In the last few months, I’ve written articles going over how Google is launching into local services. The first one covered how Google Local Services (GLS) was rolled out
, and the second covered the potential impact and ramifications of GLS on the marketplace
. From sources within Google, it appears that their goal is to have GLS nationwide by the end of 2018. As I went over in my last article about the potential impact of their program, that is probably when you can expect the game to change. As I brought up before, the game will totally change when Google starts explaining what the Google Guarantee is to the public.
As I shared in the last article, our
MORE Marketing Program, headed by Lori Smith, sat down with 25 Salt Lake City homeowners with no relationships or affinity to an HVAC contractor. First, Lori showed a Google search page result for HVAC repair—without the GLS ad at the top of the page. She then asked how they would choose a contractor for a repair for their home. As expected, our homeowner’s choices and reasons were all over the board. However, most of their reasoning could pretty much be boiled down to who they had heard of—or were familiar with. Next, Lori showed them a search page with Google Local Service ads at the top. When asked if that changed anyone’s opinion, it didn’t. They thought it was just another ad. Then, Lori explained what the Google Guarantee symbol in the ad meant, and that Google’s would guarantee up to $2,000 that the job would be done
right, for anyone who used Google to select a contractor from GLS where that symbol appeared. When we asked if knowing about Google’s guarantee affected anyone’s choice, all 25 of the homeowners changed their decision and said they would use GLS to find their contractor!
Personally, I find the above results to be extremely sobering—if not downright scary. If nothing else, it underscores the fact that the era of “free Internet leads” from which we currently benefit, is quickly coming to a close. In fact,
this month’s guest article from Tom Waddington going over how all voice search using Google Assistant—and the Google Home units—will be totally ‘pay-to-play’, only validates this. It underscores Google’s objective to become both ‘Tollbooth’ and ‘Gatekeeper’ of all potential customers who use their search engine.
“Hi, I’m from the IRS Google, and I’m here to help you.”
For those who think that having Google as the online gatekeeper for customers searching for a contractor is a good thing, making it easy for everyone to buy leads, I want you to think back to the days when the Yellow Pages was the uncontested gatekeeper for consumers looking for contractors. Do you really want to go back to that? Especially since, if Google becomes the gatekeeper, it will be just like the old ‘Yellow Pages days’—but on steroids.
Back in the old ‘Yellow Pages days’, the demand to be the first one shown in your category, was a bidding war that happened but once a year, and the winners paid exorbitant fees to be shown first. However, those were simpler days, and as Google showed with pay-per-click (PPC) advertising in the past, once demand got large enough, to increase their profits, they made it a bidding war that happened every moment—not just once a year. It would be naive to think that Google won’t change to a bidding system for GLS leads—or sell the ability to compete for the same lead to multiple contractors—if the results of our focus group of 25 homeowners is any type of bellwether for potential consumer use of GLS.
If our 25 homeowners are a bellwether as to consumer response to GLS, it will impact your marketing costs drastically. In 2017, PPC accounted for only 30% of consumer clicks. This means that 70% of consumers used organic search, which costs much less than paid clicks. If even half of that 70% decide to use GLS for the free guarantee, the effect on all our marketing budgets will be quite profound. So, what are you planning to do to deal with the potential change?
Dealing with Change
When discussing coming changes in the Industry, it continues to amaze me on message boards and in conversations that many contractors are quick to jump on a soapbox and espouse that, “change is good and they always run to happily embrace it”—no matter what it is. The reasons they give for this approach of blissfully running towards every new thing they see on the horizon, typically involve catchy phrases like, “evolve or die”… “sets me apart”… “the cutting edge”… or similar buzz terms, all of which sound bold, strong, and cool. However, with apologies to the CEO Warrior crowd, sounding bold, strong, and cool may make you feel good and powerful… but it has very little impact when it comes to making solid strategic business decisions based on forecasting. Not everything on the horizon should be blindly run to, no more than one should assume the light you see down a tunnel is always daylight.
Am I saying that change is inherently bad and should be fought? No, nothing of the sort.
Change in and of itself is unavoidable. It’s always coming, and change will always eventually happen. The only choice is to either analyze, plan, and position yourself for it—or be a victim of it. As anyone who kayaks or canoes in rivers with fast currents can tell you, it’s the subtle course corrections you make 200 feet from rocks or log jams that keep you out trouble. Maneuvering to where you need to be is always harder if you wait to the last minute—especially when you’re being pushed inexorably forward by an uncaring current. That being said, I hope you understand that, unless Google absolutely blows it (which they have done in the past), there are some potentially costly “rocks” up ahead that you should now be making slight course corrections to avoid.
Making the necessary “Course Corrections”
My advice to clients right now is that they should
get involved with GLS as soon as it's in their market, if not before. In the short-term, it will be a profitable relationship. Unfortunately, it’s the long term that's not so clear. That’s why I suggest that every contractor should have a "plan B” they’re working towards for when Google begins to focus on maximizing their profits.
As I pointed out in my previous ‘GLS Domino Effect
’ article, the best way of avoiding having to pay Google’s toll for every new customer lead, is to get that customer to deliberately look for you by name—not by generic search. To do this, you need to become the ‘brand’ that everyone knows in your area. If you don’t deliberately move towards the goal of embedding your brand into your consumers' minds, it will never happen on its own. The best part is, it doesn’t have to cost a lot—it just needs commitment and effort to make it happen. To this end, I’ve listed eight things you should consider to better protect what you already have, and to start moving towards becoming the brand that local consumers refer and look for by name.
