Marketing for Home Inspection Speaker William A Price

Marketing for Home Inspection Speaker: William A. Price, Attorney at Law [email protected] com, tel. (630)362 -8840

Defining Your Markets the Association Can Reach l Markets Your Referral Sources Can Reach l New Markets l

Association Marketing Nonprofit Mailing Rates: 25 cents first class postage vs. 39 cents l Joint Marketing is deductible to each contributing member, as dues or as a marketing fee l Costs can be spread across many companies l

Other Association’s Marketing Lawyer referral: 800 number and website, county bar associations and Illinois State Bar Association l Basic signup fee, plus a small referral fee for the first hour of service collected l

Other Association’s Marketing Realtors: Realtor’s Associations Websites: direct referral to product (homes) l Assocation advertising for profession’s image l Contracts designed to recover fees l Membership fees cover costs l

Customer Group Marketing AARP: Provider signup for mention on AARP website ($600/lawyer) l Other “partnering” by transaction (VISA card percentage to AARP, etc…) l Monthly magazine advertising l Provider/advertising fees and membership dues cover costs l

Newspaper Advertising Group may cover costs individuals can’t pay: 20 marketing exposures needed l Chicago Tribune, $1500/insertion l Daily Herald, Central Du. Page, $400/insertion l Paddock Press, $3 -500/insertion l “Homes For Sale/Farms For Sale”

Cable TV Advertising 1. 2. 3. 4. Regional and Sub-Regional Coverage Available: Infomercials! Cost/Insertion similar to Tribune Community Cable studios/COD students and other college production facilities 800 number for immediate response/measurement

Websites Mention the site in all advertising l Use “pay-per-click” to increase traffic: $7, 000 at 10 cents/click = 70, 000 visitors for your keyword. Use Yahoo/Overture keyword rankings to pick words. l Have downloadable content, free and paid l Cross-link to increase site rankings l

Association vs. Individual l l Expensive venues Generic referrals Extended production efforts (infomercials, brochures) Referral websites and phone services l l Guerilla Marketing Individual Referral Relationships Past Customer Marketing Contractor and other Business Partnering

Guerilla Marketing Uses Very Little Money l Goes Around Points Of Resistance l Makes The Population Your Friend and Hiding Place l

Guerilla Tactics l No-postage distribution: Neighborhood leafleting, “welcome wagon” distribution for post-purchase reinspection and repair, community website mentions and referrals, public library flyers for educational events, homeowner’s association distribution (email, flyer, and direct mail – offer a group discount!)

Referral Relationships Realtor Economics: Volume, not quality l Anti-kickback rules mean no direct payment for referrals l Realtor/Lawyer/Accountant/Other Trusted Intermediary (? Insurance Agents? ) referrals possible l Rule of Reciprocity: how can you help them? Why are you the best source? l

Past Customers Cheapest cost of customer acquisition (10 x less than new customer) l Reminders at least quarterly l Possibilities: Newsletter, e-newsletter (cheapest), discount coupons (transferable), non-sale services (energy audits, annual maintenance checklist/audits, rehab estimates…) l

Partnering Reliable vendors are always at a premium l Note general contractor services/pricing: 10% of project costs, need insurance, licensing? l Logical add-on to inspections l Possibilities: plumbers, drywall, electrical, HV/AC, insurance, etc… l

Know Your Value Chain SERVING SELLERS: l Realtor creates customer l Mortgage bank qualifies customer l Lawyers collect the funds

Know Your Value Chain SERVING BUYERS: l Realtor creates customer l Inspectors qualify properties l Lawyers verify ownership and funding details, are gatekeepers for funds l Insurance, utilities, subcontractors, cleaners, etc… may be needed by new homeowner l You could create the customer for them

Business Planning Issues l l The Idea: What do you sell? What else could you sell? The Market: Who do you sell to, and who else sells the same, or alternative services? Is this market growing, or shrinking? l l The Team: Why are you/is this team the best/cheapest/fastest in the market? The Plan: How do you acquire customers and deliver products and services?

