#191 How AI Is Transforming Lead Generation and Market Expansion

Summary

Owned and Operated Podcast Episode #191: How AI Is Transforming Lead Generation and Market Expansion

Release Date: May 1, 2025

Hosts: John Wilson and Jack Carr

In Episode #191 of the "Owned and Operated - A Plumbing, Electrical, and HVAC Business Growth Podcast," hosts John Wilson and Jack Carr delve deep into the transformative role of Artificial Intelligence (AI) in lead generation and market expansion within the home services industry. Featuring James Zaner from Modernize, the episode offers a wealth of insights, actionable strategies, and forward-thinking discussions tailored for entrepreneurs aiming to scale their businesses effectively.

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1. Introduction to AI in Business Growth

The episode kicks off with John Wilson posing a pivotal question to James Zaner: "How are you guys using AI just in your business to drive more?" (00:00) James responds enthusiastically, highlighting how AI has revolutionized lead generation by enhancing brand trust and enabling competitive analysis across various geographies. He shares, "AIs are starting to know like and trust brands... it's changed my life and my team has effectively doubled their output." (00:02) This sets the stage for an in-depth exploration of AI's capabilities in modern business operations.

2. Modernize's Approach to Lead Generation

James Zaner introduces Modernize as a comprehensive lead partner, detailing their multifaceted approach to lead generation. He explains Modernize's four main products:

• Shared Leads: Companies share leads with a 25% split, ensuring a steady flow of potential customers.
• Live Transfer Calls: Pre-qualified leads are directly transferred from Modernize's call center to partners.
• Inbound Calls: Particularly beneficial for sectors like HVAC and plumbing, these calls cater to urgent service needs.
• Expansion into New Trades: Modernize continuously launches new trades, having recently added plumbing and planning to extend further into areas like roofing and siding.

James emphasizes the importance of margin management, comparing lead acquisition to e-commerce strategies. "We have 4,400 combinations of DMAs and trades... focusing on margin debt is crucial." (04:58)

3. Market Expansion Strategies

The conversation shifts to effective market expansion, where James outlines Modernize's meticulous approach using data-driven methods. He discusses:

• DMA and Trade Combinations: Analyzing thousands of data points to identify profitable market segments.
• SEM Targeting: Focusing on high-margin areas through search engine marketing.
• Sales Team Directives: Assigning a dedicated mid-market sales team to prioritize and manage leads.
• Networks and Partnerships: Collaborating with franchise and partnership networks to maximize lead acquisition.

John probes further, asking about the practical aspects of new market expansion—whether it involves cold calling, emailing, or other bootstrapped methods. James responds by emphasizing the blend of word-of-mouth strategies and targeted SEM campaigns, underscoring the balance between cost and lead quality. "Our program with account managers allows us to prioritize and effectively scale into new areas." (05:56)

4. Leveraging AI for Enhanced Data Management

A significant portion of the discussion centers around leveraging AI tools like ChatGPT and Clay for data management and operational efficiency. James shares how Modernize employs AI to streamline tasks such as:

• Data Research: Utilizing AI to aggregate and process data from various sources, significantly boosting team productivity. "We've doubled our research output." (10:09)
• API Integrations: Implementing tools like Shovels API to access comprehensive permit databases, enabling detailed competitor analysis and market insights. "You can check on your competitors... it's a lot of interesting stuff going on." (12:51)
• Automated Reporting: Building custom dashboards and automations to monitor key performance indicators and operational metrics efficiently. James highlights the rapid development and deployment of internal apps to track response times and resolution rates across support teams. "Our first app... can track response times and resolution times across our six support teams." (51:13)

5. Enhancing Customer Engagement Through Membership Programs

James and John delve into the strategic importance of membership programs in boosting customer lifetime value (LTV) and ensuring client stickiness. James points out that many businesses overlook LTV in favor of immediate marketing metrics, but Modernize prioritizes long-term customer relationships. "People think it's dumb to give away memberships, but it's all about stickiness and LTV." (36:41)

John shares Wilson Plumbing's success with targeted membership giveaways, such as the "Wiser Wilson Club," which offers memberships to customers over 65. This initiative has significantly increased membership numbers and LTV, proving the effectiveness of well-structured membership programs. "We found out that only 7% of our customer base used all three services. Increasing that to 30% would be game-changing." (42:50)

6. AI-Driven Automation and Call Center Optimization

The episode highlights Modernize's partnership with Evoca AI to enhance call center operations. James explains how Evoca's AI-powered Customer Service Representatives (CSRs) handle calls efficiently, maintaining high customer satisfaction by recognizing and responding to emotional cues. "If a caller's getting heated, Evoca hears the tone, emotion, and hands the call to a real human." (31:13) This integration not only reduces churn but also provides actionable analytics for continuous improvement.

John complements this by discussing the development of in-house automation tools to address specific operational pain points, such as response time tracking for support teams. "We added our first app that tracks response times and resolution times across our six support teams." (52:31)

7. Future Trends and Personal Insights

In the latter part of the episode, James shares his aspirations and observations on the evolving landscape of the trades industry. He muses about the potential for acquisitions, greenfield expansions, and the continuous integration of AI-driven tools to stay ahead. James envisions a future where software solutions become more accessible, enabling even small businesses to implement advanced AI strategies without needing extensive technical expertise. "You can just build that one feature, sell it for $29.99, and get 100,000 customers. It's so wild." (50:11)

John echoes these sentiments, expressing excitement about the industry's direction and the immense opportunities for growth through strategic AI implementation.

8. Rapid-Fire Q&A Highlights

The episode concludes with a rapid-fire segment where James offers succinct advice and shares his favorite aspects of Modernize's verticals:

• Advice for Marketers: "Just start talking to AI. It's changed my life and my team's output and performance significantly." (54:30)
• Favorite Vertical: James expresses a particular interest in roofing due to its high average ticket value and the engaging community it fosters within the market.
• Overhyped Marketing Trend: He challenges the notion that any marketing trend is inherently overhyped, suggesting that effectiveness depends on execution and suitability to the specific business context. "If you feel something's overhyped, you're probably not good at it." (57:36)

9. Conclusion

As the episode wraps up, both hosts emphasize the critical role of AI in modernizing business operations, enhancing customer engagement, and driving scalable growth. James encourages listeners to leverage AI tools and data-driven strategies to unlock their businesses' full potential. John invites listeners to explore more resources on www.ownedandoperated.com and subscribe for future episodes filled with actionable insights and industry-leading conversations.

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Notable Quotes:

• "AIs are starting to know like and trust brands... it's changed my life and my team has effectively doubled their output." — James Zaner (00:02)
• "Our program with account managers allows us to prioritize and effectively scale into new areas." — James Zaner (05:56)
• "We've doubled our research output." — James Zaner (10:09)
• "People think it's dumb to give away memberships, but it's all about stickiness and LTV." — James Zaner (36:41)
• "If a caller's getting heated, Evoca hears the tone, emotion, and hands the call to a real human." — James Zaner (31:13)
• "If you feel something's overhyped, you're probably not good at it." — James Zaner (57:36)

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Timestamp Reference:

For detailed reference, each notable quote includes a timestamp corresponding to the podcast transcript segments.

Resources Mentioned:

• Modernize: www.modernize.com
• Service Scalers: service-scalers.com
• Evoca AI: evoca.ai

Connect with James Zaner:

• Twitter: @JamesZayner
• LinkedIn: linkedin.com/in/JamesZayner

For more insights and actionable advice, visit www.ownedandoperated.com and subscribe to the podcast to stay updated on the latest strategies for growing your plumbing, electrical, or HVAC business.

Transcript

[John]

How are you guys using AI just in your business to drive more?

[James Zaner]

We get quite a few leads coming in from AI. AIs are starting to know like and trust brands. You can look state by state, city by city, company by company. You can check on your competitors. It's changed my life and my team has effectively doubled their output.

[John]

Welcome back to Owned and operated. Today in studio, I have James Zaner from Modernize. Welcome to the show.

