Case Study #1
Hallmark Home Remodeling
Jeff had spent over 15 years in outside sales for a building products distributor. For the majority of those years he held the coveted title of “top performer.” Danny previously had worked with a major, national property/casualty insurance company, but quit to pursue his passion: purchasing homes in need of repair, fixing them up, and flipping them. His workmanship was impeccable. Homes that he remodeled sold quickly and always for a profit.
The two decided to combine their skills, abilities and talents and form a business. Jeff saw the handwriting on the wall with lack of business at the building products company and quit his job. Danny set aside his work on fixer-uppers.
The new business started. Hallmark Construction Company’s vision was to position itself as quality, high-end residential and light commercial contractors – always looking to do the best, highest quality job possible.
Their marketing approach was to concentrate their sales efforts on specific tracts of homes within a ten-mile radius of their own homes. Homes in this area were all about the same age. Many were beginning to show signs of wear and tear.
Their initial marketing activities included:
- Designing a logo and printing plastic laminated business cards
- Knocking on doors and introducing themselves to the homeowners
- Handing out business cards and flyers containing a laundry list of services they provide
- Leaving the flyers containing a laundry list of services in the door if no one answered
- Purchasing $1,600 worth of spots on a local radio station
- Purchasing yard signs with the Hallmark logo and phone number
- Creating a website that was contributed and managed by Jeff’s brother
- They each had pickup trucks and invested in decals for their trucks
When Jeff and Danny came to 10-Day Marketing Makeover, their 14-month-old home remodeling company in St. Louis was floundering. Jobs were few and far between. They had used up their cash reserves, exhausting their savings. They were living job to job. That meant no money for a rainy day… and no money for marketing.
We knew that in order to help them and to save them from inevitably pulling the plug on their business, the results of our 10-Day Marketing Makeover must include low-cost or no-cost marketing strategies for recommendations. We also realized that our recommendations must have the ability to bring about results – in the form of sales – just as quickly as possible.
Following our 15-point critique, here is a partial list of the recommendations we made:
First, the focus by Hallmark on nearby neighborhoods was a good one and showed us that their marketing instincts were extremely good. 10-Day Marketing Makeover encouraged that they retain this, but that we look for ways to perfect this neighborhood “mining” or “canvassing” and to make it more effective and reliable. This would also serve to minimize any hard-cost investments in marketing. They didn’t have the money. There was no sense in going in that direction.
Second, Jeff and Danny always worked together. When they sold a job, they both worked the job. That meant that absolutely no marketing or prospecting occurred while they were in a production mode. We recommended that they set a specific target of homes to call on each week, no matter what. They modified this to 40 door knockings a day. This was accomplished by one or both of them stopping work on the job at four o’clock every day. In addition to continual, ongoing marketing, this ultimately proved to be a more productive time of day to canvas.
Third, 10-Day Marketing Makeover also recommended that they turn their canvassing and initial jobs in a given neighborhood into an “event.” Jeff shared with us early on that he had an old golf cart in his garage. We recommended that he clean it up, paint it if necessary, and put Hallmark logos on it. During canvassing, they’d pull up to homes in their golf cart. Homeowners were much more willing to open the door, just because of the novelty of seeing the golf cart in their driveway.
During the first installation or job in any given neighborhood – which were now always scheduled on Saturdays – the golf cart arrived along with a large cooler of bottled water and helium balloons for the children.
In a summer roofing job, for example, dads and kids wandered down the street to see what was going on. Jeff or Danny would take the dad and his kids for a ride around the neighborhood in the golf cart. This usually included a drive past the dad’s home. This time was used to qualify the dad, question him about potential remodeling issues in his home, and even to ask for referrals. The bottom line was that a single job in a given neighborhood could eventually leverage into six or more within a relatively short period of time.
Jeff reported later on that this strategy using the golf cart, balloons for the kids, and bottles of water resulted in them doing four roofing jobs in one neighborhood within two weeks.
Most importantly, the entire neighborhood was involved and engaged. This provided Hallmark with an audience to see the quality of their work, how pristine they left the jobsite, and to make a lasting, positive impression.
Fourth, the standard handouts were changed from a generic laundry list of activities to specific offers such as window inspections and gutter and downspout cleaning. The goal was to offer something at a low cost in order to gain a client and a stronger foothold in the neighborhood. Flyers were nothing more than photocopies on colored paper. This was done in order to position Hallmark as cost-conscious and affordable. The focus was on value and not glitz.
Fifth, an unemployed friend named Jack was recruited and trained to canvas neighborhoods. In a matter of two weeks Jack, on the golf cart and with flyers containing specific offers, was perfecting his ability to talk to homeowners, tell them about the special offers, have a preliminary conversation, and qualify them. If and when a homeowner expressed a need, Jack would call Jeff or Danny to set an appointment on the spot.
