Marketing Indoor Comfort: Associations, Contractor Groups Doing Their Part

November 28, 2005
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To help its members learn what manufacturers are doing, ACCA hosted a panel discussion with a few top manufacturing executives at its annual convention this year. Providing insight on the topic of 13 SEER are (from left) Halsey Cook, president, North American Residential, Carrier; Tom Huntington, president, Unitary Products Group, York International; J.R. Jones, president, Air Conditioning Division, Rheem Manufacturing Co.; and Dave Pannier, president, Residential Systems, Trane.
If any member of the Air Conditioning Contractors of America (ACCA) is not prepared for the post-13 SEER world, then he or she has not been paying attention. Like most industry associations and contractor groups, ACCA has been doing its part to prepare its flock for the new higher-efficiency standard for residential air conditioners and heat pumps. In fact, it jumped on the bandwagon early.

For the past two years, information has been pouring out of the association's Arlington, Va., headquarters with one goal in mind: load up its members with knowledge regarding the subject. For instance, beginning with the May 3, 2004 issue of ACCA Insider, Glenn Hourahan, ACCA vice president, research & technology, began providing important, informative pieces concerning the implications of 13 SEER for contractors.

"The new 13 SEER mandate for central air conditioners and heat pumps, which will go into effect on January 23, 2006, will do more than require a 30 percent increase in equipment efficiency," warned Hourahan. "It will also drastically increase the size of the indoor coil unit and the outdoor condensing unit. This increase will have a big impact on existing HVACR applications."

While this may be common knowledge by now, it was all new at that point in time. Over a series of six weeks, Hourahan discussed how the new mandate would usher in a faster R-410A phase-in, noted that the new equipment could have moisture implications, and urged technicians to learn more about R-410A equipment.

"We've been trying to keep our contractors ahead of the curve," said Paul Stalknecht, president and CEO of ACCA. "That's what ACCA is all about."

Hourahan suggested to contractors that they encourage customers who have old equipment in space-constrained applications to move ahead and replace that equipment before next year, rather than simply fixing and patching for another year of service.

"At the very minimum," wrote Hourahan, "let the customer know as soon as possible of the implications for his residence and equipment. Perhaps the customer is planning a remodel in the future, which could mollify this situation.

"Don't play the product commoditization game," he warned members. "Don't fall into the trap of merely being a ‘box provider' that competes on price alone. Instead, talk with your customers. Ascertain their comfort and IAQ concerns. Fully evaluate their systems.

"Your future profitability is in becoming the solution provider that resolves deficiencies in system sizing, equipment selection, duct integrity, and the full application. Focus your business competitiveness on the ‘total solution' and not merely on the boxes you install. Then, your customers will receive the comfort and efficiency benefits they expect, and you will receive the profit margins you deserve."

In preparing for a 13 SEER world, Aire Serv is revising its Web site. It is being redesigned to allow consumers to design their own heating and air conditioning system on the site.

Bring Executives To The Table

In addition to its weekly newsletter, ACCA has provided 13 SEER coverage in its summer 2005 edition of Contractor Excellence. At the same time, it provided several training workshops at its annual conference this year in Austin, Texas. Plus, its load calculation and system design workshops, which it has been hosting throughout the country, has incorporated 13 SEER topics. "Again, this is a very important topic," said Stalknecht. "We are facing this subject head-on."

At the association's annual meeting, ACCA brought together a panel of top manufacturer executives to help members learn more about the manufacturers' preparations for a 13 SEER world. Participants included Dave Pannier, president, Residential Systems, Trane; Halsey Cook, president, North American Residential, Carrier; Tom Huntington, president, Unitary Products Group, York International; and J.R. Jones, president, Air Conditioning Division, Rheem Manufacturing Co. Mike Murphy, editor-in-chief of The NEWS, moderated the discussion.

"By the end of the first quarter [2006] and beginning in the second quarter, the world will have moved to 13 SEER," predicted Cook. "I worry about sticker shock for the consumer. There may be contraction in the industry as consumers may be stretched to more than their budget can handle."

