Now that the economy is officially in a recession, it’s time to look at your company budget and learn to be a more efficient operator.
But what do you cut?
Many gutter installers see the line item under “Advertising” and figure that ambitious marketing plans are luxuries for better times. It’s true that marketing, like any business function, can be made more efficient and yield greater bang for the buck. But also think about turning adversity into opportunity. By keeping an active presence in the marketplace, you can raise your company’s profile while your competitors are cutting back. And thus you can build bridges to new clients who, when the good times return, will boost your repeat and referral business.
For example, owner David Cullyford of Cully’s Seamless Gutter in Englewood, Colo., has found that persistence and creativity — not big budgets — are the keys to marketing success. A few years ago Cullyford was working as a prison guard when he decided to change careers, be his own boss and purchased an established residential gutter business. Times were good and, initially, he figured that training under the previous owner would be enough for him to learn the ropes and keep the company going.
But to drum up new accounts, recalls Cullyford, “I started calling roofing contractors in the phone book. It was almost impossible to set up meetings. Most contractors just asked that I send a business card.” For a newcomer who lacked local contacts, it was difficult to get his foot in the door. “But you can’t be shy,” he says. “If I see a contractor working on a remodeling job, I ask if they have a preferred gutter installer. Even if they have someone they’re working with, most of the time I’ll at least get a chance to give an estimate. And often I’ll get the job.”
Cullyford’s marketing technique is the ultimate in efficiency because he optimizes the assets he himself brings to the table. It doesn’t cost anything extra, he points out, to “learn how to present yourself well. Smaller companies actually have an advantage, because the person who is giving the estimate will often be doing the job as well. By presenting yourself well, you can gain the customer’s confidence. I even try to do estimates when the homeowner is there, so I can win their trust. Direct communication is very important.”
To hold his own against larger competitors, Cullyford provides potential customers an extra level of service. Knowing that homeowners often get multiple estimates, he offers to be their “consultant” and give them second opinions on various gutter products. “I tell potential customers who get multiple estimates to call me if they have a question about a product promoted by another company,” he explains.
Since many customers research their contractors on the web these days, Cullyford contacted a marketing company that combines phone book and Internet advertising. Though Cully’s Seamless Gutters pays for the service, the one-two punch gives the company more bang for its marketing buck. “The package deal brings in about 60 percent of my customers,” he reports. The other 40 percent come through referrals and from free advertising, such as a local website that provides space for local companies.
Another cost-effective investment was the money Cullyford spent to have his truck professionally lettered. “For $200 to $300 you can cover three sides of a truck, and it’s a great source to generate calls,” he says. “It’s all about exposure. You must evolve your business to fit your community.”
By tracking the results of each marketing effort, Cullyford can identify “what works” and target his marketing dollars more effectively. “I watch every penny and, since advertising can be expensive, I want to make it count,” he advises. At the same time, however, he cautions fellow installers that “it’s more cost-effective to give great service to your current customers than to give them long lead times because you’re spread too thin pursuing new customers.”
Cullyford is a believer in niche marketing, or targeting the markets that make the most sense for his company. Rather than go after jobs for new-home construction, he states, “I find that my profit margins are higher for remodeling projects. So I’ll pass out fliers in established neighborhoods.” By advertising free estimates and a 10 percent discount, the fliers have produced a good return for a low investment. So good, in fact, that Cullyford is thinking about hiring teenagers to distribute the fliers and reach more potential customers.
A good marketing return for a low investment is also important to president Mark Miller of Miller Seamless Spouting in Baltic, Ohio. “We’re in a rural area and so we’ve had to do a lot of networking,” says Miller in explaining why, despite a marketing budget that’s just 1 percent of his annual sales, his company values marketing.
Primarily a residential installer, 10 percent of Miller’s work comes from commercial jobs. However, “We’re different from most gutter installation companies in that 80 percent of our work comes from contractors,” Miller reports. Within the 75-mile radius of east central Ohio his company serves, Miller has cultivated relationships with home builders, roofing and siding contractors and commercial builders who furnish about 10 percent of his volume.
Such networking, Miller believes, has given him an edge of competing gutter companies in his territory. “We do our part by referring, for example, a siding contractor when we see the opportunity,” he relates, “and other times, they end up being our salesman.” Such networks, he adds, are built on trust. “When you’re networking, service becomes more important than price,” he observes. “Price might get your foot in the door with a contractor. But developing a relationship of trust is what’s really important to them.”
