Transcription:
There’s a story it’s called who stole my cheese. Have you ever seen that story or heard that story? I don’t think so. Okay. So it’s, about a group of mice and the mice get cheese every day. And some of the mice get content. Some of the mice go out and try to find other cheese every day.
And one day the cheese stops being placed in front of them. And the, person or the, mouse that is used to getting fed is like, Hey, where’d my cheese go? Who sold my cheese or the other mouses going out and finding their own cheese, they’re healthy and thriving because they know where to look for it.
If you get content, you can, somebody’s gonna steal your cheese. And then if you’re not measuring, you’re gonna wake up someday and be like, where’s my business. So you have to be able to track, you have to be able to go out and find new business, find out how you’re getting new business. They evaluate if it’s profitable.
Welcome back to another episode of DM shop talk or digital marketing shop talk. I’m Mike Mahaffey, the media production specialist with Valor Circle. As always with me is. I’m Jeremy. I’m the senior marketing professor. I was the senior marketing director at and Valor Circle too. I’m, Jeremy Mullins.
I’m Jeremy Mullins. I’m the senior marketing director at Valor Circle. We’re excited. We’re excited to have another episode for you guys here. We’re building a community. We’re talking about digital marketing tips to help you guys grow your home service businesses. And in each episode, we’re releasing new tips and whatnot, but I also want to use this opportunity to let you guys know that we the podcast.
We want to invite you to come on, share your stories, share about how your business has gone how you’ve built your business up and where it’s at. Share some funny stories. People love hearing funny stories. So I wanted to take this, take a time to invite anybody who, was listening to this podcast.
We want to have you. We want to have you on as a guest as well. Always feel free to reach out to us at Valor Circle and we’d love to communicate with that, but moving, on from that, Jeremy. It’s, we’re getting to the end of our list that we’ve been talking about and we’ve talked about a lot of things for those of you who might not know a few episodes back, Jeremy and I created a priority list of marketing items that we feel like all home service business owners should be following to help grow their digital presence.
Online, and we’re getting to the point now, Jeremy, where we get to discuss, we’ve talked about creating a website. We’ve talked about creating Google business profile, creating content and all this all these, tools that you can be using that all work together to help break online. But now we’re getting to a point, Jeremy, we have a lot going on and if home service business owners, if Joe, the plumber has been following these steps, that’s a lot to be doing.
So what do we do now? It’s time to take a step back and analyze what’s working review what you’re, what marketing tactics you’ve been using. Figure out what has been working and what hasn’t been working. Jeremy, what does that kind of look like for Joe the plumber that we’re using as an example who might Let’s say they’ve been following along with what we’ve been discussing.
They had a website built, they’re posting it on social media, they’re running their Google business profile and have ongoing content. Going out as blogs, they’re doing all these things. How do they take themselves out of that to look and review what has been working and what hasn’t been working?
Great question, Mike. So something I have to understand though, too, is no matter what you’re doing, we always look for areas to improve, right? So even if we’re, we run a successful campaign it’s time to review and it’s time to see if it’s working, if it’s working. Do we still adjust it? And if we adjust it, do we change things?
Do we change the budget? Do we change the artwork? Do we change the verbiage? Even, if it worked, you can change things. You can always change it back to what was working before as well. I always pictured that recycling triangle, right? How it always just goes over and over again.
So this is like a never ending math equation that, that you had to dive into. Do you know, Mike, out of curiosity, what the two things that marketers always look for to see if a campaign was successful or to see if what we’re doing is working or not? Will this be talking about like ROAS, return on ad spend and then just maybe just reviewing how many leads they’ve come, had come in the past month?
You’re close. The ROAS return on ad spend is to see if a campaign has worked, but we have to look at the whole thing holistically. There’s something that’s called LTV. I’m actually going to back my camera up, sorry. There’s something that’s called, there’s something that’s called LTV. Do you remember what LTV stands for?
Lifetime value, right? Lifetime value, right? So we have to look at the lifetime value of a client. Meaning if a client comes in, what’s the average lifetime value for all of our clients combined? And all we want to do is see that go up and up and up right? The more clients we have, the average should go up and up.
