A David Creation

Most service companies would love to be well known all over their city, even a large metropolitan area. In order for that to really happen, one would need a substantial marketing budget. Instead of trying to market all over your city, it is best to target your market closer into your key area. Take a look at where you do most of your work. Ask questions like, “Where do most of my leads come from?” and “Where do my most profitable jobs take place?” Look into the sizes of those cities or towns and see if there is enough work for a company of your size to dominate the area.  Instead of writing down your top 10 cities, start with 2 to 3. How can my company be the #1 painter, roofer, plumber in this city? After you answer these questions, begin doing research on how you can begin to build your brand awareness. Your budget should include some branding items such as: community events, association newsletters, little league, Boy Scout troops, yearbooks, marathons, chambers and so on.

By narrowing down your service area, you will begin to build a stronger brand and grow your company. As you grow, you can have goals to expand into other towns, but not until you are #1 in your key service areas.

How do you build brand awareness in your area now? What is working for you? A penny for your thoughts?

I’ve heard these statements numerous times, “I am not sure what to write about!” or, “I may run out of ideas.” and even “Nobody wants to read about painting!” What is my response to these comments? “Head trash!” It is head trash. Now I doubt most of your customers or the general web visitors will be signing up to read your weekly blog post, but I can guarantee they are reading good content online and researching answers to their home improvement questions. So get rid of the head trash and start writing. Use good content and answer questions to your audience. Don’t worry about how many people subscribe or comment.

Writing before and after blogs is probably the easiest way to start blogging if you don’t know what to write about or where to begin. You have a very visual business.  Your customers want to see the work before it began and what it looks like when finished. Mrs. Franklin wants to know what her neighbor Beth chose for her dining room walls or what type of countertop she selected for her kitchen remodel. This is the perfect opportunity to write up your story. Talk about the project, the location (keywords), what the customer had in mind, how the project went, materials used, colors selected and much more. End with a quote from the client (or a video). Take the blog, once it is posted and submit it to your Facebook or Google + pages (if you decide to use those channels).

We live in an age of information. People want to know something? They look it up online. Be the place that they come to find the answers and get inspired. Have you seen success writing blogs? A great follow up is to read Marcus Sheridan’s post on a similar subject, Why Facebook and Twitter Don’t Mean a Dang Thing for Online Success for Some Industries”

My dad’s small contracting business pays $4,000 a year or more for IT support, just to have an MS Exchange Server. Every time he talks to his IT company about going to the clouds, they give him outrageous quotes of all the things he’ll need to do to switch, with a hefty price tag. Really? It isn’t that difficult to switch.

With Google services firmly leading the pack in cloud computing for businesses (and Microsoft’s MS 360° coming soon), more and more businesses are moving to these services every day. It makes sense! If you are a small business, and you spend $200-400 dollars a month on maintenance for a physical server or email hosting, you are simply paying too much.

Apple Isn’t Much Help Either

My dad is just about ready to make the switch to toss his exchange server and physical server in the recycling box (yes, that was a politically correct term). Yet before he switched, he decided to go and talk to Apple. Why not! They are innovative and big into cloud computing too. Apple isn’t stupid either. They want to sell more hardware and software, like Microsoft. They referred him to a third party IT company who sets up Apple cloud servers.

Though switching to the clouds is neither difficult nor expensive, IT and computer companies are trying to capitalize on the small business owners who don’t know what to do. This Apple certified company gave my dad a quote of around $10,000 to switch from PC computers to Macs and have a cloud server and office. $10,000 for 4 computers; I’m in the wrong business! I looked over the quote this morning and all I saw was the same thing I’ve seen for years: tech talk foreign language that makes no sense to business owners, topped off with a big price tag.

Don’t get me wrong—they were not scamming him by overcharging for their services. The hourly rates and all that were in line with what IT cost are these days. Yet I feel that their quote was not in my dad’s best interest. The quote included all kinds of irrelevant extras, as well as items that he can get for free (or very cheap) elsewhere. His business is already using Google Apps for his email hosting etc, but IT companies don’t really want you to use Google because they know they can’t make money on it. There isn’t anything for them to troubleshoot anymore.

