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On our latest home improvement webinar, we once again offered $100 to the customer who submitted the best idea that they intended to use as promptly as possible. We received our most responses to date, and wanted to showcase some of the best ones here:

“When training sales staff teach them that the REASON that potential customers have price objections to begin with is not the customer’s hang-up or problem.  NO!  It is the salesperson’s problem because in the presentation they didn’t show enough value to warrant that price!!  Everyone wants to play the blame game – - knowledge is power and I hope that just them knowing that in order to have fewer price objections, they need to work on their presentations (demonstrating features, benefits & value) to the point the people feel like:Hey, this is worth it, even if it is a bit expensive.”

“I will use the left brain/right brain explanation in my next sales meeting to illustrate the science behind the customers’ demeanor during a sit.  Many times we get caught up in our own thoughts thinking about what to say next.  If my reps can be conscious about what is going on in the psyche of the customer’s mind and give the proper amount of time for the thought process to shift back to the other side of the brain, the close will manifest itself and not have to be fought for.  This scientific explanation holds merit and gives my reps a reason to buy into this logic.”

“I sat in with a fellow remodeler and I will tell you the most important thing I took from this was that practice is very important. I am very aware of one-time closing and being quiet for the customer to respond; however, like the professionals in sports, practice is what makes you a professional,  and I have now committed to practice everyday with objections – - 15 minutes daily before I head out to work.”

“The ‘we always get 3 bids’ close was great. I have played the webinar recording for my sales guys and they liked much of the other info as well. We will be using this in our sales presentations.”

“Our top takeaways:

- Learn the needs of customers
- Learn how to properly overcome objections
- Prepare yourself for each sales presentation
- Know Your Product!”

“What I have already tried on a sales call is the 4 to 6 second pause after the “We got to think about it” statement.  I told the ‘Mr.’ that I appreciate that, then looked at the ‘Mrs.’ and asked what she thought. She was excited and ready to do it, however she allowed him to make the decision.  Their excuse was that they weren’t sure if they were going to stay in this house or retire to Branson, MO. in a year or so. I plan to re-listen to the webcast, because I know I did not execute this technique very well.  I really did find the session interesting and it reinforced techniques that I was taught years ago.  Thank you for doing this for all of us.”

“The best thing I got was the S.A.L.E.S. closing process. Some of it I have used, but the part about the SILENCE for 4-6 seconds was great in addition to the rest of the system!”

“The best idea I acquired from the home improvement webinar that I will use promptly is to lead the customer to overcome their own objections.”

“I feel the best piece of advice I received was how to overcome the objection ‘We want to get several more quotes’. I had never thought to approach it with using the power of assumption to get them to commit. (i.e. so if my competitor comes in with the same price you will call me for the job).”

“S-A-L-E-S particularly ‘eliminate’. Also the phrase ‘other than that, is there anything standing in the way of you owning and enjoying our product TODAY?’”

“What I remember most and will profit by is the S.A.L.E.S close (Silence, Affirm, Layer, Eliminate and Solve). Especially, the pause of 4-5 seconds waiting for the client to go from left brain to right brain and have them answer their own objection. We will be listening to this webinar over and over again till it becomes second nature. Thanks again.”

“Be advised that we effectively used the  ’3 price close’ in response to the homeowner saying they wanted to get 3 prices. The sales rep was a veteran of ours and a very good closer, this made him that much better!”

“I always enjoy hearing you talk about the sales process. The best idea I got from the webinar was the “S” in S.A.L.E.S. – silence, (which is hard when you know what they are about to say). I have started taking the advice and listening thoroughly to each customer’s response, then keeping silent for a few more seconds before I respond.”

“What I took away from this home improvement webinar is how important it is to enter as much data as possible. I am just learning this system and have made it clear to the rest of the staff who have not been using it properly. Thank you for having these webinars. I have gone through some of the past ones as well. It makes learning much easier.”

“The best idea that I acquired from the “Overcoming Objections” webinar was isolating the objection.  Our salespeople are going to implement that idea whenever a customer states an objection, by asking “Is there anything else that will prevent you from buying our product from us today?”

“I am certainly going to use the idea of pausing for up to 8 seconds before responding.  I am a very quick thinker and often respond too quickly to what the homeowner says.  This one technique alone should bring an additional sale per month at a minimum.”

“The one thing that sticks out in my mind was the silence between the questions or answers from the customer.  I have implemented that in my life about 50% of the time so far.  I am trying harder to understand that it will take a full 30-40 days before I have it down without consciously working at it. Thanks for the tip.”

For more information on our sales methodology, download our complimentary mp3 on in-home selling or learn more about our upcoming sales seminars.

Our latest home improvement webinar on overcoming sales objections has generated a ton of response and we will attempt to answer many of your questions in this forum:

Q: Will the techniques you suggest in “The Science of Successful In-Home Selling” be effective when used on the telephone?

