← The Home Service Expert Podcast
The Home Service Expert Podcast
Why Direct Mail Still Dominates Home Service Marketing (Dan Harlacher)
00:59:03
Loading summary
Transcript60 lines
- [00:00]
A
All of the operational side of the business equation needs to align effectively with the marketing side of the equation. When we put it together, that's where we start to see the magic happen.
- [00:11]
B
Welcome to the Home Service Expert, where each week Tommy chats with world class entrepreneurs and experts in various fields like marketing, sales, hiring and leadership to find out what's really behind their success in business. Now your host, the home service millionaire, Tommy Mello. Before we get started, I want to share two important things with you. First, I want you to implement what you learned today. To do that, you'll have to take a lot of notes. But I also want you to fully concentrate on the interview. So I asked the team to take notes for you. Just text notes N O t e s to 888-526-1299 that's 888-526-1299 and you'll receive a link to download the notes from today's episode. Also, if you haven't got your copy of my newest book, Elevate, please go check it out. I'll share with you how I attracted and developed a winning team that helped me build a $200 million company in 22 states. Just go to elevateandwin.com podcast to get your copy. Now let's go back into the interview. All right guys, welcome back to the Home Service Expert. Today I got Dan Harlach here with Valpack. You know, a lot of clients been asking me who do you use, how are you getting leads and what works? And I'll tell you, I've been with Valpak since the first day I got into business. My dad used it at his transmission shop in the 90s. I'm a big believer in mail. I just believe it still works. He's an expert in marketing, branding digital advertising. He's based in St. Petersburg, Florida. Dan is the owner of a Velpack franchise helping businesses grow through targeted advertising and marketing solutions. With decades of expertise in direct marketing, Dan specializes in connecting brands with the right audiences through products like the iconic blue Valpak envelope, the Valpak Digital Network Digital push email and customize customized residential and B2B solo mail campaigns. Previously, Dan served as the Vice President of Network Sales at Cox Target Media and held senior leadership roles at Advo, where he led regional sales strategy and operations. Throughout his career, Dan has focused on driving measurable growth, strengthening brand awareness and delivering high impact marketing solutions for local and national businesses alike. Today's Episodes How Valpak evolved from an iconic blue envelope into a data Driven omnichannel marketing engine. And why? Combining targeted direct mail with digital precision, maybe the most underutilized growth strategy for local businesses today. And Dan, let's kick some ass, man. I love doing this kind of stuff because I'm a marketing machine and I just, I love to make the phone ring and I love the conversion cycle. So let's just start out with a little bit about yourself and the journey where you got here.
- [03:04]
A
Yeah, pleasure to be with you and again, happy birthday to you. Hope you have a great day. Great to be with you this afternoon. So I've got about 30 years in the business, as you mentioned, franchise ownership, corporate positions. It's a great position to be in when you're on both the buyer and seller side of a desk. You appreciate the interaction as it relates to media and marketing recipes. And so, man, it's been a great journey in the direct mail business. We started from kind of that spray and pray world where everybody kind of pigeonholed us in this one dimensional product solution. And I got to tell you, over the last three and a half, four years we have really grown up and incorporated and integrated data into our go to market approach. And that has really set the bar high for us and held us more accountable to deliver KPIs in the home improvement home services sector, particularly by marrying data with product solutions. So we have learned and seen there is an integrated relationship of all media, especially in today's environment, with the consumer. So we want to get our act together and our game together on integrating data into product solutions. And we want to align that nicely with all other multiple solutions from digital to social and all the other things out there that are trying to drive leads for advertisers.
- [04:32]
B
You know, I had Benji, I just want to bring his name up because, you know, I was around for a long time. Mike Davis asked me to speak at a couple events with you guys throughout the years. And when I met Benji, I was a little bit overwhelmed because the data and the data science and the metrics and what you guys know about my avatar was just unimaginable that you could get that kind of data. I mean, when I was a little bit weary to download my whole customer list, but you guys, we ran it through lawyers, we made sure that our data was guarded and you guys were able to tell me my ideal avatar and Benji just blew my mind. I mean, and he just was in town a couple weeks ago and he's like, man, you think that's cool? Wait till you see what we're building now. And it's insane. I mean, the stuff you guys know, you guys know how many pets people have, you know how old they are, their credit card scores, when they're moving, when they move, like all the mover date. It's just insane. And it's the unfair advantage. I mean, a lot of people look at you guys as, yeah, those little coupons that come in the mail. You guys are like a data warehouse and one of the best. I don't know how big the company is exactly, but I just know that there's nobody that mails more than you guys and what you guys know about the homeowners. And it's absolutely phenomenal. And I guess I'll just start out by asking you, you know, you, you said you guys pivoted in the last five, six years. Where, where's the company going and what, what have you guys kind of seen?
