Welcome to the Big Show
HVAC has changed significantly in just a matter of months. Many are concerned with strategies for the new 13 SEER order. Record-breaking shipments, spotty shortages, and customer ignorance have created a frenzy of discussions, preparations, and some mild hysterics. The discussions have been helpful, but the preparations are priceless, and they allow us to leave the mild hysterics to Chicken Little.
Drew Cameron, president of HVAC Sellutions, agrees. His presentation, "Stand Out From The Crowd In A Market Where 13 SEER Is A Commodity," part three of a four-part webinar series hosted by the Air Conditioning Contractors of America (ACCA), the Heating, Airconditioning, Refrigeration Distributors International (HARDI), and The NEWS, highlighted specific strategies contractors can employ to help ensure success in 2006. His three standout strategies suggest contractors take a hard look at market and lead generation, sales initiatives, and selling strategies.
RISE ABOVE THE DINManufacturers, distributors, and contractors aren't the only ones being inundated with energy efficiency and SEER issues. Consumers are hearing the rumblings of an energy revolution via their evening news and more painfully, through their monthly heating bills. It's time for contractors to "set themselves apart from the clamor," instructed Cameron. "The most important thing to do is to start right away."
Cameron advised contractors to position themselves as the market authority and adopt a policy of full disclosure, informing end users of both the positives and the negatives of the government mandate. He said it is imperative that a company gains credibility, and it can do so with its marketing approach. "You must get leads before sales, no matter what you are selling so you can create interest with your marketing messages."
Cameron advocated handing out informative packets to customers, sending press releases, changing telephone hold messages, and mailing out postcards. Although this may sound as if the contractor is just adding to the noise, Cameron continued with ideas to keep a company's voice distinct in the din. For instance, contractors can announce the government mandate, then offer discount tune-ups to determine equipment compliance.
He later mentioned contacting investment property owners to help liquidate excess 10 SEER stock, and setting up booths at winter home shows.
Customer education must be done on three levels: personally, nationally, and environmentally. The cost of 13 SEER is undoubtedly higher and is coming out of consumers' pockets. Communicating value can help ease their initial sticker shock.
Decreased energy consumption is another soothing fact consumers may not understand. Higher efficiency can equate to lower monthly bills. The savings may not be astronomical, but every little bit helps and over time, it adds up. Environmental education informs consumers that not only are they helping themselves, they are also helping contribute to cleaner air.
Once leads are generated and the customer is educated, "Let the salespeople do their jobs," said Cameron. Begin to concentrate on services and other items that will set the company apart from the rest. Cameron proposed offering 10-12 SEER units in a winter heat-ing-cooling package. Let the end user know that they are getting in on the last of the 10-12 SEER stock. "Consumers love bargains coupled with scarcity," he said.
During the webinar, the question was raised as to how ethical this strategy was. "Give the customer more credit for intelligence and use a disclaimer form," replied Cameron. "If you offered full disclosure during your presentation and you mutually agreed it's what's right for them, and they [the customer] are signing off acknowledging that they understand the facts, I'll sell it."
CLOWNS DON'T PUT OUT FIRESCameron also discussed sales initiatives. A homeowner wouldn't want circus clowns to roll up in a fire truck to put out the fire in his burning home; neither should a contractor want to send a technician to do a professional salesperson's job.
Cameron counseled contractors to adopt a specific selling system and to train new hires properly and completely before sending them out on sales calls. He encouraged ongoing coaching, training, and ride alongs to ensure proper field implementation.
No major brand distinction for 13 SEER has occurred as of yet even though several have been proactively educating contractors and consumers about products that are in development. According to Cameron, it is a good idea to compensate for this with additional customer benefits. Contractors can improve the quality of installations technically and cosmetically. This, along with extra IAQ products and services, can be the differentiation a customer is looking for, he said.
Another strategy is to change quality/pricing tiers (good, better, best) to reflect 13 SEER, 16 SEER, and 19-plus SEER. Entry-level units would be no-frill options. Progressive tiers could include various options and improved comfort items as appropriate.
Quality also helps differentiate contractors. Cameron suggested offering equipment with certified ratings and installing matched systems. He also suggested providing Air-Conditioning and Refrigeration Institute (ARI) and Gas Appliance Manufacturers Association (GAMA) certificates of verified ratings and reference numbers for utility rebates and tax credits.
IT JUST NEEDS SOME OILCameron spent a few moments discussing the repair vs. replace argument. Recent repair and energy prices and 10-12 SEER values have been dictating replacements. With the 13 SEER mandate, however, the amount of the initial replacement investment is cumbersome to many who will now likely opt to repair. Enter HVAC industry confusion.
Mismatched coils, thermal expansion valves (TXVs), and system imbalances are just a few of the factors to consider as 10 SEER parts become harder to find in the future. Cameron encouraged contractors to bundle services now, in order to begin fostering a replacement mentality.
The bundled packages should include products and services that address health and safety, comfort enhancement, energy savings, environmental consciousness, and home automation. By showing a distinct price difference between purchasing packages versus a la carte options, consumers should gain pricing perspec-tive and begin leaning towards the package investment.
Small monthly investments can be used as a strategy to promote higher sales. Cameron discussed per-month and no-money-down offers. "No money down helps to sell more equipment," he said.
WHAT MAKES YOU BETTER?Cameron's final question was, "Why should customers do business with you?"
His answer was to offer options with focus, and enhance offerings with uniqueness. He recommended creating an elite customer affinity group that could be eligible for priority service, no overtime charges, and preferred customer discounts.
He also cautioned against offering IAQ as a luxury; offer it as a necessity.
Licenses, permits, and certifications for the company, and drug, credit, and background checks for the technicians, are additional ways to set the customer at ease and set a contractor above the competition.
"Don't just say you are better. Prove it."
Publication date: 03/06/2006