• Controlling the Market: White-Rodgers Brings Advanced Technology and Market Focus to Customers

    Oct. 1, 2008
    Consumers probably know White-Rodgers best these days for its blue-screen thermostats. The extremely popular Blue product line will have 20 different

    Consumers probably know White-Rodgers best these days for its blue-screen thermostats. The extremely popular Blue™ product line will have 20 different base models by the end of the year, including a Spanish-language version. The product line's success represents White-Rodgers's evolution into a leader in electronics and systems controls with a deep understanding of its wholesaler distributors and the HVACR marketplace.

    As a division of Emerson and as a part of the Emerson Climate Technologies business group, White-Rodgers leverages technology and industry presence with its sister companies. These include the Air Conditioning and Refrigeration divisions, which produce Copeland® compressors; the Emerson Flow Controls division (formerly Alco Controls); and the Emerson Motors division.

    Emerson Climate Technologies brings these brands together to create tremendous synergies, whether it's in research and development, marketing and sales, or working with wholesale distributors.

    What had been a practice of dealing division by division with OEMs and wholesalers has transformed into a more streamlined operation.

    “Over the past five years, we have consolidated efforts in various areas to present ourselves as Emerson Climate Technologies and take advantage of the strong Emerson brand,” says Geoff Godwin, vice president of Marketing for White-Rodgers. Beginning this year, the Emerson brand will replace the White-Rodgers brand on most thermostats.

    This has allowed Emerson Climate Technologies to strengthen its relationships with wholesalers and their contractor customers by creating a Contractor Support Group. Working with a distributor's outside sales team, the Contractor Support Group calls on residential contractors with education and product support. “This team not only represents White-Rodgers, but they go to a contractor and they're representing Copeland compressors, Emerson motors, controls, valves and system protectors,” says Ron Miles, vice president of Aftermarket Sales for White-Rodgers. “This has given us the added dimension to call on the contractors.”

    Then there is the research that divisions share, adds Mark J. Bulanda, president of White-Rodgers. “We're using that to help the OEM, the wholesalers and the contractors understand why a product has been designed and launched to market,” he says. “How does the OEM sell it to his wholesaler, how does the wholesaler get the contractor to accept it, and maybe more importantly, how does the contractor sell the homeowner on the particular product?” Bulanda says. “When you can go in with data that says the homeowner wants this and they're willing to pay this, that's pretty powerful. So we've added this as a way to help out our channel partners.”

    The market research has been an important component in finding the most effective ways to get the right HVACR products to market. Like most manufacturers, White-Rodgers used to focus on the R&D and left it up to marketing and sales to sell what they had made. Today, projects receive review twice a month as opposed to once a quarter, says Godwin. “We still have that think tank mentality to get ideas generated, but before we put the effort into making a product that goes into the field, we test that several times in several different phases of the development cycle with the market.”

    Why did White-Rodgers select blue screens for its Blue product line? In surveys, consumers chose the blue color over the traditional amber or green display by a four-to-one margin. While the color may be the most prominent feature of the thermostats, the product line was also attractive to contractors and consumers because of its ease of programming and its high-precision control that is a trademark of Emerson and White-Rodgers. Today, the Blue product line accounts for two-thirds of White-Rodgers' thermostat sales.

    While the business has evolved into one focused more on electronics and system controls, it remains the primary supplier of gas valves to OEMs in the home clothes dryer, water heater and residential furnace markets. “We believe the gas valves and controls are the primary safety device on all these pieces of equipment and therefore demand a high level of manufacturing and quality to maintain the loyalty from OEMs that we have established over the years,” Godwin says.

    White-Rodgers thermostats are part of Emerson Climate Technologies' UltraTech™ communicating system. Originally released three years ago as the UltraTech home series, Emerson brought together best-in-class products like the Copeland Scroll UltraTech compressor, Comfort Alert™ diagnostics and the White-Rodgers Blue touch- screen thermostat.

