Andy Lindus, co-owner of Lindus Construction, in Baldwin, Wis., and Steve Sylvester, owner of S&S Tree & Horticultural Specialists, in St. Paul, Minn., didn't have much in common except that they both hosted local radio programs aimed at Twin Cities homeowners. Then in the fall of 2009 a big storm hit town and the two owners sat down for lunch and agreed on the need to cross-market their companies' services.
After that storm, Lindus, who was getting calls about replacing or repairing gutters and roofing, referred homeowners with tree-related problems to S&S Tree Specialists. S&S, in turn, recommended Lindus Construction for roofing, siding, and gutter work.
The two companies did a joint direct-mail piece, a handout for canvassers, and partnered in creating a joint website. “Every one of their customers has the potential to be one of my customers, and vice versa,” Lindus points out.CROSS-PROMOTIONAL
Teaming up with non-competitive companies, says Marc Slutsky of Street Fighter Marketing, in Ohio, is a smart way to leverage marketing dollars and goodwill. Such alliances can include companies sharing databases, passing on one another's business cards, and creating joint promotional pieces and websites.
“The goal is to put yourself in a situation where you get referrals from somebody you've formed an alliance with,” Slutsky says. That third-party testimonial is powerful. “It makes it much easier for the homeowner to do business with someone when the referral is coming from another company they trust.”
Slutsky suggests that alliances work best when they are between companies that are non-competitive and have the same customer base. Steve Sylvester, owner of S&S, suggests the first step is due diligence. Know who you're recommending. “You want to be sure they're going to do the kind of job you expect them to do,” he says. With Lindus Construction, the fact that the company had been around almost as long as his own — more than 30 years — was key for Sylvester.EXPANDING REACH
Lindus has since joined a local real estate association with the aim of having its 60-plus members recommend his company to new homeowners. Lindus Construction gets one or two calls a day from homeowners inquiring about services the company doesn't provide, such as flooring and plumbing, and it passes on — from a spreadsheet of contact information — info about companies that can be trusted to do that work. In turn, Lindus says, “These [companies] have a better feeling about me, and they refer me to their customers.”