- [06:16]
A
Yeah, so first of all, we believe that data really leads off all other aspects of any marketing ideas, thoughts or proposal options that we put into place. So if you think about, you mentioned our footprint, if you think about the Valpak audience footprint and the clip audience footprint combined, we're about 65 million homes monthly. But we have really come into our own in managing and owning our own in house data. So at the core base of that, we own about 165 million residential address records. And so first things first is anytime we're going to work with data against those residential households, whether it's customer supplied or data that we draw in from our sources, we're refreshing that residential list every 30 days nationwide. So when we do any modeling or indexing, it's being bounced back off to a most recent residential address record list wherever we want to go. But when we work with data, and you mentioned, you know, your reluctance at first about providing data to us, I'm happy to report we probably have over 2000 home improvement home service clients that are now sharing their data with us. So essentially under NDA and all the work that we do with data here is all SOC 2 compliant. We treat it as if it was your mother or father or brother that was doing the work on the data. There's only a couple sets of eyes that work with it and we take that information from the CRM files that clients provide to us and we go to work, we look at those avatars, we try to customer segmentation and analyze who the paying customer is. So it's one thing where a lot of companies may say, you know, who's my customer? What do they look like when you start at the top of the funnel it can give you kind of a misread on who you're really going after. So we go bottom up. We want to go who are sold net sales customers, look at those address records and then define them into a lifestyle life stage attribution state for each one of those households. And once we do that it starts to paint the picture of who the real customers are out there and how do they engage in media. So we have the ability to, to really analyze if I'm a 65 plus age person and my median income is 150 or 200, what is my tech IQ, what is my tech engagement, how do I engage with the different medias across the landscape. So it gives us tremendous insight on making a more accurate and informed decision on bringing proposals to the table in terms of how to effectively use a co op mail or a shared mail solution to targeting and or target it to the right neighborhoods or carrier route levels within zip codes in those neighborhoods.
- [09:30]
B
So you know I know a lot of business owners and they blame marketing. They there's so many options now. Tv, radio, billboards, get your trucks wrapped, lsa, BBC mailers, it just goes on and on and on. You can do you know the ott. There's all these things. Let me ask you what problem does valpact solve better than anyone else?
- [09:55]
A
I think what we have the ability to solve is when we align to the right lookalike audiences. After the analysis work is done we are able to solve the are you meeting or not meeting my KPI targets? We want to build programs that are going to deliver a cost of marketing number, a ROAS number that's going to meet or exceed your needs. And so we become a viable part of your media mix. We're driving incremental growth in new customers and or new sales. And we know the customers out there are not one dimensional. There is this integrated media engagement by consumers and so whether I'm touch one or touch three of getting that lead to engage with you or to your website, we are a valuable and viable part of the solution now to make sure we don't leave that untouched consumer behind where they didn't have the traditional versus the digital option to react or engage with you directly.
- [11:03]
B
Why does direct mail still work in today's environment? I mean Google gets most of the credit. We know that the LLMs are growing but you know I still think when everyone's saying AI over here it's like a magician we should be looking over here. So what Are your thoughts right?
- [11:20]
A
So like it or not or regardless of what your perception is, the mailbox is sexy. And it's sexy for a couple reasons. A lot of the consumers that are true net sales purchasers of products and goods and home services and home improvement, they're aging up. They're 60, they're 62, 65 and older. They're the homeowners with good solid credit. They're the homeowners that are looking to say what is my next home improvement or home service need? And that 60, 62, 65 and up age group. They invol, they engage and they get involved with traditional media. They love going to the mailbox. They look inside and see what's in there. And that is another trigger that excites incense and turns that consumer on. When we look at the home services and home improvement sector just in the last 12 to 16 months, there are certain lifestyle segmentation groups we look at. One of those segments is Gray Power. Gray Power is a lifestyle life stage segment that's 65 up with a above average median income nationwide. That one sector alone across many different brands across the country is moving up higher and higher in the index ranking. So that tells us the consumer age, the group of consumers that are buying goods and services regardless of the environment. Right now, economically, those folks are aging up and they welcome and look for traditional media. They welcome print in the mailbox and they go to the mailbox to see what else is in there to save and what's going to excite me to pick up the phone and call or make a purchase.
- [13:07]
B
I love it, man. I've gotten great results with you guys and I've got great attribution. And when I started doing monthly meetings and really checking into what's working, you know, Rick, Rick takes his time. We sit down for about an hour and our comm is unbelievably low. But here's what's interesting is it's very high in markets where we just get into when we greenfield because nobody recognizes us. And I feel like some people play this game when they do mailers of who could be the cheapest, how do I get a better offer that's cheap, cheap, cheap, cheap, cheap. And I stopped doing that. I started focusing on a really clean message with my truck in it. So people recognized it and not messy. I don't have a million numbers on there. West side, north side, east side. I don't have a million offers. And everything that we do, I keep it super clean, kind of like a Rolex. It's just kind of there. It's like there is offers. And then I learned how people look at coupons. They hold it with their left hand usually and kind of just go through it. What advice do you give somebody that's competing? Just saying I want to be the cheapest one out there and just keep offering better and better and better deals.
