Market Research at D.G. Liu Contractor, Inc

Market Research at D.G. Liu Contractor, Inc.

As the market softened in the second half of 2007, Jerry Liu, president of D.G. Liu Contractor, Inc., saw the company’s leads slowing dramatically. Their salespeople were struggling to find enough qualified prospects and close the high end sales that were typical. He knew that the company had to change their marketing approach to pump up the lead flow which would feed the production needs of this multi-million dollar Dickerson, Maryland company.

It wasn’t as if they hadn’t been marketing. Jerry says, “We were doing lots of things. In fact, we’d been spending 3% of revenue to generate the business we needed. But, besides the regular newsletter and annual calendar we developed, our tactics were all over the board. There was no consistency in frequency, graphic appearance or message.”

He laughs, “That’s probably because I was the marketing manager so we did what I though would work.” Jerry realized that he wasn’t a marketing expert so they hired one.

One of the first things steps the marketing expert recommended was to commission a marketing research study. Like many small business owners, marketing tactics are often created on the fly focusing on whatever message was hot that day. This time, they went about it differently. “Before we developed strategies and marketing materials and spent tons of money on all new stuff, we decided, first, to make sure that our message was the right one,” Jerry said.

To conduct the study, they chose In Touch Marketing (ITM) in Clearwater, Florida. Jerry said, “Our goal was to reach homeowners who fit our customer profile to find out how we could tailor our message and our media to encourage them to contact and hire us.” To get started, the D.G. Liu staff provided ITM with demographic and geographic information on dozens of past clients. The demographics included household income of $150,000+, homes that were at least 10 years old and had a value of $600,000+ which in the Washington, D.C., market, was very average.

ITM then conducted a blind telephone survey in which the company that commissioned the study, in this case D.G. Liu, was not identified. Jerry comments, “We wanted them to be as open and honest as they could and not be colored in any way by telling them who was doing the asking.” The end result, received several weeks later, included the in-depth responses from sixty homeowner interviews. “They had to make hundreds of calls in order to connect with this sixty,” says Jerry, “but the information we uncovered was invaluable.”

Bob Cefail, president of In Touch Marketing says that an investment in this sort of market research is well within the financial bounds of most small businesses. “An owner of a remodeling company can expect to receive information that can help them double or triple their leads with an investment of $3,000 to $5,000.”

Remodelers Advantage Inc., 535 Main Street, Suite 211, Laurel, MD 20707 www.RemodelersAdvantage.com He says, “We’re all about identifying the words and ideas that will motivate prospects to make transactions. Think about it, in most marketing efforts, remodelers are using words that are familiar to them. . .but they are experts in their field and their prospects are not so it’s very much like trying to speak Eskimo to someone who speaks English. They just don’t understand. Our job is to find the motivations behind the decisions and help our clients find the words to reach that motivation.”

One example of how this works is in the weight loss field. Bob said, ‘We did a research study for a company who sold weight loss products. We found out that the key words for anyone considering a purchase was Lose Weight, yes, but also ‘and keep it off.’ That was the motivation that was behind a purchase.”

He adds, “Once we identify the words that will attract the prospects attention and get them to look at your message, these words can be used in promotional materials, web sites, and sales training.”

Here are some of the results.

When asked What is the most important element in choosing a contractor?  27.5% said Experience  25% said Reputation  20% said Price

When asked, What is the least important element in choosing a contractor?  40% identified Price as the least important consideration. Jerry says, “That totally supports our experience that people are willing to pay for a great remodeling project.”

When asked what images they associate with a quality remodeling project they said  37.5% said images of design plans (Jerry said, “Who knew?”)  15% said before and after images

With this information, D.G. Liu totally changed the images on their marketing materials to bring these elements into play.

Lastly, when asked, What would influence them to contact a particular remodeler,  72.5% said Referral  And 70% said Television Ads!

This year, for the first time, Jerry is investing $15,000 on production and a test run of commercials on cable television. “This survey has totally turned around the way we think about marketing.”

Remodelers Advantage Inc., 535 Main Street, Suite 211, Laurel, MD 20707 www.RemodelersAdvantage.com