With these actionable strategies to increase ROI (return on investment) in your sales and marketing efforts, you can grow your business without...
9 Ways to Grow Revenue (Without Increasing Expenses)
Bringing more money into your home improvement business—whether you're a landscaper or plumber, electrician or roofer comes down to two things: decreasing spend and increasing revenue.
There are many ways to do both of those, and in this post, we're going to cover how to increase revenue—that is, while keeping spend at a minimum.
What is revenue?
Revenue is how much income you bring into your business from the sale of your goods or services. It's also known as gross sales or your "top line" because it is the top metric on your income statements.
The more revenue, the better, right? Sort of. Revenue doesn't yet account for what it cost you to get there. When you subtract your expenses from your revenue, you get your net income (also known as your profit or bottom line).
That said, growing revenue is a key component to increasing profitability, but only if your costs don't exceed your revenue.
9 ways to grow revenue successfully
Given the above, here are some smart ways to increase revenue that shouldn't also cost you more. The last two strategies are a little more of a lift, but the returns are substantial if you get your timing right.
1. Revisit your sales process
ICYMI: The one-call close does not work anymore. First of all, one call is not realistic.
- It takes an average of 8 attempts to reach a prospect.
- 75% of buyers would like to receive 2-4 messages before sales stop trying to reach them.
Second of all, call is not the way to go.
- 97% of consumers ignore calls from unknown numbers—even local ones.
Text is the way these days:
- 69% would prefer for an unfamiliar company to contact them over text messaging, rather than over the phone.
- 90% of texts are opened and read within 3 minutes
- 93% of consumers are interested or opted in to texts from businesses—this is 13% growth year over year for past three years.
- Consumers would rather talk to a brand via text than call them, talk to a sales associate in person, do laundry, or even exercise.
Consumers would rather do laundry than talk to a business on the phone.
- 41.2% of sales professionals believe that their phone is their most effective tool for the job.
- Most sales professionals are only making an average of 1.3 attempts before giving up.
Consumers don’t want to talk on the phone anymore, and they also are multi-tasking and multi-devicing (made that word up) so much so that they need (and actually want) to be followed up on. An effective sales approach has the following traits:
- Multi-touch: It's going to take several touches before you get a response.
- Multi-channel: Your attempts should be across text, email, and voicemail.
- Personalized: Nothing canned or overly professional. Talk human to human.
An ideal multi-channel, multi-touch sales follow-up sequence.
2. Clean up your follow-up game
Sales folks are not inclined to follow up. Not only do they not have time to chase people down, but a shiny new lead has way more appeal than someone who has gone MIA.
This is a major problem! Just like it takes several attempts to reach a lead, it's going to take several attempts to convert them. In fact, 80% of sales require 5 or more follow-ups.
That's right. Five to twelve attempts! Image source
Following up on your prospects is absolutely essential to closing more sales—and therefore growing revenue.
3. Go for the response, not the revenue
All too often, home service business reps use long emails or voicemails, trying to convey everything all in one fell swoop, thinking this is what will get a customer to "bite."
This is actually going to turn them off. Instead, send bite sized (didn't even realize the pun there) communications that they can read and digest easily.
This is what will get the response.
You're not looking for a big response. Just a sign of life of any kind—because even if it's a negative response, you can ask why. Any response is all you need, you can water the seed and handle the objection from there.
Just aim for the response.
4. Train your team in upselling and cross selling
Let's first define these terms.
Upsells are when your customers upgrade to a more expensive product or service, while cross-sells are when they add on an additional product or service.
For example, you may upsell a basic service package to a premium one. You may cross-sell a maintenance package as an add-on to an installation.
There are many factors that can aid in a higher-value product or service. Length of service, quality of materials, even things like sustainability.
Here are some tips for cross selling and upselling:
- Show your service packages side by side: Divide your service packages into tiers like good, better, best and compare the different features. When a customer can see the benefits of the higher tier services, they're more likely to be receptive to them.
- Promote discounts or new offers. On your website especially. This helps customers see what other options are available.
- Create educational guides that support additional services, and include calls to action in the guide.
- Make suggestions during check-in calls and sales conversations—if and when the timing is right.
- Send emails or texts about your offerings periodically.
- Announce new offerings
- Incentivize your sales team. Jobber has some great tips on this!
- Most importantly: Do not be pushy! Make it customer-centric, not business centric. Your goal is to help them solve their problem first and foremost, which will result in more sales. You've got to know your customer and know when the timing is right.