A: Essentially, yes – keep in mind you don’t have “face to face” contact, however, the pauses which we recommend for objections are still effective.  In responding to an objection or complex issue you might simply say,  “Hmm…” or “Let me see”.  Pause and then ask a question in response (Who – What – Where – When – Why?).  Use affirmations such as, “Thank you for bringing that to our attention.” or “We appreciate your interest – patience – etc.”  You’ll know when you are being effective when the note paper in front of you has abundant information which will help you solve problems for the caller, leads you to setting an appointment, or satisfies a customer service issue.

Q: What I am trying to do is implement some of these processes into our canvassing department.  We do follow the “affirm, layer, and eliminate” process. How would you recommend that we facilitate silence while at the door?

A: Preface the silence with a simple expression such as: “I see” or “Uh hum”.  You might cup your chin in your hand after the four to six second pause and answer with a question “Why is that?” “Who will (or normally does) make those decisions?” or “Do I understand that…?”  These and similar questions show a care and interest in what is being said.  They tend to build rapport as well.

Q: Please give more canned answers to common objections.

A: There are no “canned answers” – - there are simplified methods.  But first remember what you may be considering common objections such as: “ We want to think about it” “We’ll get back to you” or “We always get three estimates” are not objections but are procrastination statements or even part of a buying tactic.

It is usually best to uncover these statements/tactics “early on” sometime during or right after a needs assessment.  That may not eliminate that you will hear a few of these at the end of your presentation.  You need to review the home improvement webinar again.  Remember, as you develop this technique effective response methods go something like this:

Your response: “I see” or “I understand” or “No problem”. (Pause for their response – then add) I need your help. Can you tell me… (add a who, what, where, when, or why question).  Remember it needs some practice.

Q: I understand the S.A.L.E.S. process but I just get confused on how you go from those non-sequitur statements into a presentation without coming off too overbearing or saying: “I know you’re not just here to look around.”

A: Respond to all non-sequitur statements with a smile and a response such as “ No problem ” or “I understand”. Remember, you are not agreeing that their premise is correct, you are telling them you understand what they are saying and that you respect their values. Many of these “non-sequiturs” come early in your presentation and require no more response than I have given you here.  Later in the presentation your response might change somewhat.

As an example, the prospect says: “We always get three estimates”.  Your response: “No problem” or “I understand”.  Then say: “Why will it be three estimates??”  The response will lead you to their insecurity, their buying tactics, what they may be covering up, etc.  Think about it.  Why three?? Why not five? Why not two?  While it may be that this is their practice, for the most part they are repeating what they have heard from some source.  Their response to your questions may unearth the real reason they aren’t buying and your sales approach may vary.

Q: I just got this email from a customer:  I’ve slept on it and decided not to proceed . . . you guys are great but I’ve decided. Anything I can do?

A: Your response should start this way:

Thank you for your courtesy in advising us and we truly appreciate the amount of time we were granted and the opportunity to have been considered.  May I ask a question, please?  First, have you in fact entered into a contract with someone else?

(If not, proceed as follows) – Did you make any major changes in the project (increase or decrease in the size of it) or zero in on any particular product?

(Then, whatever the answer, proceed as follows) – It sounds like you gave thoughtful consideration to who you want to complete your project.  Can you tell me what made you decide against our product or company?

(Listen carefully and whatever information is provided say as follows) - Mr. Jones, I know this is an important project and before you sign a contract with someone else let me review the contract in my office and let me stop by for 10 or 15 minutes to make sure I priced the project and specified correctly what you wanted done.  It won’t take long and if you have decided to go with another contractor it might be helpful if I add a thought or idea that may lend assistance in getting this completed by others.

The purpose of the latter is to get one more opportunity to be with these prospects and determine if there is one more way, one more idea, or some other option that allows you to get back to the “being considered mode”.

Keep an eye out for more questions and answers from the latest webinar…

On our most recent home improvement webinar, we offered $100 to the customer who submitted the best idea that they intended to use as promptly as possible. We received a wealth of responses, and wanted to showcase some of the best ones here:

“If you really are number one in your area, then you have to be number one: everything about how you do business needs to say we’re number one – - without using those words.”

“Thank you for pointing out the importance of tracking a lead. From rating it, to following up with it. In the past I would receive a lead, price it, then just hope to hear back from them.”

“Best idea from the webinar is rehashing.  Our company lost sales/money due to management not rehashing appointments to see what happen during presentations.  Shame on us!”

“The countless ideas presented by yourselves which translate into opportunities to modify, enhance and improve for the betterment of our company’s moral and bottom line.”

“Post show – - I will host a seminar in our showroom for all those couples who booked an “in home appointment” but then cancelled.”

“I found the webinar to be very informative, forward thinking and helpful! I thought the energy level and enthusiasm was refreshing! Thanks for the invite!”

“The best idea I came away with from the most recent Yoho seminar would have to be what David Alan Yoho was saying about the home shows and canvassing, from attire to approach and time spent with customers at the show.”

“We have recently acquired a lease option that will open previous leads that couldn’t come up with the necessary funding for a solar system. The take away from the home improvement webinar on how to best reach them is the three part approach: phone call, snail mail, email which we are using to great success.”

“I will be organizing a window seminar at our showroom to generate sales of “rehash” & new leads.”