The Idea l What Do You Sell? Peace of Mind: financial and personal safety. Not drills, holes…. l What Else Could You Sell? Financial products (insurance), safety products (build-out, CO monitors, Radon monitors, baby monitors, etc…)

The Market Pick An Addressable Niche l This means one you can afford to communicate with 20 times this year l

Market Size How many of your services/products are bought each year in your market? l What percent of these are you capturing? l What can you/your association do to increase the size of the market? l Is the market growing, or shrinking? l What other related markets are there? l

Related Markets Annual inspections: could insurance companies or mortgage lenders require inspections? l Would apartment owners or absentee landlords buy your inspection/contractor referral and supervision services? l Can you sell related products? l

Market Competition Who are your competitors? Busy realtors, who refer at lowest cost to get the job finished. l Apathetic customers, who don’t know what an inspection is worth l Ignorant lawyers, who don’t bring you in immediately l Other inspectors l

The Team Identify All Business Functions Needed l Find Out Which You Don’t/Can’t Do l Hire/Retain People To Do Those Jobs l Remember the nondelegable functions: sales, team member recruitment, financial and personal responsibility for results and process l Is your team the best in the world? l

The Plan 90 day plans are reasonable l #1 cause of business failure: running out of money! l 80% of money/time: acquiring customers l 20% of money/time: service, billing, and followup on contracted work l

What Are Your Milestones? 12 referral sources, who each can give me 12 customers this year l 24 guerilla, association, and other marketing contacts to my market this year l 36+ hours/week marketing, 12 inspecting l

Rate Setting When The basic service has become a commodity l l Two-sided markets: a free service to bring people others need in, and a charge to others who need to reach them. (E. g. , add-on monitor sales. ) Value-added services (Contracting) Additional services for customers (energy, remodeling estimates, etc…) Disruptive innovations (10 x faster, better, cheaper than others in the value chain. )

Legal issues Pre-Closing Issues l l l Material defect? Discussion vs. Counter. Offer Time to finish inspection/work Amount of & cost of escrows Payment at closing Post-Closing Issues l l l Services liability: What would a reasonable expert do? Post-closing repairs: budget, contracts, timing, payment methods Annual inspection and other follow-on services

Defects and Casualties Material defect: contract breach, with Du. Page contract remedies l Casualties: 10% or more casualty required to let buyer out of the contract (Du. Page contract): inspection could verify l

Time to finish inspection/work Inspection is controllable l Subcontractors and other work before closing is difficult l Make sure closing is extended, or you and others may not be paid! l Remember: mechanic’s lien rights apply to you l

Escrows Title company or lawyers hold the money l $175 -250 fee to do one l Escrow conditions strictly enforced: completion of work, reasonable satisfaction, release of liens, only then release of funds l

Payment at Closing Know when the closing will be l Know who your customer is: the seller, the buyer? l Who pays you? The seller’s lawyer’s secretary, if they control title l Make sure you are paid before you release your lien l Consider collecting at closing, or on closing day l

Expert Liability l l l Standard: What would a reasonable expert do? Protection: What disclosures were given to the buyer? Insurance: non-wilful and not grossly negligent professional errors and omissions: cost of defense, cost of judgment Remember California: mudslides, other outside conditions Contract may limit customer remedies: strictly construed

Post-Closing Work Pick your role: general contractor, or owner’s representative? l Separate contracts are needed. l Payment for services (percent of job, or time on task) needed. l Reliable subcontractors needed. l Time pressure is lower, budgets are tighter. l

Annual Inspection and Other Follow-On Services and Products Define the service by contract: don’t be an insurer l Update services to meet new dangers (radon, mold, gas, floods, etc…) l Verify product liability/warranty coverage for manufactured products, have retailer functions covered in insurance l Note sales tax payment and reports l

Conclusion: Any Questions?