So What Should You Do

When I finished reading over the estimate for this new IT company, I sent off an email advising my dad to put on the brakes. Whether he gets Macs or stays with PCs, I don’t care. The bottom line is he really only needs the following:

1. Google Apps for Business: Email, Calendar, Two Way-Exchange-like Syncing to iPhones/Androids, Google Docs (getting better every month) and Contacts. A business can still use MS Outlook if they don’t want to use the Google User Interface.
2.  A Cloud Customer Relationship Management Software that works well with Google. There are dozens to chose from. For the painter or remodeler out there, Pipeline Deals works great and has excellent goal and reporting information. $15 a month per user with mobile access. No brainer. (For those who want less features, I use Highrise CRM. For those who want more… Salesforce, but that is very expensive)
3. Egnyte, which will do a two way sync with your files on your computer. You can access those files from any computer. You can take a laptop with you in the field, pull up your email and Egnyte, and you’re good to go (a virtual office).
4. Google Chrome or Firefox Web Browser: don’t use anything else. Each one has a sync option. This means you can have a laptop and desktop with the exact same look and feel (bookmarks, password keepers etc).
5. External Hardrives: This doesn’t hurt. I sometimes backup my Mac computer on an external hard drive just for the extra security.

What Does This Cost?

•Pipeline Deals $15 a user per month
•Google Apps for Business $50 a user per year (free version is just as good too, just less storage)
•Egynte: Best pricing is probably the 1 terabyte per month at $45 a month
•Microsoft Office ($170+ each But if you want to save money, go to Google Docs or Try Open Office)
•Setup: depends on who you hire. $300-1000 to set up Google Apps for Business is probably a good faith estimate (depending on who you hire). Egynte isn’t that hard to setup and move files. Their free tech support can guide you how to do that.
What else is there? Training and every now and then some IT support, which is normal. Things happen. So, before paying thousands of dollars to upgrade your office at the end of this year or go to the clouds, make sure you think carefully who you are hiring and why!

VISA, MasterCard and American Express are the three most widely used Credit Cards, yet most contractors, if they accept credit cards at all, will only accept VISA and MasterCard. Why? Because American Express charges a slightly bigger fee. I know what that feels like, as many of my clients use a credit card to pay me. When I first started in business though, I made the decision to accept credit cards, because I knew that is how most businesses wish to pay their bills. Many homeowners are the same way. So let me encourage you to consider accepting the American Express Card: your customers want you to do so! Many businesses and wealthy homeowners use the American Express and will typically have a handy VISA because they know many businesses only accept VISA.

Good marketing does not just involve creating good advertising pieces, having an attractive website or a nice salesperson. Good marketing involves listening to what your customers wants, and then you, the contractor, meeting those needs. Your customer will never tell you that you should accept the AMEX, but deep down, they are really hoping you will. I use the American Express quite often. I used it for business for a couple years and recently switched back to a VISA card because I got tired of businesses telling me, “No I’m sorry. We only take VISA.” It is actually a little embarrassing. The last thing you want is to make your customers feel uncomfortable.

Forget about the Fees!

What? You don’t accept any credit cards? Really? It is 2011 folks. You’ve got to accept plastic, my friend. Consumers want to use their credit cards so they can rack up their vacation miles, and you’ve got to help them get those miles! Doing a painting project or a light remodel can sure make getting points or miles easy. Now, there are ways you can ask nicely at times to get a check. Also, you don’t have to advertise all over the place that you accept VISA, MasterCard and (hopefully now) American Express. But always make sure that you remain positive when it comes to talking about money with clients. When you get down to signing a contract, the homeowner may ask, “Oh yeah. Payments. Do you by any chance accept Credit Cards?” You respond with, “Absolutely! We even take American Express!” I’m sure you’ll see a little smile begin to form from your new customer. I’ve sure seen it happen. I’ve even heard them respond with, “Oh good! I may get a free flight out of this paint job!” Wealthy people using their credit card(s) does not mean they can’t afford it. They just are being smart with their money.

Feedback

How do you make your customers feel comfortable when talking about credit cards? Do you accept American Express? Will you?