[James Zaner]

Thanks for having me, John.

[John]

So the latest thing that we've been working on is maximizing our LSAs, which is local service ads, and also optimizing our Google my business profiles. So what that means is we're making sure that all of our LSAs are on when we need them and they're maximized to give us the best ROI. And then for GMBs, it's been partnering with service scalers to drive way more traffic through our GMBs. GMBs are almost like the new SEO. The more you put onto them, the better the performance. So our GMBs have been consistently getting better week after week after week. And it is our currently our single most impactful organic lead channel. So we'll sell hundreds of thousands of dollars a week through our GMBs. And I think last week we got 900 phone calls. So really impactful, awesome investment. And we've been able to partner with service scalers on both of those things. If you want to hear a little bit more about service scalers, check out service scalers.com. this is going to be a lot of fun. Now you do have the unfortunate pleasure of following up Jamie. We had her on the show maybe two months ago and just an incredible conversation. So you're going to have to like take it up a notch.

[James Zaner]

Jamie Smith is a gangster in our industry. She really is.

[John]

Yeah.

[James Zaner]

She's 4 foot 11.

[John]

Okay.

[James Zaner]

She comes from a consulting background, so she has like this like McKinsey esque way of going about things. She's my boss. One of the reasons why I love working at Modernize. And so yeah, it's going to be a tough follow.

[John]

Modernize, we did a really deep dive, but if someone hasn't heard of it yet, what's like a real quick 60 seconds on Modernize.

[James Zaner]

So Modernize is a lead partner.

[John]

I learned that last episode.

[James Zaner]

Yeah, yeah, we love the shift into that because there's so much more going on in our space. So there's a variety of marketing services companies in the industry. Companies like Modernize, Angie Homebody, we're lead partners. What Modernize does specifically is we provide four different products. One being your shared lead. It is shared. If you wanna play the game, fight and win your 25% of the share.

[John]

And that's like a one in four.

[James Zaner]

Yeah, one in four split. Some companies do more. I've heard some of our competitors say five. So we do four and then we do calls. So we have a live transfer call that we will transfer over from our call center. We'll pre qualify. We'll try to make sure that they're not looking for government grants or anything. And then we also do inbound calls, which is great for like Resto, which you're getting into.

[John]

Yeah.

[James Zaner]

Also H vac if your unit's out, plumbing if your water heater is having problems. So those inbound calls are great. We're getting into other exteriors as well, like roofing, siding.

[John]

Well, when we talked to Jamie, plumbing was like up and coming.

[James Zaner]

So we launched. We're always launching new trades.

[John]

That's fucking sick.

[James Zaner]

Yeah. And then so we saw that expansion was the way to grow into the future.

[John]

So we've launched like trade line extension. Like, okay, yeah, yeah.

[James Zaner]

So we launched. I think we're up to like close to 10 new trades over the past 12 months. Plumbing was one of them. Plumbing was one of our first. Plumbing is an interesting one because what's the difference between a leaky faucet and so you're like figuring out that whole thing, the form submission process. Also in the customer intent journey, like they don't know what the problem is.

[John]

Yeah, when, when you're thinking, and this is just like a nuts and bolts question and then we can like dive into the actual stuff here. But like, do you know how like new market expansion goes? Is that like boots on the ground? Is that cold calling? Is that cold emailing? Like, because I, I, what I assume happens is you cover a map like, hey, I want to take over the Midwest. Or maybe it's even wider because like, the more data, the cheaper the lead. Like the more reps you can get on your spend, the cheaper the lead. So if you're covering this data point, how do you actually get buyers of the leads? How do you find them?

[James Zaner]

Word of mouth is great. That's always a good one. So there's a variety of ways of going about it. Currently we're going through a few initiatives, but I mean, even just standard bottom funnel semiconductors, I need home improvement leads. It's like for our business though, you have to really think about margin because we are selling tangible product that we in some ways are acquiring for a Cost or purchasing for a cost.

[John]

The lead being the tangible product, the.

[James Zaner]

Lead being the tangible product. And so it's almost like e commerce in a way. But we've got this marketplace too where we've got two sides we're fulfilling. So we really have to focus on in the end the margin. And so that's where we're going out. We have 4400 combinations of DMAs and trades that we're constantly looking at where the margin debt is and we're trying to fulfill that way. So we're going SEM targeting in our most important areas. We have a full mid market sales team where we're directing them towards accounts that we're scraping from our most priority areas and then handing them over. And then also this new program we're starting out with networks and partnerships which is.

[John]

Oh, okay, I don't think I've heard about that. And networks is another lead partner. Like we've used them in the past.

[James Zaner]

Not networks with an X. Networks as in like franchise networks, partnership networks like nextar.

[John]

Yeah, that'd be sweet.

[James Zaner]

Yeah. So what we're getting into now because we have the ability to identify where we need targets. I can get Hatch on the phone and say hey, do you know anybody? Yeah. Do you know anybody here that can help us out?

[John]

That's interesting.

[James Zaner]

Yeah.

[John]

And then increases their stickiness too, I guess. But.

[James Zaner]

Well, yeah, especially with us. We're Hatch's largest lead throughput partner, so.

[John]

Really?

[James Zaner]

Yeah. So it, it. I think co selling with Hatch is a. Is very beneficial for us. Yeah.

[John]

Whoever thought of that?

[James Zaner]

Me.

[John]

That's a good idea. Hey James, that's a good idea.

[James Zaner]

I got a lot of good ideas to talk about today. I'm pumped.

[John]

Hey Jamie, James has a lot of good ideas. Okay. How do you think about the introduction of AI and what I'm. What I'm specifically thinking of at the moment is like thumbtacks. Integration with Chat GPT.

[James Zaner]

Sure.

[John]

The operator. Right, Chat GPT operator.

[James Zaner]

Yeah.

[John]

How are you guys thinking about that? And then how are you guys using AI just in your business to drive more?

[James Zaner]

Surprisingly we get quite a few leads coming in from AI, whether it's ChatGPT, Grok, there's a variety of them. So even just starting to learn more about how to get placed.

[John]

That's because you're like showing up in search.

[James Zaner]

Yeah, you show up in search. I think that helps. I don't know if talking to AI improves your results like feeding it information, does that go back to the mainframe? Yeah, I'm not quite sure. I imagine AIs are starting to know like and trust brands similar to a human. And so I wonder how that has an impact. If there is a lot of like, public slander about a company, is ChatGPT gonna recommend it?

[John]

Oh, yeah. I wonder how much of that would be like, locked off. You know, I'm imagining like Nextdoor or Facebook groups that they don't have invites to. Like, is that how available is that data?

[James Zaner]

Yeah, well, yeah, for sure. Facebook's a walled garden. LinkedIn's a walled garden. We've been doing really good for organic on the B2B side, so that's been helping us. And we started looking at the SGE results from Google. So there's a little down arrow you can click to the right where it'll show you the articles it pulled its results from.

[John]

Oh, for the AI Spotlight or whatever.

[James Zaner]

Yeah, the AI Spotlight. And so we started looking into that and we started reaching out to different brands that had articles showing up in that for like best lead generators or whatever, like asking for inclusion. But for AI as a whole, obviously with Evoca, you've got the rillas, the Ciros Engage, I mean, keep naming them, they just keep coming in this industry. And so there's going to be a lot of interesting stuff going on. I'm sure Service Titan has something planned in the works. Maybe it's like revenue optimization or profit margin optimization, things like that, that you could be easily using AI for.

[John]

I hope it's reporting. Yeah, this is me requesting a feature, but I hope it's reporting because if they're reporting, you know, I was looking at, I think it was House Call or Jobber or one of them, but instead of like a reporting function, they just have a GPT built inside it. And it is just better. Like, hey, here's what I want to know. Data. Yeah, it's so much better.

[James Zaner]

It does. It could give it in a table. You can just ask for it to give it in a table.

[John]

Yeah, here's what I want. Send it downloadable Excel.

