55. Introducing APB Rewards With Russ, Sky & Andy

Put simply, it's free money for our members.

Let's pay our members to be members.

Your rebates will exceed what you pay to be a member of the apb. There's a complete back end engine behind.

This thing, probably even more about accessing a network of service providers that provide real value to residential building companies.

So.

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This is not too good to be true. It's so good because it is true.

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Higher margins while improving the building experience for your clients. Hello and welcome to the Professional Builder Secrets podcast, a podcast by the association of Professional Builders for building company owners, general managers, VPs and emerging leaders. Here we discuss all things running a professional building company from sales, processes, financials, operations and marketing. We have another exciting episode from the Professional Builder Secrets podcast. I'm joined today by co founders sky and Russ Stevens, as well as head coach Andy Scarner for the association of Professional Builders. Sky, nice to have you join us again.

Thank you, Bosco, Lovely to be here.

And Russ, good to see you as well.

Hey Bosco, how you doing?

I'm good, I'm good, Andy. Always a great time when you grace us with your presence and your analogies as well.

Listen. Anytime, Bosco, anytime.

Well, look, I'm really excited to chat with you all today because you've launched something really new and it's called the APB Rewards. What is it? And how do you guys get started?

Well, put simply, it's free money for our members. Now, over the years, we've had numerous companies approach us all wanting to tell our members about their great services. And it really makes sense for us to connect our members to the companies that are going to make running a residential building company easier and more systemized. Now, what typically happens in these kind of situations is that the referring company apb, in this instance get, say, kickback or a referral fee for the introduction. Now, we've never really been comfortable with setting those kind of deals up because it can lead to a conflict of interest. So we can say, well, this is a great tool or service, but if we're also receiving a cash incentive for doing that, then it could kind of lead to a situation where our recommendations are potentially going to be influenced by income so we've never done it, but then we thought, well, well, how about if we collected all that money that suppliers are willing to pay in order to access our membership, but instead of keeping the money, what if we were to pass it back to the members themselves? We could create a situation where we are then actually paying our members more than they're paying us for membership. And of course, we only partner with companies that we truly believe in. We've got a website designer that follows our process. For instance, bookkeepers and accountants, they have to understand work in progress. Obviously insurance brokers that can offer genuine savings to builders. So really it's not even just about builders getting cash back, which is great, but it's probably even more about accessing a network of service providers that provide real value to residential building companies.

A very fascinating concept. And what I'm really impressed by is the situation kind of presented itself for you because you already had this scenario where you were already having people that you could recommend and you've turned it into a wonderful feature for your members. Why did you launch something like this?

I have to say, as of the recording of this podcast right now, this whole episode, I would say it's probably our most exciting launch to date. A massive reason why, just piggybacking on what Russ has just said, our builders and all of our members, they're using professional services every day anyway. You have to have, you know, certain pieces of software to run your building company professionally. You are going to be engaging third parties. Like Frost mentioned, bookkeepers, lawyers, accountants. So these are services already required and in need. Something that we always want at apb. You might have heard us say this in the past. Bosco is we want members for life. We want people, when they join us, never leave. And how we do that is to keep giving value year on year. So that renewal is, you know, a no brainer. Of course I want to renew. I get 10 times more out of this membership than I ever pay. So if we're always thinking of ways to add value, like how can we keep members for life? It was so natural. It was so perfect. Yeah, like let's pay our members to be members. Like let's give them cash back on those services. Let's align with the right people and just make it such a perfect relationship for our builders.

I was actually traveling and talk about brilliant copywriting. I got an email from Russ saying, find a way to pay for your membership and stay tuned and you'll hear about our announcement. It caught my eye. I saw the subject line and I Was like, I actually want to know what this is all about. So the next email that came in, you made the announcement. I was like, this is brilliant. How have your members responded to this new launch as well? I'm just curious because it got my attention 100% now.

