Niche market expansion

The Official Show Guide for the Home Renovations Show (from Caneast Shows) represents a significant "jump" in our market focus, but the initiative shows how businesses can effectively expand into new areas without compromising core values and priorities.

Last year, through a client referral, we made a big business stretch -- from publishing purely business-to-business regional construction newspapers (and websites), to producing a large-circulation local home renovation magazine, Ottawa Renovates.

This task represented such a major shift from our market focus and model, I had real fears about the impact of the expansion on my business, especially because I appreciate the risks of diversifying from your primary focus and the dangers of expanding into untested spaces.

Nevertheless, we proceeded, with the risk reduced through a joint venture initiative, and the new publication has been a success.

Ironically, Ottawa Renovates started as an initiative of the Renovators Council at the Greater Ottawa Home Builders' Association, where we have published their internal newsletter, The Impact! for close to 20 years. And they sought out the magazine idea initially to produce a publication to be distributed at the Home Renovations Show, produced by Caneast Shows Inc.

Caneast didn't entirely like the Ottawa Renovates magazine idea, especially since as publishers we are not constrained to promoting only show exhibitors. This creates a challenge for any show operator, who rightfully wishes to restrict marketing activities on the show floor to anyone who does not exhibit at the event. Working with the GOHBA Renovators Council, we found the logical solution: Ottawa Renovates is only distributed from the Renovators Council Exhibit Area at the show. (This complies with show restrictions, but still proved to be effective as most show visitors head to the GOHBA area, which is prominent at the event.)

Fast forward to this year, and discussions between Daniel Smith of our organization and Caneast. Caneast wondered if we could produce an Official Show Guide, this time complying with the show's wish that advertising be restricted only to exhibitors.

I raised the possibility with my joint venture partners at Ottawa Renovates and they declined to participate. However, looking at our business/production schedule, the idea fit perfectly to create some non-conflicting revenue for the slow (in our business) pre-Christmas/early New Year period.

So we have started the project.

The publication is differentiated by its own website, produced using easy-to-use template design resources at jimdo.com (which we can host under our own name without third-party advertising for $60 a year).

This initiative is something of a marketing and business irony. It originates from an existing client request, which morphed into a significant joint venture partnership, and now has evolved back to a niche product operated separately from the joint venture, but appealing to the same market as the joint venture.

(If your head is spinning from that description, so is mine!)

Read More

Finding your way: Self employment, start-up focus and marketing

Yesterday, I had coffee with a friend who I've known for many years. Formerly employed by a major corporation, over his life, his pay cheques have probably been much larger than mine (we've never discussed specific salary or income levels: bad manners to do that, of course.)

He's seen shifts, changes, bumps and grinds, and experienced the painful reality of corporate life: When decisions are made outside your control, you can be victims of corporate misfortunes not your fault.

His challenge now: He doesn't know exactly what to do, and his explorations in starting up in business for himself have had their share of disappointments.

He started work co-ordinating a renovation project (he is skilled with his hands as well as his mind). Even with a proper contract and clear processes, things went truly bad when the homeowner suddenly decided that the project would end mid-stream, immediately. Pay -- including the thousands of dollars for ordered and delivered kitchen cabinets? "No way," the homeowner said. Lawyers say he is well covered by the contract, and with changes impending increasing the small claims limits within Ontario, he is waiting a couple of months to file the legal papers. But right now he has $7,500 in kitchen cabinets.

"There are people out there willing to work for virtually nothing, and I've been offered $1,300 for the cabinets," he said. "I don't know if this is for me?"

I started the conversation, before knowing this story, asking him what he really enjoys and is good at. He said he could be a great consultant, and maybe he could be a great renovator. Well, those are two rather different career tracks.

I have a potential business/career opportunity in the consulting space. This blog (and my own expertise) are leading to plenty of initial inquires, but I haven't found a way (yet) to effectively guide these potential clients. The problem in part is that many readers here are very small businesses and start-ups (like my friend) without much money for full-scale consulting services. We need to have a system to process the leads and guide the qualified ones for revenue-generating services.

But I have an existing business, and right now the marketing from this blog is focused on guiding potential clients to the services we currently offer. They are useful, of course, but quite specialized, and I sense that while they could be of value to many readers here, the blog isn't really the best way to refer the potential clients to my current business.

I proposed to my friend that we could build a consulting business, in part, by rethinking this blog's lead management system. He expressed interest. But I didn't rush the decision.
I probed deeper to get a real sense of what he really wanted to do.

