Tony Santangelo, owner of Innovative Pest Control, has successfully boosted his business by using the Sentricon® system as the standalone solution for termite control. By bundling services with the Sentricon system, the business has seen an increase in retention rates.
What started in the corner of a bedroom with a desk, a rolodex and a filing cabinet has transformed over the last 20+ years into the Innovative Pest Control company you see today.
Located in Tyler, Texas, husband and wife team Tony and Kelly Santangelo set up shop in September 1992 — the worst month to start a pest control company if you ask Tony.
“Back then, if you wanted to be in the Yellow Pages, you had to get your contracts in September,” he chuckled. “And we wanted that half-page ad in the Yellow Pages.”
Not long after their Yellow Pages ad ran and the business picked up, Innovative Pest Control started looking for a better solution for their termite problems.
They dipped their toes in the waters of the Sentricon® system.
“There wasn’t 20 years of data telling us how great this product was. There wasn’t 10 years of personal data working with it," Tony says. “It was a leap of faith.”
However, Tony quickly discovered that offering both Sentricon and liquid treatments was a huge mistake.
“It’s a no-win situation to try to sell two products at the same time. If you try to sell two products, you’re not going to sell either one of them,” he says. “When you tell a customer you have two products that can treat the same thing, they’re going to ask which one is better. Then, when you tell them Sentricon is the superior product, they ask why you even offered another option in the first place.”
Innovative Pest Control uses the Sentricon system as its standalone solution for termite control and Tony immediately noticed the positive impact it made on his business. He found that bundling the Sentricon system with other service offerings unlocked a new potential for Innovative Pest Control.
“It worked in spades. Bundling started doing things for us that we didn’t even think about, starting with route optimization,” Tony says. “Once, I pulled into a home and there are three other trucks in the driveway — and they’re all mine — I’m now a fourth truck. I thought to myself, ‘This is ridiculous.’”
Now, instead of sending a specialized technician for termite control and another for mosquito control, Tony can just dispatch one truck and one technician who is trained to perform all the services the homeowner requested.
“You can just get so much more done. Tyler, Texas, is a very rural community. We don’t have the routes where we park a car in a subdivision, and we walk to our houses for eight hours,” Tony says.
Bundling also helped Innovative Pest Control increase its retention rates.
“When you have pest control bundled with Sentricon, Sentricon retention rates stay higher,” Tony says. “When you’re only checking it once a year and your customer is only getting a bill once a year, they’re questioning why that’s happening, but when you’re at their house doing pest control, they don’t question it.”
With the increased retention rates and customer satisfaction, recurring revenue quickly followed.
“My definition of recurring revenue is when the billing is separate from the service. The money is coming in every month,” Tony says. “It’s the eighth wonder of the world. It’s the gift that keeps on giving.”
Tony says the key to bundling success was “looking past your nose.” Year One didn’t make a lot of money. Tony says if you could calculate the gross margin of a Sentricon job at about 50% — which means you’re not making a lot of money, but you’re not losing money — that gross margin for Year Two will jump to 70% or more.
When Tony started Innovative Pest Control, pest management professionals only sold termite work when a house had termites. Now, even with the rolodex and the filing cabinet a thing of the past, the business benefits of Sentricon keep on giving.