Ever since Netflix made its debut a few years ago, I’ve enjoyed their marketing. It is always fun to see a startup thrive. I was so impressed when the 2008 market crash hit and Netflix didn’t even flinch, but continued to grow. I also thought they did a great job connecting with their customers—early on. Those two words are key.

I think Netflix became so successful overnight, they were too busy counting their profits and their customer engagement began to slowly slip away. Google TV, Amazon and Apple began to creep up on them. Their stock prices had climbed quickly for over three years, and suddenly the bottom fell out. I’m glad I sold my Netflix stock earlier this year, because I just saw that they went from about $300 down to $123 in just two months!

So what happened to Netflix, and what can a contractor do to avoid the same mistake?

Rolling Out The New Netflix Plan

This past July I received a notice from Netflix about their new plan and pricing starting in September. I didn’t see this coming at all. I was a monthly subscriber yet found myself watching the Instant Watch more often (old TV shows). The notice I received said they were splitting the DVD rentals and Instant Watch into two completely separate programs with a bundle option. The bottom line was Netflix was doubling their prices with little notice to the consumer. Sure, I liked the convenience of Netflix, yet their Instant Watch features really were not good unless you only wanted to watch old TV episodes. This new plan hit me and many other customers by surprise. Everything was good with Netflix, so I thought. I felt they liked me, and I liked them. Then, “We are doubling your prices or cutting your features in half. How do you like that, you special customer? Oh and by the way, thank you for your business! We love our customers.”

My feeling is that Netflix did not really listen to what their customers liked about them and did not deliver. Their competition, Apple, Amazon & co, on the other hand, are listening. They use social media to continue growing despite a poor economy. These are the companies who are creating better selections and easier ways to access movies online. The funny thing is, Apple and Amazon are not necessarily cheaper either. No, their rental prices are sometimes $2.99-4.99. So why did Netflix stocks plummet almost $200 in 2 months when for over 3 years…their stock looks like the trail up to Mt. Everest?

I believe it is because they made some quick decisions on what they felt was best for their customers, instead of asking their customers what they really wanted. They had a loyal audience for the last 3-5 years, but now they are losing market share, and fast. People are not always concerned about price. They don’t like to be taken by surprise.

Netflix and the Contractor

So what can a contractor learn from the mistake Netflix made this year? Most people are typically pretty loyal by nature. Your clients hired you for a reason and will stay with you if you stay in contact with them. This should not always be an automated thing either. I love technology probably more than most of you reading this blog, but some things just can’t be accomplished electronically.

Few of you have thousands upon thousands of clients. You can do it! If you engage with your customers and keep in touch with them on a more personal level, your business will be successful. You’ll keep a customer for life. It is the little things that matter most. Take time this fall season to consider how you can engage with your customers more. Ask for their advice on how you can grow your business, or improve your services. Your customers do not bite. Many welcome you to stop by and talk to them. Write a hand written note, swing by their home to say hi, and drop off a simple gift, “just because.”

Do you agree about Netflix or did I miss something? How do you engage with your customers now? What works best?

Too Many Social Networking Sites!

Did you know there are over 200 active social networking sites on the web? What do I mean by active? Popular and still in business! This number does not even come close to all the small, no-name social networking sites that exist, probably numbering in the thousands. The big name sites are familiar to most of us: Facebook, Google +, Twitter, Yelp, Linkedin, delicious, XING, Windows, Live, Tumblr, and MySpace.

“Whoa! Slow down, professor! I’m trying to keep up!” Isn’t that what you are thinking at this point? If you are like me, you’re overwhelmed. It seems like every week I get invites to join a new social networking site. Sometimes I’ll join for a little while just to see what is going on and what it is about. Yet many of the sites I join won’t last. So what should you as a small business owner do when faced with so many choices of social media sites?

Two years ago, I was a fan of having one’s brand on the top 10 social networking sites. I thought like many online marketing guys did, “I want my clients to be #1 everywhere!” Yet I realized that good social media etiquette means to be real with people and connect as a human being. I now believe that by having your company brand on too many sites makes it almost impossible to

1. Be faithful to keep up all of them
2. Keep it real. Each social networking site has a different audience. Not all your company updates and blog posts should be posted on all these different sites. At some point, you’ll get discouraged that no one is engaging with you in return and you’ll burn out with too many posts and updates.