Very, very positively, Bosco. And I think, as sky said, it's not that we're asking them to do something different to what they're doing anyway. It's literally they are now in a situation where they benefit directly from stuff they were doing in any event. And as Russ has pointed out, if they are moving to possibly new providers, they're going to be things that are lined up with our protocols anyway. So very, very positively now, how long.

Does it take or has it taken to put something like this together? Obviously, you know, it's one thing to give back to your members, but I can only appreciate what goes into building an effective rewards program. So from concept to execution, how long did they take and take me through the process?

12 years. Literally 12 years. This is something that I've always wanted to do in the construction industry, was to create a rebate program. And the reason for that is in a previous life, from a previous company in England, I had a distribution company, so we were wholesale distributors. And I heard about this group, it was called Nicer Today. And the story went in the industry that there is no such thing as a free lunch unless you join Nicer Today. And what they were was kind of like a buying group, but they didn't get involved in the negotiations because we deal with hundreds of suppliers. We did our own negotiations, but whatever, we spent a percentage of that came back in a negotiated rebate from Nicer Today. And I was a bit skeptical because it sounds too good to be true, doesn't it? You sign up, I think it was about £5,000, which was a decent bit of money back in the day. You effectively buy shares, which is weird in this group. And then from then on, every month you get a check in the post. And it was just incredible. And I'm not talking like you got thousands of pounds or anything like that. I'm not even talking about tens of thousands of pounds. I'm talking about hundreds of thousands of pounds every year. It was phenomenal. And that money did not affect our negotiations in any way. And it went straight to our bottom line and boosted our margin. So I always had that in mind. And being in Australia and being in the construction industry, I thought, this is a fantastic concept, we should really do that because it's too Hard in Australia or the US or Canada to really negotiate prices with suppliers across such an expense, really, because there's so many different price fluctuations. So I always thought it'd be a good idea to just do a rebate. But I did try it very early on back in about 2010. Most people had no idea what I was talking about. You know, it's like it was way too good to be true. And I remember one guy said, no, I don't sign up to anything. I can't understand. And I really don't understand where the money's coming from. And I'm not asking you for any money. I just need your name, really, so that I can go to suppliers. But It's a catch 22. I couldn't get the builders behind it to get enough momentum to then go to the suppliers and negotiate. So, yeah, it kind of flopped. And as APB has kind of grown over the years, it's in our quarterly strategic planning. It's always been something that's kind of popped up. Yeah, I really want to do this idea. But sky was never keen. It was never the right time. And just really kind of didn't get the concept at all. You'll probably jump in here, sky, and probably.

I think you're being so polite. I think you're being so polite. Where father, daughter. We get along quite well. We do. But for that whole time, this was our biggest argument.

I've been in the stands on a few occasions when this argument has broken out and I'll back Sky up. This. This one got heated regularly.

This one. And you know what, though? It was because I couldn't get it. Yeah, it was, you know, Russ, if he's passionate, he's passionate. And it was like, yes, rebates. This is the way forward. We're going to make a rebate program. And I didn't get it. I didn't like it. I was really worried we were going to move into the potentially quite a boring space, like, take us away from what we're doing and. Well, it's rare, but this was our recurring argument every time we sat down for the next quarter. This was Russ's moment. We're going to do rebate. We couldn't get on the same page. To Russ's credit, it was randomly. So I started using services like, if you guys ever use, like shop back services or, you know, like with some banks, they were giving you cash back when you spend money. And I was like, this is amazing. You get cash back from things you're already doing this is so good. We should actually launch something like this. Let's make a rewards program. I think Russ just sat there looking at me like, oh, God, this is only what I've been talking about for the last decade. So it was a great idea.

If I remember correctly, sky, that was almost the key that moved it around was I watched you shift from the word rebate to the word reward, and all of a sudden, that made all the difference.

Rewards was, like, fun and interesting. It was a sexy way of communicating it. And I think everyone gets your rewards programs right. Like, they're your credit card rewards, your flight rewards. It's almost easier to explain. It probably makes sense why it was really hard to even communicate to anyone else to get on board rebates. I mean, I don't know about you guys, but it just sounded boring to me.

