HVACR distributors exist to sell HVACR equipment and components. In a nutshell, the more sales, the better.
However, as today’s marketplace darts into digitization, many distributors are struggling to keep pace. When it comes to the fork in the road that separates offline or online, numerous distributors are stuck scratching their heads when it comes to which direction to take. Additionally, when choosing a path, they’re left pondering the potency of what works best. Offline, is it print, radio, or television? Online, are dollars best spent on social media, mobile apps, search engine optimization, pay-per-click, or retargeting?
And marketing is only one piece of the pie. Once consumer awareness has been earned, distributors’ sales leaders must connect with clients at that exact moment to ensure they adequately decipher the customers’ needs, deliver the proper message, and, ultimately, close the deal.
Communicating Effectively With Dealers
Renata Morgan first hired in with Century A/C Supply in 2007 as a marketing assistant. Last summer, she was promoted to director of marketing and IT.
Over her 10-plus years at Century, the company’s marketing approach has evolved exponentially, which is evidenced by the fact that the acronym IT is now a part of her professional title.
“The line between marketing and information technology continues to blur with each step forward into the digital era,” Morgan said. “Creating synergy between these departments leads to innovative solutions that can enhance customer relationships, make it easier to do business, and propel companies to the forefront of their industries.”
In the early 2000s, approximately 90 percent of Century’s leads originated from print advertising the company placed in the Houston Chronicle. The resulting leads were assigned to dealers in a round-robin fashion based upon the zip codes they operate in.
The birth of social media changed the way Century A/C communicated its message with its dealers and end users.
“Around 2009 or so, Facebook erupted,” Morgan said. “Everyone and their grandmothers were on it. We also saw significant increases in the creation and use of online news sources, retargeting, and aggregation around this time. The whole digital landscape has changed so much, even in the last five years. Our challenge as HVAC marketers is to get our messages seen in the midst of all the clutter and messaging out there.”
Morgan said distributors should stop implementing campaigns they feel will be successful and focus more on what buyers deem necessary.
“HVACR distribution marketing campaigns could be more effective if we put ourselves in the shoes of those we’re targeting,” she said. “Rather than seeing these promotions from our view of what they should accomplish, we should see them through the eyes of the people we’re dealing with.”
Brad Telker became vice president of commercial sales for cfm Distributors on Jan. 1. Since then, he’s identified several challenges within the company’s sales and marketing approaches.
“We learned that we were losing a lot of jobs because some of our customers were not following up with their customers,” Telker said. “The more we dug in, the more we discovered that many of our dealers didn’t have formal sales processes. While contractors are really good at installing equipment, measuring airflow, and changing out compressors, very few are studying sales and marketing processes.”
In an effort to strengthen the communication pipeline between distributor and dealer, Telker created cfm Sales Academy, an information-rich channel dedicated to providing all links of the supply chain with the resources necessary to attain sales success.
“We’re creating content that we hope helps our customers with their sales processes and close more deals,” he said. “Our blog includes original, fresh articles released every week, with topics based around lead gen, follow-up, handling objections, closing the sale, and even some book reviews. Our team has access to this content as well, which offers a sense of transparency between ourselves and our dealers, as we’re all learning from the same source.”
Additionally, cfm’s commercial sales team meets every other week at 8 a.m. for a series of role-playing exercises.
“We practice the intricacies of a sales call, how to follow up, handle objections, close deals, and much more,” Telker said. “We sometimes need to help train our customers, and we can’t do that if we aren’t trained ourselves. If our customers are unable to handle their customers’ objections, we need to find a way to help them professionally fix that.”
Telker said a team of 15 salespeople shouldn’t be responding to generic sales questions in 15 different ways.
“If we can build a process where our sales team has a consistent response to each type of objection, we’re going to do a much better job of closing sales,” he said. “We want to get to the point where we’ve practiced our responses so much that they become automatic.”
Determining Marketing Roi
Before joining the HVACR industry, Mary Jo Hann spent 20-plus years in the direct-selling industry. Today, she serves as the director of marketing and communications for Munch’s Supply.
While the return on investment (ROI) was easier to measure in direct sales, it’s been somewhat difficult to calculate that number in HVACR distribution.
“In my past life, everything was built on the company name,” she said. “In HVAC distribution, there are a lot more things to be aware of, including the Munch name, the equipment and accessory brands that we carry [Trane and American Standard], our branch locations, and, of course, our contractor customers.”