- [14:20]
A
Well, you don't need to be the cheapest one out there. But I think again, the messaging in the print message itself is very critical. So less is more. To your point, less is more and that includes any type of a print image that we're going to insert or place in the mailbox. So again, what we do is we look at the customer segmentation and the attribution of what the consumer and the customer looks like based on sold customer records. And when we look at that, we not only think about the where geography wise, but we also say let's tap our creative services expertise and say what is a 65 year old or a 52 year old or a 67 year old? How are they going to engage in a print message and versus maybe somebody that's in their mid-30s or 40s? It could be very different. So less is more. Headline message offer. I want one or two compelling offers that gets my attention. Don't have to be the cheapest and we don't advocate that. But it needs to be a clean message with fonts the size that allow you to see without squinting. And I'm going to grab my attention for longer than 1 or 2 seconds. Headline Message offer. I'm in need now. I'm engaging and I'm off to the next touch.
- [15:39]
B
Do you feel like. So the way it works is per zone is 10,000 homes. Do you think being hyper localized, the cool thing about Valpak is you could, you know, this is not easy to do and I don't advise if you're not set up to do this. But you could change each 10,000 to be a little bit more hyper localized. Like for example, if I was going to Sun City, there's special things for Sun City like Sun City's best garage door repair or H Vac. How important is it to look like a local business?
- [16:14]
A
Yeah, I think it's very important. You want to have that hometown feel. So at the very first point of that it starts with a local call tracking number. We encourage the use of call tracking number because it holds us accountable and it definitely shows evidence that the program, the campaign is in full mode. When we show local area codes as an example, the Message is it looks and feels like it's a local business. If I have certain parts of the region where, to your point, if I'm, I'm, if I'm in Florida down here, I may want to show images of a Florida type home or house or window or roof or garage versus something that looks like it's in Alaska or up in New York. Right. So those are things we can all take into, into consideration when we finish out our data work. And to the final point, we have the ability to version that out then. So included in our programs, included in our analysis, we're going to say, hey listen, this creative look may, may work better in California than it does in Texas or Tennessee. Or let's take advantage of the versioning capabilities that we have to localize that message more effectively. You don't need to go neighborhood to neighborhood on versions, but in areas where you have a serviceable market or a branch, and that branch is unique and it requires something that's specific to make it look local. Absolutely. Look at localizing the version. And in part of the work that we do, we do AB testing. We do that with your group. We've done that with many other customers. So we'll try different offers, we will try different creative looks and we can do the AB testing to a point where we're able to measure that and say did we or did we not see lift or difference, good or bad? And those different creative messages.
- [18:11]
B
What our business is getting wrong about the way customer or customer acquisition today,
- [18:20]
A
you know, I think I'll go back to the CRM and the use of data. So what, what we see a lot of is it's a lot of times the reaction may be gut versus data. And when we go with our gut, what we often see is we're missing the landing zone by a lot sometimes. And so it's incumbent upon us to be able to be transparent and push back against the client or the buyer that says your data is telling us this. And because of that we're pretty confident this is going to give us the better outcome or result. We, we will see many times where a client may tell us, I have to be here or my business is coming from here. And in fact when we do the data, because we do a one to one household match back and when we analyze that customer, we will show you, hey, you're about 50% off or 30% off or all the way off on where you thought your customer was coming from. The other challenge or the other sometimes overlooked piece that we see is when you have serviceable zips or service areas that you service, we have a conversation that says the data says this. But operationally, are you healthy and ready to support leads based on where your techs or your trucks or your salespeople are? Are they dare to run leads to provide an exceptional consumer experience? We want to market and go there. We don't want to market and go to where you can't service it. You don't have a truck or a tech or a salesperson or you can't reach them in an ample amount of time to convert that lead to a sale.
- [20:01]
B
You know, when I really started getting very, very close, I basically took over as a CMO last year. And I said to every vendor, including I started a meeting with Rick regularly, is hold us accountable if our booking rate's not what it should be in a certain market, if our face to face conversion rate, if our cancellation rates too high, if the opportunity job average, which is average ticket. I need the right people in the leadership team in that market and my VPs to know that this isn't going to work unless we increase performance. Now my booking rate is pretty consistent across the board. Cancellation rate goes up, that's a bad thing. But then I need to convert those and that's going to bring down the comm and it's going to increase the return on ad investment. So, you know, for me, you guys have helped out a lot. I mean, Rick said let's pull 10 zones from this market. Let's, let's put some double. I don't know, what do you guys call like the, the one of your.
- [21:02]
A
The two panel flyer, the larger insert
- [21:05]
B
and everything he said was spot on. And then I have a meeting with the area manager of four markets in particular and I said, if you do not start training more and get this figured out, this is not going to work for you. But it's working in the other 31 markets and it's crazy. And if we're focusing on the numbers and we're driving the metrics and we're making the changes and we're partnered correctly and I've been doing this for 19 years, Dan. I mean I've never stopped. I used to have Santa riding into town with a Liftmaster opener on the back of when it would hit. And I had turkeys for Thanksgiving and man, those did really good. That's back in the day when I was really involved with the ads. And I'll tell you, this stuff really does work. And explain to me real quick who's a client that you don't want.