“The concept I’m taking from the webinar and applying is: not quoting people at shows. Don’t quote – - set up an appointment, and then SELL!”

“The act of sending an immediate email to confirm show leads was very compelling. This will be implemented immediately on all leads in our business. Thanks so much for such an educational webinar.”

“I got a lot out of the canvassing portion of the program. We are going to get more into it this year and the info that was shared was great. I like the part about controlling the herd and not giving up too much information up front. This is hard to do and training is key.”

“The number one point I took away to increase my chances for profitability is rehashing. Not rehashing can be a costly mistake.”

“Loved the ‘nugget’ of following back up on a lead with a second person who can check procedures and flush out/fix the concerns of the customer.”

“We will be implementing the pre-appointment auto-email, as David said – - keeping up with today’s times!  Just need to find a way to do it within minutes of setting.  Thanks!”

“I will be applying the “it depends” response to deflect the price question immediately.”

“I am energized to get to our next home and remodeling show to set up more in home demos.  2012 is going to be great.”

“The more information given to a potential client = the less likely they are going to want a demo.  We have seen this in the past but never really gave much thought as to why people appeared to be satisfied and uninterested in scheduling an appointment after speaking to them for a long time.  We want to develop a script that does not contain a lot of “information”, but creates interest in wanting to meet with us to learn more.  Selling the meeting and not the product during the initial face to face interaction! Thanks again for a great home improvement webinar.  We look forward to more great advice from you and your associates!”

“We will improve our appointment follow up process to include an email with hyperlinks to tell customers our company story and provide additional product information.”

Thank you for providing our company with some much needed advice. We look forward to meeting you at the Home Improvement Profitability Tour in Atlanta. The one idea that I took away from the webinar that I will use today is sending a confirmation email to all set appointments. As soon as David Alan Yoho said it the light bulb came on – THANKS!”

“Love the Revenue Recovery Program. We are just remodeling our office, with a new conference and technology area for customers. We will implement!”

“Sixty percent of prospects will not buy now, but rather hold off and buy within one year.  Follow-up is KEY!”

Our next complimentary webinar is scheduled for March 13th and will be devoted to overcoming objections while in the home. You won’t want to miss it – - we plan on doing the $100 giveaway again!

A major consideration in evaluating the worth of a home improvement lead is its lifespan.  To understand this phenomenon, let’s examine what created the lead in the first place.  While leads for many products and services come from prospects that recognize need and urgency, a high percentage also come from those who spontaneously respond to something they’ve seen or heard.  Therefore, most of those prospects acted on impulse.

Keep two things in mind.  First, lead costs continue to escalate, therefore it is important to develop leads at a lower cost and use them more effectively.  Secondly, you may consciously or unconsciously be killing leads which might otherwise become productive.  As the comic strip character Pogo states to his friends in the swamp: “We have found the enemy and it is us.”

Prior to giving some actual data on this lifespan, I want to be clear on defining the differences between two words that are often viewed as synonyms – - prospects and leads.

A prospect is someone who can use your product or service. If you have found a way to get someone to respond to your marketing devices thereby acknowledging their need, you have a prospect which you can identify for lead purposes. If they do not respond to your marketing devices or that of others they are nonetheless a prospect and will remain so until someone gets them to acknowledge their need and sells them.  You will notice the word want does not appear in this explanation.  There is more than a grammatical difference.  Someone may want to see your product or “get a price”, yet so far nothing has prompted them to respond.  Essentially, they have not been able to determine their need.

What is a lead?  The definition is often as simple as a prospect calling for an estimate, sending in a reply card, or approaching your booth at a show and asking someone to visit their home.  At other times, the lead is deeply hidden in a customer’s response for information, with phrases such as “Give me an idea of how they work” or “Send me some information or a brochure”.  To make this more complex, the prospect may make statements such as “We’re not going to buy now” or “Under no circumstances are we ready to do business”.  These leads become complicated because of the way in which we as humans interpret that language and then qualify in our own mind the value of the lead.

When salespeople raise the issue of good vs. bad leads, or marketers refer to qualified vs. unqualified, they are usually defining this by their value system.  The truth is that the difference between a good and a bad lead is usually the way it is handled by both lead intake and the salesperson.

I do not deny that some leads are easier to work than others; yet a good prospect inefficiently handled may turn up in the salesperson’s category as a weak or poor lead.  Which brings me to the issue of nebulous leads.  Successful marketers create this kind of lead by exhorting prospects to “use this sample”, “visit our website for…”, or “read this free information about…” The word nebulous by definition means “indefinite”.  This is a prospect who may need what you have to sell, but hasn’t yet identified a want. This type of “lead getting” brings the less committed prospect to the table.  While this prospect may not have identified your product as a need, this also means that you probably won’t have a lot of competition when you make your presentation.

Individuals responding to this technique are prospects for the product which lies behind the solicitation.  The lead, once received, requires finessing beyond that of the prospect who says “Give us a price” or “Give us an estimate”.  Nonetheless, this prospect is identifying themselves as a potential customer, because they are someone who needs or can use the products you sell.

