Many remodelers struggle to strike a profitable balance between sustainable growth and manageable marketing, but Anderson-Moore Builders does the job by focusing on--and only on--its existing referral base.

"A few years ago we realized that there's absolutely no sense in advertising to the masses," says Erik Anderson, co-owner of the Winston-Salem, N.C., company. Instead, he says, "everything we do is focused on referrals," by which Anderson means past clients as well as "just about everybody we come into contact with," which includes real estate agents, fellow members of the local Home Builders Association, staff of local lumberyards, and car dealers, among others.

Anderson says his goal is to "touch" this referral base at least four times a year, and as many as eight. The company mails quarterly newsletters to its entire database. It tracks all leads, and each lead that comes from a referral triggers a thank-you letter to the referral. If the lead results in a contract, in turn, at least two more thank-you notes follow: one from Anderson-Moore, saying the company donated $100 in the customer's name to a specified local charity, and another from the charity itself.

The company also looks for impromptu opportunities to make contact. For instance, Anderson-Moore gets in front of its base by donating handcrafted items, such as arbors and sandboxes, to charities it supports. Small gestures of appreciation pay off. Anderson sends congratulatory notes to peer companies when they win awards. The company also earmarks marketing funds for warranty work, even on jobs completed several years before.

This level of outreach takes effort, but it can be crucial for affluent clients. "Our customers are busy, but they want to do their due diligence" on who comes into their home, Anderson says. Sure enough, there's almostalways someone in their circle of influence who can vouch for his company. In 2005, 94% of Anderson-Moore's leads came from direct referrals.

Leah Thayer is a senior editor for REMODELING.