It's a great lesson, I think, isn't it? If you want an idea to take off, let someone else take ownership.

And I think also in our industry, there'll be a lot of people listening to that podcast that when they hear the word rebate, they automatically think about materials.

Yeah.

Where really we don't work in that space at all. And I think that it was that disconnect of we don't really do that. We don't sell timber and cement and stone and, you know, those.

I'm going to disagree with all of you here. APB rebates would have been so much better.

No, no.

Well, from the outsider's perspective, I think it's great because it's a user journey where people get to use things. Right. And they're already going to be using these different things. And I think about, you know, my Qantas Rewards points. When I first got the points, I was, like, hooking it up to my Uber and my hotel rides, and then I was, you know, getting all these different entities, but I was using it.

Yeah.

And I think about the program that you're offering, and everything that you're rewarding is things that they're going to use anyway, so why not get rewards for it? So I thought that was a brilliant concept from the outside looking in.

Thank you, Bosco.

Thanks, Bosco.

I'm going to take credit for this, Russ.

I'm going to just bask in the glory that I had nothing to do with.

Well, what's in it for the builders? Let's look at it from the builder's perspective.

Right.

What's in it for them? We have all these different programs. Some of them work, some of them don't. Work out there. What makes this so different and unique to them?

Well, I think really we've focused pretty much in the discussion so far on the cash back, but really what we've done is because of the way that Russ and Sky have always run the apb and this is no different. We're not just going to throw a bunch of people out there on whom there's some money coming back. So these are not just the kind of services that builders are going to use. These are curated. If we ignore even that, people are going to get money back in the long run. If we just look at the short term scenario, what we're doing is connecting them to people that other members have already vetted. They've got benefit out of the service that they offer and they're a recommended service. There's no uncharted waters here. In a lot of cases. I do this in my own personal life. I'm. I'm considering buying something. What's the first thing I read the reviews, if they positive and it's a five star service, etc. Etc. I'm a lot more comfortable to get involved. So at its initial level, it's the kind of services, the kind of infrastructural things, the kind of software that a builder will need to build a professional business. So there's, number one, he doesn't have to go looking for those things. Every time we add somebody to the list, he now gets that confidence to know if this is part of this list, I can trust that the outcomes will be what I'm looking for. To me, that's almost the bigger advantage. The direct benefit they get, of course, is the money comes back to them in cash. So reality, as sky has alluded to, and I think Russ said it in these many words, there is the very real possibility that if you are using the services that you would have used anyway, your rebates will exceed what you pay to be a member of the apb, in which case those partners, those rewards partners, are effectively paying you to be a member of the apb, which is just the cherry on top of.

The cake, which is a bit like the live events as well, isn't it? Our preferred partners actually pay for our members to go out to dinner. Yeah, yeah, we're trying to bring these partners in and, you know, to the benefit of the members themselves. But I think it's a really good point you mentioned about the type of partners that we're bringing in as well, because we've got some pretty sensitive topics that we talk about. Like website design has to be done in a certain way. There's so many website designers out there that don't follow our process. Yeah, we wouldn't work with those guys. And bookkeepers and accountants. I think anyone in the APB knows what a sensitive topic that is and they know how difficult it is to work with a bookkeeper or an accountant that doesn't believe in what we're actually saying and doing with regard specifically to work in progress. So it's very important that any partner that comes on board buys into our teachings. Really?

That's such a good point. The benefit is the compliance to what we are teaching. I think this is why it was the perfect time to launch it now as well, because it was almost like it was always chicken and egg. We needed the group of builders to sell to the suppliers, but we also needed the authority as a company in order to have any supplier follow particular training or methodology. So it's come at the perfect time that our preferred partners want to work with us because they want access to such a professional, advanced group of building company owners. Because it's just going to be such a complimentary. And as another benefit to the builders as well, when you sign up, and you don't have to, obviously, but if you choose to sign up to any one of these preferred partners, you aren't just one client to them because you represent, you're a client of apb and they have so much to gain from delivering such an incredible experience to an APB member because of this partnership. So you just, you're a little bit more taken care of, you're a little bit more secure because you're part of this body, this association.

