Do you have a marketing plan for 2024? To grow your home services business in a tight economy, contractors must think through their growth plans for the new year and develop a robust, but specific, marketing plan to support that business evolution.
While new customer acquisition remains an important element in your marketing plan, it’s also crucial to tap into your existing customer base, reach and engage your memberships, and continue delivering the same awesome experience your customers have come to expect.
To help guide you through crafting a successful marketing strategy and plan for 2024, pro marketers Amber McKee and Sarah Ghirardo offer tools and tips in a recent webinar, including:
How to plan revenue for your marketing plan
How to set up a marketing budget
What to include in your marketing plan
Tools to track and measure marketing plan success
How ServiceTitan’s Marketing Pro can help you capture more leads based on your own data, then turn them into sales
The #1 newsletter for the trades.
Planning Revenue
When developing a marketing plan and knowing which marketing channels to invest in to drive revenue for your business, McKee suggests starting with the end in mind.
“This is the revenue you want to drive for the year,” says the founder of Amber's Marketing Group and former director of marketing for Goettl Air Conditioning & Plumbing. “This will build the foundation for all of your marketing efforts.”
Once you know the end goal, you can begin building out specific revenue sources based on the data you already have in your ServiceTitan account. Items to take into consideration as you’re planning revenue are:
Year-over-year growth
Capacity to run calls
Operational support
Truck availability
Previous budgets
Investments needed to fuel growth
The robust reporting capabilities in ServiceTitan, such as “campaign summary” and “custom reports-all jobs,” can give you a clear, starting baseline for planning revenue.
Next, break down your revenue goal into achievable steps. To do this, break down your annual by line of business and by month. And always keep in mind seasonality and your company’s capacity to run calls, McKee says.
“You may be able to run more calls as you proceed throughout the year and add staff and capacity, therefore January may not have the same revenue goals as later months,” she says.
After breaking down revenue for each month, divide your average ticket by the revenue for each line of business to see how many “ran” calls you need (i.e., “trucks in the driveway”) to build revenue. Then, factor in the booking percentage.
In the example below, McKee says, “We're approximately 20% to the ‘ran’ calls needed to account for an 80% booking rate, and this bottom number gives us the number of leads marketing must drive into the call center to drive the revenue needed. Now, you've got your North Star.”
Using this method gives your team clear marching orders for the year, and gives owners measurable KPIs to monitor team performance as they drive that revenue.
“Do you know what your average cost per ‘ran’ lead is?” asks Ghirardo, ServiceTitan’s Senior Manager of Productized Content. There’s a clear distinction between a “ran” lead versus a booked lead.
“‘Ran’ leads are how many trucks actually show up in customers’ driveways,” McKee says. “There are a lot of stages in the process from getting the lead to actually showing up in the driveway. The ‘ran’ lead is really what's going to directly drive the revenue.”
While monitoring the average cost per “ran” lead can show the operational inefficiencies in your marketing strategy, Ghirardo says, it can also show the level of marketing efficiency.
“Some of us do know the average ‘ran’ lead, and some of us will work toward calculating what that ‘ran’ call really looks like, because in the end, marketing is equal to operations,” Ghirardo says. “But in reality, everything hits the bottom line when it becomes an operational inefficiency, and often, the first thing to cut is the marketing investment. When really, we should be tightening the ship throughout our operations.”
Building a Marketing Budget
To build your marketing budget, McKee showed two budget estimation methods:
Cost per lead
Ad cost percentage
“In the cost-per-lead method, we multiply the historical lead costs, with inflation added in, by the number of leads we need to drive the revenue we’re aiming for,” McKee says.
“If you don't have an accurate cost per lead, you can use the percentage of revenue method, which takes the revenue we want to achieve and multiplies it by an ad cost percentage that becomes the baseline for your marketing budget,” McKee explains.
If you use the latter method, you’ll need to adjust for seasonality peaks.