[James Zaner]

Yeah, that's what I mean for me, that's what I've been using it a lot for is we've got Quinn street, who is the corporate boss of us, modernizes a business unit within it. Quinn street, by the way, publicly traded company qnst on the stock market, they've got a variety of different verticals, modernized being one of them. We have a lot of different systems and we kind of all like share. And so I kind of have to. For me to do a lot of of my data research on what's going on. I have to kind of like pull spreadsheets and, like, do a lot of vlookups and like. Or I could just kind of like drop that in and say, hey, I need this, this and this brought together. Can you bring this? Can you match these columns? And then do this and then it's done. And a minute and 30 seconds versus me writing all the code for it.

[John]

Yeah.

[James Zaner]

So that's exciting. I have my whole team on ChatGPT. They all have a license. I had a training last year for them on AI and what it can do. And it's. I mean, we've doubled our research output. So. Research, like I said, we have to go find companies, find contacts.

[John]

Yeah.

[James Zaner]

There isn't really a database that covers the whole industry. And my team has effectively doubled their output recently because we built out this whole ingestion engine. I posted a video on LinkedIn about it. Long build, long build, a lot of moving parts. And also user.

[John]

It's like scraping the Internet, everything.

[James Zaner]

I mean, you have to choose destinations, but yeah. And the data comes in different formats and so you have to reformat it. And so we found a tool that helps us reformat and then we get that back into Salesforce so we can assign it to our account executives. But, yeah, AI is amazing. I talk to AI like it's a person, which is, I think, very helpful for people. Talk to AI like it's a person. Like it's an upworker that completely understands English and understands everything, but it just needs context. Like it needs absolute perfect context and it'll do everything for you.

[John]

I was at. We had a conference two weeks ago and one of our sessions was on using AI. Right. It's everyone's thing right now. But the feedback they gave, which I loved, which is exactly that, but like one more level down. So treat it like it's a remote employee. And if I was hiring a remote employee today to do X task, what would I give them? I would give them a job description. I'd give them a couple of SOPs. I would give them like the, here is what I expect from you. And then the beauty is you can just. You can just ask whatever you're using, GPT or Perplexity or whatever to give you that output. Like, hey, I need a data analyst position. Give me a job description. Here's roughly what I want. Okay, here it is. And then you just feed it back. And I thought that was just a really easy way for me to wrap my head around Increasing quality output was, hey, this is an employee wrapped in a computer. And how do we just feed it? Exactly what I would give to a new accounts payable clerk for them to know what they're supposed to do.

[James Zaner]

And also I think that the MCPS, that's like getting more defined for your ChatGPT instance. Like the MCPS on. I think it's Claude Anthropic is using them.

[John]

Yeah.

[James Zaner]

You can hook it up to a database and like. So one thing that I don't think you all use, I don't know if you've ever heard of. Have you heard of the Shovels API?

[John]

No.

[James Zaner]

So Shovels API is a database of all permitting across the U.S. oh, interesting.

[John]

I have a friend that uses this in Dallas.

[James Zaner]

Okay.

[John]

He's foundation repair and he uses it. I don't remember how he's scraping.

[James Zaner]

Yeah.

[John]

Or what.

[James Zaner]

It's like 500 bucks a month. You have access to the API. You probably have a limit on how many calls you can make. Yeah, but you can, you can look state by state, city by city, company by company. You can check on your competitors, depending on if you're in a permitting trade or not wild. And you could see the address, possibly homeowner name and things like that. Because these are. This is public information. It's a permit you have to file with the city. And so it's all public information.

[John]

And so I'm going to use that.

[James Zaner]

Well, now everybody, you better be. First. First adoption. Yeah. So there's a really.

[John]

And it gives you like type. So like water heater, stove.

[James Zaner]

Well, do you permits for water heater? I don't know. Yeah. Yeah. So yeah, if you need a. Yeah. It would tell you the type of job, what the permit was for. Like, they even have like average job costs. So I can look up a company and I can look up. I can look up what they project, the revenue being based on the number of permits they've.

[John]

What do you. What do you think the feedback like time is? Could I pull yesterday's or probably like a month ago. I'll assume a month.

[James Zaner]

I'd be more generous. I mean longer than the way that. No, no, I'm saying like maybe two weeks. Like, hey, I imagine that stuff's updated in near real time now. Most cities are on computers and like not operating in paper anymore. And so if it's on the Internet and it has to get filed. Yeah, I mean, maybe I haven't looked, but I would. Even if it's a month, that's pretty cool.

[John]

Yeah.

[James Zaner]

Like to know what your competitor did last year.

[John]

Oh, absolutely. I'm fascinated. I'm fascinated.

[James Zaner]

And then you also.

[John]

This is where I wish I could like get something up on the screen.

[James Zaner]

Yeah.

[John]

I would just pull somebody up.

[James Zaner]

Yeah. I think the way you can think about it as well is you know the date that that person got their unit changed. So then you can put a reach out task.

[John]

Yeah.

[James Zaner]

15 years in advance, which, I mean it sounds crazy to most people, but as a long terminist like Wilson Plumbing.

[John]

Yeah.

[James Zaner]

You know, in 15 years you should write something. Yeah. You got to, you got to ask them what's going on.

[John]

I'm a big fan of that. That's wild.

[James Zaner]

Yeah. And so what you can do with that is with AI, that the way I think about it. So we use a tool called Clay. Clay is basically a spreadsheet on steroids. You can pump a bunch of API data into it and then you can use columns as like an AI researcher to go find out more information based on the data points you already have in the spreadsheet. That's what we do for the businesses. We'll go scrape business websites. How many trades do you offer? And then we'll put them in the format that our salesforce accepts. So then we can import it easily. But I mean it could be anything with like this shovels API where you could easily pull in all the data, have like an easy lookup for like sort by competitor, have an easy look up for what the average job cost was. And you're like starting to find out. I don't know. I mean I'm, I'm not in your position, but like it just. The possibilities are endless for the type of information. Yeah.

[John]

I think like, you know, I'm thinking of acquisitions. I'm thinking that too.

[James Zaner]

Yeah.

[John]

So if somebody's probably the highest. I mean it's interesting for like curiosity. Like, okay, like how big are these guys actually? But I think it would be a good funnel for like. Oh, I've never even heard of these fucking guys. And they did 200 permits last year. Like who are they? Yeah. And like they're in a territory I want.

[James Zaner]

You can also see like zip maps of like where. Where it's. Where it's hot right now.

[John]

Yeah. Okay. I want this a lot right now.

[James Zaner]

Yeah.

[John]

Actually. All right. Yeah, we're going to dive into that. When. How do you think somebody. So I want to launch a new territory, whether through acquisition or greenfield. How do I combine that data and like the tools of lead partner.

[James Zaner]

Yeah.

[John]

To like win. Like how do you think I do that?

[James Zaner]

I have this dream and I don't know if it's possible. So Modernize is an amazing data company. We have a very sophisticated data team, very smart people. We have big tableau dashboards reporting on as much as we possibly can, down to, like, unique data points. Right. And I haven't even seen it on the homeowner lead side, what all that data. But I know on the B2B side, I can go look at a map like Jamie did in her conversation. It's like, what's the average close rate of this zip for this specific lead type? I know there's a program going on with our account managers where they can sit you down, they can look at all of. I heard you talking with Peter Min about greenfielding and how he's kind of gone and attacked areas that are an hour out.

[John]

Yeah.

[James Zaner]

And how he chose those areas and he maybe did it in his own sophisticated way. But for you, if you were going to start picking and choosing areas, you can look at supply and demand and you can look at average split rate of how much, how many people were selling leads to, and you can honestly just start answering calls for those areas and send a truck out.

[John]

Yeah.

[James Zaner]

And then once you get enough work, you drop an office in.

[John]

Yeah.

[James Zaner]

And you can, like, probably experiment with certain areas and, like, maybe you try one for three months, for a quarter, and it didn't work out, and so you try the next one. If you're at actively pursuing greenfield expansion or acquisition, I imagine acquisition would be helpful if you see a concentrated area where leads are selling a lot and there's somebody there that probably you'd have to. Probably we wouldn't communicate with you, probably who our customers are, but you would find out whether or not, I mean, if they're a buyer of us, they're likely also a buyer of Angie.

