This week we talked with Spencer Powell of Builder Funnel about his family background in construction, how he got started on the marketing side of the business, and ultimately about leveraging the power of the internet to reliably bring in leads for business.
Full Podcast Transcript
Grace Mase 00:04
Hello, and welcome to Revivify Podcast. I'm your host, Grace Mase. We're speaking with Spencer Powell. He is the CEO of Builder Funnel. I'm super excited to speak with Spencer today about his experience in helping his builders and remodeler clients grow their business, how he helped his client to set up marketing and sales automation systems to improve their marketing and sales efforts. Welcome, Spencer.
Thanks, Grace. Glad to be here.
Grace Mase 00:37
Well, I have been following your career. It is definitely very impressive how you grow the business, if you mind sharing with us how you got started.
Yeah, thank you. I appreciate that. We've been in business for about 10 years now, and we got started when, really, during the Great Recession. So my dad had a direct mail company, and he was working to transition that business, he went to a conference, there was a direct mail conference, and they said, “Hey, direct mail is going to go off a cliff, and so you need to transform your business.” And at the time, I set up a social media company and was helping some clients use Facebook for business and Twitter and doing some blogging. It was kind of the early stages of, of the game, their Instagram and Houzz didn't exist at that time. And so I was talking with my dad, and he said, Hey, I'm working to transform the business, do you want to just come figure out this whole digital thing over with me instead of doing your own thing? So that was kind of how we got started, and we started working on our own website, we felt like, hey, as marketers, we should be practicing what we preach and eating our own dog food. So we tried to be our own best case study, and then we also have family in the construction space out in the Seattle area. So they've been in the homebuilding remodeling business for about 110 years, and so they did a lot of spec building, they built some communities, they got into remodeling, they got into handyman property management, kind of the whole gambit. And so we helped them grow their remodeling division from about two and a half to 5 or 6 million over a couple of years, and over the next couple years, they made it up to about 8 or 10 million in sales. And we said, Hey, I think we can help some more remodeling companies do the same thing, you know, use the power of the web. And so ever since then, we've just been on this journey to work with more construction companies, mainly remodeling companies, we do work with a lot of builders too. But really, I guess try to shift away from this total reliance on referrals. Referrals are great, they're always the best leads, but they're unpredictable, and you can't scale really efficiently or predictably off of referrals. So yeah, that's a little bit of our background.
Grace Mase 02:45
Well, that's pretty impressive, and I know for just overall as an industry, the residential construction, it fluctuates fairly significantly over the years, back in 2008, there was a hit, and now we're experiencing a bit of a situation, a little bit. Marketing and sales definitely is far more critical to be able to have for companies to beef up their efforts and prepare for this, and you sound like you've been through from watching this trend. If it's before houzz, those guys come up, you definitely see the trends, and how do you help companies, I know of as even just residential construction, most people love the crafts, and not really big on marketing or sales, because that's not what we're trained in the program. And you've been working in industry, you always focus on the craft, and that's what most of us are passionate about. So how do you help your clients ease into that journey and help them begin to think like a marketer and really think about strategically defining their strategy?
Yeah, it's a great question. And you're right, you're spot on, we see that all the time. You know, you get into the business because you love the trade and the craft, and then as you start to perform really well, you get some referrals, and so you build your business, and then you start hiring. Then all of a sudden, you're in this management seat or CEO role, and you're having to think about systems and managing people and you know, finances, and things start to get more complicated more quickly. And so the part that we try to come in and help is that marketing piece, and bridging over into the sales piece, too. But it really is this mind shift of, I've just been doing the work and people recommend the work, and if when you're a one man show, it's pretty easy to sustain your business because you just need a few referrals here and there. But when you've got three employees, five employees, 10, 20, or 30 employees, and you need to keep this machine running, you need marketing because if you don't, say you're at 3 million last year, this year, you could instantly go to 1.5 million if you just don't sell the work.
You have to keep reselling 3 million, 3 million every year and so, the way you do that is through a marketing program where you can lean on that and you go, Okay, I know I'm getting 25 leads a month. And out of those leads, I book, you know, 10 appointments, and out of those appointments, I close three or four jobs. So that's how you build that predictability into your business, and what I find is, lead flow gives you confidence, it gives you confidence to raise prices, and it gives you confidence to make that next hire, because you're not worried about taking on that extra overhead, or that extra investment, because you know you have more leads coming in the following month. So I think that's where we really help is in building that system. But then that system gives you the confidence to move ahead and take that leap to the next level in your business.