Unless we’re actually lowering prices on services. It could go down, but it, but even that can be measured as a success because a cheaper service with more clients is going to go down a little bit, but then it’ll also do the hockey stick up because they’re going to stick with you for a little longer.
Do you ever, the other one that we’re looking for customer acquisition costs and marketing, we call it GAC. How much did it cost to get that customer in? So we’re taking all of our, budget that we’ve, done our website, our marketing, our Google business profile, our time that we put in there.
We’re seeing how much it costs to gather one customer, and if we can get that cost down to get a customer, we’ve done like we’re doing good. And and there’s always room to improve. So even if we have a customer acquisition cost of Let’s say 150 bucks, there’s always room to improve, to get that down by, by tweaking what we’re doing by analyzing, by by, really diving into what your customers are thinking knowing your target audience and stuff like that.
So stuff that we can talk about in future podcasts, but those are the two things we’re looking for. Lifetime value, customer acquisition costs, and how do we make it go up and how do we make it go down? If that makes sense. We’re like at a, going in the opposite directions. And, those are the two things that, that we’re looking at as, a whole.
Mike, and this is a two-way conversation here. Joel, the plumber we, have customers that have us use this one time. What is a way that we can actually measure lifetime value for a client and how can we make sure it starts going up? So make sure you’re still good. I Really ultimately how much did it cost you to bring them on as a client and then or bring them out as a?
customer compared to how much you got from doing work from them and if this is Lifetime value if this is reoccurring work then you can keep that so that obviously it took you one time to bring them on as a client and then you keep track if you’ve had to do some maybe retargeting campaigns that we’ve talked about in the past to bring them on, you keep that in one budget compared to what each job is costing for that client.
And obviously you want this one to always remain a higher value than what it’s cost and continue to bring them on as a client because that’s where you’re getting that profit margin. Let’s, talk about our real life scenarios. If you don’t mind, though. I’m a plumber. Most of my clients are one time clients, right?
I come in to fix a leaky pipe. I come in to repipe a house. How can we increase our lifetime value? How can we make sure that we’re getting repeat business from that client in the future? I was gonna say, first and foremost, if we’re talking about trying to get reoccurring from that client, making sure that you are doing the best that you can and providing the best value.
You provide good service, you complete the job that they want and go above and beyond and leave it better. Leave their, the homeowners or business owners situation better than when you were arrived. That’s the first and foremost you can do. And then after that is just good customer service. You want to make sure that while you’re there yes sir, no ma’am, yes ma’am, no sir.
Oh, just making sure you’re respectful, running your business respectfully, and your team members are running your business successfully. Because the little things matter. You want to make sure that if you want to do more work with those clients, With those customers if they were a good customer that you take care of them with a lot of care I don’t a lot of home services and most businesses Put that as a value in their business.
But do you act a business? Do you actually? Walk the talk or do you just have it as a core value and just put it off to the side? Do you actually talk or walk the talk in your core values? Really, it’s simply put, but using respect can go a long way. Jeremy not a percent. That’ll make somebody want to do business with you, right?
They want to come back and do that repeat business with you. Logistically though. Even if you’re an electrician, even if you’re a plumber, what you can do is you can actually inspect the things that they have going on right now in a home or, business. Knowing when the lifespan of a hot water heater, for instance, you’re fixing the pipe, you see the hot water heater that hot water heater has a lifespan of 10 years.
You can see that it was installed seven years ago. What you can do is you can actually put them on a reminder and offer them a special for replacement water heaters, right? Hey your hot water heaters might be coming to the end of this lifespan. They have a lifespan of 10, 10 years.
If you want to be proactive and not go without hot water in an emergency situation, we can offer a special discount to install a hot water heater at year 9. So making sure that you’re not out. And it’d be this much or it’d be this is a special. So we can increase that lifetime value with that client by doing an upsell, but being aware.
So exactly, So I guess my question, we’re talking about like how, a home service business owners can. Can really evaluate how their business is doing and what’s working? What’s not working Jeremy? I guess my question is why does it matter like for a home service business or to take the time to Evaluate the things that they’ve been doing like what if they’re just like, yeah, I’m content Like what if maybe some consequences that could happen if they’re not taking the time to evaluate how things are going I love that question, Mike.