[John]

Right.

[James Zaner]

Especially if you're good. And they're also likely playing around with a bunch of other networks. Really work with your partner. I'm not sure all the other partners do what we do. So, I mean, if you want to talk to Modernize and you want to get in on figuring out how to scale into your next new zips, that's a good way is to work with our account management team.

[John]

You know, one of the things we were thinking about as we were thinking about our expansion is like, yeah, where is there? No, we call them real, but. And I'm not trying to, like, dog larger companies. Like, some of the areas that we're identifying, there's a 15 to 20 million dollars player. It's just that they're not very sophisticated. So, like, they. They wouldn't have any idea how to make a lead partner, like, functionally work. Like, their tech stacks just not there. So we see that as, like, pretty easy pickings. Like, yeah, there's a decent sized company, but, like, they don't really know what they're doing, which maybe sounds ridiculous, but. And we're still acting like figuring out we've roughly decided what we want to do. We're like 99% there, but my 1% just keeps going back to the other side. But you have two opportunities when you're thinking about this, whether acquisitive or greenfield. Do I want to go where the market's easy or do I want to go where the market's big? And it's a big decision that really determines a lot. Like, I could go to Columbus where the market's big. That market is not easy. There's a lot of people in Columbus and, like, a lot of very real sophisticated competitors. I could go to Youngstown, and there's nobody real or sophisticated. I think the biggest company is, like, $12 million, like, which is still, like, close to mom and pop operationally. So they just, you know, that's easy. Like, okay, we could run $10 million there relatively easily, but then that's probably the cap. So then you run into the. That's the biggest we could ever get there versus Columbus could support another $50 million branch. And Chad's a good example of. He tended to choose easier markets because they were an hour away. And he says it himself. They look for C markets. They look for markets where they can go in and win. Yeah, yeah.

[James Zaner]

Dayton, Louisville.

[John]

Yeah, yeah, yeah. The downside with that is eventually they hit a cap, and that is just the biggest it will ever get. And it sounds to me like that's probably what we're going to do. But it is harder to run 10 small branches than two giant ones.

[James Zaner]

Not if you know, though, that there is an ultimate that you can just get to and stop and you don't have to worry about scaling anymore. Yeah, like, that's kind of cool to know.

[John]

Like, I know that's his perspective is he tries to stop before they hit 15. Because at 15 is when you have to add, like, real infrastructure.

[James Zaner]

Yeah. But under 15, you're saying, like, there's like, six guys in the shop.

[John]

Yeah, yeah. Like, like a $10 million company if you don't have to add, like, real, like, hey, do I need an HR person? Do I need a controller on site. Like, do I need purchasing on site for that branch? If you don't have to add that, it is just a cash cow because all of it's fed from headquarters.

[James Zaner]

Yeah.

[John]

So that is beautiful. I mean that is beautiful. He's just ripping gross margin.

[James Zaner]

Yeah. I, I like his model. I think, well, the Columbus market. What's interesting is I would identify like, and I'm not. I'm new to this, so I might be talking out of my ass.

[John]

Let's go.

[James Zaner]

It's. It all comes down to real estate and brand. Right? Like, how powerful is their brand? What kind of real estate do they. Not real estate, hard real estate, but real estate on the Internet.

[John]

Yeah, yeah.

[James Zaner]

What's their digital real estate impact? Like how much are they being talked about on the local message boards? Like.

[John]

Yeah.

[James Zaner]

Do they have that going for them? Because if they have that, then you can at least immediately walk in and drop a moat and then start operating. Like.

[John]

Yeah.

[James Zaner]

Especially if they're not using a good modern tech stack.

[John]

Yeah.

[James Zaner]

Like that's the easy improvement right there. You're going to see significant wins, but minus the Four Seasons. Those are the. You're saying they're doing it without the tech stack, but.

[John]

Yeah, yeah, that's. That's still amazing. I remember reading one of their. A friend of mine competes. I think you mentioned him before we got on air. Isaac.

[James Zaner]

Yeah.

[John]

Awesome guy. Like took the business from six to like, I think 24 and like three.

[James Zaner]

No way.

[John]

Freaking crazy. And like really inspirational. Like. Yeah, he's a, he's a fun person to be friends with, but he can. He competes directly with Four Seasons in Chicago and he sent me one of their job like posts.

[James Zaner]

Yeah.

[John]

And it was so wildly specific. So someone has to know how to use this software custom built in the 80s and that's their CRM.

[James Zaner]

Yeah. Yeah.

[John]

So. So they, they couldn't hire this. Like, in order to be an accountant at Four Seasons, you have to know how to use this software custom built in the 80s or like the framework.

[James Zaner]

Yeah, yeah.

[John]

Which is like absolutely wild to me.

[James Zaner]

Yeah.

[John]

I mean like, I can't really throw rocks at it. They're nine times my size. But like. Yeah, that's still like holy smokes. And I bet that's a ship to turn.

[James Zaner]

Yes.

[John]

I wouldn't even know how to put that on service titan if I wanted to.

[James Zaner]

Titanic. Yeah. I'm impressed by Isaac. Like his whole story excites me.

[John]

Yeah.

[James Zaner]

Yeah.

[John]

Like which part? Walk me through it.

[James Zaner]

Investment bank, banking analyst turned growth tech Bro turned plumbing company owner.

[John]

Yeah.

[James Zaner]

And also I'm from Chicago.

[John]

Okay.

[James Zaner]

Yeah. I was born and. Born and raised in the suburbs there. So just understanding his vibe. I loved his explanation of his guerrilla marketing stuff and how he's just attacking these blocks, which is Chicago. I mean, it's all just burros, like, kind of like.

[John]

Yeah, yeah.

[James Zaner]

And if you can just overtake a borough, you get your sticker on the pizza box, people know your name. Like. Yeah. I think it's fun. I think it's fun that he kept the name too.

[John]

Yeah. The. Jay Blanton might have been 21 or 22 that he bought it, but yeah, they're going to close in the low 20s this year. I think it was 17 last year.

[James Zaner]

That's awesome.

[John]

This might be his third year because he took it from 6 to 10, 10 to 16, 17 and now. Yeah. Mid 20s.

[James Zaner]

I wanted to. My favorite stat that you threw out recently was. It wasn't recently. It was maybe a year ago. It was, I think on the Isaac call, 70% of your income is from memberships revenue. Yeah.

[John]

Yeah.

[James Zaner]

That's just super interesting one because. Just learn as much as you can about those members.

[John]

Yeah. We've done data studies on ours. What's been interesting is, is I was at this thing last October, so six months ago.

[James Zaner]

Yeah.

[John]

And I was talking to this guy. He's a great operator. I want to say 45 ish million and like growing strong. And he started talking about how they gave away memberships. And I was like, that doesn't. Like walk me through it.

[James Zaner]

Yeah, right.

[John]

Like, like, I think we always want to say, like, that's dumb. But like, hey, like, curiosity. Why. And they have 10,000 members.

[James Zaner]

Whoa.

[John]

And it's a lot. That's a lot.

[James Zaner]

But it's, it's an. He has a community.

[John]

He has a community. But with the interesting part is they, they. They segmented their. Now they're in a. This is important.

[James Zaner]

Like, this is what I wanted to talk about.

[John]

It's good for. It's good for where they are geographically. It would not work here in Cleveland.

[James Zaner]

Okay.

[John]

But they are near a. An Air Force base.

[James Zaner]

Yeah.

[John]

So that. And that's important because they give away their memberships to anyone active or veteran.

[James Zaner]

Yeah.

[John]

So like, huge win. And like, these guys are buying houses. These guys. Like, it's a great community. That would. Not that it would be cool for Cleveland, but like, it, you know, eventually you have to be able to. It would eat away at the business.

[James Zaner]

Yeah.