Converting this nebulous lead to an appointment requires a scripted appointment setter and some adjustments in your sales methods.  In today’s economy, nebulous leads represent a great potential.  They can be the key to lowering your unnecessarily high lead costs.

We will now tackle many of the questions that we received on shows and events in our latest home improvement webinar on leads. If you haven’t already read done so, please read the previous posting where we also address many of these questions.

1.  What role do scripts play (pros & cons)?

Almost anyone can sell more when they don’t have to think about what to say next. Scripts enable people to be present –“to” and focus “on” the customer’s interests and welfare. Scripts work best when they utilize a methodology in outline form. Essentially, this means a sequence of steps based on the customer’s decision making process. The scripts or “what to say” element is utilized at a more effective level when the user of the script understands the reason for the technique. Understanding that process and integrating it faithfully enables the sales professional to “own” the material and better teach it to others.

2.  Why do most scripts for lead intake and “appointment setting” fail?

Some reasons for failure include:

• They aren’t written based on the customer’s mindset
• They utilize weak language
• No-one has conducted a valid test on the script’s efficiency
• You hired the wrong people to perform the tasks
• There is too much blather (war stories and anecdotes)
• The personnel has received little or poor training.

Rarely is it just one thing, and sometimes it may be all of the above.

3.  If a company develops 75 leads at a home show and has 6 salespeople how do they handle the abundance?  How far out should they set the leads?

I’m not taking your concerns lightly, however this is a great problem to have.

By far, the worst outcome is when you’ve scheduled many appointments, yet you lose business to other companies who get there sooner than you do. Setting leads “far out” means that many will have to be rescheduled or will die because interest wanes along with whatever emotion caused them to schedule with your company in the first place.

A frequent decision is to qualify most of these leads “tighter” than usual. While this works, it most frequently has several negative results – those leads which don’t qualify become lost opportunities which those in your company would have been glad to have when there were fewer leads.  In addition, the salesperson receiving the lead which is/was “more qualified” will want to accept this as the norm and won’t want to return to those leads perceived as “less qualified”.  In short, every time you relax standards, it’s difficult to return everyone to them.

Wise managers utilize abundant leads (as in your question) as an opportunity to set weekend appointments and also to search for opportunities for daytime appointments where the sales manager and owner can “dig in” and agree to cover 6 or 7 leads each.

In short, you invested in lead development, you have an abundance of leads and the entire sales department has to be conditioned to make more presentations while this abundance exists.  Caution: if your salespeople are used to receiving 6 or 7 leads per week and you suddenly give them 14, they will not make more sales, they will become more selective as to who they want to make a presentation to (also called over-qualifying).

Our next home improvement webinar will be in early March, and we will send a notice out when the date has been set. I look forward to our future interactions.

Our latest home improvement webinar on leads brought together over 900 companies to help turn leads into sales in the year 2012.

As is the case with most of our programs, we have an abundance of questions that were not able to be addressed on the webinar. We will also answer many of these in our monthly e-newsletter (you can sign up today on our website).

Questions on Shows, Events, and Showrooms:

1.  How do I keep my full-time people busy? There aren’t enough events.

Full time people can also work mall displays — radiate around recent installations – work on Quality Control programs that provide referrals (business now and later). There’s lots of prep, legwork and maintenance work for them too, especially as your department grows.

2.  In your seminars I’ve heard you say “no chairs” in the work area. Our people get tired and they sneak them in – - what should I do?

You have to check on them yourself frequently, or through a small group of mystery shoppers.  Hire part time men or women who can complete an 8-10 point survey after visiting your booth/display – also let your promoters know that they are being shopped – (it’s like putting a radar sign on the highway – most cars will slow down even if no actual radar is present).  I know this rule may be difficult to enforce, but it is a key ingredient to make your presence at a show more profitable.

3.  How do you avoid giving a price when they walk over to our window sample and ask “How much is this one”?

Usually the prospect does that when they’ve already asked for a “ballpark figure” and were given an explanation about why the price would be delivered in person after evaluating their project.

You could paraphrase the original “depends” response as follows:

“The price of (your product) would depend on the options you chose along with the quantity, sizes and colors – of course – once our representative sees the condition of your (current product), he’ll know what we need to do to order the proper (your product) and install it properly, meeting the conditions existing in your home.  In addition, he’ll be able to deliver a price in writing and as I have mentioned- that price will be good for one full year – may I make a suggestion? (Take control – get to the next step—search for the best time and circumstances to visit – set appointment.)

Questions on Canvassing:

1.  How do I find good canvassers?

A: Recruit and hire regularly using 5-10 sources with a well planned sequence enabling you to identify fearless optimists or manageable mavericks whose current lifestyle is congruent with earning fairly good money in only a few hours daily.  It is the kind of job that will appeal to many different circumstances.

Many of our clients hire college students as canvassers and those individuals who need a second income.  They also hire retired or semi-retired people – in short “people with available time”.  But don’t forget, we suggest the use of a behavioral profile to determine whether the canvasser being hired has a behavior adapt able to this sales support role.  Many of our clients hire canvassers who then become highly successful in that role and they find it good basic training for an actual sales position.