Grace Mase 05:38
That's great, and what are those, I'm sure you probably, we meet with many of these builders, and that whole concept of the internet, the web is such a foreign concept. I'm sure they also recognize the need to do so, how do you bridge that gap when you engage with them? How do you overcome their fear?
Yeah, it's a good question. You know, it's interesting, when we went back to the early days, like the first few years of us starting up the business, we were just having to convince people like, the internet is important. You know, you need a website. And it was a real push, and you get a lot of pushback on, I don't think, you know, people really search that way. Or, you know, for these big purchases, people always ask their friends or their colleagues. And so we had a lot of pushback, I would say we've started to tip the scales, like, as we just have moved forward in time, people understand that that's the way people shop and buy today is they go to Google. And even if they trust their friend, they're still going to go to Google, and they're going to do their own research. And I think that's the big thing is that people love to do their own research. And so the type of marketing that we do, blends into that really nicely. It's, hey, if somebody is going to do a kitchen remodel, they're going to look for kitchen design ideas, how long is this going to take? Can I live in the home while it's happening? What does it cost? They have all these questions. So we try to help our clients write that content, whether it's blog posts, pages on the website, videos, but it's content that addresses those questions. So as their prospects type those questions into Google, now they land on your website, they're getting that information, you start to build trust, you start to build credibility. So when we're talking to folks about this process, I think it's just more like opening their eyes to thinking about, hey, how do you shop and buy for things, whether it's a TV, a car, or remodel, and most people say, “Well, I go to Google, and I start doing my own research.” It's like, well, that's how everybody does theirs, you know, they do their own research. And so most people think about leads as Oh, I got a lead, and we got on the phone we talked about it either was a good fit, or it wasn't a good fit. A lead really starts a lot before that, and it starts when they're doing that research, when they find you and they talk to you. Now it's a sales opportunity, and maybe a bad or a good opportunity if they're qualified or not. But you forget about all the stuff that happens before that point where they're browsing your website, your competitors websites, Instagram, Houzz, Facebook, they're all over the board, we need to capture them, then. And that's how we get started.
Grace Mase 08:11
That's brilliant. And well, just a little background, I used to work for Overture, that's back in the early 2000s. And so I know that the whole conversation to try to convince small business owners as this is the direction where everyone, how people are behaving, why you need to consider bidding on keywords. In addition to make sure you have solid content on your website, make sure the SEO is robust enough, and now there's a lot more complexity with social media, there's so many social platforms, which one should they consider and how to make sure they are best positioned to engage with the clients or prospects effectively. So given that and understanding all the components of it, how do you help them to think about integrating social as their presenting who they are in this digital world?
Yeah, the way we look at it, we try to take a pretty holistic approach because like you said, there's so many different channels, different platforms, you know, it can get fairly overwhelming. So we break it down into a methodology. Maybe some people have heard this called the inbound marketing methodology. But basically, that breaks it down into where we’re trying to drive traffic to the website, then we're trying to convert leads, then we're going to nurture those leads until they become a sale. And then we're also going to analyze across all of those phases. So when I think about social or SEO, or any of those things, I go, where is this in that framework? So typically, you have your traffic drivers, so that's going to be things like blogging, SEO, social media, and then your paid channels. So Google, Facebook, Instagram ads, those types of things, those things can bring people to the site. Then when they get to the site, you're kind of looking at, okay, where are they in their research process? They're either ready to talk now, or they're not and so if they're ready to talk now, phone number, contact us like everyone knows how to take that step. But it's the people that aren't ready now, which is the majority of the people on your website, and that is where we need to capture them. And so that's going to be things like offering maybe a kitchen design guide, or a kitchen trends guide for 2020 or something like that, where they can fill out a form, download some extra information, and now they're in your funnel. So we look at that as the conversion step, now we've captured a lead, and now we're going to move them into a nurturing sequence. And that's where we're going to send them emails, we're going to stay in touch with them, we're going to send them helpful blog content projects you've done, things about your company. They're probably going to go check you out on social media to verify you. Social media can be a great way to nurture if they're following you over there. And then ultimately, they're going to book a meeting and enter your sales process. So whenever I think about something like social media, I go, where does this play, you know, in this framework, and how important is it and from our data and what we've seen, social media isn't a huge lead driver. However, it's a good lead nurturing tool. And so people are going to do a Google search. They're trying to find something, they have a question, they need a solution. And so they start with Google, Google typically is going to generate the lead, they'll do a Google search, land on your website, convert, but they might bounce over to social media and go, I'm going to check these guys out on Instagram or on Facebook and see what else I can find about them. And so then that becomes a good nurturing tool, a good verification tool. And so for us, we've started to invest heavily more in the content, and SEO, like those types of things. Social media is important, but if we're balancing a budget, we're saying we're probably going to be heavier towards Google SEO and trying to rank.