[John]

So what we did is we did a We do a customer study like once every four or five months and we should do it every 90 days, but it's every four or five months. And what we identified was like, hey, here's our age, here's our typical customer. Some of the trends were a bit concerning. Like a lot of our customers are older. I don't know if that's the macro of Cleveland. I don't know if that's how we.

[James Zaner]

Could be an old company.

[John]

Could be the macro being an old company.

[James Zaner]

Yeah.

[John]

So what we started doing is we gave, we created a segment of our membership where we just give away memberships to anyone over 65. We call it Wiser Wilson Club.

[James Zaner]

Let's go.

[John]

And yeah, it's been a win because like the LTV on memberships happens nine months after you they first become a member. So even if you use a membership to create a discount in that first visit, the actual value comes nine months after that first appointment where we sold that membership.

[James Zaner]

Okay.

[John]

They start thinking about it, they get our communication. So Almost it's like 60 to 70% of LTV is at month nine, not day one.

[James Zaner]

Yeah.

[John]

And that's like a big industry counter. Like everyone thinks it happens like day one, nine months for us. So we started giving it away because that's like, that's our biggest spenders is these retired individuals. And they're also easier to schedule our tunes for. But yeah, that was, that was insight we couldn't get without a strong customer base study.

[James Zaner]

Yeah. Honestly, are you paying an outside agency to do that or are you doing that internally?

[John]

Yeah, we did. Oh, I don't even remember. I don't remember who we did it with.

[James Zaner]

It would be interesting to. So you could start finding unique data from like the tool clay that I was talking about.

[John]

Okay.

[James Zaner]

Yeah. So one thing you mentioned too was you have 100,000 person mailing list.

[John]

Probably larger now, but. Yeah.

[James Zaner]

Yeah.

[John]

So like a year or two ago was 100,000 our customer database. We add, you know, thousands a month.

[James Zaner]

Okay. So you're probably 152, maybe 130, I would expect.

[John]

Yeah.

[James Zaner]

And you were talking about segmenting. I think that's the interesting thing is like trying to find unique insights on like neighborhoods. Right. You could break it down by zip and start seeing like what the most common thing that happened in X month.

[John]

Yeah.

[James Zaner]

Recently. Right. Like, I think that's the really interesting stuff that could become campaigns or hey, we started seeing people in your neighborhood have this problem. It might be great to book us for a checkup.

[John]

Yeah. And you could rip that probably out of permits, the shelves. Like, hey, hey. We started to see, you know, X number of water heaters, X number of furnaces go live. I think part of it's the trigger. Like, how do you trigger, like getting the data? The data's always been there. Like some of the stuff. You've always been able to get the data. I think creating the trigger points to create an action is more complicated.

[James Zaner]

Yeah.

[John]

So like, hey, this development broke ground 15 years ago or 10, 12 years ago. All right, so awesome. So they're going into roofs, they're going into water heaters, furnaces. Like we are in breaking time.

[James Zaner]

Yeah.

[John]

For that development. How do we create that trigger in order to start doing something? Cause otherwise it's kind of manual.

[James Zaner]

You would almost. Well, I mean, yeah, it's manual batch by the marketer or whatever, but I think if you could sit down and maybe have like a kickoff day where like, your team spends the whole day building these and it's like, okay, what are the 60 developments in our.

[John]

Yeah.

[James Zaner]

In our geo. And then what years are they built? Okay, what can we program a bunch of, like, already in. So that when those triggers hit, they're just going to fire.

[John]

Yeah.

[James Zaner]

Especially if it's forecasting into the future. So then you almost have. You can include that in your predictability model for your budgeting. That, like, we know this year there's four developments that are coming across this. This deadline.

[John]

Yeah.

[James Zaner]

And I think that's interest. That's super interesting. And that also could come down to greenfielding and expanding like 100%. You can start looking at the developments in those areas and being like, what. What do we got going on over here? What can we plan forward to in the future?

[John]

Yeah. What we're trying to do, and we have not been successful at it yet, is between the customer database and just like. So we've got our very large customer database. Like, that's 8% of our TAM is in my customer base, which is crazy. At Wilson, we've saved a stupid amount of money by having AI help out with our call center. And the best tool out there that's making that happen is Evoca. So, look, you've probably heard the buzz about AICSRs. They seem to be everywhere. But not all AI CSRs are created equal. And EVOCA seems to rise to the top every time. They answer every call in the first ring, they sound just like a real person and they don't take breaks. But here's what makes Evoca really interesting in the real World. If a caller's getting heated, like they're getting frustrated or annoyed, evoke a nose. It hears the tone, emotion, and hands the call to a real human. So you can still save that call. And this has been huge for us here at Wilson. There's no more churn or people yelling representative into the phone. And the backend is tight. It directly integrates into Servicetitan at the gold tier level. That means it can handle reschedules, check, check arrival times and look up customer info. It even helps with capacity planning. It's basically a CSR with perfect memory on top of all that, it consistently makes our team better. We get post call analytics, auto tagging, and coaching tools so that no matter who's on shift, we deliver for our customers. If you're curious, go to Evoca AI, a VOCA AI, book a demo, and tell them owned and operated Senshu. So big customer base. A lot of data.

[James Zaner]

How much of that is members?

[John]

3% of the 130. Yeah.

[James Zaner]

Okay.

[John]

Or like a little bit less. 2.5. We have about 3,000 members.

[James Zaner]

Okay, interesting. And then that's only 5%. At 3% of the TAM. What was that?

[John]

So that'd be. So my population in Cleveland is around 4 million.

[James Zaner]

Yeah.

[John]

1.6 own homes and have my required income levels.

[James Zaner]

Okay.

[John]

So that's how we. We measure. Tam is 1.6.

[James Zaner]

Yeah.

[John]

130 is 8% of tam. Now, some of those are debt accounts, old accounts. My live accounts are probably 80 to 90.

[James Zaner]

Okay.

[John]

But still a pretty significant portion of addressable market.

[James Zaner]

Yeah. I was talking to Sam earlier from Service Scalers.

[John]

Okay.

[James Zaner]

Asking him about a campaign. So I recently learned that you can attach a VCF to a QR code.

[John]

What's a vcf?

[James Zaner]

The contact card.

[John]

Oh.

[James Zaner]

And so people can like, scan the QR code. It'll automatically pull up the contact card on their phone. And so there could easily be for like the part of the market or the part of the TAM that maybe isn't aware of you or. Yeah, you could easily do a campaign that's like, you have the QR code, you have the contact card, and it's like, hey, Siri, call Wilson Plumbing.

[John]

Yeah.

[James Zaner]

And then once they add that to their phone, it's like it's stuck in their head. There's like that. So I was thinking about that for the part of your audience that maybe isn't a member or isn't like. And then adding a call rail number there. So then you can track how many people came from that campaign when they call you.

[John]

Oh yeah.

[James Zaner]

Interesting stuff that I was like, how could you access more through like unique ways of like land grabbing.

[John]

Yeah.

[James Zaner]

And it's like becoming the phone number on their phone. How can you like, how can you get that real estate.

[John]

I think that's a big part of why companies do that our way. Our way thing.

[James Zaner]

Yeah.

[John]

For new locations is they get to continue to like it's increasing density. So when we think about, when we think about our next market, like we're probably going to do something that sits inside my current msa. So it's going to be more dense and it's going to be in zip codes that are just on the fringe of where we would currently serve. So hour and 15 away.

[James Zaner]

But hour and 15 away from the office or hour and 50 away from downtown Cleveland.

[John]

From here.

[James Zaner]

Okay.

[John]

Yeah. Because a normal, the hour away thing is what we've just noticed everyone does now. People change at a certain point, but early stages of going multi location, it's our way. Our way. Our way.

[James Zaner]

Yeah.

[John]

So I've talked to operators with six locations. I've talked to operators with 40 and they all do our way. It does tend to switch like people maybe it depends on where you are. But at 10 to 15 locations you have enough going on. You can be more selective of your market. But for those first five or six it's all about increasing density and then increasing memberships. But uh, I want to say it's horizon, but I don't want to give them too much credit if it's not them. So. But they have for some segment. I think it's Washington, like D.C. okay. They have a membership for one in every three home.

