Four years ago, Rosie Romero sold a majority stake in Legacy Custom Builders and Remodeling Inc. to Mark Olson, an apartment development specialist. One year later, Olson recruited Brian Shaurette, a residential construction professional with a new-home construction background, to manage the company. Since then, Olson and Shaurette have analyzed each part of the company, from the types of service they offer to the types of marketing they use, to determine their most profitable activities. The goal, says Olson, is to grow the company so it will hit $10 million in revenues within the next few years. Shaurette and Olson sat down with Qualified Remodeler to talk about their success, particularly in the area of sales and marketing.
QR : How do you plan your sales and marketing activity?
Brian : It is not as complex as you might think. Basically, since Mark and I joined the company, Rosie Romero has had a radio show on Saturday morning that is the No. 1 radio show on the dial. At the time, we were struggling to make sure that we were using our marketing dollars as effectively as possible. Buying print ads and hiring marketing companies for thousands of dollars had been tried with no real good turnout.
Mark : I have a financial background and I was analyzing the operation on an ongoing basis from the day that I got here. I could see that Rosie took a broader approach to remodeling services. He really didn't appear to have the people or the information systems in place to understand the profitability of each area. You have to have good reporting systems to be able to ascertain what you are doing right and what you are doing wrong. So that was an evolutionary process. And as we were doing that, we shut down the things that we felt we were not good at and focused on what we are good at. In conjunction with the marketing dollars we are spending, we track our lead sources for all of our contracts, so we know the return we are getting on each marketing dollar. So that helped us to pinpoint some of the things that we wanted to do.
QR : After you analyzed the business, what were the key remodeling segments that you stayed with?
Mark : We decided to focus on remodeling jobs, not handyman, not custom homes, not a concierge service as we had been doing in the past. That is not to take anything away from what anybody in the organization was doing prior to our coming on board. It was just inconsistent with our vision. We like to pick a farm and farm it. We wanted to direct all of our energies toward the core business.
QR : When you analyzed Legacy's most effective marketing sources, it must have had a major impact on how you allocate your marketing budget.
Brian : Our analysis showed that most of our leads were coming from our “Rosie on the House” connection — the 60-second spot that Rosie was doing during his show on Saturday morning. And Rosie would make mention of us throughout the show, so overwhelmingly, most of our leads were coming from that avenue. Like I said, Rosie had tried high-end marketing agencies spending thousands of dollars. We had tried print ads for the company, but nothing had shown so clearly as the leads from Rosie's show. The trouble was that most of the audience for Rosie's show was small-job orientated. We have a $20,000 minimum job size. We do kitchens, baths, whole-house, exterior and interior. We had to filter through a lot of those leads to get to the bread-and-butter leads.
QR : What is your process for filtering leads?
Brian : We have a very good person answering the phone who knows how to talk to the people and find that out. We don't like to make anybody feel like they are being judged on that phone call so we pretty much steer almost everything to one of our project consultants for a personal phone call and a visit to the person's house, unless it is quite evident that it is a small, one-trade job. In those cases we counsel that person back into the “Rosie on the House” referral network. After seeing those leads from Rosie's show — and I have been a longtime talk-radio listener — that is what started us getting talking about doing more radio advertising.