It's not all boring stuff either, like traditional services like website design and insurance and lawyers, etc. There's some exciting partners getting in touch with us, bringing new concepts and ideas to market as well. And that's really exciting to be able to share what is the cutting edge of processes and systems, different ways of doing things, which puts our builders on the front foot and the cutting edge as well.

Can you give us some examples of some of the preferred partners? And I noticed that obviously the membership is global. You've got members from different parts of the world. Can they work with the preferred partners or do you have them restricted to the geographical zoning?

Well, the way we launched it was on our rewards preferred partner directory. You can segment for your country. So things like, you know, we've like a couple examples, we've got lawyers involved, like construction specific lawyers. So you get A cash reward, cash rebate, money back, cash back, whatever you do want to call it in the end there from engaging them in their services. Now with something like Law, that's going to be very specific. So they do only service a particular country, but you can start filtering on your own countries. We also have filters that are global because we have software providers. A good example is BuildXact. There's a cash rebate, cash reward plus a discount for anyone who signs up to buildxact. Through our rewards system, there are so many different marketing services. We've got like photo editing services, 3D rendering services. We've got sales and marketing assistance basically to help you in your sales process. Tons of software, different service providers like Law, insurance, so to negotiate your insurance and even to do with safety documentation as well. The thing is though, what we've launched with right now, now this is constantly and perpetually growing. So it's not going to be a static rewards program because like Andy mentioned, we get introductions, we go through a vetting process. We are meeting providers that make a difference for our builders all the time. And so our goal is to really build up this program so that it really can incorporate and include every service provider that can make a difference and help the owner of a building company run their building company professionally.

Anyone become a preferred partner. What is the process? If there is a suitable partner out there, how do they come to meet with you guys and sort of get vetted out? Do you have a vetting process as well?

Yeah, we definitely do. So we get introductions. This is the number one way we want to meet partners. We need our members to introduce them. It's obviously the best way to do it because then we get to talk to our members in detail. What is it? What are the benefits? How long have you worked with them? Then we'll try and talk to some of our other members. Have you worked with them as well? What was your experience? We'll start meeting with them and go through our process from there. So I suppose can anyone be a preferred partner? They can't just sign up on our website and that's it? No, there are a few steps so that we can make sure it's actually valuable. People have had a good experience as well, but we do want to grow this. So we're always looking for introductions and all of our members can refer as many partners as they like because there's just a button right at the bottom for them to do so and, you know, make that introduction.

So as a member, how easy is it to claim your Rewards. And is there a process for them to activate this?

It's ridiculously easy. That's the only way I can describe it because at the end of the day, they don't even need to claim it. As long as they set up the relationship with the preferred partner correctly from the word go. All of the administration and processing happens in the back end and the next thing they will see is literally cash coming back into their bank account. To be honest. And I think this, this was one of the things that really was a benefit out of Russ and Sky, let's use the nice term, debating this process for as long as they did because it meant that the detail was very well fleshed out and we literally have worked to try and make it as easy as possible on both ends of the scale. So there's a complete back end engine behind this thing that takes care of all of those financial transactions, etc. Etc. And then literally all that, the client, all that our members will see is that money coming back into their bank account every quarter.

It's a really important point, actually. So I think a lot of people, the first question when we talk about launching APB Rewards is, oh, you're just going to credit our membership then? So it's not actually cash back, you're going to reduce the renewal amount? No, every quarter, cash paid into your bank account.

That's really cool. But some might say that, well, all sounds good in theory, but at the end of the day, any company that pays a rebate will simply inflate their price in the first place to cover the cost. So it's not really a win. How would you handle that scenario?