Does he really want to be a renovator, or does he really want to be a consultant (or does he want to go back to the corporate space?) Is one bad experience as a renovator dissuading him from a really rational career choice? If that is the case, I suggested he join the relevant home builders association, and budget some money (about $3,000 to $5,000) for marketing to build a brand and distinguish himself from the low-ballers. It won't be easy, I told him, but it is the way to go if he really wants to work in that field.

I explained to him that I have always had the good fortune of being "dumbly narrow". In other words, from when I was 10 years old, I knew that I wanted to be a journalist and publisher. It took a while to fulfill these visions, but ultimately I found my way. With the decision in hand, I developed the necessary supporting skills and eventually had my own business.

I could push him to work on the consulting project, and he might be really good at that, but equally I listened to his "heart" and realized that it is wrong to sell this too hard.

So what should he do? Where should he focus? And how can he make the commitment to the course he wants to take, with the ups and downs, and the frustrations and economic risk?
These are easier questions to ask than answer. It is easy to say "go where your heart tell you to go" but there are still painful choices. Life isn't easy at the start-up stage; and things go wrong.

Read More

What works?

With more information overload in the last few days than I've experienced in many months, I've been trying to see through the increasing volume of questions and email inquiries to help you with some simple and easy-to-implement marketing insights.

For example, tomorrow, once I upload the images and verify my notes, I'll share some observations from the Greater Ottawa Home Builders' Association about the (to me) surprising and vital importance of signs in directing people to new home sites. Does the same principal apply for sub contractors; does it matter for commercial and non-residential construction?

Yesterday, a consultant whose earlier marketing materials promoted more effective Yellow Pages communications connected with me; does he think that the decline of the Yellow Pages is over-rated, or is it a real and fundamental trend?

What do we make of blogging, the social networking sites, and the like? On Wednesday, Rainmaking guru Ford Harding said his opinions about the value of these resources in marketing have changed since we first conversed on the topic about 18 months ago -- he now thinks they are important in the marketing process, but you really have to work at them. (Ironically, my conversation with Ford for became a key part of my first article in the SMPS Marketer, which led to many interesting relationships and opportunities.)

Then, I received copies of marketing material and questions about their effectiveness from a fellow blogger who is launching a new construction business. He asked my thoughts, and I responded that he is perhaps trying to do everything for everyone and it won't work, from a marketing perspective. Then I put my reality hat on and suggested he will find whatever business he can mostly from his existing relationships and previous clients.

At 10 a.m. today I'm having coffee with an Ottawa-based online service provider who wishes to expand his coverage/service to other markets. He wants to pick my brain.

When (if) things calm down, I will begin turning these issues into separate blog themes and delve into them more closely.

But I'll start with a few observations which you can use right away.

• Often simple and dumb is best. Good job site signs are inexpensive and can be highly effective in residential work. We should explore which signs work best, and why.

• The New Media is here and if you aren't connecting with it, you are missing perhaps the biggest marketing/business/networking revolution in recent history. (Thankfully, I got a bit of a head start in the blogging space).

• If you can do what you can to help and serve others, without worrying about immediate reward, you ultimately reap the rewards that occur from these relationships. (That is why I answer the blog inquiries as best as I can even though they don't generally connect to immediate business -- I see the payback in places I'd never expect otherwise).

Finally, one of my most important pieces of advice -- and the theme of yesterday's marketing book upload on Twitter:

• You need to work with your strengths to succeed; that is, you need to connect the combination of natural talent, passion and enjoyment of what you do. If you are forcing yourself into places you don't want to be just to make money to survive, or trying to succeed at things you aren't really good at doing (even if you enjoy the work) you will ultimately not get very far in life.

You have to have fun -- and be great at what you are doing -- to succeed.

Read More

The construction marketing table

This blog posting has been moved to the new Construction Marketing Ideas blog site.

If you wish to go directly to the relevant page/posting, you can go here.

Read More

Finding your ideal client

This can be easier said than done, but one of your primary marketing challenges is to focus your energies, resources, and strategies on building the trust and respect of your "ideal" potential client.

I put "ideal" in quote marks because this person (or organization if you are selling to other businesses), is not always as easy to find as you would like, and isn't always what it seems at first sight.

Nevertheless, if you have been in business for a while, you probably know who your ideal clients are: You probably can look at your current client list, and quickly find the top 20 per cent -- in loyalty, profitability, ease of service, and enjoyment.

