Crummy Cross-Sales Prompts Launch of Neighborly
Neighborly, a new site launched by The Dwyer Group, cross-promotes all of the 13 service brands owned by the franchisor.
A sad statistic—only 2 percent of customers had used more than one of the 13 service franchises owned by The Dwyer Group—has led to the launch of a new umbrella company, called Neighborly.
“It was shockingly low,” said CEO Mike Bidwell, who said the troubling stat was revealed after a months-long project at the Waco, Texas-based franchisor to assemble a data warehouse and crunch all the numbers. “We knew we were doing a poor job of cross-selling, but we thought it would be higher.”
The group’s franchises include The Grounds Guys, Mr. Rooter, Mr. Handyman, Molly Maid, Window Genie and more. With Neighborly, when a customer’s job is finished a survey is sent to rate the experience, and the customer is invited to check out the other brands by registering on the site. The site had 2,300 logins, meaning people who have set up a profile, after being launched for only a month.
“We’re in a million unique homes and businesses a year,” Bidwell says. “We do about 3 million service calls annually. It’s a lot of customers that have validated” the group's services, something that’s particularly important with service providers that come to one’s house.
“People are pretty funny about having somebody come into their home,” he says. “Once they get a service provider, they tend to want to stick with that.”
Promotional materials tout the full range of services under the umbrella. “We don’t just fix things,” says one. “We mow, wash, clean, paint, rake and occasionally unclog things, too.” Readers are encouraged to “find an expert at getneighborly.com.” The site also has info like dryer do’s and don’ts and summer maintenance tips for homeowners.
Building the data warehouse cost hundreds of thousands of dollars, Bidwell said, “and that’s just to get into the game.” He figures the investment in the project so far is into seven figures, with seven full-time employees dedicated to it, “but it will be well worth it.”
“It’s a major commitment on behalf of Dwyer Group management, our board, and our private equity partners. So we are very much appreciative of our Riverside partners,” the P/E firm that bought Dwyer in 2014.
Payback, he believes, will come through reduced customer acquisition cost, increased customer retention and shortened service intervals, all driving topline revenue. As for franchisees’ reaction? “They’re ecstatic,” he said. “Look, it’s potentially a free customer for the franchisees. It costs them nothing,” he says. “If you think about all these additional customer we have in our database, and we have poor cross-utilization, then if we can lower your customer acquisition costs, what’s not to like?"
Bidwell didn’t state an ultimate percentage goal for cross-utilization, but he knows at 2 percent, the only way to go is up. He expects it to take maybe four or five years to get the numbers to a respectable level.