[James Zaner]

You were just saying that. I remember.

[John]

Freaking crazy. That's crazy.

[James Zaner]

Yeah.

[John]

That's amazing. And I feel like a lot of that comes from our way, like just being ever present.

[James Zaner]

Well. And yeah. The length of time in the, in the, in the area. Um, also like acquiring businesses that have really good membership programs.

[John]

Yeah. Yeah.

[James Zaner]

It could help. That's insane. Yeah. One in three is. And that's a very dense area.

[John]

Yeah.

[James Zaner]

That means like that means the person two doors over is also a member.

[John]

Yeah.

[James Zaner]

That's crazy.

[John]

Yeah. I feel like members are. Members are an interesting one as we were a little scared of this year because we started the giveaway thing in January.

[James Zaner]

Yeah.

[John]

And we've added sold and given away. We've added like 600 net new members I think.

[James Zaner]

But you're, you're just losing on the things that you give for free in the program. They still got to spend on units and things like that, right?

[John]

Yeah, like we basically don't care.

[James Zaner]

I think if you, if you're not losing, you're giving. I'm sorry. Right, like that word.

[John]

Basically. I think, I think people need to nail down what is the purpose of a membership.

[James Zaner]

Yeah.

[John]

And for us it's stickiness and ltv.

[James Zaner]

Yeah.

[John]

Like that's the purpose of a membership. And I think people get really caught up and like, oh, should be 10 bucks or 15 bucks or 40 bucks a month.

[James Zaner]

Yeah.

[John]

It's like it doesn't fudgeing matter.

[James Zaner]

Yeah.

[John]

It's the LTV and it's the stickiness and that is what matters.

[James Zaner]

Yeah.

[John]

I believe we have it right. But maybe in two or three years I'll be like, dude, that was terrible. Yeah, terrible idea.

[James Zaner]

Now are there. So plumbing and H vac you can have a membership. You probably can't have a membership in like roofing and exteriors. Maybe.

[John]

I know some guys that do.

[James Zaner]

Okay. But it's like, it's very like long term projects. Yeah.

[John]

Yeah. It's like, I'll tune it up. I'll make sure your shingles are. Yeah, I don't really, you know, we've had a lot of roofers on. I still don't really know how it works.

[James Zaner]

The roofer jokes are funny, dude.

[John]

It is. It is so much so annoying.

[James Zaner]

Okay, so I will humble myself. I between jobs before taking a job at Modernize. I quit my job. I just didn't want to work in tech anymore in that side of tech anymore. And I drove Uber and like I think multiple times I picked up a guy who ran a roofing company from his living room that just subbed out everything.

[John]

Hell yeah.

[James Zaner]

And it was like, dude's living. It was just.

[John]

Well, there's just got to know how.

[James Zaner]

To LSA and Google Ad space.

[John]

I feel like there's a good argument for that in. In H vac or. Or plumbing. I think there's a way to do it. So you know, top line. I don't remember where they're out of, but I think Pittsburgh.

[James Zaner]

Okay.

[John]

I got to have them on the show. They're close enough. But they run an install only model, so they're. And they're growing like crazy. So they're doing amazing stuff. So I want to give all the credit where it's due.

[James Zaner]

But they're subbing out everything.

[John]

I don't know if they're subbing it out, but they won't service the equipment unless they installed it. So they've gone from like 0 to 40 million in like three or four years. Wild growth story.

[James Zaner]

Who's offering the warranty? The installer?

[John]

Yeah, like, well, they are. I don't think they sub it, but I think, like, my point is they're not worried about service at all. And they're basically a sales and marketing engine. Like, they do handle the fulfillment.

[James Zaner]

So it's like Legion. Okay.

[John]

Yeah. Like, basically.

[James Zaner]

Yeah. So there's local companies that they will sell the install to.

[John]

I have to find out about.

[James Zaner]

Yeah.

[John]

I just know that the, the big emphasis is install only, so it just reminded me a ton of roofing. So I do think there's an argument for, for doing that.

[James Zaner]

Okay. The membership things. I think you keep mentioning ltv, and I think when people think about lead partners, they don't think about ltv. They look immediately at the NSLI or the cost of marketing.

[John]

Yeah.

[James Zaner]

And they're not really looking at the ltv. And I think as more and more people get smart, like H VAC and plumbing, where they start looking at these memberships and they are tracking this, you know, contact object in their CRM for years at a time. It's like, bro, you spent 40 bucks on a lead.

[John]

Yeah. Come on.

[James Zaner]

Like, you made like $40,000 off of them over 15 years.

[John]

Yeah.

[James Zaner]

And we got them to you when they were in need. So I think that's the, the interesting story.

[John]

Well, I think that's, that's the. Like, how are you continuing to reactivate that customer?

[James Zaner]

Yeah.

[John]

And like, what's the discipline that's there? And obviously some, some businesses, you can't do it. Like.

[James Zaner]

No.

[John]

Yeah. Like roofing, like, you know, you're not going to sell a roof every year.

[James Zaner]

No.

[John]

But power washing, obviously, plumbing, H vac, electric, that's pretty sticky. What are some other ones you can.

[James Zaner]

I think also you got to look at like your, your, like referral and review programs. Like, if you're using like a snowball or I don't know, there's some new referral programs out there. Where, what do you get? Like, what's your average net generation off of a single lead? Like, how many times does that get referred over or something like that. Like.

[John]

Yeah.

[James Zaner]

And if you find a power referrer and that person refers you four other jobs, like, what is that worth to you? And so.

[John]

Or training internally. Like, what we found is it's 15 to 20% of any lead will turn into two leads. So if someone call and we have a bunch of buckets to catch it.

[James Zaner]

Okay.

[John]

So you guys send us A live lead. We handle it the same as we have like buckets of how we handle leads. But like, we treat Modernize and LSA like roughly the same. And so it comes in and we have a little bit of a script specific for it, try to keep it tight. But then we offer them a promo. So if I'm calling in about H Vac, we're going to offer them a promo for electric or plumbing. And it's like, hey, we also have this, just so you're aware. So we attempt to at the first offset, turn that one lead into two and have the price. And then once we get on site, we do the same thing. So we. And we get really, really tight about it during like quarter one because there's just less leads to deal with. That wasn't our, that wasn't our experience this year. But last year, like we became just a machine at every lead that comes in the door. Did we. How many chances did we give that lead to become two leads? Did we refer in plumbing while we were on site? Did we bring up our rehash? Like, did we handle on the first call? Did we handle it when the tech was in the home? Did we bring it up after the exit? Like, did we, did we like cross pol?

[James Zaner]

That's all being tracked on Service Titan. Service Titan?

[John]

Yeah.

[James Zaner]

Okay. And if you have you brought in home for like Rilla or Ciro?

[John]

Yeah, we, we have tried both right now with Ciro. I don't know that like, we've tried both.

[James Zaner]

Okay.

[John]

I'm not like wild about any of them. I think, I think execution is the more important part. And like how you're recording it just doesn't matter that. Okay, my quick take.

[James Zaner]

Yeah, No, I was curious because I was like, how are you tracking, like the offers? Like, how. I mean, the.

[John]

Well, so we try to measure it. Like we do measure. So who. Who's it referred by? So we just track like number of leads set a day.

[James Zaner]

Okay.

[John]

And that's like either the technician set that lead or call center set that lead. So that's kind of easy to track. And then on the rehash campaigns, post visit, there's a few videos, there's a few other ways to like cross pollinate.

[James Zaner]

Yeah.

[John]

The big thing we're aiming for is we found out that only 7% of our customer base used all three services. Seven percent, that's interesting.

[James Zaner]

That's really massive growth.

[John]

That's a. Yeah. So like we're looking at our own customer list and we're like, holy shit. Probably the Biggest growth opportunity that we have over the next 12 months is taking that from 7 to 30%.