Grace Mase 11:48
That makes sense. Now, that's really great advice, and now giving all that, I mean, the logic of funneling makes complete sense. And it's brilliant how you guys break things now, but now as we're going through the COVID pandemic space, and we heard this from many remodelers that things are not as consistent even though they're doing everything they've done before. What are things that you see as remodelers and builders need to begin doing to pivot slightly differently than what they've been doing in the past?
Yeah, it's a really good question. And to be honest, when we first hit the beginning of COVID, we're a marketing agency. So I'm going, Oh, usually, marketing is the first expense to get slashed, right? Like every business like, Oh, my gosh, terrible times, what do we cut? Oh, marketing, that's easy. We'll cut that. We didn't lose a single client due to COVID, and I think the reason is, the system that we're talking about is really sustainable. And it really just, it does match the way people shop and buy, so we're not trying to push our way into people's lives. We're just trying to be helpful, and so I think during a time like this, that type of marketing works even better, because you're basically just saying, I'm just trying to be helpful. So we started pivoting our content, but our overall strategy stayed the same. It's to drive traffic, convert leads, nurture leads throughout the entire framework, its value driven content. How can we help? How can we educate? And so what we did is we started writing blog posts about how to set up a creative home office, you know, and things, even if you, you know, aren't going to spend any money. It's just maybe, it's logistics and layouts, like you guys are remodelers, designers, you know how to work within a framework of a home and so start helping people with something that they may not have a good idea about. And suddenly, that content does really well on social media, because people like, Oh, this is perfect timing. I'm trying to figure out how do I set up an office, and I’ve got these two kids running around and all this stuff. And okay, my kitchen is small, how do I maybe reconfigure that or think about, you know, how can I repurpose my basement? Or what can you do in an unfinished basement right now during COVID-19? And so there's tons of content ideas that you can talk about, that are coming from a place of help, you know, and value. And I think if I've been, I've been kind of toying around with this, this phrase lately, but it's like, one, this style of marketing will never never go out of style, but you can do as much of it as you want. And you won't be annoying, because if it's helpful, and it's adding value, people want it, you know, and so it does depend on what the people want. And so you have to kind of understand, hey, what are they interested in, what would they want to read about and what would be helpful to them? But if that's the place you're coming from, that's the framework that I would take going forward. So you're saying, hey, things right now are a little crazy. They're uncertain, you know, what should I be doing? Suddenly, you can insert yourself in all of your prospects' conversations and their lives by adding value, and suddenly now you're building trust, you're building credibility. You're a part of their decision making process, and you might insert yourself into their decision making. Maybe they're thinking about redoing their kitchen, it might be a year before they do it, but if you're just kind of there always helping, always educating, by the time they get ready to talk to somebody, who else are they gonna reach out to?
Grace Mase 15:09
Right? No, that's awesome. I mean, that reminds me of a quote from Zig Zigler, help enough people to get what they want, you'll get what you want.
Grace Mase 15:19
Yeah, well, that's exactly I recognize that with this. And as you see, the stock market and just overall consumer confidence level fluctuate as we see over this, you know, short duration, three months or so. And there's still plenty of potential delaying the decision to a year later. But adding value to help them to understand how to do planning and just so they can take care of the piece of it, that's very important part of it, oftentimes, the any kind of kitchen remodeling, the one that takes most time is actually planning, deciding what fixtures and finishes and so forth. But if they can take care of that, then that will be great. And they can place all the orders and when they come in, your remodelers come in, they can just do all the work much quicker and have a much more effective time frame.
