There continues to be a steady stream of news about the economy, inflation, and a potential recession. Inflation is at its highest level in forty years. Real estate values have skyrocketed but have recently tapered off due to increased interest rates. Because of all this news, homeowner confidence is down while stress levels are up.
While we have not seen a serious decline in lead-generation demand, now is still a suitable time for HVACR business leaders to understand the latest homeowner trends and stress levels and get ready to adjust strategies.
Modernize Home Services recently surveyed almost 30,000 homeowners considering major home improvements, including HVACR replacements. We wanted to learn how the current economic environment is affecting attitudes about improvement projects homeowners need so that contractors know how to best serve them.
Below are some findings from the survey, and tips on what contractors can do to keep business flowing.
Empathize with homeowner stress
Homeowners are feeling a lot of stress. 61% of respondents said stress relating to decisions about home improvement is “more than [they] can handle” or “tough to manage.” HVACR contractors can use this information to reinforce the importance of empathy in sales scripts and training modules. This might include instructions for reps to slow down, listen carefully, and respond with positive feedback when prospects express signs of stress.
Homeowners need help understanding price increases
In our survey, the stress factors cited most often, had to do with cost – i.e., gas, interest rates, supplies, etc. And 85% agreed, either entirely or somewhat, that “inflationary pricing right now puts the cost out of reach on [their] budget.”
Since most homeowners haven’t experienced this kind of inflation, HVACR salespeople may not always be ready to turn this concern into a selling point. Depending on your ability to control these factors, consider authorizing sellers to lock in some or all costs of their new HVACR products or services once the homeowner signs a contract and makes a deposit.
Reframe interest rates in a long-term context
The second most common source of finance-related stress is high-interest rates, as mentioned by 16 % of respondents. When asked which factors could cause homeowners to postpone or rethink home improvement plans, 82 % mentioned “increases in interest rates.”
It’s important to know how to handle customers who need or want to borrow. Across all trades, our research shows that 77 % of prospects want to finance a portion, if not all, of their project. Consider responding to interest rate stresses by framing today’s rates in a longer historical context, arranging or underwriting your in-house or white-labeled financing option, and ensuring that reps have current data on rates charged for well-qualified homeowners.
Climate-related stress is unlikely to diminish
The third-most reported source of homeowner stress was related to changing climate situations, mentioned by 14 % of highly stressed homeowners.
For those in the HVACR business, this signals an opportunity. Increases in global temperatures are not projected to ease up. Help prospects understand that they deserve to live in a home with systems capable of handling higher temperatures, and unpredictable weather.
With supply chain issues and labor shortages in the news, homeowners are worried about how long it will take to get their projects completed. When asked which factors might cause homeowners to delay their projects, 72 % of respondents entirely or somewhat agreed that they “can’t find contractors who can even fit [us] into their schedule.”
Especially in HVACR replacements when system failures drive immediate needs, homeowners want contractors who respond quickly. The best performing HVACR contractors differentiate their business by responding quickly to homeowner inquiries. This is called “speed to lead.” Even a delay of fifteen minutes has a significant impact on close rates.
Be transparent about scheduling expectations. Whether equipment delivery and installation start dates are in weeks or months, homeowners are happier when they know what to expect. Quick and effective communication with consumers is always important, but today, when homeowners worry about a lack of available contractors, it is imperative.
Lastly, use this information to better serve your HVACR business – what doesn’t fit isn’t for your business. Surveys don’t always account for loyal customers, outliers, or regional interests. But knowledge is power in any business. The more you can anticipate and manage a customer’s expectations, concerns, and stressors, the more likely you are to react positively and be of service.
Gregg Hicks is a longtime marketer of home improvement services. He is a business leader for Modernize Home Services and has 20 years of experience in web analytics, SEO, social, SEM, and affiliate marketing. His role as a spokesperson is to explain the value of thoughtful matchmaking between homeowners and home improvement professionals that forges positive and productive connections between the parties.