2.  Can I pay canvassers on straight commission?

Yes, but statistically – employee retention is better when paying a base salary PLUS incentives. There are very few stable individuals who can use their own car, work alone despite the weather then deal with the face-to-face “turn down” rate, which is common in this role, even when they are paid a high commission rate. Reminder: strong management (supervision) is the key.

3.  Vans are expensive. It’s a lot less money to send them out in their own cars. Why can’t I do that?

A: They don’t show up or they arrive late or get lost, leave early and give up easier. Sometimes they have friends accompany them. That could jeopardize your plan, create insurance risks for your company and other problematic exposures.

Check out reliable used vans.  They are less expensive than you think.

We will address more of your questions in the next blog posting, and we invite you to give the home improvement webinar another listen. The material that was covered takes constant reinforcement.

We will now continue answering questions from our latest home improvement webinar. If you haven’t done so already, make sure to read our last blog posting where we address more of the questions that were asked during the program.

Q: You mentioned “lead control”.  How does that relate to giving salespeople the freedom to handle the lead in the best way because they are experienced to do so?

A: A reminder – if a lead is any inquiry coming into your business, it then has to be structured into an “appointment” (which usually requires scripting).  A properly scripted “lead to appointment” has created information beneficial to the salesperson and anticipation on the part of the prospect.

Now let’s assume the lead is issued to the salesperson.  Most efficient sales organizations have policies where salespeople are required to turn in their leads immediately after the presentation. Unsold leads were rehashed along with “no-sits”, often producing an increase of 12-14% of the volume extracted from the same leads.

Incidentally, in well managed sales organizations, once the lead is given to the salesperson as an appointment, the salesperson is not permitted to call and requalify the lead. If that process is elected, you will immediately determine a lower sit (presentation) rate.  Some leads are easier to work than others, yet a good prospect, inefficiently handled is often categorized by the salesperson as a weak or poor lead. That constitutes a break down in the marketing to sales program and will usually lead to higher marketing costs.  Leads retain dominant value for about 48 hours. While they are not dead after that, they lose the strength of the impulse which created the contact.  When you receive a lead, act on it ASAP.  Confirm that you are interested in it and don’t set conditions about whether it is worthy of a sales call.  The chances are that you and your salespeople may need training on how to handle leads of this nature.  Most of our clients confirm leads (irrespective of the source) within minutes.  They have computers set to verify their interest in the prospect immediately.  Any delay diminishes the prospect’s value in your eyes and it diminishes your value in theirs.

Q: How do the most successful companies handle lead intake and lead distribution to their salespeople?

A: Many confirm their leads within 5 minutes of their receipt (via email).  Lead intake, confirmation and rehash personnel are rescripted and highly supervised.  Salespeople are required to return a confirming sheet from all prospect contacts, enabling telephone follow-up in conformity with the “Do Not Call” laws.  Sales managers frequent “ride-alongs” to observe and enforce methodology.  In a recent survey, we were able to measure the success of the companies who had diversified lead development and strong controls in place.  In most cases these controls produced an increase in sales.  Many saw their 2009 sales exceeding those of 2008.  Many also require a quota of self-generated leads by their salespeople to achieve monthly bonuses.

Q: We were inundated with questions regarding less qualified leads.  Some requesting “information only”, others coming from 3^rd party sources which had incurred delay on reception.  While these leads require laborious techniques, they often bear fruit.

A: We call these “nebulous leads”.  Nebulous meaning not clearly defined.  These leads are frequently developed through “3^rd party” sources who run elaborate promotions or lead development campaigns.  When companies receive these leads and try to bring them to a point where a product and a price proposal can be presented, they experience a great level of frustration largely because their organization at all levels (1) call intake, (2) lead setting, (3) lead issuance is not on the same page and what follows is chaotic lead “mismanagement”.

Here is some thought on how to identify this kind of lead which was acquired by the means explained above.  Individuals that we classify as “nebulous” are usually prospects who haven’t committed themselves – yet would be open to listen and look.  The lead, once received, requires finessing beyond that of the prospect who says “give us a price” or “an estimate”.  Nonetheless, this prospect is identifying themselves as a potential customer.

Add them to your database and continue to follow up with them on a semi-regular basis. However, here is the caution, follow up too often and you may risk them opting out of your marketing, but if you don’t follow up enough they may forget about you entirely. As such, you need to continually strive to achieve the perfect mix.

Q: We hear the word “prospect” “lead” and “inquiry” used interchangeably at many seminars.  Are these all the same?

A: No, and here’s why.  A prospect is someone who can use your product or service. If you have found a way to get someone to respond to your marketing devices thereby acknowledging their need, you have a prospect which you can identify for lead purposes. If they do not respond to your marketing devices or that of others they are nonetheless a prospect and will remain so until someone gets them to acknowledge their need and sells them.

Q: Doesn’t this kind of lead represent a real challenge for salespeople who have never had to use them before?

A: A prospect requesting an estimate, responding to direct mail or registering at your booth at a show may openly declare “need.”  However, often the need may be deeply hidden in a prospect’s response for information, such as “send me some information”.  To add complexity, the prospect may say “we’re not going to buy now.”  This is complicated by the perception that the prospect hasn’t stated their need and the lead gets labeled as weak or poor.

