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Monday, July 07, 2008

What lead sources are working? (3) -- The power of focus

Further email exchange with Marc Sylvain of Sylvain Contracting in Salem, NH.

Me: Marc, thanks for these observations. I will post the remarks. An interesting question is whether you can add strategic product lines compatible with your core business, which can then be effectively sold to your existing client base. It seems if you could maintain your overall volume AND bring the referral/repeat business more in line with the industry norms your business would be beyond incredible!

Marc: We are actually doing the opposite of that. In the last 10 years we have slowly phased out remodeling, additions, garages, roofing, etc.

After reading a book by Jim Collins called "Good to Great" (Good to Great: Why Some Companies Make the Leap...and Others Don't) he says to ask a couple of questions to yourself.......What can I be the best in the world at? And what drives your economic engine?

That is why we now specialize in Replacement Windows (Not new construction windows) Vinyl Siding (Not wood siding or fiber cement) and pre-fab sunrooms (Not stick build rooms or additions).

We have added decks back in our mix because if you build a sunroom you probably want a deck off of it. We also do about 5- 10 roofs per year for past customers. We only do easy, straight forward roofs.

Jim Collins also talks about having a Hedge Hog concept. A Hedge Hog worries only about the essentials and ignores the rest.

Marc Sylvain
Sylvain Contracting

I am not going to argue with Marc's success. With a clear focus, well-defined business operating systems, and a business that sells largely once-in-a-lifetime services, the marketing and sales systems he uses with a diversity of lead sources but relying far less on repeat/referral business than the industry norms obviously makes sense for him. His depth of analytical understanding of what works and what doesn't and his willingness to share his numbers with others shows that he understands what is important in business to succeed. And of course lead development from home shows is certainly a lot less offensive to me than the intrusive yet in many cases highly effective canvassing business model common in his industry niches.

I will stretch myself on a limb, however, to suggest that with his very well defined measuring resources and Key Performance Indicators tools that if he set his priorities to increase the ratio of repeat/referral business while also increasing his overall sales volume, his profitability and business satisfaction could skyrocket. Strategically implementing communications/client service measures to improve his overall client experience (which I'm sure is generally quite satisfactory now) may yield results far in excess of the actual costs. Maybe, for example, instead of pouring money into home shows, he can set up project completion parties with his recent clients, with food and refreshments for the neighbours. I sense that actively engaging his current and former clients in the marketing process -- beyond the obvious use of street signs and conventional proximity marketing resources -- might produce some surprisingly rewarding results.

He may of course have tried these client involvement suggestions and found they don't work nearly as well as the home shows and other resources (or he is using them effectively and this explains his level of repeat/referral business.) Regardless, he is far ahead of most contractors in knowing his numbers, and sticking to his principals, and accordingly his business methodologies are worthy of respect and recognition.

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