Many plumbing and heating contractors seeing their highest profitability in history
A likely reason might be surprising — Internet marketing and search engine optimization.
According to recent data from Sageworks, profitability for private companies is at the highest level in a decade. The largest sector of business happens to be construction, which comprises plumbing and heating contractors.
What accounts for this increase in profitability, even in the midst of a recession?
The primary reason for this increased profitability is very clear: A growing number of plumbing and heating businesses have finally embraced the Internet. Not only has an Internet strategy allowed those contractors to stay in business, but it also has made them more profitable than ever, providing the channel to find new customers, fast.
Surely the Internet is not the news here. As a society, we have experienced its many advantages every day. The power to completely transform the way companies do business, however, is worth significant attention, even in areas such as plumbing, heating or any other trade, which are not necessarily considered high-tech. Thus, the disparity in profitability is obvious at a closer look when comparing the success of plumbing and heating contractor companies that are easily found online to the success of those that are not.
Phillip Maurici, the now proud owner of Tampa, Fla.-based The Clean Plumbers, notes, “My plumbing business finished 2012 with the highest level of profitability since I’ve been in business.” With 31 years under his belt as a plumber, that is certainly intriguing — why now, when the entire country seems to share a moment of great hardship and struggle?
“Until I implemented a proactive Internet marketing strategy, I was not able to get in front of my prospects at the exact moment they were looking for the type of service offered by my company,” he explains. “Now that I have a solid online presence, I get calls almost every day because of it.”
For Maurici and plumbers in general, understanding how prospective customers go about finding a plumbing service has become extremely important. It used to be that the majority of people just took out the yellow pages book from a kitchen drawer and selected a service from the listings — usually the one with the big ad. Prospects might have otherwise picked up the phone to call family members for a recommendation.
While referrals and word of mouth are still strong ways to generate new business, professionals and business owners are starting to realize that the Internet is much more powerful and efficient. Betty Lou can now find a plumber to fix her broken water heater in a matter of minutes just by quickly running a web search. In fact, within 60 seconds she can find eight to 12 plumbers in her area, see reviews and ratings of their services, and immediately take action by initiating a call from her smartphone.
SEO for increased website traffic
A 2012 report from LocalSearchStudy.com found that nearly 80% of consumers prefer to use the Internet to research local businesses. This is further proof that effective Internet marketing is a crucial ingredient of success. Businesses need to be seen where their prospects are looking — online. Companies that have not adopted an Internet marketing strategy have struggled, while many that have employed those tactics have flourished.
Search engine optimization, or SEO, is one of the key ingredients in a plumber’s successful Internet marketing strategy. You have to keep in mind that most Internet users today begin their surfing for businesses on a major search engine — such as Google, Bing and Yahoo! — so unless you show up in their search results, you’re not going to get many visitors to your website. Businesses that appear low on Page 1, on Page 2 or a lesser ranking, will receive little-to-no business from those searching the Internet.
If 80% of people are searching online for a business and your plumbing business is behind eight competitors on the page, it becomes obvious that your revenue will show some decrease as those competitors ahead of you capitalize on that traffic over time.
Mike and Jeanne Petri, from Petri Plumbing in Brooklyn, N.Y., share a story about how their typical marketing tactics slowly began producing very few new customers: “In the mid-1990s, we were still running an ad in our local Yellow Pages and we were getting more customers than we were losing at the time. It was somewhere around 2005-2007 that we really noticed that was no longer the case. Our calls were decreasing and the Yellow Pages ad didn’t even pay for itself.”
At the time, Petri Plumbing didn’t have a website and the Petris had never considered the Internet as a possibility for a plumbing business.
“We were no strangers to the Internet, as far as using it, but it still took us a few years to decide to invest in building a website for our business,” Mike Petri admits. “We finally did, only to find out that having a website was far from enough. The only people to ever see it were the customers we already had or family members — we needed help to make it worth it.”
The Petris’ story is typical, even today. There are billions of web pages on the Internet and only 10 to 20 pages are displayed on the first page of search engines for a search term, such as “plumber.” Unless you operate your plumbing business in a small town with limited competitors, just having a website will not justify the investment.
Jeanne Petri adds: “We figured out that we needed to put the same amount of effort, or even more, into making sure that people looking for a plumber on the Internet found our website. That was when we implemented SEO tactics; and just a few months later, the phone started to constantly ring again. This all started a couple of years ago, developing over time — now we are more profitable than ever.”
Mobile marketing: smartphones and tablets
The Petris understood that their marketing activities needed to change, and they took the steps to make that happen before it was too late. They also admitted that if they had not turned to the Internet to find customers, they would likely be out of business today, or just barely surviving.
Since the way to do business has changed and will likely continue to evolve, the question is: What’s next?
The answer is a variation of pure Internet marketing, which is already well underway — mobile marketing. Google states that more than 80% of smartphone users utilize their device to assist them when searching for goods and services, and more than 75% have made a purchase as a result of these types of searches.
Internet Analytics firm ComScore reports that not only are more than half of cell phones now smartphones, 61% of smartphone owners conduct local business searches from their phones and are ready to make that phone call or even hire the service immediately.
According to Informa World Cellular Information Service, the total number of mobile service subscriptions in the United States, between smartphones and tablets, jumped sharply to 321 million, which means there are now more mobile subscriptions in the United States than there are people (315.5 million).
Growing mobile use means that even more prospects in the future will find those plumbers that make the investment in being found online. Profitability is estimated to continue to grow for those plumbing and heating contractors that embrace the Internet and take market share from those that do not.