[James Zaner]

Sure.

[John]

Like that would be game changing.

[James Zaner]

Yeah.

[John]

And that's not even acquiring new customers.

[James Zaner]

Yeah. And is that membership cover individual business units or the entire. All three.

[John]

It's all three.

[James Zaner]

Okay.

[John]

Yeah.

[James Zaner]

Interesting.

[John]

Yeah. So 7% uses all three. And I don't remember what the number was for for two of the three, but it was, was really interesting I.

[James Zaner]

Think building programs around that. One of my, the guy, the CRO of HubSpot, the original CRO of HubSpot, Mark Roberge, he used to say, would you rather have a thousand customers using one feature in your product or like 100 customers using all five features?

[John]

Yeah.

[James Zaner]

And it's like you want that 100 using all five.

[John]

Oh yeah.

[James Zaner]

They're raving fans.

[John]

Oh yeah.

[James Zaner]

They'll tell everybody about you.

[John]

Yep.

[James Zaner]

They've got you in their phone. They like watching your commercials. I think that's. Yeah. So if you can convert people into the, the trio. That's nice.

[John]

Yeah. It's been a big focus of ours. I think we, we're at like six or seven steps now that we've implemented to turn one every lead into two different leads.

[James Zaner]

Yeah.

[John]

And then cross, cross selling across the business because we want to increase our density of service within our base.

[James Zaner]

Yeah. Magic. It's like being Mickey and Fantasia.

[John]

Yeah. Well, and if you have a big enough customer list, like we'll talk to, we'll talk to people that have like 10,000. That's a lot. Like 10,000 human beings are in your customer list. You know, maybe they're like a three, $4 million business and it's just an old business. Sure. But a three or four million dollar business probably only needs like 15, 20 appointments a day and they have 10,000 over here. And I'm like average click through rates.

[James Zaner]

Gotta be 1% at least on that email list.

[John]

Yeah, yeah, yeah. I think roughly 1% on email list or even outbound calling to our customer list. Yeah, like our outbound calling, our, our book rate on an outbound call is like 14%, which is crazy. Industry average is 6 to 8. So our call center manager does an amazing job. But that's really like a lot. Yeah, that's a freaking lot wild.

[James Zaner]

And are there like, oh, so you were getting into water treatment. I know you're in that, right? Like do you do water treatment? That's an amazing bolt on. That's what, five to ten grand acv.

[John]

Yeah.

[James Zaner]

Like that's insane.

[John]

Yeah.

[James Zaner]

And so yeah, like Thinking about just adding in new products and product lines and stuff you could.

[John]

Yeah, just.

[James Zaner]

I think you were talking about finding like 5 million under a rock and stuff like that. Like, that's.

[John]

Well, that I think. Yeah, Tommy said that and he said he. He brought on this CFO and they kept just like finding buckets of money. I think that's a direct quote. And. And what has been kind of funny is like, as the bigger the business has gotten, I'm not finding the same buckets as Tommy is, but we are finding these random pockets of opportunity just inside. And we're not that complex of a business. Yeah, we're maybe mid size, but still one location. Not that complicated of an org structure. So to randomly be able to find like 40 or 50 grand or sometimes more is like, yeah, what the heck.

[James Zaner]

Yeah, it's wild too, because you're taking over, like. Right. And that's a lot of the industry right now. Are the. The. The new generation, the heirs to the thrones that are taking over their father's businesses or. They're, you know, it's these investors, like, coming in and like, learning how it all works. And then they're just like. It's like, move. Like going to grandma's house after, you know, everybody's gone and like going through all the old things. It's like, oh, wow, there's this. Oh, wow, there's this, like, you just start finding stuff that you didn't realize was possible. The industry, I'm so excited about the industry.

[John]

Yeah.

[James Zaner]

There's so much going on.

[John]

Yeah. You were thinking about getting deeper in yourself.

[James Zaner]

Yeah. My buddy, he keeps sending me these. Like, there was a plumbing company in the west suburbs of Chicago for like 250. Yeah. I mean, there's. There's flooring companies. I don't like flooring, though, because oftentimes they're just like a showroom and they don't provide install, and you got to figure out how to set up the install and. But yeah, it seems like a legitimate path for me after, like, you know, stay at Modernize for as long as I want, learn as much as I can, keep talking with people like you, and I'm basically going to college.

[John]

Taking this back to Isaac, that was roughly what he did. So he. I actually don't know how many site visits he did, but he visited us a few times when he was in, like, the exploration stage. And he just came and hung out for like three days.

[James Zaner]

Yeah.

[John]

And comically, this was. This is kind of funny. At the end of it, he's like, you know John, you really shouldn't just like let people copy your business. Like show up like random people on Twitter show up like that is kind of weird. And I'm like Isaac at the moment now we're very good friends. But yeah, I was like Isaac, you're a random person on Twitter. But yeah, he basically went to school for 6 to 12 months site visiting all types of companies all over the US and just like how did you do this? How did you do this? And taking the best.

[James Zaner]

I mean literally you can just listen to own and operate it and it is legit.

[John]

Yeah. It's meant. Yeah, it is pretty. Like here's what we're doing. I think the. Now the danger is if you're. I. Jack tends to call me on it but I tend to be a bit unrelatable at times because the things I'm working on aren't the same as what like a million dollar shop would work on. So we do, we do try to hit that too but for the right zone. Yeah. I'm a great resource.

[James Zaner]

Yeah. It's. Well even just because Jack, I mean what was it like a year and a half ago Jack started doing plumbing.

[John]

Yeah. He's like, he went from a million to five in like two years.

[James Zaner]

Yeah.

[John]

Yeah.

[James Zaner]

And so that's interesting watching. And by the way, I was kind of looking forward to meeting Jack, having him been a bitcoin bro in the past.

[John]

Okay. Yeah, yeah, yeah.

[James Zaner]

Just like him like doing all these different things and then getting into the trades. It's interesting. Interesting questions for him. Yeah.

[John]

Your long term vision is that you end up in the trades in a deeper capacity. Somehow.

[James Zaner]

Somehow I think I'm just, I'm. I'm a wealth of knowledge when it comes to like I would say like novel GTM strategies and then working at Modernize. I'll probably be here for a few years and I'm just going to acquire so much information across trades. Like yeah, 25, 30 trades.

[John]

Yeah.

[James Zaner]

I imagine some PE company is going to come and try to like scoop me up at some point and be like what do you know? But I would love to dabble in ownership. I think I've never really challenged myself to own something. I did a little VR company back in the day that was kind of fun. I was going to weddings and corporate events, launching like this VR platform. I think that would be really interesting. Is trying the game. Yeah. Because it's not as. I don't need to be a software engineer. That's where software is hard. You got to be a software engineer, you got to know how to do product management and all that stuff.

[John]

Feels like that's starting to change.

[James Zaner]

Well, yeah, with the.

[John]

I mean this is crazy. Yeah, this is crazy. I have all these friends just starting to like pump out, you know, lovable apps and I, I wonder if, I wonder what'll happen. And this, this doesn't feel like a great moment to be in SaaS.

[James Zaner]

No. Somebody can build like somebody could.

[John]

I don't know what it takes to rebuild a service titan, but I know it just got cheaper.

[James Zaner]

Yeah, well, it's not even rebuild a service titan. Most software we just talked about, like most people only use one feature for your app and so like all somebody has to do is go build that one feature, put. Make it a chrome extension or whatever.

[John]

Yeah.

[James Zaner]

And sell it for 29.99 and get 100,000 customers and then they're sitting pretty and retiring. It's pretty wild.

[John]

That is wild.

[James Zaner]

I'm seeing it happen all over LinkedIn.

[John]

Yeah, yeah, yeah. We're starting to mess. We building an automations team.

[James Zaner]

That's good.

[John]

And we've had one person in the role for like four or five months now.

[James Zaner]

Yeah.

[John]

And then we're adding in the like AI component right now and it is wild. I assume we'll sell some of them off public but most of them are like, hey, I have this hyper specific need to draw data out of Service Titan. That whole AI integration thing inside Service Titan. I really think they need to do it because I'm having to build apps to do that right now because their reporting is tough.

