We've captured the thoughts and habits of your customers with the completion of the 2006 American Home Comfort Study. The homeowners, knowing they would remain anonymous, and that we were just an unaffected third party looking for facts, were very candid.
As you are most likely in your customer's homes daily, you have a pretty good feel for why many, if not most, of your customers called you and bought from you. However, sometimes your customers aren't as forthcoming, and your conversations with them aren't as long as they should be. The information in this article will shed new light on how your customers think, and will give you new ideas that will expand their comfort, increase your customer base, or keep the ones you already have.
Although no one is really "typical," that is what I will portray here. This will give you a chance to measure your people against the "average" in the business. Here is what the typical (average) contractor, and the average purchase, looked like to the homeowner.
Often, your customers actually bought what you suggested they buy. Many times the customer waited to buy until failure occurred. In fact, many of your competitors, and perhaps you, actually told the customer to wait a little longer — and the customer waited until failure was imminent. After all, you're their expert, and the customer is the first to agree that they don't spend a lot of time thinking about their heating and cooling system until it's no longer keeping them comfortable.
That is when your job becomes synonymous with that of an insurance agent. The homeowner doesn't know much about what they bought, but now that something has happened, they just want you to come in and quickly relieve their discomfort. After you do, they tend to even forget your name and the name of your company.
You might not have known that. But, unfortunately, when you do a great job and they need you again, only half of them will call you back. The other half will call someone else.
Because HVAC is a category that homeowners don't think about very often, they expect to be able to pick up the phone, call you, and talk to a real person who will send a real technician to their home at their convenience.
You and your people are burning the midnight oil, working 16-, 18-, 20-hour days just to keep up. A homeowner will call, you'll fix, and they'll forget about the system again. Do I have the process down pretty well?
That was the process I observed back in 1985, when I first joined the industry, and it has, sad to say for a large number of contractors, not changed much. When most of your customers need to replace their equipment, it's a near emergency — or it is an emergency — and they must spend money they hadn't planned to spend. The customer is looking to the contractor (the one who doesn't even have time to go home for a warm meal) for recommendations and desires his time and support.
Why Homeowners Call You
What was bought? More than half of the installations included only a part of the overall central system: the broken part. About 19% were identified by homeowners as a replacement of a heat pump, and the rest was the installation of a central AC and/or HP with furnace or boiler . . . a full system, in other words. More often than not, the replacement of the full system included a broken component. The broken component was most often the air conditioner or heat pump, and the homeowner putting in a full system also replaced a working furnace. Few times, however, did the homeowner with a broken furnace replace a working piece of cooling equipment.
But, why do they call you? The number one reason they call you is because of your reputation and/or they've found a way to remember your name. Your information is on their refrigerator, in their log, on their Internet, or a friend or relative recommended you. An interesting point here, even when your technicians do a poor job in your customer's home, three out of 10 homeowners will call you out again because they remembered your name, you had a real person answer the phone, and you could be at their home quickly.
Reputation is a dominant reason customers search you out. Because reputation is such a large issue with the homeowner, it's the one thing that will keep you in business over the long term. Finding ways to impart the knowledge of that good reputation to new customers will take you to new heights. Finding a way to know when your customer was less than happy with your last call to their home, and doing something to correct the issue, will also work wonders. Lose a good reputation, and nothing else will keep you in business in this industry for very long.
Another question that plagues contractors is "Why do homeowners buy from someone else, when they know I am the one they want in their home? Due to the nature of an "unplanned emergency," you might not be available. Or, since many American's live on "plastic," credit is where they'll go for the purchase. One in 10 times, the leading reason a homeowner will call someone else will not be because of your reputation, it will be the price.
Types of Buyers and What They Look For
One way to enhance reputation, especially with the more mature set, is to include certified technicians in your company. While many homeowners may not be sure what certified means, they do equate it with quality and reputation, and they want a certified person working in their home. This is especially true of older homeowners.
Then there is a different kind of purchase being made out there by almost a quarter of all homeowners. This is the informed purchase, and in many cases it results in a sale outside the "crunch time." The homeowner will actually takes the time to explore brands of equipment on the Internet. They'll look in stores, they'll talk to several contractors, and then they'll make a decision to buy. Reputation counts for a lot, and what you can do for their comfort is also important. However, because few understand the price of home comfort, price remains somewhat of an issue.
Unfortunately, most homeowners have unreasonably low assessments of what it will cost initially. It's one of the major areas that you need to address when consulting with them.
The good news is that most of this group does not take the lowest price. In fact, those who buy at a price above the low cost provider are generally happier with you and the system you placed in their home. They bought the system component they most believed would make them more comfortable from someone they trusted. They didn't let themselves get placed in an emergency situation that forced them to buy from whom-ever was not busy.
Retail is becoming more acknowledged by homeowners as well. Four out of 10 homeowners state that they agree completely that when the time comes, they'd visit a retail site to research their HVAC purchase. Three in 10 would consider purchasing at the store, and only 14 in 100 would absolutely not visit a retail site for their HVAC education and needs.
The Role of Relationship Selling
The HVAC contractor who wants control over his/her business should build a relationship with his/her customers. The contractor will have reasons to be with the customer often, they'll not just respond to emergencies, but instead find ways to eliminate them — much like a good dentist keeps their patients' teeth from decay and ruin. A good contractor will become an advisor to the homeowner, much like many accountants have gone beyond filling out tax forms to help prepare their clients for children's college costs, all the way to retirement.
This kind of relationship selling is being done by some forward-thinking contractors today, but not by very many. The time for you to start doing this is now, before the opportunity goes to someone else who sees the possibilities — a competitor, a retail store, or a home consultant.
For more information on this topic, go to: www.decisionanalyst.com/Syndicated/HomeComfort.asp
Garry Upton of Decision Analyst, Inc. shares his interpretations of its American Home Comfort Study of more than 27,000 homeowners, and probes what customers look for in HVAC contractors. To learn more about this study, or to purchase it, contact Garry at [email protected].