£30,000 available - 600 sign-ups required - How?

[Henry9000]

Hi Folks

I post this thread this towards the end of my thought process (not the beginning), to gather your thoughts and compare to my own - take this for what it is and we might end up with a worthwhile discussion!

So, let's say you are starting a business which sells service contracts to homeowners to protect them against leaking pipes/broken boiler + annual boiler service etc. (Similar to British Gas Homecare, Homeserve etc. though this is a service contract, not a regulated insurance product)

You have over a decade of experience in the home appliance servicing and repair industry and have a similar amount of experience in running small businesses in various industries.

You have a highly skilled and flexible workforce available to you and the necessary software and procedures to handle the requirements of a growing business.

You have start up budget of £30,000 available to you purely for new customer acquisition, all other costs of running the business for the first 12-18 months have been accounted for already.

For the business to have a realistic chance of survival, and to allow enough operating capital for the business to grow, you need to sign up approximately 600 customers to your service contracts within the first 3 months.

How would you do it? (Poll and written responses welcomed!)



FYI: The service contract costs £14.99 per month by direct debit and is cheaper than comparable products from the major providers.

 

[GeoMal]

Just how close to the business do the customers need to be?

 

[John-C]

Facebook Lead Ad's. Great way to generate warm leads. With the demographics available nowadays you can really fine tune your target audience too.

 

[Henry9000]

Just how close to the business do the customers need to be?

Good question. Within a 100 mile radius.

This takes in a population of approximately 3 million.

Facebook Lead Ad's. Great way to generate warm leads. With the demographics available nowadays you can really fine tune your target audience too.

How much would you expect a new customer to cost you?

 

[John-C]

How much I think a customer is worth depends on the industry I work in and how much a product is worth and the type of product it is.

Your's will be very different to mine as it is a recurring product. Only you will know the value of each conversion.

If your budget is 30k - that can go a long way. I think you will be able to hit your target if you implemented Facebook Lead Ads, Custom Audiences and perhaps Google AdWords too. If done correctly you will get a good amount.

When ad marketing though, you need clean ads, excellent landing pages and of course you will need to A/B test your ads for optimization - this helps gain better performance and conversion rates.

Thanks,
John

 

[Henry9000]

Thanks for that John.

The reason I asked how much you thought it would cost to acquire a customer is because I have a max budget of £50 per sale.

Do you think that is achieveable using the channels you mentioned?

 

[John-C]

Thanks for that John.

The reason I asked how much you thought it would cost to acquire a customer is because I have a max budget of £50 per sale.

Do you think that is achieveable using the channels you mentioned?

Well, your audience is quite broad so you have a lot of population to gain 600 clients from. But if there are a lot of competitors in your market then the cost of ads may be higher.

If you super target your ads and use all the resources available to you, I would think £50 per sale is achievable and you may get a few more on top.

But you will need to knuckle down and do a lot of research to make the most of your money, unless you are considering getting another marketing company involved.. It will affect your budget for advertising though.

Thanks,
John

P.S - you could also invest some of the budget in door-to-door canvassing too, but could end up costing you more.

 

[garyk]

I would contact plumbers/heating engineers and see if they either wanted to sell it with a small ongoing commission or allow direct contact to their customers again with a small slice of the pie.

In terms of the options you listed, I would only consider direct mail or ppc.

 

[beasty]

You would use more than 1
ppc and social media set up into a squeeze page, easily done, this will produce warm leads
direct mail in your immediate locality (People buy local)
and you would extract all phone numbers and call them
(This would be where you actually convert interest into sales)

Doing 1 thing is not the best way, you need a process to create awareness, gather data, then convert it

 

[Craig Curchin]

The reason I asked how much you thought it would cost to acquire a customer is because I have a max budget of £50 per sale.

Do you think that is achieveable using the channels you mentioned?