- [21:58]
A
You're talking about from a mailer standpoint or from a consumer.
- [22:02]
B
No. Who's a client that we don't want? You know, maybe somebody that doesn't have any attribution or knows any KPIs or a mom and pop with one truck. I mean, who, who's not your ideal client?
- [22:14]
A
Well, I mean typically it may be somebody. For example, to your point, I don't have the bandwidth to drive the business based on what I need to be doing off of what the industry tells us is the right size approach. You can't put a band aid on something. We're not a Hail Mary. You can't, you know, put marketing out there and then build the business up without thinking about what is my operational fitness look like on that side of the equation. And so you gotta make sure that you are ready to roll and that you have budget and you have staffing that are in place to accommodate what you're looking for when those dollars start coming in off of that advertising spend. So if your pocketbook is too small, what I do is I say, you know what, it's not a good day for us as a solution to you based on we know there's a high probability this program will fail if we're not going to go with what we know to be tried and true in the category. And so we're going to be very transparent up front and early. And we would rather be transparent and say do it this way. And if you're not ready, that's okay, we'll be here when you are. You want to revisit that?
- [23:41]
B
I want to walk through the different products because you're not just a blue little coupon mailer anymore. You guys have direct mail, you got the digital network, the digital envelope, the solo mail. Let's talk about all the products and how they work together.
- [23:57]
A
Yeah. So of course there's the iconic blue envelope that has an insert that goes inside the envelope in increments of 10,000 household zones. Incidentally, the inserts in the zones, we build those zones from the carrier route level up. It isn't a saturated spray and pray zone. We'll look at higher or upper to higher income homes with families owner occupied as a driver at the carrier route level. And we say here's a zone and then there are multiple size inserts you can put in the envelope. Then we have A postcard called Plus One and the Plus One is a standalone postcard that mails in the same 10,000 household zone configuration. Of a Valpak zone, but it's delivered outside of the envelope and it is, it looks, acts and feels like a solo direct mail piece for a fraction of the cost. Because we get postal discounts by calling it a plus one and mailing it simultaneously with the envelope, we apply data discipline to that as well. So we can pick and choose the best neighborhoods with the postcards the same way we do with the inserts. With the plus one postcard, you also get USPS informed Delivery email with that. So for those of you who are opted in, you may be familiar with. When I go to check my email in the morning, I typically get an email from the post office that says here's what's arriving in your mailbox today. And when you're buying a plus one postcard, it's going to show you a four color image of that postcard top of the fold in your email when you open it up. There's about 70 million Opt in members nationwide with informed Delivery. So a little bit of icing on the cake with that postcard because you're getting additional digital digital touches and impressions with the plus one postcard plus the USPS anytime there is a change of address record mover, they automatically opt you in now. So we typically see around 3 or 4,000 emails opt in emails per 10,000 homes. On balance, we typically see about a 65 to 70% open rate. And then we can track open rate and click through rates off of that as well. And then we have solo mail postcards. Right. So anything that you're thinking about in terms of a custom mailing list, a saturated mailing list or a hybrid version of that list, we can build those lists out for you. We postal verify everything and then based on the list in the go to market strategies or data filters, you can then determine what format makes sense. For me, we have 6 by 9, 6 by 11, we can do larger formats or flax, we can do a trifold at 8 and a half by 11 and insert it in an envelope. So there's a lot of custom solo solutions around direct mail postcards. And then the other postcard related product solution is in our event event category. So we do a lot of work with movers. There's a mover journey, my house just got listed, it's under contract or I've now moved into a new home. And then we can determine do you want to be the first to welcome a new mover to the neighborhood in a serviceable area that your business covers. And so we can build programs around Movers based on the mover journey. And then we have hyper local marketing postcards. So if I have a high ticket job as an example, if I did an install and let's just say the install is 5 or $8,000 and it's at this address in this neighborhood, we can take that address and we can drop 75 or 100 cards around the house area where that job took place using the ideal data filters to pick the best hundred homes and say, hey, we just got done doing an install on 12345 Main Street. Call us today for friends and family service or deals or discounts. So those will be the core print program products that kind of round out our product resume for the Valpak. And then on clip we have a magazine format, we reach about 16 million homes. There's full page, half page and we also do some targeted inserts in the magazine format. On the digital side we have our product called Advantage Connect which is really kind of a residential targeting targeted digital display ad. And what makes us unique and what gets us excited about this digital is we overlay those digital ads or impressions to the desired device IDs that reside in the areas that we're dropping the print insert to. And so we're going to make sure again we're using the right data filters, we own the address records and we work with our strategy to be able to decide where the right device IDs are and where they aren't. So we're going to be very efficient on Geo restricting those digital ads to those homes that are getting the print insert simultaneously to create more of that halo effect. So those are some of the digital type solutions that we complement as well. And of course we can take the same targeted approach with CTV. We have our popular 30 second spots. Majority of what we offer are static, but we can do static or dynamic. So CTV is another way of targeting your video, your spot into desired homes within the specific serviceable zips or zip codes that you service with your operational side of your business.