5. Focus on retention
Speaking of upselling and cross-selling, you'll have more success using these strategies with existing customers than with new customers choosing what to buy in the first place. According to Zippia,
- You have a 60-70% chance of selling to an existing customer vs. a 5-20% to a new customer.
- 65% of a company’s business comes from existing customers.
- It costs 6-7x more to acquire new customers than to retain existing ones.
- Existing customers spend 31% more and are 50% more likely to try a new product than new customers.
Bottom line: your current customers are your richest and most friction-free source of more sales, which equals more revenue.
If you want to retain customers, be sure to:
- Provide top-notch customer service. 80% of customers say the experience a company provides is as important as its products and services. Respond to inquiries quickly, personalize your interactions, and go out of your way to ensure the customer experience is memorable.
- Be proactive. Don't just provide service when it's asked for. Reach out and check in on customers and projects proactively.
- Reward loyalty. Give your most loyal customers special treatment with exclusive promotions and deals.
A thoughtful check-in, even if they have no questions or concerns, helps maintain communication and show that you care.
6. Seek after referrals
Referrals are a great way to increase revenue because just like loyal customers, referred customers tend to spend more and stay with you longer. This is because people trust recommendations from friends and family.
Heck, people trust recommendations from strangers (online reviews, anyone?) Customers you get from referrals have a built in confidence in your business—as if they absorbed the experience of your happy referrer.
Here are some ways to get more referrals:
- Offer incentives, especially double incentives where both the referrer and referee get a reward or discount.
- Have a referral page on your website. Make sure your homepage has a clear navigation to it as well.
- Promote your program regularly. Remind customers over email, text, and social. You really never know when the timing will be right.
- Ask for them directly. If the conditions are right, do not hesitate to ask for referrals outright. This could be during a conversation, after getting a positive review, or you may even reach out proactively. Start with your most loyal customers, as they'll be the most receptive.
7. Expand your services
Another way to grow revenue is to branch out in the services you provide. The timing needs to be right for this, however, since there is going to be a lift in resources. Here are some tips for successfully expanding your services:
- Aim for similar services that are in the same umbrella or complement what you already provide. For example, a roofing company might add on siding. Or a landscaper may expand into pest control.
- Ask your customers what kinds of additional services they'd like to see, which will help with initial adoption.
- Look at your competitors to see what you might need to add on to keep up with them, or what gaps they have that you can fill.
- Consider the costs. While expanding services can grow your revenue, the ROI will be longer term. Be sure to consider all of the up-front costs, including training, certification, new content new pricing models, and more.
8. Open up to new markets/niches
It can be hard to outshine your competition in a tight market. Rather than offering more services, take your best services and break into additional markets. Just like expanding your services, this strategy also will incur an initial lift in costs, so it's a careful process. Some things to consider:
- Make sure you fully understand your existing target market. You may be able to find niches within this market that you haven't yet reached.
- Perform market research. Conduct surveys, use trade associations, and use the tools available to you! There are plenty of free tools, like Google Trends, Pew Research Center, MakeMyPersona, and even keyword research tools that can help you identify trends that you can align with.
- Partner with local businesses already serving that market. This is not only a great marketing idea for home improvement businesses, but also great way to enter into a new niche, while also helping to strengthen your ties with your local community.
9. Increase prices
Of course you don't want to raise prices just for the sake of making more money. But if you have valid reasons for raising prices, this can be a smart, effective, and necessary move for your business. Remember, you have to communicate these price changes to existing customers, and without a valid reason, you risk losing their business or loyalty.
Some things to consider for increasing prices:
- Are any of your internal costs increasing? Perhaps supply costs, vendor expenses, or something else.
- What are your competitors charging? If it's been a while since you've done a competitive analysis, do a little investigating to see how you compare.
- What are the current economic trends? Keep an eye on economic conditions so you can identify a time when consumers will be least resistant to a price increase.
Jobber has some great tips and a price increase letter template you can use.
Grow revenue for your home service business
Revenue is an essential component of your profitability. Hopefully the strategies covered in this post will give you some ideas on what you can do to increase your top line metrics.
To recap, here's how to grow revenue:
- Revisit your sales process
- Clean up your follow-up game
- Go for the response, not the revenue
- Train your team in upselling and cross selling
- Focus on retention
- Seek after referrals
- Expand your services
- Open up to new markets/niches
- Increase prices