Show Information

Episode Number: 80

Date: March 24, 2025

Duration: 30:09.687

Host: Justin Deese

Website: www.JustinDeese.com

Contact: [email protected]

Guest: Rich Harshaw

Company: Level 10 Contractor

Website: www.Level10contractor.com

Email: [email protected]

Podcast Link: https://podcasts.apple.com/us/podcast/the-level-10-contractor-daily-podcast/id1477623969

Summary

In this episode of the Freedom Blueprint podcast, Justin Deese speaks with Rich Harshaw from Level 10 Contractor about effective marketing strategies for contractors. They discuss the importance of standing out in a competitive market, the difference between marketing and branding, and the concepts of 'hunting' and 'farming' in lead generation. Rich shares insights on the evolution of television advertising and the significance of identity in marketing, emphasizing storytelling as a powerful tool for engagement.

Takeaways

• Standing out is crucial for contractors.
• Marketing and branding serve different purposes.
• Hunting is immediate lead generation; farming is long-term growth.
• SEO is a farming strategy that requires patience.
• Television advertising has evolved with streaming options.
• Targeted advertising can be more effective than traditional methods.
• Identity in marketing is about clear communication of value.
• Storytelling enhances customer engagement and retention.
• Investing in branding can yield long-term benefits.
• Understanding your audience is key to effective marketing.

Chapters

00:00 Introduction to Level 10 Contractor

01:16 Understanding Marketing vs. Branding

05:24 Hunting vs. Farming in Marketing

11:14 The Evolution of Television Advertising

19:40 The Importance of Identity in Marketing

Keywords

contractor marketing, branding, television advertising, SEO, identity, home services, lead generation, storytelling, digital marketing, Level 10 Contractor, Justin Deese, Freedom Blueprint Podcast, When Your Business Partner is Your Spouse, Kristen Deese 

Mentioned in this episode:

Power Profit Workshop 2025- PowerProfitWorkshop.com

Welcome to another episode of Freedom Blueprint podcast. We are hanging out today with Rich Harson from Level 10 Contractor, and we're going to talk to him a little bit about what are some ways I'm to say stand out as a contractor. You think that's a fair statement, Rich?

Yeah, I mean, absolutely stand out. Here's another option. Don't stand out. That's usually not a very good option. And it's actually what most companies do.

Well, okay, good work. And we're going to get into that here in a minute. But before we dive all the way in, I do want to take a minute and just say thank you for coming and hanging out and sharing some of your experience with us.

So if you don't know Rich, Rich actually also has a podcast as well that you definitely need to check out and we'll put a link in here on how to check it out, but it is a daily podcast. And I do wanna say this from one podcaster to another, that's a lot of work, kudos to you. Man, that's a lot of work, so that's awesome though.

You it's a lot of fun. You've been doing this for a long time. You know how it goes. Talk to some interesting people.

Yes, it is. It is a lot of fun. So let's let's dive in a little bit to. Well, let's do a quick overview. What is level 10 contractor?

So we're an agency that works with remodeling contractors and home services companies. I would say by client count, we're more heavy into remodeling, but by client size, we're more into home services. I've worked in the past with Horizon Services and the group that ultimately became a private equity roll-up. Currently work with Champions Group. They've got about 20 brands. So been heavily...

engaged in this industry for, gosh, close to 15 years now.

Fantastic. And those are some, those are some big names. wouldn't, I'm imagining that anybody listening, should know who those names are. And if they don't, you should. So let's do some homework in our industry. Yep.

Yeah, I've had the pleasure of working with Mark Aiken and Dave Geiger personally, especially Mark Aiken for seven or eight years and then working with Leland Smith over at Service Champions, which then became Champions Group. Just some real titans in the industry, but you know, real, real cool guys.

Yes, they are. Yes, they are for sure. So yeah, so what is some, okay, so that's a really good segue. So from those businesses that you named, mean, those are hundred million dollar plus, plus, plus, plus in some cases, dollar businesses. What do you feel like is some of the success that they do or some things that they do on the marketing side versus some of the smaller businesses?

