Marketing System Considerations for Remodelers Looking to Break $1Million
Most remodelers, but certainly not all, rely heavily on referrals and repeat customers as they grow their businesses. This may keep a contractor doing a low volume of work busy, but relying so exclusively on referrals won't be adequate if you want to become a construction business owner, break the $1Million installed sales threshold and develop a constantly growing business.
The fact is waiting for the phone to ring, having no idea what type of prospect will be calling your business, or what types of projects they will be looking for is a risky and uncomfortable way to grow a business. Remodelers who attempt to grow without a marketing system in place will experience a roller coaster like ride of sales volume from year to year as well as season to season throughout any one year. Plus, when leads are slow business owners may compromise on their pricing and even who they allow to become customers. Doing business this way can be very stressful and frustrating for the owner as well as the employees.
To successfully grow past $1Million at your remodeling company, and sustain that growth from year to year, a strategic marketing plan and system are needed. Here are several important marketing related considerations remodeling business owners will need to address if they want to get up to $1Million. They will also need to already have these things in place to profitably grow past $1Million and comfortably sustain that growth.
Decide your niches
There are many customer types out there all with their own expectations when it comes to working with a remodeler. Successful remodeling businesses are those that strategically decide who they will be and who they will serve. If you choose to work for people who buy on price and expect more than they are willing to pay for, you will get more work from them. And because people tend to hang out with other people just like them, your past customers will refer you to more customers just like them. Before you do marketing to grow your business decide and define who you want as your customer. Also, think about the project types that make sense for the business you want to develop and grow. For example pull and replace kitchens and bathrooms may not be sexy or all that challenging to you, but remember you are building a company and a team of employees to complete what your company decides to sell. If you decide to build complicated and or highly detailed projects you will need the appropriate systems and staff to estimate, sell and produce that level of project to the expectations of your targeted client type. Choose wisely.
Develop a marketing plan
Marketing is only a cost if you don't know why you are doing it and or if you are doing it wrong. By having a marketing plan and a way to measure against the pre-established goals in your plan, the money you spend on marketing is more likely to be an investment with high ROI. Keep in mind a list of marketing tactics you intend to employ is not a marketing plan. Tactics should only be considered and developed after you have decided what you want to accomplish. To help with the delegation of marketing related tasks the business should also create a marketing calendar identifying not only when defined marketing tactics will be used, but also when supporting activities must be scheduled, delegated and completed to support the on time delivery of the tactics to be used. I refer to this as "franchising" your marketing because your system and calendar will help you manage the day to day work and activities required to keep it going without the need for micromanagement of the staff doing it. By having a plan you can also estimate the cost of your plan and include that cost in your overhead budget and calculated markup for pricing jobs.
Be strategic about how you do your marketing
Your marketing should serve two very important purposes. The first is to help your target customer type(s) find you. The second is to convert leads into sales. The marketing tactics you use should support these two goals. One marketing tactic that can be really effective at accomplishing both could be your company web site. For example, done well, SEO can be used so prospects searching online for certain services and contractor types can find your business, and find it on the first page of search engine results. Goal #1 achieved. But once you get them to your site you also need to differentiate your business from other businesses in the marketplace or risk being seen as a commodity. As discussed above, if you know your target niches you can then offer them additional information about those differences and can include customer testimonials as to why those differences were important and mattered to them. The right information will help prospects decide if your difference matters and they should contact you, or that your difference doesn't matter enough to pay for it and they should look elsewhere.
With the right marketing in place growing a remodeling business past the $1Million threshold is much easier and far less risky. Choosing the right customer types and job types will make it much easier to develop cost effective and highly targeted marketing tactics. By franchising how it gets done the owner can gain more time to work on other high value activities that keep the business healthy, profitable and growing. The right remodeling consumers want different and they will pay more for the right difference.
(Note: This is the seventh article in a series of articles written specifically for remodelers who want to successfully break past doing $1M/year in installed sales. Click here to see a List of all the articles in the series.)