As the market softened in the second half of 2007, Jerry Liu, president of D.G. Liu Contractor, in Dickerson, Md., saw the company's leads slow dramatically. Liu knew the company had to change its marketing approach to pump up the lead flow, which would feed production needs.
“We'd been spending 3% of revenue to generate the business we needed,” he says. “But besides our regular newsletter and annual calendar, our tactics were all over the board. There was no consistency in frequency, graphic appearance, or message.”
Liu hired a consultant who recommended a marketing research study. “Before we developed strategies and marketing materials and spent money on all new stuff, we had to ensure our message was the right one,” Liu says.
STUDY TIME In Touch Media Group (ITMG) in Clearwater, Fla., conducted the study. “Our goal was to reach homeowners who fit our customer profile to find out how we could tailor our message and media to encourage them to contact and hire us,” Liu says.
D.G. Liu staff provided ITMG with demographic and geographic information on dozens of past clients. ITMG then conducted a phone survey in which D.G. Liu Contractor was not identified. The result, after hundreds of calls, included responses from 60 homeowner interviews.
Bob Cefail, ITMG president, says this sort of market research is within the financial bounds of most small businesses. “With an investment of $3,000 to $5,000, a remodeling company can expect to receive information that can help double or triple leads.”
ITMG identifies the words and ideas that will motivate prospects to make transactions. Cefail offers this example: “We did a research study for a company that sold weight-loss products. We found that the key words for anyone considering a purchase were ‘lose weight,' but also ‘and keep it off.' That was the motivation behind a purchase.” These key words can be used in promotional materials, Web sites, and sales training.
Liu was surprised by some of ITMG's findings: When asked, “What images do you associate with a quality remodeling project?” 37.5% of respondents said images of design plans; 15% said before-and-after images.
And some findings supported Liu's experience “that people are willing to pay for a great remodeling project.” When asked, “What is the most important element in choosing a contractor?” 27.5% said experience; 25% said reputation; 20% said price.
When asked, “What is the least important element in choosing a contractor?” 40% identified price.
With this information, D.G. Liu changed its marketing materials to bring these elements into play.
Lastly, when asked “What would influence you to contact a particular remodeler?” 72.5% said referral and 70% said television ads.
This year, for the first time, Liu is investing $15,000 to produce and do a test-run of commercials on cable television. “This survey has turned around the way we think about marketing.”
—Victoria Downing is president of Remodelers Advantage; www.remodelersadvantage.com; 301.490.5620.