The question is, can you find more of the same, or more clients with enough attributes that you would still be happy to have them?

You can then survey your market, and determine how many potential clients fit your description. In a local business-to-business space, you may find you have just a few dozen possibilities. In the residential market, you can connect the dots of demographics, neighbourhood size, and market area, to find your totals.

Then, take a close look at your former clients; the business you have either lost to the competition, or because the former clients simply do not see enough value in your service (or have had such a bad experience they have vowed not to return). This group should get special attention: If you can recover just a percentage of them, you will be ahead of the game.

Next, you have to develop your strategy to reach these individuals/organizations and attract their interest.

Along the way, of course, you may find your marketing process takes twists and turns.
Consider our business, for example. Eighty per cent of our business is from editorial feature profiles generally supported by supplier advertising. We've learned these are generally effective for businesses with sales volumes greater than $2 to $3 million annually (of course within the architectural, engineering and construction community.)

The actual advertisers, the suppliers of the profiled companies, don't need to be so large but we won't get their business without a direct referral from their clients and these clients need enough volume to have 'clout' with their referrals.

This blog reaches many thousand readers, but only a small fraction are decision-makers within this select community.

Ironically, this blog originated as a client service initiative. Advertisers, spending hundreds of dollars to support their clients (the featured businesses) were originally treated with less-than-respect by our business; we sold them their "support" ads, sent invoices, and then moved on to the next feature.

I started the blog to give the actual advertisers some real value -- ideas and insights to help their business grow. I certainly didn't anticipate it reaching international proportions, or achieving top rank on Google searches.

This status of course has led to other opportunities, and market development potential. So it hasn't been a linear or totally scientific process.

But our core marketing model hasn't really changed that much, we still need to focus our energies on businesses within the qualifying framework; the only difference is we now can communicate and offer something of value regardless of where they are located.

Consider your focus; but sometimes you can find the best results by looking in places where others don't go. Unfortunately, while it can make sense to head off the beaten track, I can't tell you where, or how.

Read More

The Marketing funnel

Conventional sales practice requires you to process many "leads" before you find the gem of real business.

Not-very-good salespeople (or not terribly effective businesses) then instruct their sales representatives to "make the numbers" by calling and calling, emailing and emailing, and knocking and knocking on doors. A few thrive within this cold approach to business development -- but most either become drones or burn out and move on to something better, quickly.

Undoubtedly, this approach to finding business actually is effective, to a point. Since it is so distasteful and frustrating to encounter rejection, few bother to go through all the steps necessary to succeed; and since a few people may actually wish your service, if you are lucky, a few of your spam emails or nuisance phone calls may actually respond (and, in the case of spam, because it is "cheap" to send it, you can theoretically just turn up the volume.

Of course, these practices are exactly why most people build up huge defensive walls when they encounter any selling initiative; especially the clients you most want to reach -- the ones with more money than time to waste fending off unwanted solicitations.

You may find the "numbers" this way, but can you find the trust to win the commitment and business you need; and what about the negative fall-out from all the people you bother, who are not at all interested in your service (and won't have a favorable first, second or third impression of your business.)

Effective marketers seek to turn these problems on their heads; winning trust in your business to the point that (a) people will call you to initiate the relationship or (b) you are so well respected that when you call (for good reason), your call is accepted with anticipation.

Here, the numbers game is modified, because you don't want to waste marketing dollars and energies on people and organization with no capacity to pay for your architectural, engineering or construction services. You need to focus your marketing energies and resources carefully to build the trust and relationships of the people you really wish to meet. In the next few blogs I'll look at some ways you can achieve that focus.

Read More

A tale of two markets

Dinner at the annual Greater Ottawa Home Builders' Association boat cruise. Events like this allow trade contractors and builders to "connect" and develop relationships, which ultimately lead to business opportunities.

On Thursday, I had conversations with two sub contractors, one in Ottawa and the other in suburban Washington D.C. Their stories are like night and day.

(I can't name the contractors here because the successful contractor doesn't wish publicity, and I have a policy not to identify anyone in this blog in a less-than-positive manner.)

The Washington-area contractor is struggling. His daughter-in-law phoned me to ask my advice; she had seen my blog postings about canvassing, but they were having little success.

The contractor, in business many years, claims on his website to be excellent at rapid framing and described success with the hotel and hospitality sector. Now the commercial business bidding opportunities the contractor is receiving bids so low that he cannot hope to make a profit.

