Sowing Customer Seeds (Just Add Water)

Expansion takes thoughtful planning, strong relationships

You want your pool service to grow, but any small-business owner knows how it can be to find time to devote to company expansion. Brett Lloyd Abbott is president and chief strategist of MYM Austin, Inc., which specializes in serving the marketing, advertising and business-growth needs of the swimming pool construction and service industry. Growing a pool-service business is his forte, but he recommends that before diving into growth strategies make sure you have a strong story to tell. That way, when a potential customer responds to your efforts, you can offer a clear and compelling reason why you’re a better choice than your competitor. Additionally, before making expansion efforts, Abbott suggests putting all leads current, past and potential on a monthly email list, and consistently sending insightful emails with pool maintenance tips. “This is smart for a couple of reasons,” he says. “It establishes and reinforces that you’re the expert…. It also helps maintain your one-on-one relationship with that homeowner so they don’t forget about you — or think you’ve forgotten about them.”

Calculate the Cost

As you examine the expansion options available, weigh how cost effective each will be for your pool service business. “Before spending any money, you’ll need to calculate the average lifetime value of a new client, and compare that to what it will cost you to gain that new client,” Abbott says.

For example, assume each customer you have brings in a $100 monthly profit, and typically uses your service for three years. Therefore, a new client is worth $3,600 in average profit to your company. “That tells you how much money you can spend to gain new customers before you actually start losing money,” Abbott says.

Pool Service Referral Program

For your first growth strategy, Abbott recommends a referral program for your current customer base. “It works forever, and it costs you nothing to implement,” he says. Provide something valuable, he adds, such as a month of free service for both existing and new customers. Put information about your referral offer on everything: invoices, newsletters, emails, your website, social media, brochures, business cards and mailings. And be sure to mention it in conversation with your current customers.

“We love word of mouth, and a happy customer is worth a lot to us,” says Rick Woemmel, president of Bi-State Pool and Spa in O’Fallon, Mo. “We do many spiffs for our customers when they let their friends know who we are, including sporting tickets, free pool openings and closings, and chemicals.”

Luke Norris, owner of Luke Pool Service in Milton, Ga., mentions that, though it provides one month of free service for referred customers, every customer referred to his business ended up not lasting. In order to avoid a loss in man hours, consider providing the month free only if the new customer signs up for a minimum of three months of services.

Buy a Service Route

“If I were in a hurry to grow my service business, I would talk to a route broker and find out what service routes might be available for purchase in my area,” Abbott says. “The advantage, of course, is that your business growth will be almost instantaneous.”

This approach will cost a sizable chunk of capital up front, however, and Abbott points out that a pool retailer is likely lose at least some of its newly purchased clients through attrition. “That’s not necessarily your fault,” he says. “Some homeowners just don’t like change and will discontinue service.”

Norris once purchased a route through a private sale, paying much less than those sold through a broker service. “We ended up losing two-thirds of the customers due to conflicts on price and other issues,” he says. “I wouldn’t recommend purchasing a service route unless someone worked with a broker who could help protect the buyer.”

Work With Pool Builders
Another low-cost way to expand your service business is to form a working relationship with a local pool builder who doesn’t provide maintenance. But don’t expect this new business to simply fall into your lap, Abbott warns: “You’ll need to take some extra measures to really make this pay off.”

Abbott recommends finding your story: Explain why working with you will be better than working with your competitors. Keep in mind that your selling point is assuring the pool builder you’re trustworthy and won’t harm their reputation.

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You’ll then need to build strong, personal relationships with builders. Cold calling is an option, but you’ll likely have better success by attending local APSP meetings. “That allows you to network face-to-face with builders, and they will appreciate that you are attending their chapter meetings,” Abbott says.

You’ll also want to incentivize the builder to continue to refer your service to his customers. Abbott suggests a 10 percent commission for the first 12 months for each referred customer who goes on to use your service.

Once you establish a working relationship with a builder, maintain it. “It could be as simple as putting the builder on your monthly service newsletter or taking the builder out to lunch once a quarter,” Abbott says. “Mailing a monthly commission check won’t hurt either…. Proactively nurture your relationship with the builder so the referrals never stop.”

Woemmel’s company both builds and services pools and knows the maintenance side is invaluable. “We count on return business when a person purchases a pool,” he says. “We want them as a customer for life.” The same benefit could potentially come from working with a builder that doesn’t provide maintenance services.

Direct-Mail Marketing

Filtered mailing lists that include only homes with a swimming pool are available for purchase. You can send the mailings yourself if there’s time, or work directly with a company that has the list, prints and sends the mailers at approximately 50 cents per postcard.

“To really get results, create a low-risk offer that just about any pool owner would find too irresistible to pass up,” Abbott says. “A free pool inspection is a good start, but not nearly as compelling as free service or a sizable discount.” Expect that your response rate to a direct mailing campaign won’t likely be more than 3 percent, however. “Most people get less than a 1 percent response rate,” Abbott says.

Norris buys and uses mailing lists. “If you have a weird offer or the price isn’t right, you could end up empty-handed,” he says. “With pool service cost being low, you have to get a lot of business to pay for it.”

Offer Pool-Maintenance Classes
Dick Nichols, owner of Genie Pool and Spa in San Jose, Calif., has been teaching classes in the industry for about 30 years. “It has led to various types of referrals from others in the industry,” he says. “We’ve done orientation classes at commercial pools for their lifeguards, which helps solidify future referrals.”

Woemmel says it is acceptable to charge a small fee for maintenance classes. “It places a value on the class and lets them know it is professionally done,” he says. “Or give them a coupon so the customer’s net cost is zero.”

Other Growth Options
Abbott recommends nonadvertising strategies and tactics first. “They tend to be lower cost, and the results are more predictable,” he says. “It’s a bigger gamble, and the return on investment is not as certain.”

With advertising, Abbott recommends pay-per-click ads on the Internet first, because they are 100 percent measurable, highly targeted, simple to test effectiveness and easy to modify or discontinue.

Radio advertising can be very powerful, he says. “A well-crafted and well-executed six month radio campaign can truly establish you as the preferred company,” he says. “If you want to truly take over and dominate a particular city or market, radio it is.” The investment is substantial, however, requiring at least $50,000 for that six-month period, and you typically need to commit to six months to monetize the effort.

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