Keep Things Simple

My suggestion is to step back and look at what you are doing. Ask yourself, “What do I want to accomplish by marketing my business online or using social media tools? The primary purpose should be listening to and engaging with your ideal customers.

Find out what your customers want to talk about, learn about, read about, watch, and then give it to them. Find out who they are and where they spend their time. If most of your customers seem to spend time on Facebook (800 million users now… chances are they do) then focus your attention on Facebook and pull back on Linkedin, Twitter and the other hundred sites you’ve started to date. If you are a commercial contractor who typically deals with business people, Linkedin is definitely for you. If you are doing market research and trying to see what the word is on the street, or do some networking, check out Twitter.

When The Dust Settles, My Personal Pick

So what is one change I’ve made in 2011? My job is in marketing. So I will still be testing out social networking sites and occasionally you’ll see me on multiple channels. Yet I’ve narrowed my focus to primarily using blogging and Facebook to engage with friends, as well as current and potential customers. I get most feedback from blogging and Facebook. Also, Facebook has done a fantastic job creating THE social network.

Google is trying to outperform FB by creating Google +. It will not stick. When the dust settles, Facebook is here to stay. Why? Because the baby boomers and even many in the silent generation are learning how to use Facebook–not Google+, Twitter or the others.  So I continue to spend a few hours a week writing blogs and posting useful information here and on Facebook, distancing myself from many of the other social sites.

What about you? What do you think about all these social media sites that keep popping up? Have you tried out Google+?  What changes have you made this year in your business with regard to social networking?

I recently came across another cloud-based Customer Relationship Management (CRM) that I found noteworthy: Nutshell CRM. My first though: “Oh great, another wannabe CRM competing in red oceans (a competitive market).” Yet the more I explored the features of Nutshell, the more I could not believe how intuitive and simple each feature was to use. I can see blue oceans ahead for this program!

The design of the user interface (UI) was very impressive. Of all the CRM programs I’ve tested in recent years, Nutshell seems to have the best UI. I found myself wondering if the designers worked for Apple, since every design feature was top-notch. Most CRMs I’ve tested start with some advanced features but not a great UI. Then as they release updates, the designs gradually improve. Nutshell, on the other hand, started with a good UI, so I expect each update to be like updating my iPhone, just more features with a quality design. This observation makes Nutshell noteworthy to me, because they right from the start they have a quality product with good features.

The icing on the cake for me was the native iPhone mobile App that does an instant sync with the desktop version.

Pros

• Google Apps plugin to add new contacts or forward emails into Nutshell’s Contacts (works great)
• User Interface is simple and beautiful
• The native iPhone App is simple yet powerful (two-way sync)
• Android App soon to be released
• CRM is very customizable
• Can be used as a simple or advanced CRM program (lots of features if you want them, or a simple Contact Manager)
• Reporting and Analytics: easy to run reports and view (again…user interface is very good)
• Sales Pipeline is very organized: You can customize all sorts of activities such as when to send an email, a thank you note, follow up, who and when, what day, and much more
• The “deals” (or Opportunities) make it easy to add standardized pricing. So a contractor could have set service prices i.e. Kitchen Remodeling $45,000 (then adjust the price)
• Easy to setup and start using
• Events Sync up nicely with your Google or Outlook Calendar (I only tested Google Calendar and it was instant)
• Importing from other CRMs seems to be easy. I tried it from my CRM, Highrise and it took me a couple minutes. (btw, I still use Highrise and like it…it fits my business style perfectly)
• Captures leads from your website and creates a contact

Cons

• The iPhone App, although is awesome, still has room for improvement. It does not sync with your native iPhone calendar…and I am not sure how well setting events on the app work with Google.
• The Task Manager works well when dealing with a Lead (next steps), but not great dealing with existing clients or projects. I’ve spoken to Nutshell, and they are working on releasing a Task Management section soon. So this “con” may change. Task Management is one of the number one reasons I continue to use Highrise.
• To set a task, you basically have to create an “event.” So the process is not easy. This may sound minor, but for me, I use to-do lists and reminders all day long.
• The program is more geared for sales management than for customer management. This too is a major downside to the cloud-based CRM. The whole purpose of a CRM is to manage the ongoing relationships you have with your customers. It is not a one time deal: sell them, do the job and move on. A good CRM should then take you through the next steps: customer follow up, customer satisfaction, setup monthly email blast, thank you notes, etc. Although there are ways within Nutshell to do some of these tasks, it is not as simple as one would expect. If they improve in this one area, I believe Nutshell will be a major threat to Zoho, Salesforce, Pipeline Deals and others.

