come.

What about you?

Are you one of the minority that uses email marketing? How’s it working for you? If not, what’s holding you back? I look forward to reading your replies below.