Huntington noted that major homebuilders see the switch to 13 SEER as "a dilemma." He added that there would be a strong emphasis on retail selling skills for 2006. "It will be a watershed moment in our industry in 2006, as it will be in all of our retail world," he said.

He had this piece of advice for contractors, too: "If you try and cut corners with 13-SEER installations, the feedback will be quick and negative from consumers."

Jones, on the other hand, asked that contractors not turn 13 SEER into a commodity-priced purchase. "It is important to sell comfort, service, and brand," said Jones. "It is going to be a major challenge."

By "brand," the executives did not mean just theirs. They meant the contractor's, as well. "We've long felt that it was important for you to build your brand, too," Pannier told the room full of ACCA members. "It doesn't have to be one or the other. It can be complimentary."

Huntington emphasized that point, too.

"Managers come and go, products are phased in and phased out," he said. "So at the end of the day, what is the one thing that endures? That's your brand. The partnership of the contractor's brand and the manufacturer's brand combine to make a very powerful retail tool."

There will be some technical challenges, each executive admitted. Regarding the switch from R-22 to R-410A, Jones said that manufacturers would make dual products until 2010 as long as there's a demand for them. He said contractors will need to invest in training techs on 410A, as operating pressure is significantly higher - the 600-psi range compared to R-22's 300-psi pressure. Also, R-410 oils are polyolesters, not mineral oils.

"Training will be key," said Jones, adding that contractors should not sell up until knowing the technical issues.

System integrity is a factor in 13-SEER installations, he added.

"There are major potential performance issues, especially if you've got a heat pump application," said Jones.

In other words, if you just replace the outdoor unit it will work for a short time, but the system will fail sooner rather than later. In the end, said Jones, the contractor will have to deal with callbacks and dissatisfied customers.

"Don't walk away," he cautioned, "especially if it's an 8-SEER indoor coil."

The Air Conditioning Contractors of America (ACCA) provided numerous 13 SEER communiqués for its members, including its weekly ACCA Insider newsletter (above).

More Tools For Fuel

ACCA also put together many marketing tools for its members. For instance, it created a flyer that explains for homeowners the efficiency considerations, as well as refrigerant considerations, each faces. The flyer ("Changes Mean Choices. Should you replace your system now or later.") spells out in layman's terms what the new regulations mean.

"If your unit is in good working order and less than 8 years old, you should continue to have it regularly serviced by your quality contractor," it recommends. "However, if your unit requires extensive repairs, or is older than 8 years, you should make plans to replace it.

"Additionally, if your equipment is in a space-constrained situation, you should consider the structural changes that may be involved and replace the existing equipment prior to 2006. In this case, you will have far greater equipment choices."

Like ACCA, the Plumbing-Heating-Cooling Contractors - National Association (PHCC) has been providing 13 SEER communications, too. It continues to be an active participant on the North American Technician Excellence (NATE) board of trustees. It is the belief of PHCC that in the 13 SEER world, the NATE-certified technician is going to be the recognized authority on current technology for the consumer. PHCC chapters throughout the country offer NATE training and testing to help develop and recognize the best techs, it said.

With regard to training the industry, the PHCC Educational Foundation has also joined forces with the Air-Conditioning and Refrigeration Institute (ARI), ACCA, and the Refrigeration Service Engineers Society (RSES) to offer an annual instructor workshop for those involved in HVACR and plumbing apprentice training throughout the United States. The 2006 Instructor Workshop will be held April 5-7, 2006, at the National Conference Center in Lansdowne, Va. It features a schedule packed with instructional strategies and technical sessions geared toward instructing students on 13 SEER and the latest technologies in the field.

In addition, the PHCC Educational Foundation is working with RSES and ACCA on the development of new HVACR apprentice manuals for traditional classroom programs.

The four-year series is designed with three years of studies on core HVACR topics, with the fourth-year curriculum allowing for a choice of specialty, such as heat pumps or radiant heating. These new manuals are designed to bring apprentices up to speed on 13 SEER and the critical new technologies in the industry.