“It will show you have a lot of money to spend in-season, but you really need to pull that budget forward so you’re driving marketing to take advantage of being in-season and lead into the spike,” McKee says.
Ghirardo explains further. “You're pulling your money ahead so that you're planning for the demand,” she says. “You're not in the demand, spending the money. You’re planning for the demand to spend consistently to get there.”
Both pro marketers suggest increasing your marketing spend based on the year-over-year growth and your anticipated new customer acquisition costs, which can be significantly higher than marketing to repeat customers.
“Every market has unique conditions that affect the percentage of revenue spent on marketing, including geographical areas, competition, customer database, and product lines,” McKee says.
Next, break down your marketing budget by marketing channel. At the top of the funnel, you’ll need to budget funds for branding, mass marketing, and direct mail to gain new customers. In the middle of the funnel, use conversion assistance tools, such as website visitors or online searches, to enhance your marketing efforts. At the bottom of the funnel, budget funds for remarketing to existing customers via email, text, or social media.
”It is much less expensive to remarket to your existing customers and re-engage them than it is to acquire new customers,” McKee says.
Creating a Marketing Plan
Decide which stage of the funnel you want to focus on, then allocate your marketing budget to the different sources, such as direct mail, digital, radio, TV, or billboards. The variables to consider before creating any type of successful marketing strategy should be based on data-driven insights gleaned from your company’s:
Existing customer base
Size of the market
Capacity to run calls
Geographic location
McKee created the spreadsheet below to track marketing spend agilely and update revenue and spend throughout the year.
“This spreadsheet should be revisited monthly, and you should be readjusting it to align with what you believe you can achieve,” McKee says.
With a marketing budget set and a plan in place, you’re now ready to share your marketing messages with your target market. Start by trying to build a strong, recognizable brand.
“Branding is the heart of your organization, and a tool to tell your customers why you exist,” McKee says. “A strong brand is more than just consistencies of logos, colors, and visuals. It has a compelling story and a message that evokes emotion in your audience.
“In our industries, we don't have the luxury of being in front of customers exactly when they need our service, therefore creating an emotional connection to help recall our brand is very important,” she adds.
It’s also best to keep discounts and other incentives to only 30% of your messaging, leaving approximately 70% of your marketing to building the brand and a relationship with the customer.
Next, create a campaign calendar that shows all of the advertising you've budgeted and planned for and placed in the market.
“This is a great visual tool to help align all of your teams to create projects and timelines, and also show the rest of your business what you’re doing to drive leads for them,” McKee says. “This tool summarizes high-level revenue goals and the map to get there. It also shows the promotion that's running in the market at any given time.”
Tools to Measure Marketing Plan Success
Once you’ve launched your marketing campaigns, it's time to start tracking performance to see how each campaign aligns to your goals.
“Marketing is never a set-it-and-forget-it. It needs to be evaluated and readjusted constantly, at least once a month,” McKee says. “You'll need to learn how to pivot, pivot, pivot to constantly realign marketing to drive your business.”
The best way to pivot successfully requires understanding what your cost per leads are and what advertising sources are working for you, so you can then reinvest that money in your best opportunities, McKee says.
In the example template below, McKee shows a summarized tracking system that can help keep your marketing investments in line and optimized. It also shows your overall marketing performance as well as performance for each campaign.
“All leads are not created equal, and this helps show the steps in the process from a lead hitting inbound calls, to being booked, to being ‘ran’, and the actual cost of each stage,” McKee says.
Ultimately, McKee says she looks at her ad cost percentage and optimizes leads based on that. She also advises clients to try certain types of advertising for at least three months before dropping any and pivoting to something new.
“This isn't an exact science. It's just a pretty good directional tool,” McKee says. “The key number that I'm tracking is the ad cost percentage, and I'm wanting to see that decrease as I'm running ads.”
To recap, the steps to create a marketing plan include: planning your target revenue, creating a marketing budget, sending the right marketing message, then measuring performance.
