Radio, TV Advertising Spurs Growth for Plumbing Firm

Idaho contractor’s growth spurt illustrates the power of radio and TV advertising

Radio, TV Advertising Spurs Growth for Plumbing Firm

  Plumbing technician Josh Knowlton with MAGIC Electric, Plumbing, Heating + Air in Jerome, Idaho, carries tools to a job site. The company uses radio and TV ads not only to prospect for customers and promote seasonal services, but also to build its brand and attract technicians like Knowlton.

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Some plumbers think that radio and television advertising is something expensive that only big companies can afford. But there’s another viewpoint to consider: Some of those big companies used to be small companies — until they embraced radio and TV advertising.

Take MAGIC Electric, Plumbing, Heating + Air, based in Jerome, Idaho. Radio and television ads played a central role in the company’s rapid expansion to 109 employees today from just three in 2013, when owner Billy Salts established the business.

“Our rapid growth has a lot to do with frequency of marketing,” Salts explains, noting the company also uses everything from direct-mail campaigns and door-hangers to the internet and social media platforms to saturate the market and reach potential customers.

“Good marketing is all about frequency, which we achieve by using so many platforms,” he says. “They give us a strong presence in our markets.”

Furthermore, Salts relies on radio and TV ads for more than just branding his company and prospecting for customers. They also play a valuable role in recruiting new employees, one of the toughest challenges facing the industry.

So far, the approach is a winner for the company, which employs 18 plumbing technicians and runs eight trucks: six in Jerome, located in far south-central Idaho, and two in a satellite office in Boise, about 120 miles northwest. The company made Inc. Magazine’s 2020 list of the top 5,000 fastest-growing, privately owned companies in the country (it ranked 3,763rd and 27th in Idaho) and was named one of the top 10 medium-size companies to work for by Best Places to Work Idaho for 2020.

RETURN ON INVESTMENT

An old business adage says companies must spend money to make money, a philosophy that Salts adheres to when it comes to marketing. The company invests anywhere from 7% to 10% of its annual revenue on marketing; Salts says he invested about $200,000 on running radio and television ads alone in 2020, plus another $20,000 in production costs.

The company strives for a 70% to 90% return on investment (ROI), depending on the type of advertising used. Salts has established different ROI goals for different advertising platforms. Some programs return 100% of an investment, while others don’t.

“But even platforms with lower ROI’s still provide another way to get our message out there,” he says.

The key to calculating ROI is tracking the revenue generated by each kind of advertising. To that end, call-center employees always ask customers where they heard about the company. In addition, Salts uses ServiceTitan field-service/business-management software to track revenue produced by each advertising campaign.

“We also have different phone numbers, divvied up by ZIP code, on all of our ads for tracking purposes,” he says.

EFFECTIVE MESSAGING

Salts started running radio and television ads within the first six months after he established the company. “If you’re growing a business, you have to get out in front of potential customers,” he explains. “Plus, people tend to forget about contractors, so it helps if we’re constantly in front of them.”

MAGIC works with Michigan-based Yellow Dog Creative to produce its radio and television ads.

Generally speaking, the company runs 30-second radio and television ads from 6 a.m. to 8 p.m. Two to three different ads usually run concurrently on each venue, typically focusing on particular products or seasonal service promotions, he explains.

“But we also periodically run branding ads that just explain what our company is about, not focused on one division or one service,” he notes.

MAGIC also relies on radio and television ads to recruit new employees. To do this, Yellow Dog crafts ads that focus on the company’s culture.

“We try to get the message across that this is a great place to work, as well as a great company to hire,” Salts says. “A lot of times, customers end up being our biggest (recruiting) advocates because they may know a technician or electrician that’s trying to find a job or someone who’s trying to get into the trades.”

The messaging apparently is working. Salts says the company hired 28 new employees from March through August and plans to hire another 25 or so within the ensuing six months to a year.

HIRE AN EXPERT

The bottom line in advertising is that great ads are necessary to produce maximum impact. That’s where Yellow Dog steps in. “When we first started working with them, TV stations would call us and ask who produced the commercials,” Salts says. “The quality was that good.”

Salts advises working with an advertising agency that thoroughly understands the market and also takes time to understand clients’ goals.

As for the ever-popular radio and TV jingles, Salts used them when he first established the company, but not anymore. Jingles were effective early on for branding, but marketing has changed since then, he notes.

“I just don’t see a lot of companies on the forefront of marketing using jingles anymore,” he says. “They seem to be more of a thing of the past.”

Regarding the argument that radio and television ads are just too expensive for plumbing companies, Salts has some advice: Plumbers should first consult with an advertising firm to see what kinds of advertising venues work best in their markets and go from there.

“We no longer go all in on just radio and television, but they’re still platforms that we feel offer great potential for getting our message out there,” he says. “You have to be willing to spend the money and do it the right way so you get a return on your investment.”  



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