Do you have your head in the sand? Many home improvement retailers apparently do, failing to see the disaster looming before them in the form of marketing costs.

Think about it. Are you a company owner who claims 6% to 8% marketing costs, not realizing that your event marketing and showroom costs are listed under G&A, and your actual marketing expense is double what you think it is? Are you marketing a big-ticket item ($15,000+), failing to see danger in a 15% to 20% marketing cost, then decrying your own poor profit? Do you complain that sales personnel seldom visit jobs in progress to solicit referrals or to generate leads? (Why should they, when they know they'll continue to receive new leads whether they self-generate or not?)

Consequences The home improvement industry suffers from its own success. As revenues rose and once-abundant lead sources dried up, little thought was given to database management. The recent demise of a major company — volume more than $100 million — has largely been attributed to negative publicity on one specific Web site. While acknowledging the portent of poor customer relationships, it was that company's failure to change its lead model at least a decade ago that contributed to its collapse.

The model, unlike a business plan, denotes where and how many leads you will develop at what cost and from what source. The latter is closely tied to the issuance of a lead and a salesperson's follow-through practices.

Time for Change In short, the marketplace has changed and the demographics of your customer have changed, too. But many in this industry are not reexamining how and where they advertise, nor are they paying sufficient attention to modern sales training, which requires a stronger focus on self-generated leads and referral solicitation.

Although marketers continue to invest in new lead-generation methods, their counterparts in sales fail to develop the skills necessary to sell leads from disparate sources.

Though I do see hope in the future of this industry, this is a clarion call for change in marketing by the home improvement industry. —Dave Yoho is president of the oldest and largest consulting group serving the home improvement industry. His company presents seminars on “Solving the Marketing Dilemma” and “How to Sell Value vs. Price.” 703.591.2490;