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Marketing to make sales

Are you under assault from BIG companies? A local lumberyard is, as is everyone in their industry. They have to compete with the marketing might of Lowe’s and Home Depot. Not to mention other players like Dunn and Lumberman’s.

Here’s how one local company is battling back and carving out a niche. The name is withheld because they were in a precarious position for a while and it’s not fair to scare their customers.

Like others, they were hit broadside by a combination of factors. Supplier consolidation, big box stores with marketing muscle, 9-11 and a weakened economy. Combine that with a generational change of ownership and management and it led to trouble.

The company was teetering on collapse. They had no effective outside sales program and, like others, simply waited for the phone to ring and people to walk in. After years of this working they needed to change with the times. Customer loyalty disappeared with the perception of cheaper prices down the street.

Here’s a summary of what we did and some of the results. First, we insisted on an attitude that customer service comes first (and that little favors bring big orders). Here’s an example. One of the owners stopped by a job site. The project manager needed some specialty blades. The company didn’t stock them so he went to the competition, bought and delivered them to the job site. He marked them up for his efforts. The first comment from the project manager was, “I could get these for $XX at “the big store.” It’s been almost a year now and that person has not done any business with the company.

What he should have done is gone to the competition, bought the blades, delivered them, told the project manager that he didn’t have them in stock but knew they were needed immediately and only needed reimbursement for the price he paid. Being bull-headed does not lead to good service. In fact, a shift to doing it the right way has rewarded the company numerous times in the months after we discussed this issue.

The real key was to start a customer contact program. This started with research. We identified the best customers. This means those who buy regularly and buy products with the best margins. After a lengthy interview process, we narrowed it down to three types of contractors and one non-contractor industry. Homeowners have always been a small share of the business and tend to be less receptive to service so they were not emphasized in this first round of activity.

Our goals were to be consistent in marketing, deliver a consistent message and always provide a call-to-action. One of the owners designed a flyer that could easily be changed yet would have the same layout so it will always be recognizable. There are always at least 3-5 versions of this flyer available. A fortunate occurrence was that a community newspaper recently did a feature on the company. A copy of this went with every flyer (or was copied on the back). 

The outside salesperson targeted his best customers and made regular stops. Whether or not there is an order he leaves behind a promotional flyer and the article. The bookkeeper sent a flyer with every invoice. The delivery people are to leave a flyer with every order. The flyer is targeted to each customers needs. No sense sending a special offer on molding to an excavation contractor.

Every month an announcement with the special of the month is faxed to every customer. After three months there were only two complaints and numerous complements. Here’s a comment from a customer, “I got your promotional fax. I appreciate a good effort to promote one's business. Not as much of it goes on these days as should.”

We also did some price comparisons with “the big stores.” For example, they priced a 12x12deck package. Their price was the same as both Lowe’s and Home Depot and less than the others.  However, they offered free delivery and professional advice. Whenever they can, they show price comparisons because they are usually cheaper or at the least, very competitive.             

As mentioned, every flyer is targeted to the customers’ needs or potential needs. Recently a big customer commented that he didn’t know they sold paint until he got the flyer. He now buys his paint from them. Every flyer has a call to action. This means it’s not an open ended offer. There is always an expiration date. Just like late night TV and the “Call now. This offer is only good during this broadcast.”

Here are some of the results:

• Volume is up and margins are up.
• The abovementioned major customer now buys more products.
• A prospect who gave them the brush off with, “We don’t buy anything you handle” recently placed a major order for lumber.
• A commercial customer who told them that he didn’t think they could be competitive on the wood for his new (personal) home did major price comparisons and awarded them the job (over $10,000) at their regular prices.
• Activity is up, morale is better and customers are happy.

The bottom line, if you don’t toot your own horn, nobody will. A recent article in Business Week stated that the two most important items to increase sales are a good plan and hard work. Marketing must be part of that plan as it paves the way for sales. It raises brand awareness, creates an attitude of vibrancy and let’s you make your customers aware of the value you offer. It doesn’t have to be complicated and it doesn’t have to be expensive. It just has to be done.

© Copyright John Martinka 2003. All rights reserved.