Do you sell high-ticket remodeling? Do you offer financing? If you leave it to your prospects to figure out how to pay for your project, you are leaving deals on the table.
I’ve been listening to a lot of contractors who are doing a lot of talking about how they don’t offer discounts, how they don’t bend when the customer says they can’t afford the project or how they walk away if the homeowner pushes back.
First of all, I say that’s bullshit, they are most likely lying. People do that in forums.
Secondly, it is a way of them saying they don’t know how to negotiate. Getting push back on your first proposal is standard operation procedure, so when someone says I don’t cave at all, I can tell you one of two things; either they are happy with the amount of work they have and don’t care if they get the job or they aren’t busy enough.
So what happens when you press it and try and get max dollars? You lose out on bids. If your closing ratio was higher at a lower price, the market is telling you you are too high.
Marketing for builders is especially hard; you have the difficult job of building quality homes AND advertising the fact that you do well enough that people should come to you to make one of the largest investments of their life.
It is imperative to establish yourself as an expert in order to build the amount of trust necessary for prospective clients to choose you when they are preparing to build their dream home. How can you effectively advertise your skill, competitive edge, and value?
Establish your company name.
A strong brand is important to any business, but it is vital for home builders. Your customers are spending a substantial amount of money and trusting you to build the home where they will raise their children and spend their life. Your brand needs to reassure them that this special task is in capable hands.
Establishing your company name starts with a great logo. One that is professionally designed is best, so choose an expert who understands the emotional and subconscious responses that go along with various images, colors, and patterns. You need your logo to speak to your strengths as a home builder. Do you focus on high quality, affordability, or custom work? Maybe your specialty is a certain type of housing, such as lake homes, log cabins, or sustainable structures. That picture, your logo, should say at least 1000 words about your company to each prospective client.
Get some feedback.
Call the owners of your recently completed homes, send out an email survey, or use postcards. Whichever channel is most likely to appeal to your customers should be used to obtain feedback about what your company’s strengths and weaknesses are. You may think that you know exactly what you need to work on and what about your company draws people in, but you may be wrong. Nothing is more valuable than the opinion of those you have completed projects for. They can provide you with ideal information to feature in your advertising as well as give ideas for improving your customer relations.
Develop your online presence.
If you don’t already know it, an online presence for your business is essential. As a locally focused business that deals in large dollar purchases, you may think that people aren’t looking online. They are. Today’s consumer researches almost every purchase imaginable online. Review websites flourish because people are eager to share their opinion on every item in existence, and others are just as anxious to read those reviews to help them make the right decisions.
Your online presence should begin with a professionally developed website. As with your logo, it is important that this representation of your business be the result of expert design that captures the essence of your business. At minimum, your website should feature a gallery of completed homes, a contact form, and information about your company and your areas of specialty. A blog is the most significant element that will bring traffic to your website, so write one or hire someone to write one for you.
Once your website is in order, you can expand your online presence with social media profiles. This aspect of your online interactions allows you to begin building relationships with people who may not be customers now but they could be later on. By becoming a “friend” online, you ensure that they think of you when they or someone they know considers building a house.
Know your customer.
Before you can effectively advertise your home builder business, you must develop a detailed vision of who your ideal customer is. Your message should be tailored to your target audience, so time spent defining that audience and how to reach them is time well spent. Create a profile of your typical customer and customize your advertising to appeal to them and use channels that meet them where they are.
Evaluate the competition.
One way to assess your own strengths is to compare yourself to the competition. What are they succeeding at and where are they advertising? You can determine the best way to set yourself apart from the competition when you have evaluated your strengths and weaknesses and theirs. This is not to say that you should participate in a smear campaign. You should understand your competition, but your advertising should emphasize your strengths and not mention the competition.
Define your objectives.
Before beginning any advertising campaign, you should have clearly defined objectives and goals that you hope to achieve as a result of the campaign. Not only does this help you choose your advertising message and channels, but it allows you to determine how successful each effort is. Without goals to measure your marketing results against, it is easy to assume that things are going better or worse than they really are.
Protect your reputation.
As a home builder trying to market your business, it is essential that your reputation be spotless. Though it not exactly a marketing strategy, few people will trust you with thousands of dollars and their most prized possession if they do not feel that they can place their trust in you. Home building is an industry that places an extraordinarily high value on honesty and integrity. Do not cut corners unless you are willing for any subpar work or practices to become common knowledge. Just one incident can affect your reputation for years to come. Complete every job with the same high level of customer service and building excellence that you would want in your own home.
Lead generation services make big promises about connecting you with prospective clients. Unfortunately, it is a promise that they can’t usually deliver on consistently. If you are depending on a lead service for your business, you may need to restructure your construction marketing strategy. While some great jobs can come from these services, they come at a high cost, and your dollars may be better spent elsewhere.
Calculate the real cost
If you have decided to try a lead service, it is important to go into the arrangement with eyes wide open. Know that the types of leads that you will receive, even if you are paying premium amounts, are going to be for people who are shopping around looking for the lowest price above all.
Their name has likely been sent to half a dozen other contractors, and competition will be fierce. You may feel that your company is structured well to cope with this type of battle. If so, good for you. Give it a try.
When buying leads remember to calculate the true cost of each job that you actually receive from following up on them. For example, it would be easy to say that you paid $50 for the lead and made a sale that included $2000 profit. That sounds worthwhile. However, if it took 3 leads before one panned out and you spend 5 hours quoting and making follow up calls on each of them, your profit dwindles to nothing and your time has been wasted.