- [29:55]
B
You know, Benji told me at any given time if I we're working with Benji pretty intensely right now, most likely 15% of my clientele, which I've got 2 million clients in my database are moving at any given time. I mean 15, 2 million is a pretty old list. But I mean he said, can you imagine if you were to hit them at the right time and they need your services, like to get the homelink set up in your car, the MYQ system. Anybody moving? Well, there's a stat of how Much people spend their first year moving in a house and it's far more than any other year. And do you know any of those stats or why it's important to hit them when they're moving?
- [30:36]
A
Well, we know that typically what we see is that mover in that first three months to one year of new mover occupancy, there's about 70% of that mover crowd that's then ready to do an inventory of what's the punch list look like on higher ticket needs. And then again, I want to establish who is my next home services provider, who's my next lawn service person, who's my next garage door repair service person, who's my next person when I'm ready to do something like internal painting or external painting. There's a high percentage in that 90 day to one year period when they get settled in, they've got some of the initial moving activity and stress and anxiety out of the way, then they're going, okay, where's my short list on home service and home improvement related items that I need to worry about? And then the other stat is those who reach the new mover first, those who welcome the new mover first. There's a higher percentage than you become the new customer and a loyal customer that is retained over a far longer period of time. When you reach them first and then the competition is knocking on your door to try to steal them. They at some point in time afterwards.
- [31:56]
B
I love it. So you offer a complimentary market analysis for potential clients and the value can range anywhere from 500 bucks to 5,000 depending on the size and shape of the company. Can you talk a little bit about what that looks like for anybody that's interested in learning more?
- [32:11]
A
Yeah, absolutely. So if you're interested, reach out to me and then we'll have one of our data analyst folks get on the call and do a consult with you. It's about a 15 or 20 minute walkthrough of what we do, why we do it, and then what data we need, and then what the deliverables will be typically around an 8 to 10, 8 to 10 day turnaround to review the results of that. And what we do when we do a market analysis is simply put under NDA. We say share your CRM data, your data with us. We're looking for address records, date of transactions, dollar amounts, no names, nothing that's more personal or confidential, but core information that says if we have an address record, if we have a date of a transaction, and if you offer one or Multiple services. We break all of that out and we say what does that consumer, that net sales sold consumer look like in our lifestyle segmentation analysis? So step one is we're going to look at that data and say what do you look like? According to segmentation modeling analysis, which gives us an index to then create a score that we could use that score to say where are high potential lookalike carrier routes in neighborhoods. The other thing we're going to do is this is added validation. We want to look at the customer penetration of your business today as it relates to our audience who's getting the envelope. As an example, if we're looking at a valpack analysis, we want to align your business, your customer with our audience to make sure we've got a more effective match. If it's outside the audience, we do another analysis that says here's what that looks like and here's what the options are as well. So modeling is one thing and indexes are great, but dollars and cents and customer pen are golden as well. To say, all things considered, I may have high potential here, but my business is strong here and thriving here. My customer pen checks the box and if there's anything else relevant to multiple data signals, we put all of that into the mix to say the output is this is where we believe the best opportunities are and that's the work we do with this complementary service. And, and then once we get to that point, then are you interested in looking at what product or products you're interested or if you're not interested at all, have a nice day and we appreciate doing the work for you.
- [34:47]
B
I love it. And you also provide an ads tune up for the listeners. I don't really know what is an ads tune up.
- [34:56]
A
Yeah. So here we've got a, we've got an outstanding creative services team of about 10 people that work work on best practice creative spec ads and designs for print and digital banners. Right. So what we do is a combination of a couple things. We constantly poll the audience. We're always asking consumers what ads turn you off and what ads turn you on. And we look at that you mentioned earlier, where you scan your eyes, we do eye retina scans. We look at all of that and we say when a consumer sees a print ad, which way did their eyeballs drift? What turned them on? Where did they stop? What are they reacting to in offers? We look at dollars off versus percent off versus free. You'd be amazed at what we see and what insight we have within certain verticals under home services and Certain verticals within home improvement. We put all of that good thinking to work and create some spec ad templates for you to then say here's what we think works based on our vertical experience of hundreds and hundreds of clients up against what thousands and thousands of consumers are telling us.
- [36:10]
B
I love that and I think it doesn't cost anything. There's no obligations if to just sit down, hear what you guys have to say, see if it's a fit or not. Is that right?
- [36:21]
A
Correct? That's correct, yeah. It usually starts that way. And one way or the other, you will walk away with some positive insights. You know the other thing we do with the market analysis and even with creative services, many of our clients will take those insights and learnings and revisit their digital strategy. And so again, you know, if you're not happy with your click campaign, if you're not happy with what your lead conversion is or the volume of leads, we find out sometimes you're running campaigns in areas that make no sense for you. So the data and the work that we do could help you draw in and validate or confirm. Am I running not just a print campaign but all media campaigns in the right areas that align with my business and my audience?