Yeah, you know, when I first got into this industry from a phone call from Mark Aiken, it was 2011. I was on spring break with my kids and he somehow he got my number. And if you know Mark Aiken, he's let's say an intense individual. And he said, Hey, I heard you're good at helping brand and advertise. Can you come up here? And back in those days, I used to do a four day training just for all kinds of companies. And he said, can you come up here and do this training for my staff? And I said,

timeframe and they were about 40 million at the time but they were not in radio and TV at all. The big market Philadelphia so it's expensive and you he said I hate radio and TV because we can't measure it. We don't know how well it's working and I said well you're gonna have to just deal with that. You know we'll talk about some stuff in a minute Justin where that's actually changed it's a lot more measurable now. Then a few years later Horizon held sort of a peer group type

conference for I think they had about 10 different companies from all over the country came in one of them was service champions and Leland Smith was there with his marketing director Katie Stern and They said you know we like what you're doing there We want you to help us tell our story and this is always what people are asking me help us tell our story help us tell our story so That's what I that's what I excel at. That's what I'm really good at and You know, it's really interesting

Justin, because those two companies, while they're both very large, 40 million at the time and 30 million at the time, now they're both well over 100, they have very different stories. So it's not like, hey, we're an AC company, so here's our story. So we lean into what their DNA is and then tell those stories.

So I think that's such a good topic when you mentioned that you can't measure it because I think that's a challenge is, well, not challenge, but the difference between marketing and branding. And I think a lot of times when you're smaller, that is something that you maybe miss a little bit. Can you tell us a little bit about, like, what's your opinion of the difference between marketing and branding?

Okay, so I'm gonna use two different words than you just used, but they're gonna be very similar. So I'm use the word hunting and farming. Hunting is direct response advertising. It's like, hey, I'm gonna spend money, I'm gonna generate a lead, we're gonna run the lead, we're gonna make money, rinse and repeat, okay? Then you've got farming where you're gonna spend money, you're gonna put seeds in the ground, you're gonna nurture it, and then it's gonna grow. Now,

Obviously, the benefit of farming is that you can take a little bit and turn it into a lot. It takes more time, but it's more of a long-term model. So I would say a lot of smaller companies, maybe some that are listening today, say, man, I'm a million dollar company. I'm a $2 million company. Probably you're going to want to lean a little bit more heavy, obviously. I said that as if it wasn't obvious, into some of the hunting things. Like we need leads right now. We're going to buy leads from aggregators. We're going to do some Google pay-per-click.

Maybe even some Facebook type advertising But as you start to grow a little bit then it makes sense to lean into your branding because look you got to decide what you want to be when you grow up Do you want to do you want to build a brand that people call because they already know who you are and what you do Or do you want to just you know wait for somebody to go to Google and have Google tell them who to call?

and pay them.

Both are okay. This is not an either or, it's a both and, but it's kind of an evolution really as your company grows.

I think that's, and I wrote that down. think hunting and farming is, and I haven't heard anybody use that expression. I think that is such a good expression for the difference between, branding and marketing. Cause that is the challenge, right? So marketing for a lot of contractors, especially when you're in that certain wheelhouse. And I'm going to say under 5 million, it's tough because you're like, well, I need the phone to ring, but I'm not an expert in it. And I don't know what to do. And I'm, know, I'm just paying it, but I'm not getting, I'm not seeing the return.

I think that's a really good way to break that down is what are you doing? And there is always going to be short term and long term stuff. I a question for you on the on the hunting and farming side of it. When you think about SEO, which one of those do you feel like that might fall under?

100 % farming. Farming. Now, here's what it doesn't have to be. It doesn't have to be farming that takes 11 years to see a crop, which a lot of SEO agencies would lead you to believe. I the number of people that don't understand how SEO really works, including the companies that are actually doing it, which sounds crazy to say, but it's true, is insane. Typically, here, I'll give you a quick idea on SEO, okay?

Okay. Love that answer.

Google doesn't rank websites. That's the first thing you gotta understand. It ranks web pages. So what happens is somebody goes in and they type in what they're looking for, you know, my air conditioner's broken, I need an AC guy, whatever the keyword is. And then Google looks at where that person is by reading their IP address, and then it looks for a page on the internet that is optimized for that, what I call, keyword pair. Geo keyword pair. So here's the problem that most people have with SEO.

