How will that happen? In a word, marketing. Home improvement companies typically are sales and marketing organizations that sell renovation projects. Because even if it pours rain, people don’t know or know they need Atlantic Remodeling.
With an average job size far smaller than most full-service remodelers — $8,251 last year — home improvement companies typically need many jobs to build the kind of volume that gets them on this list. To generate many jobs takes many leads. Marketing remains the No.1 challenge for many, in part because it is changing so rapidly — and so are consumers. It is “harder and harder to get a two-legged appointment,” Gindele says. In addition, homeowners seeking services now flock to the Internet.
“We’ve begun to look at our lead sources in a new light,” says Eric Tulio, president of Mid-Atlantic Waterproofing, a basement repair specialist in Maryland. Like roofers, Tulio’s company has always depended on rain. And when it rained, all the company’s marketing needed to do was let people know what Mid-Atlantic Waterproofing was, where it was, and how to reach it. Not anymore.
Five years ago an Internet marketer that the company hired told Mid-Atlantic Waterproofing that marketing and the Internet were “changing dramatically.” It turned out, Tulio says, that they were right. Today the Internet and shows/events are Mid-Atlantic Waterproofing’s most dependable sources of new business. The company outsources its search engine optimization and pay-per-click activities to two separate companies.
Replacement 100 companies used an average of 20 lead sources last year. The best lead source, of course, remains referrals. But as the Internet itself has evolved in the last five years from a pseudo-passive electronic billboard to a tool of interactive search and engagement, that medium has become ever more important.
Gindele says that last year he took the advice of a fellow Renewal by Andersen dealer and set out to generate 20% of his business from new lead sources, including ads on magazine covers, a mass postcard mailing, and a new website launched in July 2011.
In Texas, Statewide Remodeling, which 10 years ago primarily sold windows and sunrooms and is now mostly a bathroom and kitchen remodeling operation, worked a Pay Per Inquiry deal with newspapers such as the Fort Worth Star-Telegram. The company, CEO Rob Levin says, was investing hundreds of thousands in newspaper ads and getting little back for its money until it went to PPI, a change, he says, that the papers did not resist, anxious as they are for any kind of revenue.
INTERNAL CHANGES DRIVE GROWTH Statewide Remodeling saw sales grow 17% last year, part of that due to offering a product — walk-in tubs — whose time has come. The products and projects in demand are often those that serve the needs of an older generation of homeowners who have elected not to move. They’re getting what they need to stay in that home. So does product affordability, says Vince Nardo, president of Reborn Cabinets, in Anaheim, Calif. Reborn’s sales were up 31% last year, and some of that has to do with offering products — mainly bath liners and kitchen cabinet refacing — that cash-strapped, credit-wary homeowners can afford.
Refacing means you can give clients the same look and the same quality as a new kitchen, Nardo says, without the time and expense.
But just as important for Reborn’s growth, Nardo points out, were the internal changes the company made in 2011. It hired a full-time sales manager in September 2010. That freed Nardo — who had managed the company’s sales-force of about 20 people — to “market aggressively” (including its showroom events and mall shows that were “incredible”) and improve on tracking measures that make both its marketing and sales efforts ever more efficient.
Companies that grew in 2011 typically built on well-organized, even rigorous, fundamentals while looking to stay ahead of the technology curve and read an increasingly different, and sometimes difficult, homeowner customer. “I think 2011 was a challenging year for everyone in the remodeling industry, across all product lines,” Whitworth says. “These are challenging times for homeowners. We can’t control the macro economy, but we can control how we run our businesses. It’s about concentrating on, and getting right, your basic systems. And bringing value to that homeowner every day.”
—Jim Cory is editor of REPLACEMENT CONTRACTOR.
