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.

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.

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)

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.