Your Thoughts?

This was just a quick, “nutshell” review of Nutshell CRM. Has anyone out there tried Nutshell?  Do you currently use it?

A quick word of caution: don’t quickly switch CRM programs. Although companies online are making switching easier, take the time to evaluate what you want your CRM to do. I would also suggest talking to your staff about it too. Show them the program(s) you are looking at. Ask them to take some time evaluating them and give you feedback. I tend to always want a program to do something better and can easily get discontent. I’ve forced myself to stay with Highrise from 37 signals. It keeps getting better and works for my company.

Twice in the last week I’ve had young men knocking at my front door, trying to sign me up for a free estimate for roofing, siding and/or windows. Overall, I was impressed with both guys that came to the door. They were professional, and not too pushy. Having just moved into a home that was already in good shape, and since my brother-in-law is a professional roofer, I declined the offer, at this time.

Before the young man left, I wanted to encourage him a little. I wished him all the best in his efforts, and I asked how the work was going: “Not too great…got 2 leads so far today.”  And this was at 5:30 in the evening!  If I were the marketing manager of this company, there are a couple of tweaks I would make to try to improve the image and closing prospects of these canvassers.

1. Dress Code The young man who came to my door was probably a college student. He was dressed in shorts and a polo shirt–not too shabby. However, he did not have any company apparel. As a homeowner, I’d like to know this is a legitimate company. He told me the name of his company but when we were done talking, I forgot the name. Tip: Don’t go cheap if you have people walking the neighborhoods! Make sure they present your company well.
2. Leave Behind Material: I was not interested in their service right then and there. Plus I was in the middle of wrapping up work…so it was not a good time. However, I was impressed with the canvasser.  He was good, yet he did not leave me his card or a brochure. Tip If someone is busy or in a hurry, at least leave them with your information. With your business card or brochure in their home, you never know when a homeowner will run across it again and call you or look you up online (hopefully they will be impressed with your online image too).
3. Better Organization: The two guys that came to my door were from the same company within days of each other. Tip When doing canvassing, make sure you have a good road map for your sales team. I didn’t like explaining twice we didn’t need their service, especially at dinner time.
4. Use Your Own People More: Hiring canvassers can be a good idea if you hire the right people who are personal and “closers.” Those folks are hard to find. Sometimes just using your own people is the best way to canvass a neighborhood. Tip Better yet, use the employees who are truly doing the work in the neighborhood. These guys are not born salesman, meaning they don’t have sales training. While homeowners are often “put-off” by a typical salesperson, a painter in his whites or a carpenter with his red wing boots and saw-dusted hat is very approachable. He can take a break from his project and canvass 5-10 (or more) homes and actually point out where he is working. He can ask the homeowner if he or she would like an estimate while his company is working nearby. This approach is the way to go, because homeowners can look outside their front door and see that work is truly being done at their neighbor’s home.

Do you have any tips on canvassing neighborhoods? What has worked for you?

Zig Ziglar said, “If you help enough people get what they want, you will get what you want.” 

I truly believe this and that is exactly what I am doing while putting myself out there and promoting others in my communities. I am offering a community service to my friends in local communities by giving them a 5 minute video interview, promoting them on “Community Spotlight” to my entire Social Media network.

I go one step further and have the videos transcribed and then post them as a blog post for them as well.

After interviewing the local Venice Florida business or professional, I then include them in the Community Spotlight e-mail that I send out that includes the latest Community Spotlight encouraging them to support their fellow spotlighters (creating community)  by promoting the video to their social media channels!

What I do:

1. First, these are all good friends of mine. I am a heavy net-worker! I attend 4 to 8 networking events a week. So this helps to create community within “our” chambers. I offer the interview opportunity and set up a time to meet them at their place of business.