There’s a really good, there’s a really good story. It’s called Who Stole My Cheese? Have you ever seen that story? Or heard that story? I don’t think so. Okay. It’s about a group of mice. And the mice get cheese every day. And some of the mice get content. Some of the mice go out and try to find other cheese every day.
And one day the cheese stops being placed in front of them. And the, person the, mouse that is used to getting fed is like, Hey, where’d my cheese go? Who sold my cheese or the other mouses going out and finding their own cheese, they’re healthy and thriving because they know where to look for it.
You get content. You can, somebody’s gonna steal your cheese. And then if you’re not measuring, you’re gonna wake up someday and be like, where’s my business. So you have to be able to track, you have to be able to go out and find new business, find out how you’re getting new business. And evaluate if it’s profitable.
If it was a waste of money, if it was something that like maybe you’ve discovered the way to print money for your business by, offering a, special or, doing a certain promotion. If we don’t analyze, we never know. And if we don’t know, we’re never gonna be able to like really thrive in any economy, really, to be honest with you.
As I say, and that makes sense. And as you said, if you’re just the way I look at it is if you’re just doing all these marketing, you’re spending, there’s, even if you’re not spending money on a lot of these marketing tools and resources, you’re spending your time, which is also valuable in if you, Don’t know what’s working and what’s not. Then you’re just going to keep pouring into things and just doing things blindly where it’s so important to take a step back and be like, and you use these measuring tactics that we’ve been talking about. To, really see what parts of your business are working well and what parts can, or need to grow to match up so you can continue to see the results that you’d like.
You don’t want to be, the last thing you want to be doing is wasting money and wasting time on things that aren’t working. And a lot of, times, whether it’s a content campaign, whether it’s. Whether it’s your email database reactivation of some of the tools that we’ve talked about in the past.
Even if you’re not spending money, if you’re putting a lot of effort, into those and you might not be seeing the results. A lot of times it just takes, it takes a second to take a step back. Do a couple tweaks and then just by doing, taking that moment, then you can start seeing results from there.
But if you’re not taking the time to do that, then you’re missing out on opportunity. And as I said, wasting time and wasting money, the two worst things that you could be doing as, a business owner, obviously. But as I say what are some strategies? I have one at the top of my mind that I want to see if we’re on the same page here.
What are, some strategies as, business owners are implementing these things? They’re going through the checklist that we made and, they’re going through what are things that they can be implementing that will help them when they get to the, point of measuring and making sure things are working.
What are some tools that they can use? To implement, does that make sense when I’m asking? I think so. Are you talking Google analytics? Yes. Exactly. The big A word, analytics in general, right? So we have Google analytics. We have I’m assuming if you’re a business to use something like QuickBooks or an accounting software you’ll know your, gross revenue.
And then you have your net revenue, your net profit. I’d be looking at that net profit and seeing if it’s going up. Because that’s what we want, unless you’re buying equipment and it goes down. But those are the two things I’d be looking at as a business. Not two things. I’d be looking at analytics in general, just like you.
So, you talked about ROAS earlier, right? Mike can you describe what ROAS is for audience and help them understand that’s a campaign and the campaign has a much bigger picture when it comes to LTV and CAC. Yeah. So when you when, you decide to run an ad campaign You’re, going to choose the duration of how much time you want it to run in and put an ad spend to it.
So how much you’re, putting into it. And then once that campaign’s over, we’re going to talk about ROAS, which is return on ad spend. And that’s how you can evaluate if that campaign was successful or not. So you’re going to take how much it costs you to run that ad, The amount of leads or calls, or maybe even jobs that you had brought in.
And to see if you actually had a good return on that ad spend or if you had a bad and from there you can measure to see, okay, this was a good, we got three, four jobs. We spent, let’s say 50 on this, campaign that ran for a week and we got two jobs off of it. If I had to guess those two jobs are worth a lot more than 50.
So that’s a good return on ad spend. But let’s say you set a campaign that was once again, 50, but you didn’t get anything from it. So you had zero return on that ad spend, you can now say, okay, that ad campaign was not successful, but we can at that point, figure out what might’ve gone wrong with it. Maybe you need to adjust some of the demographics that you were targeting.