Let's say that you're in San Diego, but the person who needs help with their air conditioner is in Chula Vista, which is not San Diego in case you're not tracking with me here. It's a suburb, okay? If you don't have pages on your website that are absolutely optimized for Chula Vista, you're gonna lose out to other companies who do have those optimized pages on their website, okay? So.

If you can create those optimized pages and put them in on your website, you should start to see results in terms of real quotable leads within two to two to six months. Two to six months. But here's here's the key distinction. I want to make sure the listener understood this. You're not creating a website that's going to start getting you leads everywhere all over the San Diego greater metro area because you have a website. You're only going to start getting leads in the specific places.

where you're specifically putting these geo-optimized pages. So if you put five or six pages in there today, four to six months from now, you should be getting leads. So is that farming? Yeah, it's farming. It's definitely not direct response. It's definitely not hunting. But I bring that up and I go through that little explanation because I've just seen so many contractors that are like, man, it takes forever. We don't ever get any leads. And then they just quit. They're like, this is stupid. Why am I even paying?

So, so a quote, a quote that comes to mind is, maybe it's not a quote, it's a phrase, but when's the best time to plant a tree? It's 20 years ago. When's the second best time today? So it is a long-term game and that's why I love the farming analogy. You're not going to throw seeds in the ground and it sprouts up tomorrow, which by the way is why I'm not a farmer. Cause I would rather just throw the seeds down and boom, it spontaneously combusts whatever food I would like.

Well, know, realistically, here's the funny thing. Look, when you're a small business, every dollar counts. mean, every dollar counts all the time, but it counts a lot less when you're, you know, 40 million in sales. you do something that costs $50,000 and doesn't work, it's not catastrophic like it would be at one or two million. But, you you've to be willing to try some things and the big companies continue to get bigger and bigger because they're willing to invest in farming.

Meanwhile, the little guys are out there just hunting, hunting, hunting, and they're all fishing in the same pond trying to pull a fish out so they can eat it that night. And they're being systematically destroyed by the larger companies that are branding.

So let's shift a little bit over to the television side because I think that's changed a lot over the years. And I know you guys really really experts in that. I really want to talk about that a little bit. I know, you know, back in the day, it used to be you would run a TV ad and you had two choices. You could either do like these cable networks that put you on whenever, or you could do a specific channel. But that looks a lot different now, doesn't it?

Well, it's evolved into more choices is what's happened. So that is still available. we run probably through my agency roughly about $10 million of traditional radio and television. Most of the TV that we're doing is on news programs, local channels, know, ABC, know, five o'clock, six o'clock news, noon news. It still works. And the reason that we do it still is that it's relatively speaking inexpensive.

Okay, so when we look at TV advertising or radio advertising, we measure things. The metric that we're looking at is the cost per thousand, CPM. You familiar with this term, right? Cost per thousand, is the, what, Roman numeral for thousand CPM. And we can buy CPMs, depending on the market, for anywhere from about four to eight dollars, typically. Sometimes a little bit higher. Austin, we've got a client, just on top of my head right now, more like 10 or 12. But typically about eight or 10. Let's call it six.

I am.

Okay, so it's cheap enough that it's worthwhile. Here's the problem with that. If you're in Austin, Texas, to just bring up Austin, because I just brought it up, and you're doing $2 million, you can't be on TV. Because to be on any single channel to get any kind of frequency at all, it's gonna cost more than you have available in your budget. Now, if you happen to be in Muncie, Indiana, where I also have a client, well, you can...

You can do a lot there because it's going to be cheaper. But here's what's changed to your point, Justin, is the maturity of the streaming advertising ecosystem. Okay, now when I say maturity, here's what I mean specifically. If you go back even two or three years ago, it's been around for five or six or seven years, maybe longer, who knows, but it's really matured in the last five, six, let's say two to three years. But if you even go back two years, here's what you'll find.

The cost per thousand to be on streaming television, it's cost prohibitive. It's like $50 CPM. So it's like, hey, what do you want to spend 50 or five? Okay. It's literally 10 X and then it's come down to like eight X, seven X, six X. But look, there's definite advantages to streaming television. And by the way, let me give you a couple of terms here.