Miller has built that level of trust by understanding that contractors live or die by how well they stay on schedule. “Communication is very important because they can be very picky,” he relates, “and since we don’t see 90 percent of our jobs until we get to the jobsite, that means the contractor must have confidence that we can size up the project and do it right.” Not only does Miller Seamless Spouting do it right but, because Miller himself has installed gutters since he was a teenager, contractors can rely on him to troubleshoot any problems.
Helping contractors meet their schedules also means that Miller keeps on hand the products they need. “We stock 18 popular colors and sizes, so contractors can get what they need fast. They know that if they forget to call ahead there’s a good chance we’ll still have what they need,” he relates, “and some of our remodeling contractors count on us to provide products on a next-day basis.”
Many of the most basic techniques for cultivating good relationships don’t cost Miller a penny. For example, since large jobs are often quoted months in advance, he understands that “contractors don’t want any hidden costs on the invoice. And of course, quality is crucial. ‘Good’ is the enemy of ‘best.’ Homeowners will notice if the gutters drip or leak — and then they’ll blame contractor, as well as us.”
Though Miller has an established network, he is always on the alert for more networking opportunities. “The industry is competitive, so you always need to be growing,” he says. “So I’ll stop by if I see a new homebuilder that I don’t recognize and try to get a chance to quote on the job. And I’m also a member of the local home builders association and other groups.” He frequently offer discounts to contractors on their model homes as a way to help them out financially while also securing the relationship.
Miller figures that about 20 percent of his workload comes from homeowner referrals and new customer leads generated by yellow pages advertising and his company website. Miller Seamless Spouting has dedicated phone for both advertising channels, he adds, “So I know how many calls are coming in from which source.” Meanwhile, newspaper advertising has been ineffective. Instead, he plans to try a mass mailing next fall to highlight the gutter protection products he offers.
At the same time, Miller believes the web has the most potential of all to generate leads directly from homeowners. “Most people on the web tend to have higher incomes,” he says, “which means you can sell them a better system and increase your opportunities to up-sell products.”
Having a website builds credibility for his company and gives homeowners a chance to see his products. Most content on the site emphasizes consumer education and highlights the top-selling products. “Provide an easy way for them to contact you,” he advises, “but don’t offer online estimates.”
Seizing seasonal opportunities
Co-owners Mark Mangen and Andy Moffatt of Ace Rain Gutters in Vista, Calif., are a two-man show. Though a few commercial projects come their way, most of their jobs are for home-owners. The duo generates significant referral business because, says Mangen, “We do the work ourselves, which builds confidence for the customer. We know exactly what we’re doing and don’t have to fall back on crews. So it gets done right the first time.”
Work is seasonal in his area, Mangen reports, so marketing efforts are often governed by the time of year. “We get most of our rain during the winter, so business really seems to pick up from August to January,” he relates. During those months, the phone book tends to generate more leads.
At other seasons, Mangen continues, “We know that we can depend on getting business by distributing fliers. The copy simply explains why you need gutters — and then sometimes we run a sale.” Yet even fliers can yield fewer results when the weather is unseasonably dry. Believing his area is overdue for such conditions, he is keeping an even closer eye on his advertising dollars.
“This year we have a certain number of leads guaranteed by the publisher for our phone book ad,” Mangen relates, “and we have a tracking number and get graphs every month telling us where our leads come from and what day each customer called.” If not for the guarantee, Ace Rain Gutters would have considered dropping its advertisement. Though the fee is expensive, however, the guarantee provides rebates in case the ad does not deliver.
In the meantime, Ace has stayed flexible to stay busy. For one thing, good marketing means offering the products people want. “We now offer rain barrel installation and gutter protection accessories to try to help our bottom line and meet the demand from our customers,” Mangen explains. “We’re also trying to set up more maintenance projects in the summer during our slow time.”
Ace Rain Gutters’ website focuses on consumer education and basic product information. “We try to update it as often as possible with pictures of jobs we’ve done,” Mangen states, “and we’re definitely noticing that we’re getting more customers off the Internet. They’re able to see what we’re about before they talk to us. And other sites that rate gutter installers have rated us well, which has helped.”
For the future, Mangen plans to increase his efforts to stay in touch with previous customers. “We need to be in better contact with them, even if it’s just through a twice-a-year flier,” he says. Though seasonal ups and downs are facts of life in the gutter business, Mangen suggests there is at least one no-cost marketing strategy that pays big dividends. “Always call customers back,” he advises, “and follow-up on every bid.”