    Taking the home series a step further, Emerson recently announced the UltraTech communicating system, utilizing ClimateTalk™ open protocol. This is the first open protocol system to enable indoor and outdoor electronics, variable-speed motors, Copeland scroll compressors and the thermostat to communicate, improving installation capability and providing ongoing diagnostics through the system. “The difference between our open protocol approach and the other closed protocol systems is the flexibility this allows OEMs and contractors. It makes adding system components easier and gives the contractor confidence that the system is installed right the first time,” Godwin says of the UltraTech system.

    OEMs will be rolling out the UltraTech system, says Godwin, and Emerson Climate Technologies' Contractor Support Group will be educating and training contractors. One of the key benefits of the system, notes Bulanda, is the ease of installation and the “plug and play” capability of all the components. High-end systems of the past could be difficult to install, making the jobs unattractive for contractors. “We went to great lengths working with our OEM partners to develop this system so any crew can install this at the dealer level,” he says.

    Emerson Climate Technologies' Contractor Roundtable, which brings together anywhere from 15 to 25 contractors four times a year, was one of the venues where the company brought its original UltraTech system and Comfort Alert diagnostics module. Godwin recalls a roundtable meeting two or three years ago in which the discussion revolved around the development of Comfort Alert, which is part of the communicating system.

    In discussions with contractors about warranty and service cost reductions, Emerson explained that more than one- third of all compressor change-outs are the result of an incorrect diagnosis, and the compressor has not failed. By using the compressor as a sensor, and relaying the message to the contractor through a red light-green light display, the contractor can be certain if the compressor has in fact failed. Contractors asked if the compressor could also point out malfunctions in other parts of the systems. “And we said, ‘You know, we probably can,’ so it went from a red light-green light product to one that has nine different diagnostic codes to tell the contractor what's wrong with the system without a lot of additional pressure taps and sensors embedded in the unit,” Godwin says. Another contractor at the round-table explained that he was colorblind and couldn't make out red from green, so the engineers created a flash code in addition to the colors.

    The Contractor Roundtable has been a valuable resource for White-Rodgers and Emerson Climate Technologies. “The objective initially when we started it was to understand the contractor market and figure out what we could do to support the contractor trade,” Godwin says. “It was an education process to explain to contractors who we were and what we did.” But the contractors also get a lot out of the meeting. Godwin estimates that about 75 percent of the meeting focuses on contractor issues, such as training and business issues like employee retention. “It's about the trade support that they need.”

    In addition to the roundtables, Emerson Climate Technologies has actively pursued contractor focus groups to gauge the development of new products. These focus groups, as well as other types of research and analysis, are part of the company's ongoing effort to engage wholesalers, contractors and homeowners. “We've had several products that we've been working on where we've had a preliminary concept that we'd show to this group and we've changed it as a result,” Bulanda says. “It's really been instrumental in helping our product development.”

    Such marketing and research efforts are essential for HVACR manufacturers like White-Rodgers to maintain their leadership position in the market. Their team consists of product and channel marketing, and they work in concert. “There is a lot of interaction, not only between the product and the channel marketing organizations but between sales and engineering and operations,” Bulanda says. “They are always cross-functional teams.”

    The product marketing team focuses on the various product lines and has the responsibility for the specifications, life and phase-out of the various lines. Channel marketing is responsible for defining the market needs as far out as 10 years while attending to such immediate needs as forecasting, pricing and product promotion.

    Keeping the various channel partners informed of the changes and arming them with the ability to best serve their individual needs are paramount. That means targeting the OEMs to ensure a strong market base, targeting the wholesalers to ensure they can service the needs of contractors and targeting contractors to ensure the pull-through of the product back through the channel, Godwin says.

    With White-Rodgers and Emerson Climate Technologies' laser-like focus on developing the right products for the right markets, they expect their wholesale distributors to provide a high level of service for their contractor customers. Like the manufacturer itself, the distributor must react to a changing landscape. “The best wholesalers are those that are embracing change and are not resistant to it,” Godwin says. “That helps us as we promote new ideas and new products, especially the communicating system.” After all, the contractors are loyal to the distributor first. “They're more loyal to the wholesaler than any brand or product,” Godwin notes.

