Constructing homebuilding model
Putting subcontractors online eases some of the bottlenecks
At Martell Home Builders’ job sites, subcontractors carry smartphones and regularly flip open their laptops, while webcams stream images of the work underway back to clients. But when Pierre Martell started out nearly six years ago, the owner of the Moncton, N.b.based new-home builder didn’t even have a website. Today, the company’s interactive client login system lets customers follow the progress of their home and sends reminders when it’s time to select finishings. Vendors and tradespeople also have access to the online platform and photos of each job’s progress are regularly posted to customers’ accounts. Mr. Martell credits the platform with helping the company meet its 99-day time frame for constructing a new home and not missing a deadline on the more than 200 projects completed so far. About 350 subcontractors work for the builder at any given time. The company is making money and growing, and he has paid back his initial investor’s $500,000 loan. With 35% of new jobs coming from referrals this year, the “Martell experience,” as it’s coined on the website, has generated positive buzz in Moncton, where the company does 80% of its work. The company has jobs in Saint John and Miramichi and has plans to expand to Fredericton and Halifax in the next three years. In this edited transcript of his conversation with Financial Post reporter Christine Dobby, Mr. Martell explains how he hit upon his approach.
Q Your system is essentially designed to keep everyone on the same page. Is that something you saw that needed to be addressed in the construction industry?
A Absolutely. It keeps everybody organized and it doesn’t even minimize, it eliminates missed communication. I had an extensive renovation background. One of the biggest things that led me into new-home building was that in renovation, you quote a job to the best of your ability but you never truly know what you’re getting into until you do the demolition and open up the walls and see what’s behind them. There are so many unexpected and last-minute changes that you just can’t plan for. I thought it would be nice to start on a fresh, square foundation.
Q So was there something in your renovation background that led you to come up with this idea of the client login?
A When I started the company we didn’t even have a website. As time progressed, we started thinking about building a brand. At the time, we were still selling with real estate agents and I thought there was a huge disconnect where we were trying to offer this experience but we were delegating our brand to an agent. So I brought all the sales inside and started looking at technology. Having worked in construction, the three largest pain statements I always heard were stress, timing and budget. I leaned toward technology to solve those problems and the client login evolved from that.
Q What challenges have you had as you’ve expanded?
A As with most rapidly growing construction companies, it’s difficult to grow at the rate we have been and manage cash flow. There have been some all-nighters and some extremely tight closings. We’ve never missed a closing date and if we did we could no longer advertise that, so it’s very important to us to make sure we don’t. A couple of times we were setting somewhat unrealistic closing dates that really had to get in fast and we were just way too busy to do it comfortably. Now we really try to schedule properly.
Traditionally, the tradespeople involved in homebuilding are not technologically inclined and are, for lack of a better term, flying by the seat of their pants. Our system introduced them to a very scheduled and organized environment and they appreciate it because it allows them to do more than they could before. They were not originally very receptive. Some of the best trades in the industry didn’t even have an email address. As we grew and continued to give them business we told them they had to get on email and even offered to train them. They were open to learning and now, a couple of years in, they’re all thanking us and saying they wished they had jumped on the tech bandwagon years ago.
Q You use social media fairly extensively for a construction company. How big a role does it play in your marketing strategy?
A About two years ago, we decided to do zero print advertising except for handouts and went 100% online. I call it word-of-click advertising more so than word-ofmouth because we have a very strong online presence. We started social media and online advertising primarily because we didn’t have the budget to do traditional marketing. Locally, we were an early adopter of Twitter and we started a Youtube channel. We realized our return on investment in terms of online exposure and social media has improved our sales cycle. It used to take us about eight hours face-to-face with a client to convert to a sale - multiple meetings and different discussions etc. - but because of the positive feedback online, we’ve been able to take that down to an average time of less than two hours.
Financial Post cdobby@nationalpost.com