Having used Facebook advertising recently for our business, we have managed to get our CPA (cost per aquisition) from around £20 down to around £5 per signup... it takes work to constantly tweak your audience / advert content, but the ability to narrow down your market on Facebook is incredible. So I think it would be more than possible for you to get a sign up for less than £50.

 

[John-C]

Having used Facebook advertising recently for our business, we have managed to get our CPA (cost per aquisition) from around £20 down to around £5 per signup... it takes work to constantly tweak your audience / advert content, but the ability to narrow down your market on Facebook is incredible. So I think it would be more than possible for you to get a sign up for less than £50.

Whilst you could be right it will still depend on how competitive the market is and how many advertisers are still looking for the same demographic then compare that to how often you want your ad to show. It could cost more. But it may still be possible and this is why the OP needs to do some thorough research and make sure that he laser targets his ads.

I would recommend using the new Lead Ads, it is available for display on desktop too now, will generate warm leads and you can choose the information you want to capture.

 

[boring-friday]

Probably try telesales first seeing as you could test it fairly cheaply.

PPC if that doesn't work, will need atleast a couple of k or so to test first though. I've not done much myself but as others have said you need to test different ads,keywords,landing pages,bids,methods,platforms.

Doubt any affiliates will be interested and SEO isn't well suited to stuff like that

 

[Paul Kelly ICHYB]

How much are your products?

 

[MBE1]

You might wish to consider pricing again, a quick search on google threw up homeserve offering annual boiler breakdown cover, annual service, plumbing drainage problems, internal gas supply, electrical wiring, pests and security from £9.50 per month. Only available to homeowners in houses and bungalows but that is a fair bit cheaper than your offering, and that was a 5 sec search on google.

 

[John-C]

You might wish to consider pricing again, a quick search on google threw up homeserve offering annual boiler breakdown cover, annual service, plumbing drainage problems, internal gas supply, electrical wiring, pests and security from £9.50 per month. Only available to homeowners in houses and bungalows but that is a fair bit cheaper than your offering, and that was a 5 sec search on google.

Depends if they offer a far better service or not. The price means nothing, it the quality of the service.

 

[MBE1]

Depends if they offer a far better service or not. The price means nothing, it the quality of the service.

I agree in part, but most members of the public will see a large national company, a market leading name established for many years and a lower price, most will see it as a better offering. The OP might be better to reply if different, having sold such policies in the past it is a price sensitive product.

 

[Court Jester]

Sign-ups are like website registrations, the OP needs a website, since a tradesman's site is a calling card, you need to get eyeballs to this for conversion to happen. I don't feel handing out business cards will accomplish the sign-ups required. With £30k to hand, suggest £5-10k on public relations should give enough credibility to get the sign-ups coming in - but it wont be 600! - maybe 10 - 20 to begin with.

The rest spent on some sort of linking campaign, as they'll need a more permanent status online that will work for years to come. Once the first 100 customers bite, get testimonials off them all, and put these on the site - then the rest is upto direct mail shots and only time will tell the rest.

Suggest:

1. Public relations to get the trust/credibility
2. Direct Mail shots
3. Follow-up telesales campaign

 

[Nick James Lomax]

Hi Henry

Are you tagging this service onto an existing business or maybe you're looking to breakaway.... ?

- If so then maybe you'll be able to utilise contact base that you have access to with a view to up-selling or introducing the new service/business....

You have a highly skilled and flexible workforce available to you and the necessary software and procedures to handle the requirements of a growing business.

With a max £50 cost for new acquisitions and your target I would say that with the right structure, team etc then outbound calling would most likely be the quickest/cost effective way to get anywhere close to the 600 target in the first 3 months....

Suggest:

1. Public relations to get the trust/credibility
2. Direct Mail shots
3. Follow-up telesales campaign

Jester makes sense....

If you exploring B2C Direct Mail/Email campaigns then it would probably make sense going the B2B route as well targeting tradesman letting/estate and property management agents too....

I would also look to take it to existing Commission only Door to Door Sales Teams if the package/deal is right....

Best of Luck