Do you know where most of your business comes from? For most contractors, it comes from past clients. I have spoken to contractors who generate over 75% of new business comes from past client referrals. If this sounds familiar, I want you to think about putting more attention on these past clients.
If you have a marketing budget, how do you spend your marketing dollars? If 75% (or more) of new business is coming from past client referrals, are you spending 75% of your marketing budget on these past clients who are responsible for over 75% of your work? If not, begin to consider this:
- We are in a relationship-driven business
- People work with those they know, like, and trust
I know a business owner in Phoenix, AZ who opened 3 complementary service companies in 2008 (at the start of the economic downturn):
- Pool cleaning
- Carpet cleaning
- Pest extermination services
He reasoned that if he got customers in one service area, that they would benefit from the other service companies, so he could cross-market all 3 service-companies. What made this more interesting is that he formerly was the owner of a marketing company. In starting his service companies in 2008, he did some things differently. Instead of traditional advertising methods, he focused on 4 specific relationships building activities:
- Sending holiday and birthday cards (with a personal message to all past customers)
- Sending personal notes to past clients highlighting one of their personal interests that he had learned from working with them
- Sending annual gifts at the end of each year to thank them for their business (the gifts would vary depending on the amount of work he did with them)
- Doing joint ventures with sub-contractors so that they could cross-market each others’ services.
The results – his businesses have grown an average of over 30% per year since 2008. He understood that he was in a relationship-driven business.
It is no different for contractors in the remodeling industry. People are inviting us into their homes. They need to like and trust us before they will hire us. Managing the relationships with past clients will put this trust on display, and your past clients can easily share their positive experience of working with you. Let your past clients sell your services. They are the best people at doing this. Mange these relationships, and the business will follow.