There's different words that different companies call streaming advertising. OTT, CTV, those are both the same thing. So streaming, OTT, CTV, CTV stands for connected TV, OTT stands for over the top. Don't worry about that. I want people to know if you hear these terms, it's the same thing. A lot of people are super confused. I heard CTV. Same thing, okay? There's a lot of advantages. Here's the major advantage. You can...

pinpoint target who you want to reach by both geography and also by demography. So if you're in that Austin area, like we said, and you're a two or three million dollar company, give me your top five zip codes that you want to service that are maybe close to your office or maybe they're more affluent or whatever makes you want to go there. You've had a lot of success in the past. And then here's the first thing we can do. We can only hit homeowners.

So all the people that are renting, they'll never see your ads. Then we get people that only have home values of a certain level. Okay, 400,000 and above. Austin, 500,000 and above. know, California is probably a million and above, who knows. We can also hit certain ages, certain income levels. So we have the ability to focus in and only hit specifically the people you want. So that's worth, that's not worth nothing. It's worth paying a premium for, but here's the question. Is it worth 10X? Probably not.

Yeah.

Now, we've got contracts all the way down into the 22 to $26 CPM range. So still higher, but it's now more affordable. And when you overlay on that, the ability to do hyper pinpointed targeting, it's viable. And guess how much you have to spend minimum, any amount you want. You don't have to come into this with a

Yeah, that's pretty awesome, the flexibility that's changed that so much.

Yeah, you don't have to have a $10,000, $15,000 budget a month. You can come in with $2,000, $3,000. Let's get you on the air.

Well, and so I was in my head, I'm thinking about, cause we, we stream here. We, we cut the cable cord. It's been a lot of years ago, but you know, the YouTube TVs and the Hulus and all that kind of stuff. And we're in a smaller market being in the, in the panhandle of Florida, we're in a smaller market. And so when you turn on the local news, you have lots of, companies that are advertising there, but then exactly what you're talking about, and at least in our area, there's not a lot of companies that are.

that are hanging out there and investing in that. And to be honest with you, I didn't realize you could dial it down to that granular of a level.

Well, it's even cooler than I've already explained because there's some stuff I haven't explained yet that's even cooler. Here's what it is. So we can actually go to your website and we can put a pixel on your website. This is a tracking code. Same thing that you do for Facebook or for pay-per-click other digital advertising. So we put a pixel on your website. So now let's say you buy a hundred thousand impressions, you know, in your market, specific zip codes, homeowners, home value, all the things we just talked about. Now what'll happen is...

Couple things, number one, we're delivering that message via your IP address. That's how these companies, these publishers, they know your IP address. So they know that you live in this zip code, you have this home value, you have this age range, et cetera. So they'll send that specifically to you. Now, if you turn around and go on your phone or on your computer and go to the website that I'm advertising, XYZ Plumbing,

Boom, it fires that pixel and now we know that you came to that website and then we can start really digging down into that data. We can say, okay, when do they come? When do people come to the website? When do we wanna run the ads? What publishers? Is it Discovery Network? Is it History Channel? What is driving people? Okay, we've got two or three different ads that we're running and we can see this ad got 800 visits to the website. This one only got 400 visits. This one only got 200 visits. Okay.

Quit running the one that's not working. And we have so much control now that we can optimize these campaigns to where they just work great. Can't do any of that on that $6 CPM regular television. It's not available, it doesn't exist.

Yeah, the channel is the channel. But I will say, you know, to me, I think that when you do the local news, you do have a, like the same people watch the news every day for the most part. But I think that's really exceptional what you're talking about because now, you know, the trick with marketing is making sure that you're available and in front of a customer when they're ready and giving them information to make them ready sometimes, depending on what you're selling.

The channel's the channel.

But man, that's really cool to be able to dial television down to that level.

Yeah, and look, there's a reason that we still have millions of our clients dollars on regular television because you're right, the same people watch the news, you know, day in, day out, we can reach them for a relatively low cost per thousand. So it still works. But there's a lot of people, especially people listening to this podcast, maybe either you're in a large metro area. So it's just cost prohibitive to be on TV or maybe you're just a little bit smaller company and you just don't have the budget for it.

and now it becomes available. It's like viable as an advertising medium for you where it didn't used to be.