[James Zaner]

Are you using N8N or are you actually building JavaScript?

[John]

It was JavaScript and then actually I don't know if JavaScript specifically but it is line coded. Now we're adding in. It's either replit or.

[James Zaner]

Yeah, replit.

[John]

You can build apps. Yeah, yeah. I mean, well it builds like 80% of the app and then you just need the coder to do the back 20. But like we have the coder now. Like we built that team. So yeah, we're starting to spin out. Like our first app went live on Monday and it's like very simple but it's a dashboard for our support teams because a pain point, which I never knew I'd have this fucking pain point. But apparently when you get larger you have to know the response times of your support teams. Makes total sense. Like you're probably used to this. Like, hey, we expect four hour email response times to our customers. Whatever big a thing, you know, when you're $10 million. Doesn't. Doesn't matter. Nobody really cares about that. But at 30, we have to care about it a lot. So, like, what is our HR response time? What's our HR resolution time? What's our fleet response time? What's our fleet resolution time? So we added. That's our first app that went live on Monday. Again, not pretty, but it's functional and we can track response times and resolution times across our six support teams.

[James Zaner]

Yeah.

[John]

And now we just threw it up on a tv.

[James Zaner]

It's like Google Data Studio. But like.

[John]

Well, that's what we were gonna use. We were gonna use Google Script or I don't remember what the goo. It might be Google App. I don't even remember. There's some.

[James Zaner]

There's an app Script. Yeah, yeah, they have the data studio too. I saw. So there was one guy who recently used clay to build a lead magnet for SEO for his teams where he went and scraped the company. He ran the company's numbers, like through the. I don't know if it's a Semrush API or Google Search API or something like that.

[John]

Yeah.

[James Zaner]

Pulled all the data in and then connected to the replit API, built the replit dashboard for all their numbers. And then he sends that in the email. He's like, here's your current.

[John]

Yeah.

[James Zaner]

It's like, it's so wild how quickly they can automate it.

[John]

It's wild. Yeah. We're trying to get deeper into it. I think it's a. It's a funny project to work on and funny only in from like, I'm a plumber.

[James Zaner]

No. So like. But a business.

[John]

But the amount of data that we need to run this ship every day is wild.

[James Zaner]

Yeah.

[John]

I really, every time I think about our business and you know, think about like, what it takes to run it today, I really am amazed by companies that grew 20, $30 million, like 15 years ago.

[James Zaner]

Yeah.

[John]

I mean, that's granted why there was so few of them. It's just incredible what it takes.

[James Zaner]

Yeah. I, I mean, you got the premier home pros doing zero to 100.

[John]

Yeah.

[James Zaner]

Two years.

[John]

That's crazy.

[James Zaner]

Roofing, bathrooms.

[John]

Yeah, yeah, well, bathrooms, maybe kitchens, but yeah, very sophisticated lead funnel. They're going to come on the show in a couple weeks.

[James Zaner]

They should.

[John]

Yeah. Yeah. I think they're based like 15, 20 minutes away.

[James Zaner]

I'm going to visit them.

[John]

Yeah. Heck, yeah. Yeah, yeah, yeah. That'll be, That'll be fun. I've got a couple rapid fire Q&As for you. Let's go. What is one piece of advice for marketers working with AI?

[James Zaner]

Yeah, I kind of said it earlier. Just start talking to it. It's scary at first. You're worried about people getting access to your information or data. The privacy is probably impeccable. I imagine OpenAI is never going to let somebody hack your account if you don't have an easy password. But just tell it as much as you can about whatever you're going through, like whether it's even relationship with your boss, the current situation you're in, the problem you're trying to solve. Where can you access resources for more information if they don't currently have it? I Talk to my ChatGPT app on my phone a lot.

[John]

Yeah.

[James Zaner]

Put it in the voice to text mode. I don't want to hear it talk back to me. I just want it to give me text feedback. And it's changed my life and my team's output and performance significantly.

[John]

Yeah, it's awesome. Of the various verticals you guys have right now, what's your favorite?

[James Zaner]

What's kind of yours? The H vac, Plumbing, electrical. Just because it's the most entertaining content right now. You. You have me at roofing. Like that one's. I'm starting to get interested.

[John]

Roofing is such bullshit.

[James Zaner]

Starting to get interested in bullshit. Well, I just. I mean, watching the home, genius story, like, you'll learn. I'll. I'll show you what they're up to. But yeah. As three guys moved over from collegeworks painting, three executives started an exterior company and they're booming. Yeah, I think water treatment's going to be super hot. Moving forward in the future, water quality is going to definitely become more questionable. Yeah, it's just like human nature for water quality nearby to become more questionable. Like, really bad at keeping water sources fresh. Yeah. We're getting into, like, new trades, like fences, decking, things like that. So those will be interesting to look into. I think sunrooms is. I was talking to a guy about sunrooms. ACV is like 50k.

[John]

Yeah. I. I feel like if I was redoing all of this and I was intelligent when I first started, I would have picked, like, Premiere is doing an amazing job and they're totally kicking ass. Like, this is not dogging at all. They're inspirational. But it sure helps having an average ticket of 50 to 70 grand.

[James Zaner]

Yeah.

[John]

So I'm like, man, I should have. I should have done that. Like, we should have done something. And that's why roofing, I think, is a bit Alluring. It's like, okay, average tickets, 18 to $20,000, and you're mainly a marketing and sales engine. Yeah, like, sign me the fuck up. Like, where's the line? That sounds amazing.

[James Zaner]

Yeah. You're just competing at. @ H1s and H2s, right?

[John]

And, like, I think I can play that game. Yeah, maybe I can't, but I think.

[James Zaner]

You know, you want to.

[John]

I think I can.

[James Zaner]

It's like ufc, right? Like, I think I can.

[John]

Whereas, like, plumbing's average ticket is good, but it's $2,000, $3,000. Like, it's just a different game.

[James Zaner]

But it's also fun because you have these rabid fans that, like, follow you. It's probably a lot easier to build a podcast in the community. In plumbing and H vac, you don't have your roofing customers sitting around listening.

[John]

Yeah, well, a lot of roofers listen and they see. The funny thing about it is I keep calling it easier than H vac and I'm expecting some roofer to like, like, clap back in the comments and they're like, nah, dude, it is.

[James Zaner]

Fuck. You guys collecting checks?

[John]

Yeah. What is a current marketing trend that's overhyped?

[James Zaner]

Current marketing trend that's overhyped? Well, I'm in a different space for being B2B, but I don't think anything's overhyped. I think the hype comes from the people it works for, and the people who think it's overhyped are the people it doesn't work for. So, like, I think because, like, marketing's marketing, man, not everybody can do each individual tactic the same way. Like, not everybody has a face. Right. Like, and sometimes it's not the most attractive face that wins on. On video. Right.

[John]

You're seeing it right here.

[James Zaner]

Yeah. And brand, too. Like, sometimes it's not the most attractive, like, multi hundred thousand dollar brand kit like, that wins if it's over. If. If you feel something's overhyped, you're probably not good at it.

[John]

That's a nice take. I like it.

[James Zaner]

A hot take.

[John]

Yeah, it's a hot take. Yeah.

[James Zaner]

Hot take.

[John]

If people want to connect you with you, where can they find you?

[James Zaner]

I'm at James Zayner on Twitter. I'm LinkedIn.com/in/James Zayner on LinkedIn. And I'm also at Modernize. A lot of cool stuff to talk about. I imagine my. My goal this year is just to become a sophisticated knowledge keeper of information, like, stuff that you deliver on your podcast. I want to start meeting a lot of customers. I want to start talking about tactics and things in person. Yeah. So here for you, if you want a conversation.

[John]

Awesome.

[James Zaner]

Yeah.

[John]

Thanks for coming on today. This was a lot of fun.

[James Zaner]

Awesome. Yeah. Thank you for having me.

[John]

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