- Fence in your herd. If Google succeeds in becoming the gatekeeper for clueless users looking for a contractor, there’s not much you can do about it other than play the GLS game. However, it will be tragic if you pay for existing customers to contact you through GLS because they feel better protected due to Google’s guarantee—especially when your own guarantees are typically way better than Google’s 30-day one. If you’re not making an effort to educate your customer now about the ways you stand behind your work, why aren’t you? How hard is it to create a ‘leave-behind’ that educates your customers about your guarantees and the protections you offer? If you don’t educate them about your guarantees, it’s a sure bet Google will educate them about theirs.
- Communicate with your customers. At least once a year, communicate with your customers where you are not selling them anything. Be their friend instead of just another sales guy. Do something that helps them without pushing some type of sales offer. If you’re in the North, something as simple as a quick friendly postcard reminding them to remove and drain their hoses before winter will make an impact and make you memorable from everyone else trying to just sell them something.
- Focus your efforts. Know the difference between your Market Area and your Service Area. The key to being the big fish in the pond is to intentionally choose your pond. Twenty percent of what you call your Service Area will typically provide 80% of your business. Unless you have a real heavy penetration in a far out area, why would you waste your money and time trying to convince someone who rarely sees your trucks, and doesn’t have a clue who you are, to use your services? Unless wasting money appeals to you, focus and market where you are the most familiar—people always go with the familiar over the unfamiliar every day of the week. If you don’t believe this ask yourself... when you go through your mail, are you more apt to open a sales letter from a local company you recognize… or one you don’t?
- Put a face on your company. If you’re the shy type who doesn’t want your personal life associated with your business—get over it! The golden rule of marketing has never changed. “People do business with people they like—and people like them.” It’s no accident that more people trust a local website with a picture of the owner on it than websites that don’t show who owns the business. Newsletters can be great for this if you take the time to write a column in it and share what’s important to you personally and how it affects how your business operates. This approach has been very successful for our contracting company. However, if the thought of a monthly article daunts you, then at least have a letter with your picture on it that goes to every job thanking your customer for their choice to use your company and inviting them to call you if there are any issues.
- Engage with your community. Get involved in what people are passionate about in your community. Nobody is passionate about their HVAC or plumbing until it's broken. If you wait for that before you engage with your customer, it’s probably too late. Get out and get known in the community. When it comes to how homeowners learn of the contractor they choose, relationships and word-of-mouth produces 4-5 times more customers than the Internet in every age bracket! Referrals only come from people who have an opinion about you.
- Be ‘over-the-top’. Go beyond just making impressions—look for the opportunity to make an impact. The best example of this is a story Mike Morosi shared where a contractor client of his would have a breakfast meeting once a week at different restaurants around his community. The rule was when the meeting was over they all had to drive back to the office single file. That’s the difference between creating an impression versus making an impact. We actually did it in our HVAC/plumbing company and it was pretty amazing the impact it made as every car slowed down to look at our impromptu motorcade. Our trucks are out in the community every day making impressions—but a parade of them made a memorable impact. Do whatever you can to be recognizable in your market area and look for ways to compound your effectiveness. Having a nice-looking truck in a local parade is good… but donating $100 to a couple of local charities to let them have your wrapped trucks pull their floats all throughout the parade is 10 times more effective.
- Make customer reviews a priority. If you don’t have a working system where half the people that your techs ask for online reviews give them to you—you’re missing the boat. Don’t settle for a 5-10% response. Obviously, everyone knows that getting reviews is good for the company, but what many don’t realize is that it’s the best way to get your customers to commit your company to memory. Think about it, how did you memorize things for tests in school? You wrote them down because the mind remembers better what you write or type. If you can get a customer to write that they love your company, they'll be more likely to remember you and less likely to go anywhere else. People very rarely argue with positions to which they commit, so get their commitments through reviews and lock in the customer.
- Sticker everything. As old-school as this is—it's still the most cost-effective and granular way to grab customer headspace. It's probably also one of the most neglected consumer retention systems we ask our techs to implement. Too many contractors don’t have a system to make sure it's getting done. If you have a sheet of stickers that every tech is supposed to use in the home, find a way to police that they are being used. Don’t expect what you don’t inspect! The best way is to require dated pictures from each job of at least three of the stickers that were applied—or at the very least, make sure they turn in the backing page showing missing stickers with each job sheet. When we started requiring pictures from our techs showing applied stickers, it blew us away when we saw all the pictures of existing customer equipment that only showed the new stickers and none of the ones that were supposed to have been applied in past jobs—but weren’t. Talk about wasted opportunity.
Everything that’s worth anything requires effort!
The siren-song that continually distracts contractors is the mythical “Magic-Bullet”. You know what I mean... the magical marketing piece that you can simply throw money at and it instantly solves everything. It would be great if such magical “bullets” really existed, but in the 40 years I’ve been in the industry I’ve yet to see one. In a nutshell, spending time searching for magic bullets is a waste, since the only thing they typically kill are unicorns and dreams—however, in full disclosure, I've never seen a unicorn killed by them. Unfortunately, unlike the mythical “bullet”, everything I listed above takes time, commitment and effort to follow through on. Is it worth your time to figure out how to get new customers in your market in the future—without relying on Google to provide them? Absolutely.
It’s obviously a lot easier to just “see what happens” rather than go through the pain of self-imposed change. If you’re comfortable to let Google be the gatekeeper on your company’s ability to find new customers when they are looking for a contractor, then obviously the best plan is to just sit back and deal with what happens as it happens. Personally, I’m not comfortable to let an entity that makes no bones about the fact that their goal is to make all other businesses a commodity have that type of control over my business. It reminds me too much of a children’s poem my father frequently quoted to me when I was a kid. It went like this:
There was a young lady of Niger
Who smiled as she rode on a tiger;
They returned from the ride
With the lady inside,
And the smile on the face of the tiger.
‘til next time… --dave