- [37:13]
B
I want to just go through a speed round of about six or seven questions. How do you track ROI across both offline and online channels?
- [37:25]
A
So what we'll do there is again most of our clients that share their CRM data with us, we take that information on whatever agreed upon terms are. If it's every 90 days, twice a year, at the end of the year, we look at that data, we look at the sales information, we validate that they're those dollars are matching back to homes that we either mailed a print piece to and or did a digital image to. And we say what are the dollars off of that that are being credited to the Valpak CRM tracking, We look at that and if the net dollars are X and we look at the spend, we know what our ROAS is. If we don't have that information, we'll take another approach and we'll look at lift analysis, we'll look at testing control areas and again sharing that information out, we can also determine are we seeing a lift in sales and then based on agreed upon metrics with that customer, then we can establish or determine what ROAS is. That approach as well. We, we will look at, on the, on the front side we'll look at things like what is my comm. You mentioned comm earlier. Cost of marketing, cost of sales. Many of our clients want to see a cost of sale of X15 to 25%. Whatever that number is, we will look at that and measure and monitor that. And we do that check in as needed based on our agreement as a client or an advertiser. We do that with you as well. We do one or two refreshes a year and we adjust accordingly. So if comms are high or ROAS is too low, we do a refresh of the work of the program and we will come and tell you areas to stop mailing or stop marketing to to areas to continue marketing to. And sometimes there may be areas we didn't touch at all and we see high potential. Here's areas to add and reinvest and align all those activities then to. To get that com right and that roas right.
- [39:28]
B
Yeah, I'm a big believer. I mean I'm, I'm living proof. I wanted to share this because this is the number one question I get all day is like how do you get marketing to work in this busy world of marketing and I think hitting the customer from every angle. How do you help small businesses compete with national brands?
- [39:50]
A
Well, it's a great question because most of the small businesses that we work with will recognize I have a limited budget to do X, Y and Z where we're able to say let's from a Valpak or a digital standpoint based on a smaller budget. Let's take the information that we know to be true as best practices in your business category and make it as local as possible so that it's as effective as possible to serve your business trade area. Eliminate the waste and make sure we're using all media assets at our disposal with your budget to be local, local, local and make sure that message resonates with local consumers online and offline.
- [40:39]
B
What industries are you seeing the strongest results right now?
- [40:45]
A
Wow. So right now we've seen banking and finance. We're seeing some very strong results there through the bumpy bumpiness of the economy right now. Ironically, home improvement home services have had some bumpy areas you probably know based on consumer buying buying patterns right now. But if we look at entertainment, we look at medical finance, we're seeing some very strong continued trends there. We're seeing on the lower ticket garage door services where I need repair. If there's replace, we're still very solid and stable there. Where we move up the food chain in your bath or shower remodels or roof where, where we're 10,000, 15, 20 or more. That's where it's been a little bumpy and sluggish. And so that that has had some challenges due to more customers not qualifying for terms, being a greater credit risk or standing on the sideline until they're ready or healthy. And again, I'll go back to how we combat that is be very smart in our programs or our campaigns to make sure we're dialing up or dialing down to be as nimble as possible. So if it's bumpy, we want to make sure we're checking in more consistently. And a campaign, a media campaign, a valpact campaign, it's not a static program, it's fluid, it needs to stay fluid. And we need to always test and pressure test are we happy or not. And let's dial up or dial down while we figure out and see where the consumers are going three or six or nine months out.
- [42:28]
B
I love it. It's interesting that, you know, is it good to lead with financing? Do you find that that helps conversion rate?
- [42:44]
A
You know, here's what we've seen with some of the nation's largest home improvement companies. This, this last year there were more younger consumers that applied for financing that failed out. They couldn't qualify for the financing. Their credit cards are maxed out. And so even though they called up, somebody showed up, gave them a quote, a proposal, they didn't pass the final net sale test because they just financially couldn't do it unless they had cash in pocket. So on the, on the younger side, so 30 to 45, 30 to 50, there's a lot of homeowners in that group that are in that keeping up with the Joneses lifestyle. And when your credit card is maxed out or you have below 650 credit, it's going to be more challenging for you to get financing done. And so we typically see we're seeing fewer net sales out of the younger generation that are thinking about financing or 0% and no payment for, for two years might be a better option. But the older generation, again that 50, 55 plus, 60 plus crowd, they either have cash ready to go or they're credit worthy and they're good to go. So I think it's really important to know who's going to be my high potential conversion versus my lower no potential. And then dialing in the right marketing dollars and mix using our data analysis is one day, one day, one way to manage through that.
- [44:18]
B
What's one misconception about direct mail that drives you absolute bonkers?