2. I use a Flip Video on a tripod. Flip is great for fast editing and uploading.

3. I then edit the beginning and the ending.

4. Upload it to YouTube

5. From YouTube it drops into my website under the Community Spotlight tab.

6. Have the video transcribed.

7. Take the transcription and screen shots from the video and then set it up as a blog post.

8. Take that link and e-mail all of the Spotlighters to promote to their networks.

9. Post the video to all 7 of my Social Media channels.

And that is it!

How is it working for us? Well, year to date, we are up 97% with a record 73% close ratio without 1 print ad.

In closing, also consider what Zig Ziglar said, “People often say that motivation doesn’t last. Well, neither does bathing – that’s why we recommend it daily.”

~Steve Burnett

As a contractor, I have always dreaded the “winter” because work would dry up, and weather often prevented what types of projects could be performed. As the leaves began to turn, I used to get an uneasy feeling in the pit of my stomach, as I knew what was just around the corner. After the first painful winter, I decided to be proactive and generate the work I needed not only to survive, but also to prosper.

Start Before Winter

The key with developing winter work is to begin generating it PRIOR to the winter beginning. Once Thanksgiving comes, people stop thinking about home improvement projects. It is imperative to contract for and schedule the winter work before Thanksgiving while people are still in a buying mode for home improvement projects.

Budget & Projections

First, start with a budget of what you need both from a break even, and then a full capacity, perspective. For instance, if you need $100,000 of work to break even over the winter months, and the average job is $5,000, than you need 20 jobs to break even. If your closing ratio is 66%, you would need 30 estimates to generate the $100,000 you need to break even. You should do the same for a full capacity projection.

Past Customers

The easiest way to generate the required leads is to start with your past customers. A good response rate for direct mail is 0.5% response rate. Obviously, people you have a relationship with (and whom are presumably satisfied), will respond at a higher rate. Depending on the effectiveness of the offer, it is reasonable to achieve anywhere from a 2% to 5% response rate.

Going back to the original break even analysis, if you need 30 leads, you would need 1,500 customers on your mailing list (30 divided by 0.02). However, if you can generate a 5% response rate, you only need 600 people on your mailing list. The bigger your customer list, the larger number of estimates you will generate.

Next, you need to generate a compelling offer to incentive people to schedule work in the winter. What I have done in my business is give a large percentage discount (usually 30% off our regular rates) for work scheduled between specific dates in the winter. Our most difficult period for scheduling work is December 15th through January 15th, so we set that windows as the “discount period”.

The catch is you limit how many projects you take at the heavily discounted rate. For instance, if you need 30 projects to break even, you limit this discount to the first 30 people to respond to the offer. This will give your past customers the sense of urgency to move quickly and take advantage of the proposed savings.

Whether you send a letter or some other postcard style mailing will be up to you, but I suggest a simple letter. It will give you the opportunity to explain why you are willing to offer such a tremendous discount. Specifically, that you need a certain amount of work to retain your employees during a naturally slow period, and that you are willing to offer a great deal in exchange for scheduling during this slow period.

I suggest sending this letter in late September or early October. Follow up this mailing two to three weeks later with a follow up mailing (this time a postcard) indicating how many projects you have sold, and how many spaces are left.

Two weeks later, send a final mailing stating how few spaces you have left for the promotion, and reminding them that the promotion will end shortly. You will find you will get a flurry of calls at the tail end of the promotion of customers desperate to get the last spaces available.

Email Works As Well

If you have email addresses of your customers, you can send email blasts in between mailings two and three. Again, the focus should be about highlighting how many spaces you have left.

It may seem counter intuitive to have work scheduled say from December 15th – January 15th when you may have openings still in November, but knowing the exact amount of work you have signed and scheduled during your slow period, will give you the comfort level to continue to sign and schedule the “normal” work that will come in naturally.

Mark Osborne owns and operates Manor Works Painting, which services the Greater Washington DC Metro areas and Northern Virginia. His website is: Manor Works Painting. Mark is a leader in the painting inudstry: known for knowing his numbers and running a smooth and organized painting company. In his spare time he enjoys attending local beer dinners and is in the process of creating his own brewing company. Stay tuned!