Taking the Mystery Out of Lead Generation

One important Web strategy is speed of response. A study done by the Massachusetts Institute of Technology, Musch says, shows that after just five minutes chances of reaching someone who submitted an online request for information dropped off very quickly, even at 10 and 20 minutes. “After spending a lot of money on Web strategies, make sure you have a mechanism to respond to these people in a very timely basis; otherwise you are going to lose a lot of leads,” he says.

There’s Still Life in Old Leads

Lead generation, too, goes beyond generating the initial inquiry. A remodeling company may generate 10 leads at a cost of $3,000 based on an average cost of $300 apiece, not an inconsiderable investment. The initial conversion rate traditionally has been about 30 percent. What many remodelers don’t take into account is that of the seven that don’t buy right away, 60 percent end up buying a similar product from someone within a year. “That means there are 4.2 more sales left in those original 10 leads, which is more than you originally had when you sold the first three,” Musch says, “if you do a great job on your sales presentation and your marketing follow-up.”

He advises “multi-channel” follow-ups, maybe 10 or 15 marketing touches throughout the next year, whether that is phone calls, direct mail or email — all of which are relatively low-cost items. He suggests an automated system to manage those touches in an organized fashion.

Failure to pay attention to those leads that don’t immediately result in sales means you’re going “to have the percentage you spend on marketing begin to approach 20 or 30 percent, and that’s when your profits aren’t there anymore and you go out of business,” Musch warns.

Another tactic is to do a little micromarketing in neighborhoods where you have existing jobs and a happy customer or two, rather than shotgun marketing. Musch suggests direct mail or maybe a little door-to-door canvassing as a way to reach neighbors in similar homes with similar incomes and tastes.

Canvassing Isn’t Dead

Tony Hoty, a Cleveland-based home-improvement sales consultant with clients in the remodeling industry, feels that canvassing can still work. He warns, however, that remodelers can’t bully or nag someone into making a sales appointment. “People keep their appointments and allow a full demonstration as a result of a true desire and a true need,” he says.

Like Musch, Hoty is an advocate of micromarketing in neighborhoods where jobs are taking place. He mentions granite countertop companies that find neighbors down the street — with similar homes and similarly aged countertops — are eager to have a conversation about their countertops once they hear about a nearby installation.

Canvassing allows a remodeler to get results the same day, and the cost is reasonable. Plus, it’s predictable, Hoty says: “Once you have your group trained, you can predict you’re going to get X results on a daily or hourly basis based on your investment.”

Canvassing has changed, however, from the old days of aluminum siding “tin men,” Hoty acknowledges. “I think companies that are successful have a very sophisticated approach at the front door — everything from the ID badge to the brightly colored safety vests. The companies that are most successful do what I call ‘customer care canvassing,’ where they visit the installation first, making sure the yard signs are posted and the site is clean, asking the homeowner if they’re satisfied, possibly asking for referrals.”

Some remodelers have taken the approach to an extreme by posting custom-made, bright-orange construction-like signs in the neighborhood: Caution — ABC Remodeling Crew Ahead, for example. That way, Hoty explains, when a canvasser knocks on their doors, homeowners already know someone is working in the neighborhood and is supposed to be there.

Be More Professional

Hoty also notes many more wrapped vehicles are being used by remodelers — vehicles that have prominent graphics and signage identifying the company working in the neighborhood. “No more of those ‘free candy vans,’” he says. Law enforcement and permitting issues related to canvassing are more likely to be prompted by a call from a suspicious homeowner, Hoty advises, “so the more professional the approach the better. With uniformed individuals, decorated vehicles and the signage that says you are working nearby, the tactic is much more of a public service announcement as opposed to a sales pitch. You really have to be more professional than ever and upfront about it.”