IN FOCUS: SALES AND MARKETING
While preparing for the Marketing & Sales Optimization Focus Conference, June 3-5 in Miami, members of HARDI’s Marketing Committee surveyed 66 HVACR distributors, asking them to identify their most significant sales and marketing pain points.
On a 1-10 scale, with 10 being the most problematic, “Communicating Effectively with Dealers” scored an 8.33, “Determining Marketing ROI” scored an 8.12, and “Building Distributor Company Brand” scored a 7.86.
“Unfortunately, there isn’t a golden bullet designed to solve every company’s marketing needs,” said Renata Morgan, director of marketing and IT, Century A/C Supply, and chair of HARDI’s Marketing committee. “E-commerce and tailored communication are areas that distributors will be focusing on for years to come. As distributors, we have to use the technology available to us to come up with strategies that really help us accomplish our goals as well as the goals of our customers.”
While the approach may be considered old-school, Munch’s has had great success through the delivery of a monthly print sales flyer.
“If you get the Target ad at your house, and you notice there’s a good deal on paper towels and laundry detergent, you make it a priority to stop at Target,” she said. “Our approach is very similar. The front page of our monthly ad showcases the rewards we offer — those are our version of laundry detergent and paper towels.
“The monthly print and digital marketing plan is brought full circle by also highlighting the sale flyer on our website and in our electronic customer newsletter,” Hann continued. “The return on investment is calculated based upon the sales and the number of dealers who arrive at a branch specifically seeking the items featured in the flyer.”
While it’s difficult to calculate marketing ROI in HVACR distribution, it can be done, Telker said.
“In my opinion, it’s much smarter for distributors to spend their time, money, and energy on what I call the new internet – Facebook, LinkedIn, Twitter, SnapChat, YouTube, Instagram, etc.,” he said. “It’s easy to calculate the ROI on a digital ad if your goal is to generate actual leads. For example, let’s say we spent $200 on a Facebook ad and 20,000 people see it. If we received 30 likes and gathered eight leads from those 30 likes, and one person purchases a packaged chiller, that’s a great ROI on a $200 investment.”
When it comes to marketing, Telker suggested distributors focus on spending money where the attention is underpriced.
“Your ultimate goal is to gain your customers’ attention,” he said. “The most underpriced attention I can find right now is Facebook ads. Most media returns around 30-35 cpm [costs per thousand]. We recently ran a Facebook ad, and the first week, the cost was only 8 cpm. It eventually settled in around 10-11 cpm, which is still a great price.”
Building A Distributor Brand
Hann recently helped Munch’s rebrand its logo and visual presence, which has helped it gain uniformity across its 13 branches.
“We were inconsistent in using logos and fonts,” she said. “I’m a big believer in brand standard and feel like brand loyalty lends itself to customer retention. I want our dealers to know the Munch brand just as well as they know the Trane and American Standard brands.”
Following the rebranding, all of Munch’s materials utilize the proper logo, fonts, and colors per the parameters of the brand’s style guide.
“I think this uniformity is important and a good first step for distributors. We utilize a diamond for a logo, but if we run into an instance where the space is too tight for the diamond, we’ve created a version that emphasizes just the text and can be manipulated to fit any sort of surface area.”
While branding doesn’t lend itself to a clear ROI calculation, Hann is confident, over time, the results will speak for themselves.
“Branding is very difficult to measure,” she said. “That said, we’ve heard a lot of positive feedback as we continue to evolve our materials. I believe our brand is much stronger now. If you lay down all our materials, you can instantly tell they’re all representative of the same company. We’ve achieved cohesiveness, which is a testament of branding success.”
Distributors Win When Dealers Win
Hann believes the distribution sector could do a better job helping dealers navigate through the challenges that new technology brings.
“You can be a brick and mortar business that’s been around for 100 years, but if you don’t have a Google My Business page, you’re in big trouble,” she said. “Many companies are unaware of this. HVAC is an old industry, literally and figuratively. We have to make it as easy as possible for our customers to do business with us, and educating them on how to effectively use technology is a big part of that.”
Sales and marketing synergy is a recipe for success, Morgan said.
“Companies that embrace effective sales and marketing teamwork tend to feed off one another,” she said. “If sales and marketing fail to align, it often shows in the results.”
While it’s not easy to execute, Telker said distributors must strive to be the experts when it comes to technology, sales, and marketing.
“Sales leaders should aim to coach, train, and role-play with their teams,” he said. “Besides learning by osmosis, it’s important to immerse yourself in books and podcasts. If you’re not continually practicing, learning, and sharpening your skills, you can’t expect to ever get better.”