Spencer Powell 16:06
Yeah. And I think too, you know, as you think about this, this process that we're going through, you know, you are going to see some changes, like using Zoom in the sales process will be different. But at the end of the day, all you're trying to do is again, kind of meet that person where they are, you know, and so if they're at home, they're more comfortable at home, like you're just trying to say, Hey, here's all this great information, or here's some things that you can do to get the process started. Here's how we can start the conversation, you know, you can still get that face to face over the computer. And then eventually, you'll hit a point where you need to start doing in person things. And so, yeah, like you're gonna see these shifts. And I think it's kind of, it's interesting, because coming from more of the like, digital marketing, tech world, but also working with the construction space, people in the construction space, like, oh, Zoom, and GoToMeeting, this is crazy, you know, but for those of us that have been in the tech world, and you know, we've been selling over GoToMeeting and Zoom for like 8 or 10 years now. So it's very normal, and so it's just fascinating to watch that shift, but I think people will adapt pretty quickly to those types of technologies. And it takes a little bit of practice, and it can be a little bit uncomfortable, but you know, you use FaceTime with your family, and so you're used to being in front of the video. It's no different than that.
Grace Mase 17:25
Right? And presumably, I'm kind of interested in getting your perspective, what do you see will happen post COVID? How would businesses run differently? Not so much of the operation perspective, but more operation of the front end, such as marketing? Do you see more adoption to the sales and marketing automation systems?
Yeah, I think we will, and I think it's moments like these where at least we're feeling it in that, it seems like it just kicked the industry forward a little bit. So the industry probably would have adopted a lot of these things over time, but this is just accelerated. Well, we have to figure out, you know, Zoom, and by the very nature of using Zoom, you think about using a booking link, and in automating that process somebody can click it and they book and now it auto sends a Zoom link, and it's already on your calendar, like these are things, again, that we've been using for a long time. But the construction space, I think hasn't typically done that, and so you see, it starts to bleed back into, you know, sales, and then it starts to work itself back into marketing. And you think about, okay, I've got all these people that are researching, but they're not ready to buy now. Well, these could be great customers in about six months or nine months, how do I stay in front of them? Oh, like automation and email and some of these different components, so it kind of works its way back. And so, I think we'll see a huge adoption of this type of marketing. Again, I think we've been seeing the trend over 10 years, but this just kind of jumped it forward, maybe by a couple of years. That's kind of a fast forward, and I think the industry is set up for a really strong next couple of years. I think for a couple of reasons, one, before COVID, they were forecasting a strong remodeling season for another two or three years, but now with COVID-19, people are going to want to redo their kitchens, finish their basements, they're gonna want to make their space more so where they can stay there and be more comfortable. So if they're traveling less, they're working from home, they're gonna want to add a home office, they might do an addition, like there's gonna be a ton of stuff that people want to do. And if you look at the global landscape, all the jobs and the things that were eliminated, unemployment is really high. Typically the jobs that people had where they can just, oh, now I'm just working from home and they weren't really impacted. Those were the higher salaries, they were your clientele anyway, they were the ones doing remodeling. And so it's very unfortunate that everyone that did lose their jobs and the high unemployment that was in the lower earning sector. Those people weren't doing a lot of remodel, so I think remodeling and this industry is actually set up for a bright next few years.
Grace Mase 20:06
Yeah, I think you touch upon really good plans. I mean, we definitely see more of requests coming through our system of looking for remodelers. Remodeling from, you know, doing additions and home office, home gym, that's the other thing that we're seeing a lot of, which is great. And as you mentioned, people who work from home, they are staring at this wall and say, gosh, you know, I need to do something about this, or I need to expand to the backyard, I need more space, or having a separate ADU unit to convert into my home gym or home office, and whatnot. So those are exciting, but at the same time, as you mentioned, that appointment right, hopefully, we'll see a big shift too, with a labor shortage within construction. So although maybe I'm being optimistic, I do hope that this is beneficial for our industry as a whole.