Marketing Trends of Note
In the process of developing your 2024 marketing plan, take a moment to understand the trends affecting your industry, Ghirardo says. After all, a marketer's job is to look at trends and forecast ahead, and also learn from other industries.
“I don't just stay inside of HVAC, plumbing, pest control, roofing, etc. I look at the bigger technology companies and follow those trends to see where we should be in innovation, and then where we are in innovation at that time,” Ghirado says. “That's really going to help me develop a better strategy to be more innovative, automated, and efficient.”
For 2024, AI and automation will be huge.
“It's not that we're going to put something into ChatGPT and that is the end-all,” Ghirardo says. “We're going to edit it, make it our own, and make it work for our business. Marketing teams that leverage AI will be way ahead of traditional marketing teams that don’t.”
She also suggests getting your feet wet with using e-commerce and social commerce to sell your home services. Think about offering better pricing transparency online to attract new customers or expanding subscription and membership services to existing customers.
Video domination is another trend, Ghirado says, especially with the rollout of Google’s new search generative experience in December. The more content you have online, including videos, can help your company surface in this new AI-powered search experiment.
Innovation and equipment is another big trend, with smart home automation and system monitoring taking center stage for the home services industry. Finally, be prepared to pivot from a year of recession and inflation to a political year with a lot of noise in the marketplace and rising advertising costs.
Marketing Tools for Every Stage of the Funnel
Ghirardo says the marketing funnel has changed. Before, marketers focused on the top of the funnel (awareness), then worked their way to the bottom of the funnel to get customers to take action. Now, the marketing funnel is more of an hourglass that can be turned upside down at any stage of the marketing journey.
”It's a continuous conversation,” Ghirardo says. “Our job as marketers is to ensure we're satisfying the needs of our consumers, not just our businesses. If we speak to them and with them, the funnel will continuously flow.
“Remember, if we're marketing to everyone, we're marketing to no one, so each part of the funnel deserves personalization, because knowing your customers’ lifetime value, the retention will decrease the cost per acquisition in the long run,” she adds.
Turn Leads into Sales with Marketing Pro
Each marketing channel comes with its own cost of management, time, and analytics. With Marketing Pro’s full suite of services, marketers can monitor every channel at every stage, all from one system.
“In Marketing Pro, you can see what satisfies inside of the funnel,” Ghirardo says.
Top of the funnel: Brand awareness
Marketing Pro - Measurement connects the customer journey, while Marketing Pro - Optimizer sends revenue data from ServiceTitan back to Google Ads and Google Analytics, making it easier to see which campaigns generate the most revenue.
Middle of the funnel: Booking convenience
Scheduling Pro and Reserve with Google creates instant gratification for your customers and helps your business book jobs faster, resulting in a boost to those “ran” calls mentioned above.
Bottom of the funnel: Customer nurturing
“Reputation management, email, nurturing the yes or rehashing the no, all of this is going to create loyalty when we continue to educate and really nurture our customers,” Ghirado says. “We want to turn leads into repeat customers.”
With Marketing Pro, companies can turn leads into repeat customers by:
Following up on unsold estimates
Requesting customer reviews
Sending thank-you notes to customers
Sharing educational content
Offering promotions or discounts
And more!
“Your existing client database, which is inside of ServiceTitan or any CRM you're using, is a gold mine of missed opportunities or opportunities to nurture,” Ghirardo says.
So, how do we unlock these opportunities by utilizing the tools we already have?
Ghirardo thinks about it this way: The marketing campaign for each business unit are the parents, and the job types for each campaign are the children. Parents want to nurture their children, so personalize each campaign based on the job type and help them through the journey with every tool at your disposal.
“Marketers have created a totally different consumer experience than what it was, and it's different in each geographical area,” Ghirardo says. “Our job is to decrease the marketing costs, optimize what's winning, and test into new innovation.
“Marketing Pro is really about taking it to the next level and utilizing all of the data that's inside of your CRM to create personalized audiences so that you can be a better marketer,” she adds.