The more sophisticated companies don’t try to force the “information only” lead upon the salesperson who had no respect for this kind of lead or doesn’t understand it.  It still requires marketing skills to turn that into an issued appointment.  One of our clients in a Midwestern city makes the following comment regarding this kind of lead after he developed a marketing technique with a series of “follow ups” which ultimately produced an issued lead (appointment).

“Most companies – don’t – or – won’t follow-up on an “information only” lead – we do.  Over a period of 6 years we sold $1,900,000 business with leads such as these.”

Q: What techniques work the best with unsold or unissued leads?

A: In our experience, a system that uses scripting, which in turn encourages a prospect who, in the past, hasn’t seen the demonstration, to view it now. This process is called rehash.

Take an example of a prospect who received a presentation that wasn’t sold, but later agrees to have someone come to their home and review the original presentation and price proposal (in well-run companies this also includes sales which were cancelled or were credit rejected).  Rehash requires a “refined” technique that starts with a scripted phone call that contains no risk or threat to the prospect – in fact, implies a “benefit”. This task is never allocated to the original salesperson.  It is, for the most part, a call center issue made by a marketer, not a salesperson.  The rehash lead is seldom, if ever, issued to the original salesperson (for obvious reasons). He/she didn’t’ sell it the first time and the no-sale or cancellation may have been created by a malfunction in the presentation.

All leads which do not turn into issued appointments or remain unsold, or those cancelled or credit rejected should be accumulated into a database.  We call the use of this database to manufacture sales asset recovery. The company has an investment in these leads and any sale made from the database has very few costs related to “reissuance”.  Most successful companies acquire 20% or more of their revenue annually from their database and their customer solicited referrals.

If we did not get to your question, please email us directly at admin@daveyoho.com and someone will get back to you shortly – - and don’t forget, part two of this home improvement webinar series will be held on Decmeber 13th.

Last week’s home improvement webinar on lead generation was a rousing success. There were over 950 companies on the program and we received numerous questions. As is frequently the case, we did not have enough time to answer them all on the webinar so we took the opportunity to respond on our blog (the first series of questions and answers are covered in our latest e-newsletter – to receive a copy e-mail admin@daveyoho.com).

Here is a sampling of the questions we received:

Q: You give the impression that many home improvement companies have tried canvassing, yet few have been successful at making it work “long term” within a practical budget.

A: As we pointed out in the webinar, it is not uncommon for companies with a canvassing program to issue as little as 30% of their canvass leads as appointments. In addition to that, they may only gain entry into 40-50% of these homes for a presentation.  They experience a closing ratio lower than they do for other leads (some of this is attributed to the salesperson’s dislike of that lead). Then top this off with marketing costs that sometimes exceed 20% (some even much higher).  Not a practical way to do business.

Q: Has your company made a study of effective canvassing programs?

A: You bet, and here are some of the basics:

Unless companies subscribe to a plan that includes territory and time selections (by management) for canvassing in middle income neighborhoods, they’re off to a poor start.

It is human nature to try to find the path of least resistance. Better neighborhoods with higher income families frequently represent better education and more well-informed prospects and in turn represent more complications in developing a lead.

But there’s more to it than that.  Actually, there are about 51 components for an effective program. The script language is extremely important.  Intelligent people with money to buy the products you offer have to receive information which they see as beneficial.  Many canvassing groups use a mini-presentation book at the door.  One company we studied has canvassers earning $40-60,000 annually with a fully loaded marketing budget of approximately 9.6%.

Q: What kind of results can be effective with a well-managed canvassing program?

A: The better managed companies have a 50-60% issue rate, a 60-80% sit rate and marketing costs below 15% (fully loaded).

Here is an actual case study of a very efficient program:  Canvassers working (average) 4 to 5 hours daily produce ½ lead per hour set with the homeowners by the canvasser (via cell phone) with their office. This translates into a 60% (minimum) presentation (sit) rate and a minimum of 1 presentation (sit) produced in less than 8 hours of the canvasser’s effort.

One of the keys in this last case study is the “canvass manager” who makes everyone (including himself) adhere to the “model” of the program.

Is it easy? No. Is it successful? Yes. Is it cost prohibitive? This particular company operates with overall marketing costs at 13% and their canvass program (fully loaded) is slightly over 12%.

Q: We are considering hiring a company to do our canvassing.  What are some of the cautions?

A: We received the same question from 12 companies who participated in the home improvement webinar.  If you tried canvassing on your own and couldn’t make it work, or it was too costly, you may succumb to someone who encourages you to let them do the canvassing and provide you with the leads.  There are several smaller companies who provide this service – however – be cautious of “canvassing companies” who want to sell you leads. Several larger companies who provide this service do not appear to have “long term” success stories.

Q: Our salespeople don’t like the canvass leads, so we haven’t been successful with closing many.  Apparently our canvass program “stinks”.

