There’s always a risk involved when a customer purchases a service. It’s why many have taken to the Internet to research service companies, such as HVAC contractors, before contacting them for repair or replacement needs. Wary of a bad experience, they look at online ratings and reviews for some kind of direction.
One way HVAC companies can help build trust and brand awareness is by offering customer satisfaction guarantees. These types of guarantees are useful sales boosters because they instill trust and give customers one less reason to be apprehensive about making contact. Essentially, a guarantee helps build credibility.
While Thornton and Grooms has always offered its customers a satisfaction guarantee, the Farmington Hills, Michigan-based contractor recently decided to refresh its guarantees to help better brand the business. Earlier this year, the company launched realguarantees.com, a new website that links back to its business website.
“We did a customer survey and learned that customers really appreciated the way we handled our guarantees,” said Dave Knight, service manager, Thornton and Grooms. “We recognized that is who we wanted to market to. We wanted like-minded customers, people who appreciated that type of service. Because anyone who offers any kind of 100 percent satisfaction guarantee is going to train like heck to eliminate bad things from happening.”
After brainstorming, Thornton and Grooms determined they were going to name the new initiative, The Real Guarantee. With the help of a branding company, Thornton and Grooms developed a brochure that provides all the guarantees the company offers in writing — everything explained on the new website — which is handed out to customers. In addition to the 100 percent satisfaction guarantee, Thornton and Grooms’ Real Guarantee also includes a property protection guarantee, an on-time guarantee, a cleaner-than-before guarantee, a one-year risk-free guarantee, a no-lemons guarantee, and a five-year performance guarantee, to name a few.
“We want to raise the bar for our staff and for the industry,” Knight said. “We felt we needed to establish something pretty significant from what we’ve seen in the marketplace. And, we identified all the things we could think of that were most important to our customers. That’s what customers want. They want the house to be cleaner than we found it. They want us to respect them and their property. They want to make sure everything’s done to their satisfaction.
“A lot of people have 100 percent satisfaction guarantees, but what does that mean?” he continued. “I think we spell it [the guarantee] out so there is an end. If we don’t leave your house in as good of shape or better than before we arrived, we’re going to give you $100 and then go make it right. So, that’s an example of having an end, so customers understand what it means when our guarantees are not achieved.”
Thornton and Grooms also phones its customers and asks how likely they would be to refer the company to family members or friends. By employing that procedure, it has uncovered three customers within the last four months who were not entirely satisfied.
“We had one case where screws were found and we offered him $100 because it’s one of our guarantees to leave the area cleaner than before,” Knight said. “The customer told us we didn’t have to do that, but we wanted to pay that out. I know it hurts to pay out $100, but we also want to cement in customers’ minds that we’re going to do what we said we’d do. We feel that, one, it’s the right thing to do, and two, it will carry on. That customer will tell her story to her neighbors and friends, and that will get us more business. And, in fact, it has. About three weeks after this incident, we got a customer who was referred to us by one of the people we wrote a $100 check to. Would it have happened otherwise? It’s hard to know. But we definitely got a referral out of that customer.”
Offering guarantees has definite value for Thornton and Grooms, according to Knight.
“In our industry, and in any home service industry, one of the biggest fears people have is how are they going to be treated, how is their property going to be treated, are they going to get ripped off, and what happens if something goes wrong? It’s risky to bring in a home-service HVAC company. This helps us establish that level of trust and transfers the risk from them to us.”
And, oddly enough, the implementation of Thornton and Grooms’ Real Guarantee has decreased the number of errors its staff commits. “We’re tracking such occurrences and we’re trending below what we used to before we introduced it [the Real Guarantee],” Knight said. “We were doing this before and, since we started to heavily market it, our performance has gotten better as a result. And, when we do have mistakes, we own up to them and try to fix them. It’s caused an increase in positive culture.”
Additionally, it’s also helped the company recruit new talent, Knight noted. “We’ve hired two people now who’ve said the reason why they were interested in our company is because of what they read on our website as it relates to our brand and our guarantees. They want to be part of something like that. So, now, we’re rethinking how to use this in recruiting, because that’s such an issue.”