- [44:23]
A
Yeah, great question again, nobody opens it or looks if you're co op mail or shared mail, nobody opens it up and looks at it. So it's always a great conversation to have. But you know, here's what we know. We have a very high open look through rate and the reason we have a high open look through rate is for the most part nationwide, when mom or mom and dad or parents are sitting down in these economic times, when you open up the envelope, you're going to see 20 to 30 different categories represented in there. So the variety of categories of local, regional and national brands gets me excited about going to the mailbox, opening it up and looking through it. And so we know that in our low ticket, high transaction businesses, pizzas, food, dining, things like that, we knock it out of the park with number of orders and great guest check and great response when we move up the food chain on home services, home improvement, right. It's a higher ticket, lower transaction count. But we are drawing engagement and attention of that consumer to take action. Again, whether that's go online, call you direct off of a call, tracking number or QR code scanning to your site, we know that activity is there and we know because of the diversity of all the content, it creates a high engagement of open and look through.
- [45:55]
B
What have you learned about local business growth that most owners overlook?
- [46:04]
A
Again, I'm going to go back to an earlier comment where data vs gut and so I think, and as a former business owner myself, it's one thing to say I think this and here's what I think and it's another thing to draw on people. Draw on people in your category, draw on business owners whether they're in your business category or similar categories. Talk to them and find out what is the recipe or the formula or the ingredients not only to be operationally fit, but what have you learned from an advertising or marketing standpoint. And then use that information then to decide what are the media options I want to take advantage of or consider. And then once you land on what those options are, make sure you're you're applying data to your thought process into the strategy of how you want to write a check for advertising. If you're a mom and pop shop, there are still ways we can take data and make a more educated and informed decision for you of where to go and where not to go, who to speak to and who not to speak to.
- [47:14]
B
And you guys do a really good job. I mean Benji showed me, like I said, the data sets and it's kind of an unfair advantage. I mean we're going to opt into that data and I'm just expecting so many good results. You know, Mike Davis, neighborly. They're paying for every single franchise. You know, you wonder why the big get bigger is because they're open ears, they're curious and they invest in the data. And I will say that the small guy listening to this, they're going to put this on their to do list. They're going to get it. Here's what's going to happen, Dan. They're going to get bombarded. They're going to no show the meetings and they're going to say, dude, I had another fire. When I'm going to be here learning. I've got a just from this podcast, I got a list of 20 things I need to do. I'm going to go from this podcast, I'm going to go make a video on loom, I'm going to send it to three people and then I'm going to have a checkup meeting for it and it's going to get done and it's going to be appointment set and we're going to get it started and everything I want. The difference is most people that are listening are like, this is great, I need to do this. And then they get sidetracked and they don't follow up on the meetings and they never show up. And it sucks because I was there and I'm not talking shit. It's just the reality.
- [48:24]
A
Yeah, yeah, 100%. Yeah. I mean listen, we have currently we have around 35, 36,000 clients that use Valpak nationwide from the mom and pops to the big national brands. And it's not uncommon to see north of 50% of new businesses churn out pretty quickly because again, they went gut versus data or didn't take the best advice to say I'm going to win long term if I take this information and take the advice and use the data to make smart decisions. And so we see a lot of them, the smaller ones churn out because they're half in in terms of attention or didn't follow up to your point. And so if you're serious about opening your business or scaling or growing your business again, I'm going to go back and I've learned this myself too, man. Data versus gut all day long. And we have the tools to help make that decision and put a spotlight on what the data signals are telling us as it relates to your business. Where to go and where not to go, what to do, what not to do on all aspects of the Right size buy for a media campaign.
- [49:41]
B
I know it. What's the most rewarding part of helping businesses scale for you?
- [49:47]
A
Yeah, so one great example is we have a client here. It's a car wash business here in Tampa where I live, Coachman Car Wash. He's been a Valpak client for close to 47 years. He started with a small little lot and was washing by hand essentially. And here we are, 40 plus years later, he's got a thriving business. He's never missed a mail date and he's used creative that has kind of that good, better, best option for my car wash options. And the redemptions every month, every week have allowed him to scale and grow his business all because of how we started and how we sustain that program. So he's one example of many where clients will say Valpak is a important reason why I'm still in business a year later, 30 years later, 40 years later. Or I went from one location to five locations or 20 locations or I scaled from 10 serviceable zips to 50 serviceable zips or bought multiple branches. Whatever those reasons are, we hear great feedback. That's really the icing on the cake for me when we get feedback from clients that say you guys are an important, valuable part of my media mix and a reason why my immediate, my business has been successful through your media. That's the payoff to us and that's where we, we smile.
- [51:15]
B
I got one more question before we close out. If a business owner is listening and they're just unsure where to start, what's the first move you'd recommend?
- [51:23]
A
Well, for, for us here is call us and have a consult. One thing if we're going to do discovery and discovery is we've got the right questions once we know the business and the vertical again, 35,000 plus clients later, we know home improvement, we know home services. So we can draw on our expertise of what we know to be true in the vertical and say here are the winners and the successful operators who, what questions do you have that we can align to that with the support of what our knowledge and expertise brings to bear and then talk about where you at, where are you at in your business startup or your business journey to say here's maybe the 1, 2, 3 building block steps to get you going.
- [52:11]
B
And Dan, what's the best way to reach out?
