Just Discuss It
At Case Design/Remodeling, the leading salesperson in 2009 wasn’t an aggressive, “sign today” salesman but a personable, patient, and pregnant mother of two named April Case (no relation) Underwood. She estimates that her 2009 sales were $200,000 above her 2005 volume, which went down in many remodelers’ history books as their biggest year ever.
Her secret? Sure, pregnancy and parenthood bond Underwood to many of the homeowners she works with, but other factors — replicable processes and attributes all — are also at work. A few years ago, “I felt that people were chasing me down” in their rush to remodel, she says. Today, the research and meetings that these clients didn’t have the patience for then are becoming critical stages of the selling process.
Education: Case Design has been holding homeowner seminars for 20 years, but attendance has tripled recently, Richardson says. He notes that some remodelers find seminars frustrating, as contracts are rarely signed at them. “When homeowners go to a seminar, however, they feel that they’re doing something.” They’re researching and getting comfortable.
In turn, his company has consciously invested more time and energy in a ‘just-discuss-it’ approach aimed at closing a design contract or feasibility study, rather than a construction contract.
The warm-up call: Underwood considers this a pivotal part of her sales process. “People are stressed; they’re wondering if they can afford this. They want to make sure they’re not throwing their money away,” she says. In 2005, where many were happy just to have a remodeler call them back, they’re now listening for signs that the remodeler cares about them, knows exactly what she is doing, and is acting with their best interests in mind.
To that end, Underwood listens carefully during the call, jotting down project notes as well as, when relevant, the names and ages of children and pets. This attention to detail resonates with and reassures nervous homeowners, she says. “When I go to their house, it’s almost like we’re meeting for the second time.”
The downsell: With average job sizes way down, and financing tougher to come by, remodelers must improve their close ratios as a hedge against lower volume. Richardson has found that using different sales techniques — and “not trying to swing for the fences” of big project sales — can increase close ratios by as much as 50%.
“In the past, we followed the fantasy,” he says, referring to the bubble-driven money that homeowners spent lavishly even when they had to borrow it from their investments or home equity. “Now we’re guiding the fantasy. They’re using their own money, and the banks want to get paid back.”
One method is to present remodeling options in three categories: the must-do (rotting wood, dangerous conditions), the want-to-do, and the future idea. “Remodelers can be their own worst enemy by letting the fantasy grow out of control,” Richardson says. Today, “you really have to be a financial adviser, a voice of reason,” who is as quick to encourage clients to stick within their means, as to stretch.
Different price points: It’s a fallacy to believe that consumers want the best of everything, Danziger says. When she and her husband remodeled recently, she wished that the architect had presented “A, B, and C price points. In some cases, I was perfectly fine with good,” she says.
A case in point is private spaces versus public spaces. For her master bathroom, Danziger saw no need for the “deep bathtubs with bells and whistles” that are so common in expensive homes. A shower was just fine. But for the kitchen, site of frequent entertaining, she wanted “top-of-the-line the whole way.”
Underwood appreciates price-point distinctions and strives to value-engineer projects where possible. With certain cabinet lines, for instance, she can give the client the option of two kitchens with identical floor plans and appearances (when the cabinet doors are closed), but that can cost $2,500 less by selecting the box construction line.
Sell expertise, not product: “Remodelers should realize that homeowners have done their due diligence,” Danziger says. “They know more about the remodeling business than you could have imagined several years ago.” Above all, that knowledge extends to products, which they can easily research — and compare prices for — online.
For that reason, Danziger says, remodelers should seriously rethink conventional billing practices. Charge for design. Charge for expertise. “And to hell with the markup,” she says. “People may not be willing to pay for it because they know they can find it cheaper.” Why not help them get the best price on commodities, and charge instead for what is unique to you?
Most remodelers may not be ready to abandon markups, but they can find better ways to sell their expertise. For her part, Underwood always has a well-rounded project portfolio to show prospects and vividly helps them to visualize the design possibilities using descriptive, carefully chosen words.
“I’ve always tried to help people feel comfortable, and that they can trust me,” she says. “Now they want even more reassurance that I know what I’m doing, and I’ll hold their hand through the process.”
—Leah Thayer, senior editor, REMODELING.