    Being a member of HARDI has enabled White-Rodgers to develop and maintain relationships with its wholesalers. “We're active participants with HARDI and go to the national show and participate in almost all of the regional meetings throughout the year,” Miles says. Adds Godwin: “HARDI continues to be a great place to get those face-to-face contacts in an open forum. It's hard to understate the importance of that.”

    With housing starts and completions continuing to decline, the nationwide slowdown in the residential market has certainly captured the attention of White-Rodgers and Emerson Climate Technologies. The air-conditioning and furnace market is about 30 percent smaller than just two years ago, Godwin says.

    Despite the negative news, White-Rodgers has grown in recent years. Because it is part of the Emerson Climate Technologies family, the company as a whole has invested in engineering and product development. “Certainly, because we are part of a large organization, we can see this and ride those things out and continue to invest when the market is down, so when it recovers, you have additional strengths that you didn't have before,” Godwin says.

    The rise in energy costs also presents a business like White-Rodgers with both challenges and opportunities. White-Rodgers' programmable thermostats and the overall energy efficiency of the Emerson HVACR systems are big selling points for contractors — a message that the company is actively promoting. Of the 90 million homes in the United States, only 25 million have programmable thermostats. Of that 25 million, only half of those households are using the programmable feature. “That's 80 million that do not have it or are not using the feature,” Godwin says.

    The average home can save between $250 and $300 per year in energy costs with a programmable thermostat, roughly the same amount of money it costs for its installation. If just half of those 80 million homes used a programmable thermostat, Godwin estimates an annual national energy savings of $10 billion.

    Designing and promoting energy-efficient systems have become a guiding principle of Emerson Climate Technologies. “Whenever we're designing new products, we're trying to make them more energy-efficient than the last one,” Bulanda says. This includes an expansion valve designed by the Flow Controls division specifically for R-410A. The company is committed to ensuring that its customers can meet the changing regulations.

    While White-Rodgers continues to become a stronger and more effective manufacturer of its products, its commitment to wholesale distribution remains as strong as ever. “We're a huge supporter of the two-step channel,” Bulanda says. “I think the linkage between the contractor and the wholesaler in terms of going out to the market and selling to the homeowner is going to become much stronger.” And White-Rodgers, with the backing of Emerson Climate Technologies, will be there with the products, the marketing and the customer support to ensure that the relationships throughout the channel remain strong.

    Michael Maynard is a business writer in Providence, RI, who writes on issues related to HVACR, construction and architecture. Contact him at [email protected].

    Best Practice

    Market Research

    Definition and Example: Building on Contractor Councils and Distributor Roundtables established by Emerson Climate Technologies many years ago, White-Rodgers uses extensive market research for nearly all new products. We obtain customer and user input for product designs to better identify market needs.

    In September, we will launch the first Hispanic-only thermostat in our award-winning Blue™ product line. Even before launch, we have received press coverage on CNN, national Associated Press, St. Louis Post Dispatch and several magazines outside our traditional industry channel.

    Significance: Allows us to develop a product designed specifically for a market need and creates new selling opportunities for our distributors and contractors.

    Benefits: Assures rapid customer adoption of new products.

    Procedure: Focus groups consisting of contractors and end users, electronic surveys and phone surveys.

    People involved: Marketing and Sales Departments

    Contact: Jay Wirts, director of Marketing

    White-Rodgers at a GlancePresident & CEO: Mark J. Bulanda Sales and Marketing Vice Presidents: Geoff Godwin — VP, Marketing
    Ron Miles — VP, Aftermarket Sales
    Matt Keithly — VP, Sales, OEM Headquarters: Emerson Electric Co. World HQ
    8100 W. Florissant Ave.
    PO Box 36922
    St. Louis, MO 63136-9022 Employees: 2,200 worldwide Annual Sales: Part of $3.6B Emerson Climate Technologies business Major Product Lines: Heating Controls
    Gas Valves
    Cooling Controls
    Communicating Controls
    Thermostats — Residential / Commercial
    Water Heater Controls
    Indoor Air Quality Products Website: www.white-rodgers.com Year Founded: 1937