- [52:15]
A
So if you, if you don't have any Valpak contacts in your Rolodex now, reach out to me. Danharlicer valpak.com I'm happy to take that inquiry on email and I can move very quickly to connect you with a local media consultant or any one of our data or research folks to get a conversation going with you very quickly.
- [52:40]
B
Is there any books that have changed your life when it comes to business?
- [52:49]
A
Yeah, I mean going back in some of the earlier days, some of the motivational books and there's a lot of them. But I think one of the, one of the other cool things I did as a business owner back in the day is I joined EO Entrepreneurs Organization and there are local chapters or affiliates pretty much in any city, anywhere, usa. And so when I joined EO or Entrepreneurs Organization, it was a coming together of small lookalike business owners in revenue, but very different in business types. And so when I went to that group and joined that group, the insights in the exchanging of ideas, I was a nobody rookie trying to figure out what the hell have I just done starting a business.
- [53:37]
B
And.
- [53:37]
A
And here I am with four or five people that have been in business for years and have been very successful. And so very quickly you could see there are a lot of consistent fundamentals that say whether you're selling widgets or any product or service, there are going to be some core fundamentals and disciplines that will be the success in terms of how well you succeed and how quickly you succeed and starting your business up. Listen to those people. The insights are priceless. They're invaluable learnings. And when you, when you create those relationships with those partners, and I'm sure there's other groups that may look like that, that is probably the best advice and motivation that I would suggest to anyone out there.
- [54:24]
B
And finally, Dan, you know, we talked a lot and I know this, it's a lot to kind of digest because I remember when I started getting really into attribution and just UTM parameters and understanding. Exactly. I got 7,000 call tracking numbers and now we use Power BI and we've got this data analytics team and financial engineering team that just literally like I started loving this stuff, I really do. And it's confusing. I think a lot of people probably listen to this and they're probably saying, man, this is a lot. But you guys kind of carry the load. I mean, I'm not sitting there. You just enter it in and you got these algorithms and this advanced AI systems that just spit out what to do next. So if you're confused, I think you guys should just call these guys my job. I just, Dan, I get so many people that are like my marketing's not working. And I think you guys could help them and I think you could give them the answers they need. But you got to pay attention. The biggest advice I'd give before I give you the last, the last note here is it's easy to blame advertising. It's harder to blame the cancellations and the non bookings and the non follow ups and the no rehash team. And you're not doing anything to train your people and you don't have a, you know, a brand that really stands out against the noise out there. And marketing is blamed for a lot of stuff. And I think it's BS and I don't think it's fair for a lot of companies out there. And by the way, not all marketing companies are created equal. In fact, probably 3% of them actually do a great job. The PPC company, if you're paying 1500 bucks for SEO, you might as well kiss that money goodbye. They hired somebody in the Philippines at 2 bucks an hour to do 10 things a month for you. You're never going to rank. You know, a lot of companies, they, they put all this stuff into a package and they're not really given much of anything. But you guys do it a fantastic job. I get fantastic results. And the truth is, when I started meeting with you guys regularly and listening to what you recommended and pulling away zones and adding zones and adding the plus ones and doing everything, it got better and better and better. And I think we could continue to get better. So I appreciate the partnership. I'll give you the last, last thoughts.
- [56:44]
A
Yeah, appreciate the time. I would say, you know, to your point on marketing, whether my marketing is working or not working, what we want to do is be more holistic about the conversation. And what I mean by that is again, I said this before. All too often we find out that businesses are spending money on marketing in areas they don't service effectively. Yep. And so if you don't know where I'm servicing and not servicing, where's my online and offline reputation the strongest? And does it align with where I can fulfill and run a lead in the ample amount of time and then I've got people trained up then to take that lead, convert it, upsell it. All of the operational side of the business equation needs to align effectively with, with the marketing side of the equation. And all too often we don't put the two together and consider that when we put it together, that's where we start to see the magic happen.
- [57:46]
B
Yep. Well, listen, you're crazy if you don't reach out. I think the most important thing is understand who your avatars are, understand where you're getting. I have zip codes where I'm getting five times the clientele and the ticket averages. And you guys have been very easy to point that out once I decided to share the data with you probably six years ago. So it's been a fun journey, my friend, and hopefully, hopefully some people take action. So I appreciate you doing this today.
- [58:14]
A
We appreciate it. Thank you. Happy birthday again. And folks, take advantage of our free consultative services. Call us and we'll see if we can help you.
- [58:22]
B
Thanks brother. Appreciate it. Hey there. Thanks for tuning into the podcast today. Before I let you go, I want to let everybody know that Elevate is out and ready to buy. I can share with you how I attracted a winning team of over 700 employees in over 20 states. The insights in this book are powerful and can be applied to any business or organization. It's a real game changer for anyone looking to build and develop a high performing team like over here at A1 garage door service. So if you want to learn the secrets that help me transfer my team from stealing the toilet paper to a group of 700 plus employees rowing in the same direction, head over to elevateandwin.com forward/podcast and grab a copy of the book. Thanks again for listening and we'll catch up with you next time on the podcast.