A: Your question probably contains the answer.  You hired salespeople, promised them bona fide leads and they expect to get them. However, if you are allowing your salespeople to determine the source of leads you will never get a canvassing program to work, and since this is but one form of face-to-face lead solicitation (which also includes “shows” and “events” and “SFI programs”) the failure is not in the lead, but in the method of adapting a salesperson on how a face-to-face lead has to be handled to obtain results. Unfortunately this is a management failure.

Management frequently “succumbs” to the complaint of the salespeople that these are “weak leads”.  When the sales department convinces management this is the case, the marketing department is told to get a stronger lead. Ergo: the number of leads decrease and management is unhappy because they don’t have enough leads for the salespeople.  Weak canvassing methods include “looking for”.  Successful canvassing programs treat the canvassing department as part of the sales methodology. At the risk of being repetitious, modern techniques require that the canvasser be hired with a behavioral profile indicating sales “traits” and the ability to follow special scripting devices which often includes a mini presentation book. The appointments were set via cell phone from the canvasser and the prospect to the call center.

Again, at the risk of being repetitious, The successful companies measure not only the number of leads which are produced by hourly effort, they measure the hours it takes to produce a sales presentation from the leads acquired with a marketing budget of 12% to 15%.  In short, the entire process is treated as a science – not – an art form.

Q: We received numerous questions on “diversified lead sources”.

A: Today’s marketing techniques, whether for a small company trying to stay alive or a large company attempting to expand, have to include diversification. Smaller companies may have 10 or 12 sources for lead development; larger companies 30 to 50 sources.  Companies who choose not to diversify their home improvement marketing typically tell us:

• The majority of their leads are referred to them through a satisfied customer.
• We are a recognized name in our territory, so we don’t do much advertising.
• We invested heavily in print ads – yellow pages – web design – or similar and couldn’t make it profitable.

Here is what you have to remember.  In every market and for every product or service sold in that market, there are a certain number of prospects who develop a “need” for most of the products sold.  The trick is how to identify and find these prospects then sell them without resorting to being the “lowest price” in town.

The next “trick” is to find ways to identify and attract prospects who haven’t yet met the explicit need level, but could be convinced to “take a look”.  That requires a good marketing technique which then has to be balanced with a strong sales technique.

This is not being critical of those who get “referred” as a good contract or source, because referral leads are great; most salespeople love them. The reason they don’t get more of them is usually determined by their lack of “asking for them”. If you can develop enough business without advertising or spending promotional dollars, I applaud you. However, keep in mind that past customers should be solicited for referrals with a plan that meets the requirements of your local state laws.

We will answer more questions on our next blog posting so make sure to subscribe so you can receive updates as they happen!

This is a critical time for the home improvement industry as recent laws are making it more and more complex to do business as many retailers have done in the past.

With that in mind here are eight critical issues that the industry is facing:

The inherent risk in using “share of profit” compensation for salespeople.

Despite it having been “industry practice” for many years, government agencies continue to crack down on retailers and levy exorbitant fines in an attempt to curb these practices.

The co-mingling of 1099 and W-2 employees in your installation department.

Frequently, this will lead to an IRS audit or citation for misclassification.

The use of a “price drop” for a one night close if followed by a rehash using the same product at the same or lower price.

Consumer protection legislation that has been enacted over the past few years leaves this issue open to interpretation and has proven to have disastrous results for many home improvement retailers.

Improper (or lack of) compliance with EPA regulations/requirements concerning lead paint.

If you perform work on houses built in 1978 or prior are you providing correct documentation (whether the job is sold or not)?

Providing the proper notice of rescission as required by federal and frequently state law.

There is a required format and number of copies of the notice of rescission required for each sale made at other than the seller’s place of business.  Many retailers leave an incorrect number and are in violation.

Operating with a retail contract that doesn’t provide sufficient protection.

Collection practices may be difficult. Clear definition regarding limits of liability should include arbitration in the event of disagreements.

Failing to protect your intellectual property and proprietary information.

Your logo, brand, motto, customer/employee list and presentation material can be at risk without proper protection.

The use of a “non-compete” provision for salespeople.

May be a mistake if you don’t have one  – - and in some states a worse mistake if you do.

To hear us expound upon these issues, make sure to join us in Chicago at the 2-Day Home Improvement Profitability Summit where you will hear expert analysis from our legal counsel D.S. Berenson while also being exposed to the top trainers in the home improvement industry.

Last week’s home improvement webinar entitled “Open Your Mind to Close More Sales” generated an excellent response from our customers as well as industry leaders.

Once again we would like to thank all of the attendees as well as all of our sponsors of the program.

The 90 minute webinar was filled with tons of Q&A; yet despite that we were not able to answer all of the questions that were posed.

As has been our habit in the past, we are now posting a sampling of questions that were asked prior to and during the webinar.

Q: In today’s market, people seem to be more price conscious and our area is loaded with “price cutters”.  How do we justify our price for a quality product?

A: You can’t justify your price — stop trying.  With the right presentation, you establish “value”.  You have to demonstrate and have your customer agree that the product you sell is high quality, long-lasting, installed by experts and meets their needs better than other products in your market.  In our series “The Science of Successful In-Home Selling” we explain a method entitled The Total Offer Concept™ which goes into great detail on this topic.

