Remodelers concerned about keeping business coming through their door at a time when they are closing fewer jobs and contending with cutthroat price competition need to take a second look at how they handle their leads, Victoria Downing, president, Remodelers Advantage, told the Oct. 12-15 Remodeling Show in Chicago.

“A strong nurturing leads program can move up to 70% of what used to be lost back into the sales funnel,” Downing told an educational seminar at the show.

She cited the example of a remodeler in San Diego who was making do with only two sales people to handle the “tons of leads” emanating from his online marketing, “picking what looked like the most worthwhile.”

The sales staff followed up on 50% of the leads, but the problem, she said, was that the company could have been lining up some business from the 50% who were being qualified out.

Typically, 25% of customers being funneled through the marketing and sales process may be great leads looking to move directly into a contract, she said.

An equal share may be comprised of poor leads who simply aren’t qualified, and 50% may be interested but not ready to commit to having work done.

Many leads “probably will be ready to buy at some time in the near future,” Downing said, “but leads are lost. They dribble through your fingers.”

A Nurturing System

Even hot leads can be mishandled, she warned, if customer service doesn’t respond quickly with a job estimate, but it is the warm leads especially who need to be nurtured until they are ready to become customers.

Downing said that the nurturing system preferably should be automated, automatically adding information on prospects into the database.

She recommended ACT contact and customer management software, which can be purchased for under $300.

The system, she said, is aimed at following up on leads by developing “a positive long-term relationship through meaningful dialogue and tracking their development until they are ready for sales.”

The process can also be educational, turning leads into more qualified prospects.

“What used to work doesn’t. You need to be more creative,” Downing said, and as more and more remodelers are beginning to realize, that means establishing a presence on the Internet through a good website and presence in the social media.

Getting Online

Remodelers should start generating leads by marketing to their circle of influence, which includes “anybody who can refer business to your company, not people to whom you would hard sell. Let them know what’s going on in your company” and look to them as a source of referrals.

Monthly e-newsletters are a worthwhile communications tool. She advised testing their frequency to see how often is too often. “The key is being a soft sell,” she said.

Remodelers can establish both company and personal pages on Facebook. They should be attending community events; inviting previous customers to trade shows and special events, such as barbecues or shopping sprees tied to charitable causes; presenting educational seminars; looking at blogs; and joining Angie’s List and YouTube to encourage happy customers to provide third-party testimonials.

Downing cited Main Street Design Build of Michigan as a company that is doing things right and worth emulating.

Capturing Contact Information

The trick is capturing leads from the website so that some rudimentary information on them — a name, phone number and email address — can be entered into the database.

Investment in Infusionsoft technology can be used to start an e-marketing program, creating a simple form that interested consumers can fill out in exchange for receiving “something of interest that will target and attract people to the kinds of things you are looking to sell.”

For instance, a report — a few pages in length, on design trends, how to choose a contractor, how to prepare for a remodeling program, 10 things you need to know to hire a remodeler — can drive people to fill out the form.

“Add sizzle to make it compelling,” she said, and don’t make the form too complicated. If the form asks for too much information, people are unlikely to respond.

“All we want is the email address”; once that is obtained, send a thank-you along with a bonus offer for a free downloadable e-book, coupons, special offers, a raffle ticket at a home show — in exchange for providing a bit more information, including checking off the services they are looking for.

Remodelers should put the law of reciprocity on their side, she said. “When you give something of value to people, they feel obligated to return the favor.”

Sending Emails

“Get started on emails, because it is such an affordable way to market,” Downing said. Much of the material can be ghostwritten at an affordable price by a freelancer, a college intern or a part-time marketing consultant.

Invite leads to download a report on kitchen projects. The next day invite those who obtain the report to attend a kitchen design seminar. Add, or return, those who do not RSVP to the nurturing list, which receives marketing materials over the longer term.

Turning leads on the nurturing list into actual customers might take 20 steps, she said. However, “don’t send a million things to them or their reaction will be, 'Get me off this list.’”

Only 2% of sales are made on the first contact with a lead, she said, and 80% of sales are made somewhere between the fifth and 12th contact.

Unfortunately, 87% of leads are never pursued, and 48% of all sales leads are dropped after the first call or meeting.

Variety helps in marketing communications, she suggested, and can include snail mail, phone calls and e-invitations — with some help from ConstantContact.

“This is a new learning curve, but it can really pay off,” Downing said. The nurturing list of leads can be built up gradually, but “you have to use automation to make it work. Once it’s done, it’s done.”

For information on remodeling resources available from NAHB, click here; or email Therese Crahan, or call her at 800-368-5242 x8211.