Remodeler Insight Blog Post by:
An industry affiliate partner, Modernize
Part 1: Why You Need a Lead Generation Strategy
Welcome to our three-part series on home improvement lead generation, where we discuss marketing techniques that work for busy residential contractors. In the first part of the series, we’ll focus on why you need leads, and why word-of-mouth referrals will only work for so long. We’ll also talk about how the landscape of home improvement is changing—and how those forces could shape your marketing approach in the years to come.
It’s a simple law of supply and demand: if you’re running a business, you need new customers. Of course, finding those customers is the hard part.
Lead generation strategies for home improvement professionals come in many flavors, from DIY social media and blogging to online review sites like Yelp to professional lead generation services. Each one of these has its own set of pros and cons, but first, it’s important to understand how a clearly-articulated lead generation strategy can add to your business. Read on for the scoop below.
To Grow Your Business, You Need to Access New Markets
For some home improvement professionals, the small approach to business works best. They prefer to keep their operations as minimal as possible, investing very little in marketing and sales. However, earnings and growth potential will always be fixed in such a setup.
For others, a clearly defined marketing strategy and lead generation campaign just make sense.
If you have these larger aspirations, you’ll need to expand—and that means tapping into new markets and getting the word out about your company. A thoughtful approach here will help you drum up new business. Once you begin to track where leads originate, you’ll be able to gain new insights about what works, as well as how to replicate those models in the future.
Homeowners’ Approach to Remodels is Changing
Contrary to popular belief, millennials are buying homes, marrying, and raising families at rates that mirror previous generations. The Harvard Joint Center for Housing Studies projects 23 million new millennial households in the next decade. And yet, it’s widely understood that this generation has less disposable cash than predecessors. Millennials earn, on average, 20% less than their parents did at the same age. Meanwhile, 63% of them carry over $10,000 in debt. Not your typical home-buying material.
So how is it that millennials can afford homes with less pay and higher debts? The same way cash-strapped buyers always have—by buying fixer uppers. Industry analysts predict that younger buyers will gravitate toward older homes in need of repairs and updates that they can make over time as their finances allow. And guess whose help they’re going to need?
But your new clientele won’t rely on word-of-mouth the way boomers did, because Gen Y are notorious Googlers. Research about this generation’s shopping habits show that they’re much more likely to read reviews and research their options online—that’s true whether they’re looking up a new hot brunch spot or searching for home improvement services. To reach to this upcoming group of home buyers, you may have to take more of your marketing online with a more digital approach to lead generation.
Online Marketing Is Becoming a Powerful Tool for Home Improvement Professionals
Word-of-mouth referrals still hold powerful influence in a homeowner’s decision to hire a contractor. But increasingly, the process of finding contractors has moved online. Eighty-eight percent of homeowners say they trust online reviews as much as a recommendation from a friend. Eighty-one percent research online before making major purchases, such as home appliances, furnishings and flooring—it follows that most home improvements would fall into that category.
Meanwhile, the methods that customers use to search the web are changing, too. Potential clients are now much more likely to use their phones or tablets to browse for service providers. They may even rely on a voice assistant to fetch a list of potential hires near them. To reach them, you need a far-ranging web presence that makes it into those top results. The more ways you can get your name out, the wider the potential audience. From there, it’s simply a case of playing the odds. The more people who are exposed to your brand, the more likely you are to get customers to convert.
Today’s Customers Are Just More Sophisticated
Audiences today are increasingly put off by traditional advertising. They need the ability to quickly pivot to search engines and review sites to do additional research on their own—before they’re ready to give you a shot.
According to industry statistics, it now takes customers several “touches” to make it to the “sales-ready” phase. That means potential clients need more prompting than a single ad to decide if they’re ready to pull the trigger. They need to see your business from several different angles first.
That said, many are weary with pushy sales tactics and may resist if providers seem too “salesy.” That’s one of the major advantages of “free” offers, like an informative or entertaining social media account, or educational content in the form of how-to videos and articles. These help you nurture leads without appearing too confrontational—and offer chances to bring more traffic to your site. And of course, more traffic means more business.
Now that you’ve heard why you need a lead strategy, you need to know what that looks like, right? Join us for part two of our ongoing series, where we’ll discuss some common lead generation techniques for home improvement contractors, their costs and their likelihood to influence customers.