"Many residential contractors are getting into the commercial space," he told me. So he decided, since his business can do "anything", that he would embark in the residential market where hopefully the margins could be higher.

I scratched my head. How can someone who has specialized in commercial framing in a bid-for-work environment succeed in the residential space, when (as he said) his residential-side competitors are moving into the commercial markets?

Could he have any chance at success with cold call canvassing for framing services, with a web site touting his company's great work on hotel projects?

"Do you know of any good leads services," he asked, saying he was considering one of the major brand names in the leads services business. I told him the leads would be a waste. 'If the competition is killing you now among commercial clients you know, how will a leads service which sells the same information to dozens of competitors help you?"

A couple of hours later, on the Greater Ottawa Home Builders' Association annual (Ottawa River) boat cruise, I met a sub contractor who specializes in crown mouldings. That is his business, and his only business. And business is good.

"I make a fortune off of the Yellow Pages," he said. This immediately caused my ears to perk up.

What is a contractor whose business is mostly with tract builders doing in the Yellow Pages?

It turns out that the residential clients responding to his Yellow Pages ads are impressed by his service, and his highly competitive prices. "I don't need to bait and switch. My materials are much less expensive because of the volume purchasing for all the home builders I work for. And I tell my Yellow Pages clients that they will have to wait a week or two for service -- then use "fill in time" to accommodate them."

As well, for him, the Yellow Pages aren't a complete waste from an Internet marketing point of view. He has a simple website and a logical URL, so it doesn't take long for people searching for crown mouldings in Ottawa to find him.

Now, lets look more closely at these two businesses. Both are contractors straddling the consumer and commercial markets; both have websites, and both are in cities where the construction market, while greatly diminished by the recession, has not been totally destroyed.

(Certainly, GOHBA boat cruise attendance dropped by 50 per cent from last year, but the builders say they know things are much better here than Toronto or Montreal. Ditto for Washington, compared to the Carolinas and other U.S. markets. Capital cities almost always fare better in recessions than most communities).

But why is one contractor succeeding and the other failing?

Focus

Crown mouldings is a clear niche. Whether you are a home owner, a tract builder, or even a commercial business, if you want crown mouldings, you are not going to go to a generalist who can do "everything". Of course the Washington area contractor had a niche as well, "rapid framing" which is perfect for the high-velocity and tight schedule of hotel construction (I'm writing an article on that sector this month for our Canadian publications). But it doesn't convert very well for the residential market. Are you realistically going to call a renovation contractor whose claim to fame is "rapid framing?"

Rational synergies

The crown mouldings contractor takes his materials volume discounts from home builders and combines it with blocks of "off time" to convert Yellow Pages listing calls to solid revenue. The pieces fit together. Can a "fast framer" used to bid-for-work speed adjust to the pace and cycle of residential renovation without a major business rethink. I think not.

Rational marketing

I believe Yellow Pages advertising is a waste for most contractors, but would never question the crown mouldings contractor's decision to continue using them. They work. And the Yellow Pages advertising requires virtually no management effort, other than writing cheques for the services.

Canvassing can be cheap and fast, at least in terms of hard cost, but how would you respond, as a homeowner, if a canvasser from someone whose website proudly proclaims "fast framing" and hotel work knocked on your door to sell you on "we can do anything around your house?"

Assuming they reached my door, I'd sit outside and try to give them a free lesson in marketing, but they certainly wouldn't get my business.

Can we learn anything from these two stories? The crown mouldings contractor doesn't need any marketing advice from me. He's doing everything right. Even as he earns profitable revenue from the Yellow Pages ads, he is doing the right thing to maintain his business within the tract home builders' market. Remember, I met him on the home builders' association boat cruise as he conversed with current and potential clients.

I spent about an hour on the phone with the Washington-area contractor. His business volume and scope are large enough that he could theoretically qualify for my publishing marketing services, which have a minimum $1,500 fee. But I couldn't in good conscious push him to take up my offer (which includes guidance, consulting, and support far beyond the service itself). The reason: He simply had so far to go to get to the basics of getting it right that my services would be a waste of money for his business.

I told hm he needs to change his website and URL, and he needs to focus on his current clients and learn what they need, and what they read/view and study, and that he needs to learn a lot about focus and niche marketing. (I suggested to his daughter-in-law that she go to the library and look up the book Positioning: The Battle for Your Mind by Al Ries and and Jack Trout.) If he wants to do residential and homeowner work, he will need to ditch the hotel website, or at least set up another business presence focusing on the residential market.

Read More