By Richard Rutigliano, PriMedia Inc.
There is a lot of potential value in a great corporate reputation. If your company has performed well enough to earn the respect of its customers, you are sitting on a reservoir of goodwill that you can leverage for greater success. Sadly, that value can dissipate rapidly if you do not cultivate it with care.
I am talking about a certain kind of risk management — of opportunities and so-called “opportunity costs.” For anyone unfamiliar with the latter term, the website Investopedia.com defines it like this: “The cost of an alternative that must be forgone in order to pursue a certain action. Put another way, the benefits you could have received by taking an alternative action.” Fuel companies that only “do what we do best” rather than take the risk of launching and marketing new services could pay “opportunity costs” for a conservative approach.
On the other hand, seizing the opportunity could lead to great things:
- Earning more profit per account by expanding the scope of business with current customers to include building shell enhancement, indoor air quality, electrical, plumbing, home automation and handyman services.
- Making accounts more secure by improving the customer’s perception of the company’s value to them.
- Making accounts more secure by eliminating opportunities for competing contractors to raid your base.
Choose Your Risks
It does not really matter whether or not a company is losing business to fuel conversions, because the opportunities in diversification are available to all reputable companies, at least in theory. If you have customers who appreciate you, you have the opportunity to do more for them, whether or not you “need the business.”
New services like home automation will continue to emerge, and companies that make it their modus operandi to seize opportunities as they emerge are leveraging their reputations for maximum value. Their risks are in the areas of over-extending, which is a very different risk profile from a company that passively loses value by playing it too safe.
There are different ways to diversify. You can do it all in-house, or you can acquire other companies, form partnerships, hire subcontractors, etc. Whichever you prefer, there is potential reward in positioning yourself to do more with the customers who already trust you and regard you highly.
Adding new capabilities is challenging, no doubt, and it’s also only half of the battle: You must follow through with aggressive marketing and sales in order to capitalize on the opportunities you pursuing.
As you take new services to market, it is often necessary to redefine the company, starting within your customer base. Your customers have a perception of you now that is positive but which confines you to a certain role, based on the services they use now. If you deliver fuel and handle their heating and cooling equipment, that is the image they will have of you. Perception is malleable, however, and you have the ability to reframe yourself, starting immediately.
Direct communication with your customers is the tool set you use to reinvent yourself in their eyes. Some marketers readily grasp this concept, and they regularly touch base with customers to shape perceptions and drive relationships where they want them to go.
To launch new services and gain traction within the base, you need to engage your leadership team and work on several fronts simultaneously. While you are getting the services themselves up and running or making arrangements with other contractors, you also need to get to work on a marketing plan. Retain a marketing agency and work closely with them, starting with the big picture stuff. Explain your short-term and long-term objectives, and have in-depth conversations about how you want customers to perceive you. This can be an invigorating process that literally changes the fortunes of your company and takes you to a whole new level.
Image and Message
Once you have formulated a reasonable set of goals and a strategy for achieving them, go to work on your corporate image and message. Determine how fuel sales fit into your business plan going forward, and manage that perception accordingly. Redefining the company as a service provider makes good sense, even for companies that still plan to sell a lot of fuel.
With your marketing firm, pick and choose which elements of your legacy image and message should continue and how you will use them. Going forward you will want to be perfectly consistent with key elements such as your logo, tagline and color scheme. If you already have elements that are familiar and work well, plan on modernizing them to reflect your expanded business model. If you have been inconsistent with your color scheme and/or typography or you lack an identifiable logo, develop those core elements now. In either case, spend some time during this stage — and be picky. Consistency and appeal are critical in your key image elements, so it’s worth the investment to get them right.
At the same time, develop and hone a corporate message, and think of it the same way job seekers think of a co-called “elevator speech.” In the case of a company, the message should be customer-centric, i.e. emphasizing how the customer benefits by choosing you. Your core message should be the answer you give when someone asks, “Why should I go with your company?” Again, take your time on this stage. It’s a great opportunity to focus on what really matters at your company and put it into words.
With your image and message squared away, you are ready to reposition the company as something much greater and more valuable than a heating and cooling company/fuel provider. Work with your agency to develop a marketing strategy that anticipates the sales strategy and supports it every step of the way.
Plan to invest pretty heavily in this stage of the operation. Your customers have a fixed image of your company along with expectations of what you can do for them. You will be looking to rewire those perceptions, and this requires persistence and patience. It would be imprudent, for example, to try to sell your customers home automation services when they have a strong perception of you as a fuel-centric company, because they might think you are in over your head. You have the power to redefine yourself in their eyes, and you it’s wise to accept the challenge.
Direct mail remains the avenue of choice when targeting the base, because the print medium continues to offers the best in high-impact communications. You can combine imagery and message in print; you can explain and illustrate things that need explaining; and you can reach all your customers, because you have all their mailing addresses.
Marketers and agencies alike have been searching for an alternative to the printed newsletter for years, but it remains the most effective tool for customer communications. If you have used newsletters in the past and didn’t care for them, the solution is simple: Do them better this time. Newsletter deliver on your investment when you do them right. Set aside any preconceived notions; every newsletter begins as a blank slate, and when it’s done it should convey a robust message that refreshes your image and accelerates your sales.
How do you achieve this kind of excellence? Advocate for yourself! Demand articles that inform and inspire. Insist on great design and imagery. Make sure the newsletter makes effective use of coupons and reply cards.
At the same time, make your website an excellent companion resource. Stock it with excellent information about your new services, and refer customers to it from your newsletter. Again, be a demanding agency client, and get your website exactly the way you want it.
Across all communications channels, repeat your core messages again and again to drive new perceptions and make customers curious. Set an ambitious schedule for newsletters and other direct mail pieces and stick to it, this year, next year and the year after that.
The best thing about marketing is that when you do it right, it works – and with more reliability and predictability than you might imagine. If you have a solid reputation, you really can chart a new course for the company and do more business with your customers — provided you stay the course.
If you don’t want to look back and regret the risks you didn’t take for your company, start formulating a new strategy now. Be bold, be smart, and be persistent — and you can become the provider of choice for all kinds of new in-home services, including ones that are only beginning to emerge.