After 38 years as Dwyer Group, Neighborly is fresh off a company rebrand. The holding company of 22 service-based organizations is as focused as ever on its commitment to franchisees and the consumers they serve. This month, I spoke with CFO Jon Shell to learn more about his role in the rebrand, the importance of consumer data, and how the finance team can integrate with other departments for strong business outcomes.
Jeff Thomson: Last year, your organization rebranded itself Neighborly after 38 years of operating as Dwyer Group. What data informed this strategic decision? How does finance contribute to large-scale decisions of this nature?
Jon Shell: Neighborly has been a long-time vision for our company – in fact, it took more than a decade to get it right and rebrand ourselves. While the company had always been focused on delivering premium services to repair, maintain and enhance homes and properties, it was difficult to promote complementary brands to our customers. With that objective in mind, and our continued growth and private equity partnerships, our strategies became more sophisticated. The decision to rebrand from Dwyer Group to Neighborly followed the rapid success of the consumer-facing Neighborly umbrella brand and platform developed in 2017. Decisions of this magnitude required a series of investment decisions, including aggregating the brands’ independent data into a central data warehouse. By understanding the target demographic/customer, we could quantify the business opportunity and plan to invest in tactics to start engaging with them.
My role from the finance perspective is to help determine the size of the prize and value. Prior to and during the rebranding process, I evaluated increases in system sales and profitability and value to franchisees in order to inform investment-making decisions.
Thomson: Since the launch of the Neighborly platform last year, multi-brand customer penetration has increased 39 percent. As Neighborly aims to be the Amazon of home services, how are you using new technologies to master the digital market? What challenges have you faced managing multiple brands like Molly Maid and Mr. Rooter on a single platform?
Shell: At Neighborly, we establish a common Point of Sale (POS) system among each brand, and data feeds into a master data warehouse. That single source of information allows us to leverage and strengthen existing customer relationships by introducing complementary service providers through our platforms. Our campaigns are strategically designed as a result of our collective data. Neighborly is complex, with service verticals ranging from appliance repair to snow removal and everything in between. Our website includes the top service categories that our data tells us consumers are searching for. Customers can read more about a service and quickly request an appointment with a local professional by inputting their zip code.
Neighborly is the world’s largest franchisor of home service brands, with nearly 3,700 franchisees and 22 home service brands. With that title, challenges do arise. Determining a unique customer can prove to be a tremendous lift. It took time to identify our ideal customer profile and we certainly experienced common data challenges, such as ensuring clean data to truly leverage the analytics. With so many brands represented on one website, there are times when customers live in areas where more than one company provides the service they are searching for, such as gutter cleaning or holiday lighting. Our solution is to provide all options and put the power of choice in the consumers’ hands.
Thomson: One of the many difficulties of working in the digital market is data security. As CFO, how do you work with your IT team to proactively prevent security breaches and minimize the impact they have on consumers? How do consumer privacy concerns inform decision-making across the organization?
Shell: Data security starts with engaging best in class, third-party providers. We emphasize the importance of information security, so our IT team uses the best-available security software and applications to maintain the security of our customer’s data and monitor for any breaches. As CFO, I stay knowledgeable and keenly aware of the various data privacy laws, which sometimes differ country by country. Neighborly has franchise locations throughout the United States, Canada and Europe and rules and regulations about sharing customer information, marketing our services and disclosing franchise candidates differ. We spend a great deal of time maintaining compliance in all our efforts.
Thomson: With the recent acquisition of Dream Doors in the United Kingdom, Neighborly reached an important milestone, $2 billion in systemwide sales. What role does finance play in contributing to systemwide sales growth? How does finance support your franchise partners in realizing increased sales?
Shell: The finance team strives to be a good and reliable partner with the other branches of the Neighborly executive team, including operations, IT and marketing. We support other divisions by analyzing data to inform our business leaders on spending to maximize the company’s return on investments. Neighborly’s Code of Values ensures we choose to allocate resources with our franchisees’ growth in mind. For example, investing in resources to improve our brands’ POS systems must support the franchisees and make their business run more efficiently and capture actionable, customer data. Marketing investments should be prioritized to help develop creative, campaigns, tools and resources to help franchisees attract and retain customers and build brand awareness to help them recruit employees in their independently owned and operated small businesses.
Thomson: In 2012, your company expanded into Europe and is now operating across nine countries. What new skills and technology did your finance team need to enable these expansion efforts? What do you look for in finance talent, especially given the global nature of your organization?
Shell: When we expanded into Europe, we recruited and hired talented people who had local tax/statutory reporting and U.S. GAAP (General Accepted Accounting Principles) knowledge and skills in each of the markets we moved into. We also had to make sure all of Neighborly’s systems could operate within a diverse environment, which enabled associates and systems across countries to effectively communicate both internally and back to the U.S. One of the most important changes our team had to make was getting everyone onto a single set of general ledger, banking and expense reporting platforms regardless of time zone and geography.
When we’re recruiting for finance talent, we’re looking for flexibility. With Neighborly’s long-term history in the franchising industry, technological advancements and our system’s ongoing growth, we understand that how things are done today is going to be different from one year to the next. We’re looking for team members who can continuously adapt to new challenges brought on by exciting opportunities.