You've been hanging out with too many builders, Bosco. You're getting old and cynical. That's exactly what I would be thinking for sure. And it's the reason why we make it very clear, clear in our contracts with each preferred partner that under no circumstances will our members be penalized on price. And if we find out that they are, then we have the right to terminate that contract immediately. Now, I guess this kind of like touches on another benefit for the builders as well, because apart from tapping into a network of preferred partners that can help systemize their business, and apart from the fact that they're going to get money each quarter paid into their bank account, the other benefit is that they are not a single company dealing with another company, they effectively represent over 500 members of the association of Professional Builders. So you can be sure that your business is going to be taken very, very seriously from. Right from the moment you make that initial inquiry, you're going to get the follow up it deserves. And if that doesn't happen, because let's be honest, a lot of companies are not the greatest at sales and follow up and we've already had an instance of this. But very quickly that feedback came through the coaches and back to us, at which point one email and within minutes that problem was sorted. And that's the clout you have as an individual builder, because they tried numerous times, they weren't getting the response they wanted when it came from us and it went straight to the top. Things happen very, very quickly and that's the power of being part of a group when you deal with different partners. Now, some of the partners actually offer discounts to AP members like BuildXacto, but the majority, and this is the way it's set up to go forward, it's all on rebate, but the price, it cannot be inflated to cover that rebate. That is never going to fly. And I guess another way we protect ourselves, because things like BuildXact, it's quite easy, isn't it, really? It's a set price, everyone knows the price, they can't inflate it to cover the rebate. But when you talk about things like lawyers and maybe even website developers and pr, you know, all these things, it can get a little vague. So in a lot of instances, we've got specific packages that have been set up for apb, so they know exactly and obviously we've had good insight into exactly what's being provided. So we know those, those packages are in line with their rates and value for money. But yeah, if it's more general, ongoing hourly rate, if ever it was a case that we found out, or even a builder, a member found out that their price was being inflated, they got too much to lose, these guys. They just wouldn't do it.

Obviously, the timing this time around was right and both sky, you and everyone aligned in making this decision. So I'm going to throw a random curveball question here. I want you to think of your most desirable rewards program or your least favorite, and tell me what was it about that feature that either made you really like it or, you know, made you sort of not use it? And how did that shape the making of this rewards program? For me, obviously the biggest one for me was the usability factor and the fact that I'm always a big fan of rewards programs that I can use and it's in my life and I can integrate things and I talk about the QANTAS one, which you know, obviously has a lot of features, but Andy Ruska, anyone can take this. If there's a rewards program that you really like or you'd stay away from, please throw it at me.

I'm tempted to say the four letter word but I can't get it to be four letters because they'll get everybody's attention. But the three letter word that you've used multiple times about that airline that you've been talking about because they're not part of our awards program. So I'm not going to talk about. No, I'm just joking, I'm just joking. You use it. You know, I'm sitting. I think it's a great question because flybys and all those kind of things. I have no idea what to do with flybys but I religiously go peep peep every time I, I go through the till and, and I've got 11 million 926. I don't ever use it. It's almost irrelevant. So I think that is the key. We've almost removed that process because you're not going to use the reward, you're going to use the service that generates the reward and then you're going to get that reward automatically. For me, that is the real kicker here is that I don't have to do anything with my 10,865,000 flybuys dollars. It automatically gets done for me, which makes it really, really easy.

I think that's a really good point. Mine would be that it's real because what actually convinced me in that whole 10 year saga was actually using a rewards program. And you know this, I think they're only Australian based, but maybe they're bigger. This was shop back and I online shop a lot, shockingly enough. And I heard about it and I was like, oh sure, it's just a chrome extension and I can see it on my phone and let's just activate it next time I shop. And I got all These emails, like 20 bucks here, a hundred dollars here, and I thought, wow, this is legit, let's just wait. And I could withdraw all the cash. It worked, it was real. So it was that whole too good to be true argument. And that's why I couldn't get my head around rebates. It was. Sounds cool. Sounds a bit slight, like something's off, there's something wrong happening. No, the fact that it was real. So that would be mine, I think.

