With everything you have to keep up with as a residential contractor – multiple jobs, job schedules, subcontractors, work crews, materials, change orders, billing, and much more – it comes as little surprise that most home builders and residential remodelers devote time to building everything but their brand and generating new leads for their business.
If you’re in that boat, it’s time to let that approach go by the wayside. The rapid growth of online marketing channels like Facebook & Twitter and channels like Houzz make it more important than ever to have a clear marketing strategy, plan, and unique value proposition. Without a plan you risk both falling behind your competitors who figure it out first and remaining frustrated and confused by where and how to pursue great leads for your business.
As a marketing consultant working exclusively with small, growing businesses like home builders, home improvement contractors and home remodelers, every day I hear the frustrations from business owners who know they have a great product/service/reputation but don’t know how to stand out from the crowd. I’ve chosen to focus on the small business segment of the market both because I love small businesses and the often superior service they provide, and because they are almost always folks who do not have a marketing department or clear strategy for growth and I can help them with that. Most of the time residential contractors plan to grow by doing a good job and generating good word of mouth, but that’s hard to plan for – where is the next great, profitable job coming from? Can you predict with high confidence what your job load will be for the next 6-12 months? For many contractors and builders, even successful ones, the answer is “no.”
So, my purpose in this post is to help you get more predictable and profitable results. The first step in that process is defining your unique value proposition.
In simplest terms, a unique value proposition is whatever it is that you do different and/or better than your competition. What sets you apart from every other builder or home remodeler – or at least, what sets you aside from most of them? What can you do better, faster, or cheaper than your competitors? I’ll delve a bit more into UVPs below, but in a nutshell, it’s what makes you different (unique) and why it’s an advantage (value) for your customer to do business with you rather than another contractor.
To put it in the terms of the old contractor’s adage, “Fast, cheap, and good – choose two.” Your unique value proposition is probably going to come down to defining which two of those attributes you offer your customers – since we all know you can’t offer all three! So if it’s helpful to think of your unique value proposition in those terms, use it.
You may think it doesn’t really matter – but really, it does. You can’t effectively market your business if you can’t offer customers a good reason to choose you over all the other home builders and remodelers out there who do the same type of work. Without telling potential customers why you’re different and better, you blend in with everyone else. A unique value proposition helps define your business in the mind of the customer and helps you stand out from the crowd. Without one, you’re trapped in a race to the bottom (that is, competing on price only) with every other builder and home improvement contractor who doesn’t have a UVP – which means, most of them.
Start by asking yourself: Who is your ideal customer? Think back over the best customers you’ve had and what, if anything, they have in common. These are the people you want to target in your marketing and these are the people you’re building your unique value proposition to engage. They are your ideal target customer. They may be young families, retired couples, people of a certain income level, people who live in a certain zip code, or any other characteristic. For example, a bathroom remodel company might want to focus on targeting customers in a neighborhood with homes built 20 – 30 years ago, because we know that’s about the average lifespan of a bathroom before it needs a complete remodel.
It’s important to zero in on who your ideal target customer is, because you only have a limited amount of time and money to devote to marketing. You want to put those limited resources to work to reach the people you want as customers who are most likely to do business with you. Everyone with a pulse is not a targeting strategy. Consider the example from above of a company that specializes in bathroom remodeling. While it’s possible they may occasionally get a customer who has a new home and the money to re-do a bathroom simply because they don’t like the way it looks, there probably aren’t going to be many of those. So targeting a neighborhood with homes less than 10 years old isn’t likely to generate much, if any, business for the simple reason that most people can’t afford or aren’t willing to spend a large amount of money on replacing something that is still in good repair. Even if the people who live in that neighborhood fit the target profile in other ways such as income level, you want to look at all factors, since other factors can disqualify them from being your ideal target customer.
Next, determine what you can say about your business that other contractors can’t say. Be as specific as possible. Everyone says they offer “great service” – and customers know this because they hear it a lot more often than they experience it. If you want to stand out, you need to be unique. So instead of “great service” mention your 95% on-time completion rate, your clean jobsites, your background-screened workers, or whatever you do that most or many builders can’t claim. Try to zero in on why past or current customers have hired you – and by extension, why potential customers should choose you, too.
You can see why this matters. If your message is a generic “great service,” you’re part of the crowd. If you’re a bath remodeler and know that most of the home improvement contractors in your area stretch out jobs over 3-1/2 – 4 weeks while you finish your jobs in under 2-1/2 weeks, that’s a real advantage for the customer – you are bringing value to the table. Suddenly, your higher estimate is justified in the eyes of the customer and you’re no longer competing on price alone. You’ve removed yourself from the race to the bottom, where price is the only consideration. Be specific – and be honest. Highlight your strongest points and you know you’ll be able to deliver on them – crucial for building relationships and generating repeat business.
Don’t just rely on your own honest self-assessment of your strengths & weaknesses – ask your best customers or get someone to ask for you. Ask your subcontractors, suppliers, or other business associates. Look for themes in both their feedback and by doing a performance review of previous jobs. Don’t assume that everyone you work with sees you the same way you see yourself! Remember, you want your unique value proposition to be accurate so you can follow through on it and build good relationships. According to Houzz, 83% of home renovation buying decisions are driven by good reviews and recommendations, so it’s extremely important that you don’t promise more than you can deliver.
Your unique value proposition will become, essentially, the tagline for your brand. It’s your primary marketing message and the lead-in in all your communications. That includes verbal communications – you’ll train your employees in how to talk about your business to reinforce your message, so you’ll stand out in all your communications. Instead of being one of many talking about what you do, you’ll be elevating yourself above the competition from the beginning by leading with why people buy from you.
Here’s what you can do today to start defining your unique value proposition:
Sustained effort over time is what it takes for local marketing success. By beginning with the strategic step of understanding your customers’ true perception of your value and what makes you stand out you will be able to begin building a reliable marketing system and lead generation machine.
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