I’ve come across two newsworthy Internet items recently that could have bad results for contractors. That’s why I keep harping that you need to be vigilant about new forces and new paradigms that could take business away from you. If you begin to pay attention once your business is declining, it’s already too late.
The first is the results of the American Home Comfort Study conducted by Decision Analyst out of Arlington, Texas, that we’ve reported on ContractingBusiness.com. In what the research firm is describing as a sea change, for the first time more consumers in its American Home Comfort Study reported using the Internet to gather information about their new HVAC system purchase than reported getting that information from their contractor. That’s why we’re putting on a Comfortech show this September in Philadelphia that is substantially different than any we’ve hosted before.
In 2016, more than half of homeowners surveyed said they used the Internet as a source of information before their recent purchase of a central HVAC system, while less than half said they relied on their HVAC contractor’s recommendation. These sources of information were utilized equally in the 2013 edition of the American Home Comfort Study, and prior to that, the contractor was the unequivocal primary source of information for consumers.
“While some HVAC contractors are building a consultative business, too many have given away an important opportunity: their professional knowledge-based relationship with their homeowner customer,” said Garry Upton, a leading market researcher in the HVAC field.
Sixty-four percent of the homeowners researched brands of HVAC equipment or contractors as a first step in their purchase process. Of those who said they used the Internet at any point in their purchase process, almost all (92%) performed some kind of initial research, compared to only about one-third (35%) who did not use the internet at all.
Of those who used the Internet, more than two-thirds (68%) researched brands of HVAC equipment and significant pluralities researched contractors, created a list of contractors, and/or created a list of brands in which they were interested. All these actions were significantly more likely to be performed by those using the Internet versus those who did not.
That’s scary; it means you’re losing control of the messaging. And speaking of losing control of the messaging, a court case out of Northern California means that you can lose control over your online reviews.
SFGATE, the Hearst-owned web sister-site of the San Francisco Chronicle, reported that Yelp can legally manipulate the ratings of your firm. Businesses have complained that good reviews disappear and bad reviews move up in the rankings if you refuse to advertise with Yelp. A federal appeals court affirmed a decision by the federal district court, which had dismissed a proposed class action suit against Yelp. The appeals court said that Yelp is entitled to set whatever price it wants for its ads and that no business has a right to favorable reviews.
Even if businesses could prove that Yelp is manipulating reviews, (Yelp says its review-filtering software isn’t programmed to look for advertisers), it wouldn’t matter.
“As Yelp has the right to charge for legitimate advertising services, the (alleged) threat of economic harm ... is, at most, hard bargaining,” and not extortion or unfair business practices, Judge Marsha Berzon said in Tuesday’s 3-0 ruling, SFGATE reported.
There are a number of vendors in this industry, industry partners with contractor groups that can help you with your reviews. They have techniques that make it easy for homeowners to review your services and get good reviews up at the top of your website. You need to seek them out and use them. You have an online reputation whether you want one or not, so you must control it.
There was a time when all you needed to do was good work and success would follow. Unfortunately these days you must be vigilant, aggressive and proactive because there are more threats to your livelihood than ever before.