Meanwhile, because most of its membership consists of commercial and industrial contractors, the Mechanical Con-tractors Association of America (MCAA) and the Sheet Metal and Air Conditioning Contractors' National Association (SMACNA) has not dabbled much into the 13-SEER issue.

"Our residential market section has not focused on 13 SEER as an issue," said Rosalind Raymond, director of public relations and communications for SMACNA, via an e-mail.

Contractor Groups Get Into The Act, Too

Associations have not been the only concerned industry citizens. Most residential contractor groups have been busy preparing their members for the new-13 SEER world. In fact, many contractor groups opted not to disclose what they have been doing behind closed doors. Others were just too busy to respond.

"I do like to participate, but it's just very hectic right now," said Terry Nicholson, president of AirTime 500, via an e-mail.

Suffice it to say, though, each has been devising ways to help its members be successful in 2006 and beyond. For instance, at the Aire Serv Fall Conference at the Atlantis Resort on Paradise Island in the Bahamas, Aire Serv unveiled the format of its new Web site, www.aireserv.com, scheduled to be up and running by Jan. 1, 2006.

According to Doyle James, president, Aire Serv Heating & Cooling Inc., customers will be able to design their own heating and air conditioning system on the site.

"It focuses on value-added features, not product efficiency - helping our franchise owners sell themselves, their employees, and their companies - which nobody else in their market offers," explained James, who said the object of the new site is to drive customers to its Home Comfort System Design Wizard from the site's home page.

"If they start at our national site, they will be prompted for a zip code to specifically be driven to the local franchisee site that serves that area. Each franchise owner will choose what product displays on their site, including brands, efficiencies, included options, accessories, and default items, all which create a system ‘package.'

"Even though four options are given, they are generally not driven by four levels of efficiency. A customer could see a 13-SEER option in each of the columns, but with varying levels of accessories, warranties, and system enhancements."

According to James, once the customer's zip code is verified, the Wizard prompts the person to answer questions to help with choosing from four system packages that best fit the customer's needs. He said the Wizard analyzes the answers to the questions and selects a preset Web template that determines which products and options are displayed.

For example, if a customer answers questions that indicate issues with allergies, asthma, etc., a package including an air purification system and duct cleaning might be included. If a customer plans on staying in the current home for a long period of time, a 10-year parts and labor coverage might be recommended. The packages that are recommended can then be adjusted further by changing the options included in each package, said James.

"If a salesperson is in the customer's home, they can log in to view pricing for the package and options," explained James. "The site is not intended to disclose pricing without interaction between the customer and a salesperson. If a salesperson is not present, the results are forwarded to the appropriate representative for scheduling an appointment at the customer's convenience."

According to James, some of the potential uses of the company's new Web site include:

  • A customer calls in and would like a quote on a new system. He is instructed to visit the Home Comfort System Design Wizard and asks the customer to answer the questions. After the questionnaire is filled out, the customer is forwarded to the company's independently owned and operated franchisee from the Web site, with a full proposal of recommendations and options. The franchisee's salesperson goes to the customer's home and reviews the selections and completes the sale. 

  • A salesperson is in the home presenting options for new systems. Together the homeowner and salesperson can answer the questions online and build a system through the Home Comfort System Design Wizard.

  • A technician is performing maintenance or repairs and the customer shows an interest in an upgraded system. The technician can direct the customer to the Home Comfort System Design Wizard and continue working while the customer learns more about a new system and possible options. Once the process is complete, the technician can present the pricing or request that a salesperson return to the customer's home.

    "Verne Harnish, author of the book Mastering the Rockefeller Habits, inspired the creation of this system at a leadership meeting he conducted for Aire Serv and its parent company, The Dwyer Group," said James. "He believes that your customers must be able to do business with you online, otherwise you will be left behind. He sums it up by saying, ‘When people self-serve, satisfaction goes up.'

    "We believe in giving customers the tools they need to help them make a wise decision, and giving our company owners the tools to set themselves apart from the competition."

    Publication date: 11/28/2005

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