But obviously that’s a sign when you have a negative return on ad spend, or maybe not a. As much return on ad spend as you’d like to take a second, evaluate that campaign so then you can run a smarter, more strategic campaign to follow. And obviously this is very specific to return on ad spend, Jeremy, but what would be, something when it, outside of advertising, maybe they’re running social media campaigns.
What would you say about tracking numbers, tracking phone numbers that people could use to implement in these campaigns to help, figure out where, these leads and phone calls are coming from? Do you think they’re worth using or do you think they’re messy? Yeah, no, probably yes. And maybe depends on the way that people run their business.
A tracking phone number is a software that you can set up to find out. You’d have a different tracking number for your Google business profile, offer your website and other social media presences. And pretty much what happens is when somebody calls that it’s going to track that number.
Sometimes it records that phone conversation as well. And as a business owner, that’s like a big bonus knowing, Hey I’m getting more calls off my Google business profile. Cause maybe I’m a I’m, on a Google guarantee or something like that. And they offer their own tracking number to say, no, but it did tracks all them, all the calls that come in, the duration.
And the big bonus, in my opinion, is having those recordings as well. How is your staff like answering those phone calls? How do you sound when you answer a phone call? I don’t, I know a lot of home service companies business owners, they answer the phone call and it’s like, we hope you’re calling me or you’re been in inconvenience.
Like maybe it takes a recording to understand, like when you answer a phone like that, your clients might get turned off. You might not get that repeat customer that you’re hoping for. Maybe having somebody answer the phone for you and getting you connected. And knowing the numbers of the phone calls that come in, knowing the energy you put out to get those phone calls to come in will help you analyze and really figure out where to put your time and your money in the future.
So you have great stuff. Yeah, it’s exactly using those tracking numbers. You can tell if those phone calls are coming from, your website, they’re coming from Google, they’re coming from maybe some Facebook. Groups you’ll be able to tell where it’s coming from. Okay, that’s working.
Let’s try to put, let’s try to put more effort into that. Let’s create a strategy to really lean. Let’s say your Facebook’s really bringing you, bringing in a lot of leads. Now so you know, you can start putting in a lot more effort and creating strategy to target that audience, but without these tracking numbers, without taking the time to reevaluate things, then you’re really, you’re not going to know that you’re going to keep just shooting.
I use this analogy a lot, but you’re just keep using, just shooting a shotgun blindly hoping things are hitting. And so this is just a way to make sure that you can see what’s working and put more effort or see what’s not working. And do the proper fixes so you can continue to see that return on it.
Let’s say, Jeremy, obviously reviewing, marketing campaign, reviewing your business as a whole, taking the time to do that is so important. I was going to say, do you have any, final things that we haven’t discussed yet about why it might be important to, to do this? Or maybe some strategy? If you’re in the home service.
You know that there’s a final inspection that needs to be done on all the services you provide, right? That final inspection, you might end up having a leaky pipe or something like that. You have to test the water pressure, right? You have to flip the switches. If you’re an electrician, you have to make sure the roof doesn’t leak at your roofer.
And those inspections are done to make sure that the work you do is quality. I don’t see there’s any difference between taking that inspection mindset, making sure things are working when it comes to marketing. So what’s it costing you not to do it? It could be. It could be as expensive as leaky pipe or replacing a roof in my opinion.
So no, exactly. It, as I say, just as you would say, Jeremy, the house, just like you treat a house, just like you treat a job, you ought to treat your own business and have that final inspection that said very well. But as I say, if you ever, I also want to just put out, talk to us, we’re here we’ve, worked with Tracking Numbers, we’ve worked with ROAS, and we’re always a resource to you.
I don’t want to sit here and sell our business, but I do want to, I do want to use this opportunity to let you guys know that we are a resource, even if you want to have a conversation about like, how can I implement? Some review camp, review campaigns or analytics into my business. We’d love to have a conversation about that, but until next time, we thank you for, listening to us ramble here for 20, 30 minutes.
And we hope that we can continue to build a community around this and invite some of you guys to be on our podcast, but thanks for joining today. All right. Cheers.
