Running a contractor business can be hard. Marketing that business can be even harder. Cue Mike Jeffries. eLocal has recently partnered with Closing Success System, a marketing consultant firm exclusively for contractors. Founded by Mike Jeffries, Closing Success System is dedicated to helping contractors close leads and develop a profitable business.
Jeffries agreed to let us in on some of his marketing secrets. Today, he gives contractors advice on using price to close a deal with a new customer.
“Is THAT your best price?”
It’s a question you’ve probably been hearing a lot more of lately. How do you handle it? Chances are, you end up coming down more than you’d like in order to get the job.
Our clients get the same question, but with the tools in the Closing Success System, they have the tools to work out a fair and reasonable price with their customers.
Here’s what I advise our clients to do.
First, you need to find out how much the customer is looking to get. There’s a big difference between coming down $500 on a 20K job and $500 on a 5K job. Simply ask: “Do you have another estimate that you are comparing us to?” If the difference is large, ask if the other company detailed all the materials and installation steps they were going to do so the prospect can compare apples to apples.
If they didn’t get all of the details from the other guy, then they really don’t know what they’re getting, and the conversation goes something like this: “In our business, a 15% profit is considered excellent. If their price is 20% below mine, then it can’t be the same job. Either they’re substituting inferior materials or they are leaving out critical steps that may jeopardize the quality and longevity of the job.”
You’re simply establishing real value. Remember, most customers don’t want the lowest price…they want the best value/price combination.
The problem is, more often than not, it’s your fault they’re looking for the lowest price.
That’s right. It’s your fault. Why do we say that?
Think about what you’re saying to a prospect, either in your marketing or in person.
Now, evaluate that message using these questions:
1. Who Else Can Say That? – Can what you state in your ad be true for your best competitor? How about your worst competitor?
2. Would someone looking at the ad expect you to say things like: “Great service, quality workmanship, your satisfaction is our priority?” – Of course they would! You need to stand out above these typical claims.
3. Cross Out Write In Test: Can you cross out your company name from the ad, replace it with your competitor’s name, and the ad will STILL be valid?
When your marketing message fails these tests…the only conclusion that the prospects can draw is that all these guys are pretty much the same…so I’ll just go with the lowest price.
You’ve given them NO reason not to demand the lowest price!
So, evaluate your ads, marketing material, website and personal presentations. Then give the prospect a real reason to choose you over anyone else (What is your unique selling proposition?).
Until next time, I wish you much success.
Mike Jeffries is a strategic marketing consultant. He is a SuperStar instructor for the PDCA and on the NARI Panel of Experts. He is presenting marketing workshops at national and regional industry conferences in 2009 and 2010. His proprietary Closing Success System immediately increases his client’s ability to close profitable business, increase average sales per call and retain customers.