Q: We are often met at the door (sometimes over the phone) with the statement — “We just want a price, not a long visit.”

A: Respond quickly by saying — “No problem.  Let’s take a look at your project and determine your needs.” During the review of the project, ask questions, write down the responses and sell yourself.  Present yourself as a professional.  It is your job to uncover needs.  Then present your product to meet those needs.  Explain the options, the various protections they need, such as a written proposal, a reliable guarantee, a product installed by specialists.  Most prospects will listen if you are talking about them — their needs — their problems — and how you can help solve them and why this home improvement project isn’t an expense — it is an investment.  You will extend your time with those prospects.

Q: Can I use a one-call close without high pressure?

A: It all depends on what you consider high pressure.  Explaining in detail what your product and service represents — isn’t — establishing the value of the product/service you are providing — isn’t —and — asking for the order, if done properly — isn’t.  Our closing system is utilized by the most successful companies in your business. I recommend that you listen to the free recording “The 7 Myths of In-Home Selling” — where this question is answered in detail.

Q: What is a decent closing rate?

A: Some companies still measure their close rate against presentations, which fails to account for the number of leads issued and this is a mistake.  So we measure closing efficiency against leads issued.  Yes, there will be some no-shows or some 1-leggers that you do not wish to present to, but if these are not exorbitant in number, it’s all part of the process.  So if you’re still measuring by the old fashioned rate – closes vs. presentations – 1 out of 3 or 4 is decent provided there is a 70% sit rate on leads issued.  Small ticket items ($4,000 or less) should close at 50-70% with a 70% sit rate.  Caution – don’t be too quick to blame the low sit rate on your marketing department.  Frequently it is the inept processing when the salesperson is at the door of the prospect.

Q: So what’s the difference if you’re measuring against leads issued?

A: First of all, our latest industry survey shows that the average cost of a lead issued is $285.  If a salesperson receives 7 leads per week, that equals $1995 – close to $8,000 a month and that’s $96,000 a year.   You will want to measure the efficiency rate of anything in which you have invested $100,000, I’m sure. Depending on the lead source, conventional leads (radio, television, print, direct mail) should look for a 70% “sit rate”.  That’s a presentation being made to all interested parties where you have sufficient time to do a needs assessment (walk around), company and product presentation, present the price and attempt to close.  If you sell 1 out of 3 of these presentations, that’s a 23% close rate against “sits” and roughly 33% against leads issued.  These would be effective goals.

Q: How do statistics differ with canvass leads?

A: A whole different ball game.  Our surveys indicate that canvass leads as well as those produced from other face-to-face sources, such as shows, malls and even S.F.I., don’t do nearly as well (greatly due to the attitude pervasive in salespeople who don’t like canvass leads ) – partially due to mismanagement by marketing (poor scripts and poor lead issuance management).

Our surveys indicate that 90% of all canvass programs are failures (too costly – poor sales vs. leads issued).  The person-to-person leads, when processed, have reached a 40% issue rate or less.  Remember, if you took in 100 leads that means you issued 40.  Then the sit rate as defined in the previous question is usually 50% against leads issued.  That means you’re now down to 20 leads from the 100 acquired.  The gross close rate averages 3 to 4 sales.  When you eliminate credit rejects and rescissions, you’re down to about 2 sales.  So fully loaded costs are usually more than 20% of the total revenue produced.

However, don’t sell the concept short.  Canvassing works if it’s structured properly, then managed properly including personnel selection and rigid script enforcement from the lead intake by the canvasser through the appointment setter or confirmer – - and, of course, add the “attitude factor” of the salesperson.

Q: What are your suggestions in terms of scripting for canvassers?

A: 2 factors need to be considered – -

1. You’ve got to have the right script
2. You have to rigidly enforce its use.

A well-scripted canvasser is not a canvasser. Modern canvassing requires the selection of the proper personnel.  Those selected should be profiled and have a behavior which is adaptable to a selling function.  The good canvasser is an extension of your sales department and will frequently grow into becoming a closer.

In addition, all scripting is subject to the discipline of the canvasser and management.  Scripts are what they imply, i.e. what to say and how to respond to questions.  With some success the canvasser starts to embellish these with war stories, personal philosophies and small talk that reduce effectiveness.  Successful canvassing programs have somewhere in excess of 50 components if done correctly.

Q: What are the statistics on rescission?

A: Here’s a rule of thumb – - if you’re getting no rescission at all, you’re probably selling “call back” business or you’re not attempting to close at all. On the other hand, if you’re getting too much rescission be aware that “rescission is a malfunction of the selling process” – so you’re doing something wrong.

Here are some statistics, if the size of your contract is $4-5,000 or less, your rescission should not exceed 5%.  If your average contract is $8-12,000, rescission should not exceed 10%.  If your contract exceeds $25-30,000, your rescission rate might be between 20-30%.  Remember, I said that rescission is a malfunction in the selling process.  In a well structured organization, 25-30% of the rescissions can be recovered and are then reinstated as valid contracts.

Should you have any follow up questions regarding this blog posting, or if your question was not addressed please comment or e-mail us at admin@daveyoho.com.