Mine is a credit card that I signed up to probably about six or eight Months ago. That has an instant cash rebate on it, 3%. So there's no fee for this credit card and you just use it as normal and instantly. Yeah, you don't have to wait till the end of the month or the end of the quarter. Even instantly when you spend it. When you spend money on anything, you automatically get this 3% come up on your credit card statement, which is awesome. And it's that gratification of getting something for nothing, really.

Bosco, you said it. You put your Uber on it and you do all kinds of things with it. That's really the principle here, is it's not even go and spend money that you would not otherwise have spent. This is money that is in your interest to spend because it's going to make your business more professional and efficient and blah, blah, blah, and you get rewarded for it. This is not too good to be true. It's so good because it is true and there's value.

It's a classic win, win, isn't it? Because one of the first things that the building company needs when they come to us, typically, they start working with the coaches is a website. And that was an Achilles heel for us for years, wasn't it? Finding a website that we couldn't recommend anyone at all. So, yeah, it was really difficult to tell them what they needed to do and what they needed to look for. And we couldn't even suggest someone that could do it for them. So to actually work with someone that can deliver on exactly what they need, but then know that they're going to get looked after and that they're going to get a benefit that they wouldn't have got otherwise as well, where it's a win, win, win. Really.

Well, some really exciting times ahead for you all. If you have to think about what the next few months or years would look like. Is there a preferred partner you'd like to bring on or do you have any exciting, future innovative things that you want to bring to the rewards program that our members should be excited for?

I'd love to bring on an accountant that understood work in progress. I'm sure we will get one one day, but that's. That's my dream.

Yeah, I'm trying to work out a way to get a brewery involved. I haven't quite worked out the mechanics yet, but that's my goal.

Let's get some airlines involved too.

All right. All right. Well, where can the members get more information about this? Obviously, I was on the road, I saw the email. I've seen it on social media, but is there a centralized point where members can get tips on how to maximize the points or make the most out of this? And is there a resource sheet all over the website?

And to make it nice and easy, what we will do is we will put a direct link to our rewards and preferred partners in the show notes here just so everyone can have a browse, check them out, see what is available and just know that even from the time of recording this episode, we would have added so many more because they're just coming constantly. So it's definitely worth keeping up to date with.

And even if you're not a member of the association of Professional Builders, you can still opt in through that rewards process. You won't actually receive the rewards until you become a member, but if it's something you're considering doing, you might as well get tagged now so that when you do join the association of Professional Builders, you will start instantly receiving cashbacks.

Let's be honest, they're substantial. You know, a lot of these services, they're not like a couple hundred dollars that you're getting 8% cash back or 16% cash back. They are substantial services. So it's a really good point. If you find yourself in the need of signing up to those services, it becomes that no brainer. Win, win.

As you're saying that, I'm thinking we've got a couple of Gandalf wizards in this thing in particular areas, one of which being something like homeowners warranty insurance where forget the rebate, forget the reward. This guy's creating things that were impossible before he came along. He's not only getting right, but he's actually saving people money on their insurance premiums directly.

14,000 savings in a year like these were big money that we were hearing from our members.

So I think that and Russ's point is valid even if you aren't a member of the association of Professional Builders yet. And of course the question would be why the heck not? But that's another discussion. There's benefit for you in this, even in that area, that you'll get better service at better rates.

So before we go, are there any other 10 year arguments that Russ and Sky have that we should bring to the market? I'm just curious.

Sandy will reveal all.

Not that we're going to talk about on a podcast, I'll tell you privately. Bosco.

Well, a pleasure to have you all again. I'm really excited to see this roll out and you know, again, thank you for your time, energy and insights. And we look forward to hearing more about the rewards program Grow.

Thanks Bosco.

Thanks Bosco.

Thank you.

Pleasure as always guys.

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