(Although the jury is still out on Jack, 10-Day Marketing Makeover commended Jeff and Danny for realizing that they could leverage this necessary activity beyond their own personal productivity.)
Sixth, 10-Day Marketing Makeover also looked at the issue of how to find and obtain the first job in a given neighborhood. 10-Day Marketing Makeover provided a strategy that included locating the nicest house on the block. Jeff and/or Danny would knock on the door, introduce themselves, and compliment the homeowner saying that he had the nicest looking home and yard on the block. Invariably the homeowner would either step outside or invite them in. They’d talk about the homeowner’s home and then start talking about the neighborhood.
Danny once told 10-Day Marketing Makeover, “We couldn’t shut them up.” Jeff and Danny would learn who had leaky basements or roofing problems, who was new to the neighborhood, who was planning to sell, and so on. Jeff and Danny became so adept at this that they would be able to turn the homeowner into a real ally and referral source – in some cases an unofficial non-paid salesperson.
Seventh, knowing that consumer financing is a critical issue in this economy, 10-Day Marketing Makeover recommended they locate a local banker or lending institution that would be able to support them. The purpose, as we analyzed their sales process, was to remove any barrier or interruption to the sales process.
Eighth, 10-Day Marketing Makeover recommended the purchase of shirts and hats with Hallmark logos in order to present a more professional image when they are working the neighborhoods.
Ninth, 10-Day Marketing Makeover recommended that Jeff and Danny open their thought to accepting smaller jobs as a way of gaining the trust and confidence of consumers. Experience supported the strategy. Demonstrating their professionalism with small jobs often won them larger jobs… and almost always won them referrals.
Tenth, the 15-point critique revealed that Hallmark’s closing ratio needed considerable work. In the current economy, low-ball prices by competitors seemed to kill their opportunity to make a sale. Prospects told them, “We really want to use you, but the other company is so much cheaper.” 10-Day Marketing Makeover recommended and choreographed an in-the-home as sales approach to deal with this problem.
This sales approach included a strong emphasis on relationship building and, especially, on education. This included describing different ways that home remodeling companies do things. Although this did not directly “knock” the competition, it did provide a heads up so that if the homeowner did go shopping, they’d be better educated about what to look for and where competitors often try to cut corners.
The sales approach included a process for qualifying the homeowner and determining how quickly the homeowner might want to move forward. It also determined up front how far along the homeowner was in their decision process, if they had talked to another company, if they had financing in place, and so on.
The final part of the 10-Day Marketing Makeover strategy was for Hallmark to provide good-better-best pricing. For each job – ranging from a room addition to replacing a roof – they provided alternatives at three different levels. This supported the education process and demonstrated how other companies are able to “skimp” on various things, but helped the homeowners understand their real alternatives and what they’d be getting.
Danny subsequently shared a story about a homeowner who was looking to add an enclosed sunroom or porch. Hallmark provided good-better-best pricing at (rough numbers) $15,000, $20,000, and $25,000. The homeowner actually took the lead during the presentation and created his own solution that fell between better and best. At $22,500 they closed the deal – a one-call close on a substantial project.
Critical to the good-better-best pricing approach was that Hallmark relate to the homeowner that any choice the homeowner makes will provide a first-rate outcome and that Hallmark’s good is better – dollar for dollar – than what the competition can or will do.
In addition, pertaining to the good-better-best pricing, 10-Day Marketing Makeover strongly recommended that each of the levels always produce a favorable profit for Hallmark. So, it wouldn’t matter which deal they sold. Each and every deal would be profitable and help them build their reputation within the neighborhood as the best home remodeling company!
In a matter of their first six weeks following implementation of this strategy, Hallmark’s closing ratio went from one in 10 to one in four. Jeff and Danny are committed to doing even better.
10-Day Marketing Makeover presented additional strategies and action plans that Hallmark adopted. However, the points outlined above represent some of the most dramatic outcomes as a result of our involvement and leadership. It’s astounding what can be accomplished in only 10 days!
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© 2009 10-Day Marketing Makeover
Names and locations have been changed for purposes of confidentiality. The case history does not include every recommendation that was provided to the business. This case history is provided as a means of demonstrating the scope of activities provided by 10-Day Marketing Makeover and the client’s experience as a result of implementing the recommendations provided.
No two situations are alike. 10-Day Marketing Makeover provides a custom service. Each individual organization’s success depends on the background, dedication, desire, and motivation of the principals. As with any business advisory service, there is no guarantee pertaining to the final outcome or to an individual’s success.