Yeah, yeah, I think we're all hoping that, but I think if you look at the the big signals and the big, you know, indicators, I think you can, you know, objectively look at it and say there's a good chance that there's more optimism within the remodeling space than pessimism. But obviously, nobody has a crystal ball, you know, we'll see how that shakes out, but I think all of those things kind of point to a positive impact on the remodeling industry.
Grace Mase 21:19
Exactly. So I know you're a big reader. So I'm kind of curious, what book are you reading now?
Oh, man, I actually just started one, it's called The Membership Economy, and it's around, basically subscription type models and subscription type businesses. And it's interesting, because I had this thought, you know, I don't know five or six years ago, I'm going, okay? Remodelers, you're a project based business, right? You have to sell, you get a customer, you need more revenue, you go sell, you get a customer and you keep having to sell. And so if you want to grow from a million to 2 million to 4 million, each year, you need to sell that amount of work and deliver that amount of work that year, and then you have to resell it to maintain. So each year, if you want to hold 4 million, you’ve got to keep selling it, I always thought there was a unique opportunity around home maintenance subscription. You know, as a homeowner you have stuff that happens, you're like, do I call a handyman? Do I call a plumber and electrician? And like, who do I call who's trustworthy? Well, if you're a remodeling company, having a division like that, where maybe you charge somebody, hey, it's 99 bucks a month, and these are all the things that are included. Quarterly, we'll come out, we'll change your furnace filter, we'll go around and touch up some paint, well, you know, you can build your list beforehand. Like if we're already out there, you have certain things that are included, and then certain things that are, you know, time and materials above that, but as the homeowner that just makes it so easy. And so that's kind of the tie in with the industry that I always thought there was a good model in there to build a kind of recurring revenue base, and then you'll still do your project work, you'll still do your remodeling projects, but that can add some predictability and sustainability to your business. You know, if you do see some fluctuation. So, I'm a little bit early in the book, but it's a good one so far.
Grace Mase 23:12
Yeah, subscribing remodel will definitely be interesting, because I know for a law, they definitely have a subscription model for small business owners be rather than working with one attorney, they have this pool of attorneys to get to work with and as a small business, they pay for monthly fees, a SAS agreement, and they just continue on. Yeah, service is ongoing. That's great. And any book that would you recommend for remodelers to read at this time? And why?
Yeah, good question. Gosh, there's so many, but I would say anything by Seth Godin, if you haven't read him, is a marketing genius, I guess. And he's just got a very simple way of explaining complex things. Yeah, there's a few but Purple Cow is a really good one. Yeah, I would say anything by him. And then I think, too, if you're, if you're thinking about that transition that we kind of talked about earlier in the conversation from Craftsman to business owner, and maybe you're deeper into that transition, but I think anything, leadership wise, you know. You start thinking about removing yourself from the operation. So I've got one behind me, actually, John Maxwell Leadershift, that was a good one. And then I think Traction is a good one. That's one that's kind of a business operating system. There's another one that's similar to that called Four Disciplines of Execution, or 4dx, I would put that in a similar bucket to Traction. Basically, it gives you a business framework to set goals and move ahead and get the whole team working in the same direction. So that's the one we use here at Builder Funnel is the Four Disciplines of Execution. It's kind of heavy, but it's a good one.
Grace Mase 24:53
That's awesome. I'm sure there'll be tons of remodelers dying to get in touch with you after this. What's the best way for them to get in touch with you?
Yeah, thanks for asking, the easiest way is builder funnel.com. We've got tons of free resources there, you'll find your way into downloading things, you'll have to fill out some forms and you'll get into our Funnel. I always recommend that as just a way to kind of see what it looks like you know, and what it could look like for you. If you want to talk to us, there's ways to do that, we've got a contact page, easy enough to find but I would say start with the resources section. Start with our podcasts and you can find it all at builderfunnel.com
Grace Mase 25:30
That's awesome. Well, Spencer, thank you so much for taking your time and sharing such brilliant insights and I’m really enjoying listening to and thank you for listening to this episode of Revivify Podcasts where we speak with Spencer Powell, CEO of Builder Funnel. I hope you enjoy his inbound marketing approach and are encouraged with a real change as possible with the construction industry. Thanks again for listening, and we'll see you next time.