Yeah, man, that's great.

So what, when you think about contractors, specifically in the home service space, obviously that was a great, great information about the television that I didn't know. And I'm excited for other people to hear it and learn it and hopefully reach out to you and find out how to really execute that. But what are some other things, some very simple things that you, when you talk to contractors, you feel like they're missing.

that they could just plug into their business and make an impact.

Yeah, probably the first and foremost foundational thing is what I refer to as identity. Identity is communicating with your target prospect with power, precision, and passion, telling them who you are, how you're different, why you're better, and what they can expect when they do business with you. It's kind of like building a case, okay? Think about a court case where you wouldn't just show up and say, he's a nice guy. He probably didn't do it. he wasn't even there.

It's like, no, let's get into, I don't know how you are listening to this, but if you remember the OJ trial, it's like the Bruno Mali shoes, the glove size, if it fits, you must convict or whatever, I can't even remember. But you just gotta get super specific. And what you wanna do is you wanna tell the story. So I'll give you a good example of this. I'll move over into the home remodeling industry to give you this example, then I'll move back into home services.

If it doesn't fit, must acquit.

But I like this example because it's so easy to understand. I've got a client in Kansas City called Jericho Home Improvements. They're a kitchen and bathroom modeler. So when I sit down and talk to him, I was like, all right, so what makes you guys different and better than your competitors? And there's a lot of things, but one of the things in conversation is, well, we use higher quality materials. Okay, higher quality materials. What does that mean? Well, we spend more money to use materials that are gonna last longer, they're gonna look better.

So I want you to imagine for a minute the radio commercial. I'm gonna use radio just because it's an audio. It's easy to kind of spew it out of my mouth right now. So you might create a radio ad that sounds something like this. Hey, if you're gonna remodel your kitchen, call Jericho Home Removments, Home Improvements. We use the highest quality materials. It's gonna look great for a long time. It's gonna last forever and it's gonna be beautiful. People are gonna be astounded at how great your kitchen looks. It's kind of a snooze fest.

But it hit the point. Now, check this out. Same identity point, which is high quality materials, but check out me telling a story and making it come alive for people. So it might go something like this. When it comes to kitchen remodeling, most people want to know, how much does it cost? How much does it cost? What you should be asking is, how much does it weigh? Let me give you an example. At Jericho Home Improvements, we only use Moen.

faucets, which are made in America. They're pure metal. They look stunning. They last forever. And they weigh about 10 pounds each. Most of our competitors, they use imported half metal, half plastic faucets. They're cheap. They don't look that great. They weigh about a pound and a half. What would you rather have? A 10 pound faucet or a pound and a half? At Jericho, that's just one of many things we do, you know, high quality materials, right? Do see the difference?

That's great.

So we're taking something that people understand, Fawcett, we're taking something else they understand, Wait, and we're telling this story so it comes alive in their mind. So let's go back to Horizon Services now, HVAC, put them on the radio back in whatever, 2012 or something. And here's what we found. They had a policy where they, on time or free, on time or free.

So the idea there was people don't like to wait. So we create this ad and it's Mark Aiken. And again, if anybody knows Mark Aiken, he's a very intense individual. I love Mark Aiken, he's awesome, but he's very intense. So he kind of has this intensity when we put him on the radio. And he's like, you know, I hate to wait. If I go to the doctor's office and they make me sit there in the gown in that little room, I get up and leave. If I've got a reservation at a restaurant and they can't see me within two minutes, I'm just leaving.

I hate to wait. And when I started Horizon Services, know, five, 15 years ago, whatever it is, I vowed that I would never make my customers wait. That's why we put in a policy. If it's even one minute late, your entire service is free. No hoops to jump through, no fine print. It's just free. Cause I'm serious. I hate to wait. And I'm not, I'm never going to make you wait. Now.

That's exceptional storytelling.

Now, let's review the definition of identity. Communicating with power, precision, passion, who you are, how you're different, why you're better, what people can expect when they do business with you. Boom. Now guess what? I get over and I start working with service champions and they say, we don't really do that. We don't have a policy at one minute late. Okay, so what do you guys do? Well, here's what I found out. They cater to an older crowd. Older crowd.