DISSATISFACTION A RARITY
GAC Services, located in Gaithersburg, Maryland, has offered a 100 percent satisfaction guarantee for the past 10 years. The 2015 ACCA Residential Contractor of the Year markets its guarantee to customers in print, online, and through the communication and sales process, said Richard Biava, vice president, GAC Services.
“Putting out guarantees generates business, for sure,” Biava said. “It shows that you’re confident in your team, your process, and that you’re here for the customer, not just to make money. For us, we want to improve the industry. We want to help our neighbors and provide the best heating, cooling, and electrical service in our area. The bottom line is, we’re here to help people. That is what we do, and we will honor a customer’s request for their money back up to one year.”
Biava also acknowledged that, sometimes, people just cannot be pleased, no matter what you do. In those cases, it’s best to offer the customer a full refund and move on.
“Recently, I had a guy get very upset with us because his house wasn’t cooling well,” said Biava. We were out there several times and just couldn’t please him. There was also a language barrier between us. What we discovered later was he took out the stairs to the basement and created an apartment in the basement for rent and had an apartment on the first floor for rent. He crushed returns, moved ducts, and his tenants were not comfortable. So, he blamed us, but he was truly at fault. I gave him back $5,500, took the equipment, and we moved on. Some people are going to just be a drain of resources. When you see that, cut your losses and move on.”
That type of situation rarely happens though, Biava noted. The last one occurred a couple of years ago when a customer complained the system that was installed was too quiet. “He liked the sound of the motor, the white noise, I guess. It was just a weird situation. Those types of things rarely happen.”
Biava said having a guarantee raises the company’s expectations and awareness. “When you put strong offers and guarantees out to the customers, you want to make sure the quality of your work is better. Obviously, it can cost you money, and it’s up to you to create a business that delivers better quality. This means you want to hire better, smarter people and invest in and take the necessary time to train your people.”
DIFFERENTIATING YOUR BUSINESS
Mike Agugliaro, owner, Gold Medal Service, East Brunswick, New Jersey, said his company gives every customer a certificate containing all the guarantees Gold Medal Service offers in writing.
“Guarantees give people a sense of trust and, it shows them the company is being held by a standard of some kind,” Agugliaro said. “It also shows that the business understands customer satisfaction and things like that.”
Gold Medal Service has several “Golden Guarantees,” including a 100 percent satisfaction guarantee and a “We Value Your Time, Safety, and Home” guarantee. It also offers a lifetime guarantee on repairs.
“The No. 2 core value in our business is delivering wow through service, or exceeding customer expectations. All the guarantees are about setting a standard of exceeding customers’ expectations. So, when we say, ‘We value your satisfaction guarantee,’ if, for some reason, they’re dissatisfied at all, we’re going to jump through hoops to see that it gets made right. We’re not going to run from a problem, and you’re not going to have to chase us down. Nobody feels really comfortable with just a one-year guarantee anymore.”
According to Agugliaro, HVAC companies need to think about which guarantees they’re going to offer and then build the costs into the business.
“You assume there’s going to be so much that can happen with product failure and other things, so you build it into the budget at the beginning of the year of how much you’ll possibly give back,” he said. “When you forecast, base these issues on the prior year’s budget. Build it in, and look at it on a monthly basis to see if any adjustments need to be made. It’s not a blind-shot thing; it’s important to plan ahead. With 150 employees, we expect there will be a mistake here and there.”
Additionally, guarantees can help HVAC contractors differentiate themselves from their competition, so companies shouldn’t just copy the guarantees of other businesses, Agugliaro noted.
“Owners should ask themselves, what guarantees should they offer to create a very different experience from anybody else in their market? You should never offer a guarantee of another company or what someone else is doing without really evaluating what that will look like. If you’re a small company and you offer a one-year guarantee, it would make no sense to go to a lifetime guarantee because you haven’t even stepped up to a five-year guarantee or a 10-year guarantee. What I normally like to tell people is, ‘Don’t copycat what someone else is doing. Just think what you can do that will be very different, and better than everybody else.’”
Publication date: 10/19/2015