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Business Observer Friday, Apr. 4, 2014 5 years ago

It's Electric

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A business owner with a fast-growth story faces an obstacle many executives are familiar with: where to spend marketing dollars.
by: Mark Gordon Managing Editor

An electrician's job in New York City lured John Leavy to move from his native Ireland to the United States.

A few years later Leavy began to dream American, when he sought to run his own business. So he moved back to Ireland, where he built up a 14-employee company that wired new homes under construction in and around booming Dublin in the early 2000s.

But the American Dream never died, and when the bubble in Ireland began to burst in 2008, Leavy, again, looked west. “I always wanted to come back to America,” says Leavy. “We wanted a better opportunity.”

That opportunity is embedded in Bradenton-based Luminous Electric, which Leavy founded in 2011. Back then it was him and a truck. Three years later Luminous, with clients from Tampa to Port Charlotte, has eight employees and four trucks, and is on the verge of adding a fifth vehicle. Sales, projects Leavy, will at least triple in 2014, from around $300,000 in 2013 to $1 million. The firm will work on any residential call, from a doorbell to a large remodel project and a ceiling fan to complicated troubleshooting. Says Leavy: “No job is too small is one of my mottos.”

Luminous also recently moved into a new building, a 2,400-square-foot flex space just east of Interstate 75 in northeast Manatee County. “We were limited in how we could expand,” says Leavy.

The new building, double the size of its last facility, includes a 1,000-square-foot warehouse and a conference room, where Leavy holds Training Tuesdays — several hours of safety and customer service sessions for employees. “There are a lot of companies out there that do what I do,” Leavy says. “But we are trying to do a good service at a good price.”

Leavy's main obstacles now are split: One is to simply manage the growth and make sure it doesn't engulf the company. The other is something he didn't encounter much in Ireland: the cost of customer acquisition.

“Money and managing the budget is a big challenge,” says Leavy, who, along with his wife, invested more than $100,000 to start Luminous.

The crux of Leavy's dilemma is how much to spend on marketing and advertising. Over the past year he's spent about 20% of monthly revenues in that area.

That buys a series of ads in various mediums. The list includes four billboards at major intersections in Manatee and Sarasota counties; radio spots; direct mailings to homes; and print ads in community weeklies published by the Observer Media Group, publishers of the Business Observer. Luminous also pays a fee to Sarasota-based Rooks Advertising, which handles the ad buys and helps set the strategy.

Leavy says he came to the 20% figure on advice from a friend and fellow electrician-business owner. It's a ratio, he says, that's more intuition than science. “Going forward I want it to be less,” he says. “It's a big chunk. Once I get more established, I can scale back.”

Leavy moves around different marketing pieces to see what fits. He says newspaper ads, so far, have outperformed billboards, to the point where he plans to cancel two of the billboards soon. Leavy and Luminous employees always ask where a client found out about the firm, and Rooks Advertising tracks some other metrics. Leavy and David Rooks, president of the ad firm, reassess where the marketing money goes every month.

“We continue to track (everything) to see what is working,” he says. “I have to be a bit conservative about where we spend marketing money.”

Follow Mark Gordon on Twitter @markigordon

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