July 26, 2016
Recently I presented a half-day marketing workshop titled, “Choosing and Targeting the Right Customers and Projects Types for Your Business.” At the workshop I shared new ways contractors can think about and do their marketing so they can attract their desired customer and job types. It’s what I call strategic marketing. For those of you who missed the workshop, here are some of the key points we discussed.
Take advantage of the timing
The economy and residential construction are both picking up. At the same time the majority of attendees agreed with me in that we are not yet confident that the pace of the current surge will be sustainable considering the uncertainties businesses and consumers still have about the economy. With that in mind this is however a good time to take advantage of the surge to concentrate on developing market share in a strategic way.
It’s my opinion that most contractors would benefit from becoming a specialist in what they do and how they do it. After all, specialists typically command higher prices than generalists. And, true specialists are always in demand, even in down economic times. Now is a good time to specialize, as long as you also work on branding to establish and maintain your position as a specialist in your desired market areas.
Here are some specific tactics contractors can consider and use to strategically build market share.
Pick your customers, don’t let them pick you
Stop taking just any customers and jobs. Be selective about who you will let become your customers. For example, why not work only with people who would say they are working with you, not those who would say you are working for them? Also, be selective about the project types you go after. For example, why not attract people who want high quality products? If you sell using one mark-up across all cost categories, the gross profit dollars earned on material intensive projects due to higher price point products is an easier way to meet overhead and net profit goals, both now and in the future, particularly when compared to selling and producing labour intensive projects.
Stop competing, differentiate
I don’t understand why contractors think they have to compete and or be competitive. For most construction business owners, competing means bidding. Homeowners who seek bids are typically like auctioneers, except they are looking for the lowest price, not the highest. And, rather than try to be better than your competition, why not seek to be different from your competition. Being different attracts attention, and consumers who want different also know they have to pay more to get different.
One key to being different and attracting positive recognition for it is to concentrate on how you do what you do to demonstrate your difference, rather than work on what you do to differentiate. One example of potential differentiation could include helping prospects develop project specifications with the agreement that you will come back to present your proposal and solutions, but you will not leave them behind unless they sign your proposal and give you the required deposit.
Being different comes with pros and cons
If you decide to use these example strategies, many prospects will go away. However, the ones that see value in your differences will become cogs in your new referral generating machine and will pre-sell the value of your differences to their referrals so you won’t have to. I call those types of referrals “layups.”
Think of how you do marketing in a new way
The old traditional marketing methods of trying to find prospects who want your services now and interrupting them to get their attention no longer work. Today consumers are the ones deciding how they will find and qualify their project ideas as well as the contractor they will work with. Instead, use inbound marketing tactics that help consumers find your business.
This should be one of the two primary purposes of your marketing and can be accomplished on your website using SEO tactics and good content on your site’s pages as well as your blog. The other primary purpose of your marketing, particularly at your website, should be to help prospects decide if what you offer and how you do business are right for them. In other words, your marketing should help them prequalify themselves so they either want to contact you or know they shouldn’t.
Final thought: marketing shouldn’t just be limited to creating leads
At the workshop I also shared one more new way to use your marketing: to advance the sales process. Consumers want to gather information and ideas about their project, but they want to be sure they are getting accurate and useful information. Savvy contractors are now using the content on their websites to educate consumers before they call to set up an appointment with a contractor. This saves both the prospect and the contractor a lot of valuable time. In addition to offering project and product related information, you can also educate them about how and why you do business the way you do.
This can not only speed up the sales process, it can also help clearly differentiate your business and therefore improve the quality of your leads.
Shawn McCadden is a consultant, educator and speaker who offers business consulting and coaching services for remodelling business owners who want more for and from their businesses and their lives. He also consults with construction-related product manufacturers and suppliers, helping them understand, find, educate and better serve remodelers. Check out Shawn’s website http://www.shawnmccadden.com/ and blog www.shawnmccadden.com/Subscribe-to-The-Design-Builders-Blog.