Don’t give your lead service false justification for the amount that they charge or credit your leads with more success than they really created. If you are still earning a healthy return on investment when you include all of the costs involved in lead generation and follow up, by all means continue to use it.
Could you better use your resources?
Even a construction lead service that provides you with a decent return is going to require your time and a portion of your marketing budget. Could they both be better spent elsewhere?
It is common knowledge that the best marketing tool a contractor has is word of mouth, but you can’t always count on that to be enough. Therefore, it makes sense to allocate a reasonable amount of resources to maintaining relationships with your past clients.
But, if the energy required by chasing leads is leaving you not able to do this, it may be time to reprioritize
Recommendations from your past customers create better leads for your company for at least two reasons.; first, these new client relationships will have a built-in element of trust. Since they trust the person who recommended you, they trust you. This removes an important step from the relationship building process.
Second, people who value a good recommendation are putting trust and quality before price, while leads provided by a service are often simply looking for the lowest price. If you tend to have the lowest price, that’s great, but you do not want to have to start reducing quality in order to fill under-quoted work. Do not change the way you do business for the sake of generated leads. Make them work for you or don’t use them.
Making the most of purchased leads
It can be tempting to give Yelp, Houzz, or something similar a try, so here are a few tips for making the most of a lead service.
Know what you are paying for. Are the leads you are receiving being sent to other contractors? If so, how many? Be aware of what kind of competition you are setting yourself up for. If a lead is sent to six contractors at the same time, you are not likely to have much success, especially if you know that time constraints will keep you from getting to a lead for more than a day.
Understand the payment structure. Does the service you have chosen charge a minimum monthly fee or a charge per lead? What if the lead is a dud? Some services offer credits for leads that don’t pan out, but others do not. Make sure you understand how your bill will be calculated.
Stand by your business plan. Construction leads gained through these means will most likely be budget shoppers looking for the lowest price. Refuse to lower your quality or level of customer service to gain these jobs. Once you start discounting, you will find that it is difficult to maintain the name that you have built for yourself. If these buyers are not right for you, be prepared to let them move on.
Be prepared to quickly respond to leads. If you do not have resources in place to respond to leads within a few hours of receiving them, these types of services may not be for you. Since the same names will probably be sent out to several other contractors, you will be ineffective if you are not among the first to contact them. Decide before signing up if you are willing to designate resources to this purpose.
Don’t depend on lead services
You may find that you gain enough from lead services to make them worthwhile. Despite the negative aspects, if the return on investment is there then you can build it into your marketing strategy. It is essential that your business does not depend upon these leads. Recommendation from past clients will almost always be your best source of new work, so continue to maintain those relationships regardless of how many good leads you have coming in.
The following post was a recent newsletter topic where I talk about DNA and knowing where you’ve been to know where you are going. It talks about changing we’ve made here on Darrenslaughter.com from both a design element as well as a business model and product offering. If you aren’t getting my weekly newsletter, you can sign up by clicking here, I’d love to have you and I think you would get something for your effort
Today, I’m going to talk about knowing your DNA and how that helps your business. If you know me for a minute, you know I have a saying, “you have to know where you’ve been to know where you are going.” I didn’t coin it or anything, but I use it a lot. I like it because it remids you to pay attention to your past before you can begin to think about tomorrow.
I use myself as an example, we recently redesigned our website again over at darrenslaughter.com. That’s a pretty common occurrence, I mean, we are website designers, but this time it wasn’t a token change with a few new images here and there, it was a complete overall in design AND philosophy, and it was a step back into the future.
I went with a blog-inspired look and feel and got rid of most of the services we provide in the navigation to promote just one service with three products; The Contractor’s Toolbox, which consists of the Apprentice plan, the Journeyman plan and the Master plan. Three levels of service based on what your particular needs are, but with one approach, giving you back more time.
That was our original DNA
When I started the company, it was predicated on giving you back time. By giving you a suite of services that you could use to get your online marketing done and go on about your day. That was our DNA and that’s what we went back to this week. New year, old approach to new things.
How about you?
Have you found yourself lost a bit, wondering what road to chose or path to take? Let me help. In the hundreds of consulting calls I’ve had over the years, the guiding light that get’s most people back on course is figuring out what the PURPOSE of the business was when they started it.
When I’ve had the conversation about purpose, I can almost see the person on the other end of the phone light up with excitement and realize (or remember) what the hell they are doing all this for. When you can get to that true North and remember what your purpose was, there is nothing stopping you.
Nothing can stop you because motivation kicks it, momentum swings back in your favor and you realize you are an expert at this thing you do, no one does it better and you can scream it from the rooftops. But you have to dig deep into your history to get there.
In the famous words of Steve Jobs;
“You can’t connect the dots looking forward, you can only connect them by looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something: your gut, destiny, life, karma, whatever. Because believing that the dots will connect down the road will give you the confidence to follow your heart, even when it leads you off the well-worn path.”
When you remind yourself of that, whole new worlds open up for you. Clarity sets in and the future get’s easy. Or it should anyway.
So spend today thinking about yesterday, last week, or as in my case, over 10 years ago. Remember what got you to today and figure out how it is going to sustain you through tomorrow.
Have a great week!
Listen, I’m a marketer, I’m an ad man, I’m every descriptor you can come up with for the people in my profession, but for fuck sake, I can’t stand text-message marketing, and I hope you hate it too! Thoughts?