And the older crowd is very concerned about the way the technician presents themselves. So we created something called World's Friendliest Technician. World's Friendliest Technician and a happy money promise. And so we leaned almost all of our advertising, probably 50, 60 % into this idea of World's Friendliest Technician. Mother's Doorstep, something like this. So the radio ad might go like this.

Hey, this is Leland Smith over at Service Champions and I want you to know the very first thing we look for when we hire new technicians here at Service Champions is friendly. Friendly. We put them through a secret test that they don't even know they're taking to see and observe how friendly they are. Because if they're not friendly, we don't want to hire them. Obviously, they've got to be good at what they do, but we found that we cannot train people who are good to be friendly, but we can train people who are friendly to be good at their job.

So if they're not friendly, we boot them out the door. If you want to talk to those guys, go call our competitors.

That's good stuff.

friendly, right? It's it's a whole different identity.

Well, and it's, yeah, mean, such a good differentiator because most people are like price quality, you know, the same kind of thing where the stories you just told certainly in your head, as you're listening to it, there's a whole different image. Like you're not even thinking about the HVAC or the water heater or the faucet or any like you're well in that story, you're thinking about the faucet, but you're not thinking about just the service. You're thinking about the experience of it.

Yeah, I'll tell you a funny story.

One of these companies that I worked with, it was Verizon actually, they hired a company called Magged Research that does these consumer studies. Here's how it works. They put people in a room and then they play the radio commercials or play the TV commercials and they give them a dial. Are you familiar with how this works? Have ever heard of this before? So here's how it works. So they have a dial and it's set on 50 and you can turn it. Okay, so you can turn it up to 100 or down to zero. You tracking with me?

Mm-mm, no.

Mm-hmm.

Okay, so they start playing the ad and they have it on 50. And then if you hear something you like, you start to turn it up. If hear something you really like, you turn it up to, you know, closer to 100. If you hear stuff you don't like, you turn it down. Okay? So we started, they started playing these commercials like I'm talking to you about right now. And for the first, so radio commercials, so for the first 15 seconds, 20 seconds, 25 seconds, it just stayed right on 50. Nobody moved it either way.

And then it hit about 20, 25, 30 seconds. And then it just went way up to the 60, 70, 80, 90. And the research company came back and said, these ads don't work. So what do mean they don't work? They said, well, what we're looking for is in the first five seconds, we want to see it at least hit 65. And I said, why? They said, because we want them to hear stuff that they like right away. Now, here's what they weren't accounting for.

The reason it was staying at 50 for 20 seconds is because I'm telling a story for 20 seconds. And people are trying to figure out what is this guy talking about? And then when they hear me tie it to, when I start my HVAC company, I vowed people would never have to wait, boom, up to 70, 75, 80. But while they're hearing him talk, what's this guy talking about? He hates waiting in the doctor's office. He's gonna get up in the gown and leave. He's gonna leave the restaurant. Like they don't even know what's going on, but they're engaged. They're paying attention. So.

that a big fight ensued over what really works in advertising. I won.

I won the fight.

I mean, you think about it. mean, storytelling is one of the greatest ways to advertise. And the truth is, is there's not a ton of ways that you can do direct storytelling. mean, part of what you were talking about is that you can do that in a whole big story as far as social media, TV, digital marketing. But to be able to tell direct stories like that, radio is a great way to do that.

You can do the exact same thing on TV. It's it's easier for me to give examples, you know, because we don't have a visual other than my face.

No, you're good. Rich man, I appreciate you coming and hanging out. That was a lot of really good information. What if somebody wants to get in contact with you, how would they do that?

Let's see, best way, just email me, rich, R-I-C-H. I get called Rick a lot, but my name's not Rick, rich, R-I-C-H at level10contractor.com. You go to level10contractor.com or you can check out my podcast, Level 10 Contractor Daily Podcast. Also I have a book on Amazon called Unlocking Unlimited Lead Flow.

Very good. And all that information too will be in the show notes. So if you're driving and listening or cutting the grass or maybe hitting the gym, you can, you can come back to it and find it in the show notes. But Rich, I appreciate it, man. Thank you so much for coming in and hanging out with us.

My pleasure, Justin. A lot of fun. Thanks.

Thanks.