New Move-Ins Spend Tons Of Money On Remodeling Services…
How To Get Your Share Of The Pie.
By Rich Harshaw
“Because that’s where the money is.”
That’s the famous answer prolific bank robber Willie Sutton gave when asked why he robbed banks.
Then, he added, “It couldn’t be more obvious. Go where the money is, and go there often.”
When it comes to direct mail marketing for contractors, it’s pretty obvious where the money is: NEW MOVE-INS.
Just look at the data. According to Scarborough report released in 2012, new homeowners are more likely than established homeowners (those who have lived in their home for over three years) to spend on the following items for their new home:
- 53% more likely to repair or replace flooring
- 47% more likely to add or replace heating and cooling systems
- 47% more likely to have the interior of their home painted
- 45% more likely to remodel the home’s kitchen
- 34% more likely to replace siding
- 33% more likely to add on to the home
- 32% more likely to remodel the bathroom
- 29% more likely to replace windows
- 24% more likely to upgrade the home’s exterior
- 14% more likely to repair or replace the roof
It only makes sense, right? When people buy an existing home, they’re not always going to be crazy about the condition, the colors, the design, or the look. That’s when the checkbook comes out and the spending starts.
And that’s where you come in.
One way to capture these eager spenders is to make sure that you’re killing it with your internet marketing. Contractors like yourself you should already be investing in SEO, and you need to make sure you’re king of the pay-per-click mountain in your local area.
So yes, Internet marketing. Of course.
But now let’s go out and GRAB THOSE NEW MOVERS, shake them a little, and make sure they come your way before they can even think about Google.
I’m talking about direct mail. And a little kicker, too.
The obvious thing to do is to send mail. The less obvious thing to do is to focus on consistency and frequency. In other words, if you send one or two mailers to new movers, you’re probably going to be pretty disappointed in your results. But if you have the patience to stick with it a bit, you can see some good results.
So how many mailers should you send, and how often?
Answer: More than you think, and oftener than you think.
But instead of giving you some arbitrary numbers, let’s work our calculators a little:
First, figure out your allowable marketing cost per sale (AMCPS). In other words, how much money do you normally spend on marketing to generate a sale? Not a home improvement lead—a home improvement sale. For example, let’s say you normally spend $250 per lead, and you close 33% of them. That means you’re paying $750 for a sale. That’s a critical number to know for this exercise.
Next, estimate what percentage of new movers you think you can convert to sales if you consistently send them a high volume of mailers on a frequent basis? I know you don’t KNOW… but come to think of it, you never really KNOW what results any marketing activity will bring. So we have to use common sense and logic to estimate.
Just for grins, let’s say that number is 1%. In other words, you think you can sell one job for every 100 people you consistently send a high volume of mail to. I’m not talking about a single stab in the dark with a single mailer. I’m talking about piling it on.
That would give you an insanely high budget of $750 for every 100 new movers to cover mailing costs.
Think about that for a second: If mailers cost fifty cents each, that means you can afford to send all 100 of those new movers FIFTEEN mailers ($750 x $0.50 / 100 people).
So here’s my recommendation. If you think it seems reasonable to net one new sale from NEW MOVERS for every 100 homes you target with a veritable mountain of mail, I recommend you send one postcard a week for four months.
This gives you enough time to:
- Establish a rapport with the homeowner; make yourself a familiar name.
- Educate them about who you are, what you do, and why you’re better than everyone else.
- Let them get settled into their new home and start a project when they’re good and ready.
- Nudge them into taking action on the project they know they want/need to do.
- Outlast all the other remodelers who send paltry one or two mailers (or none!).
Now here’s the kicker:
Hire a guy and give him a clipboard with the names and addresses of all the new movers on the list that you’ve been mailing to for at least two or three months—every week.
Have him drive around and knock on the doors of these folks and see if they’re interested in a home improvement project. When you do this, you’ll find that people are surprisingly open and willing to talk. Why? Because a sizeable percentage of them ACTUALLY NEED AND WANT WHAT YOU SELL… RIGHT NOW!
Here are some sample mailers to give you an idea:
This isn’t rocket science. It’s simply identifying a target in construction marketing—in this case, new movers who WANT and NEED what you sell—and bombarding them with a message for a long enough period of time for them to have a chance to respond.
And the good news is… all of this can be done FOR you so it’s easy to manage. We do it all the time for our clients. Otherwise, your head might explode.
But in the end, remember this: Go where the money is. And go often.
Advertising Audit: Have an advertisement, website, or mailer that you’d like to get a 2nd opinion before spending big bucks to execute? Let a seasoned Monopolize Your Marketplace expert give you advice and recommendations on how to make your marketing perform better. Just fill out the form below and we’ll contact you to arrange a time to talk. Be ready for candid feedback—we’ll be as nice as possible, but our real objective is to make sure you’ve got good stuff!
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© 2015 – 2016, Rich Harshaw. All rights reserved.