by Michael Weil, executive editor
Contractor Roundtable PARTICIPANTS
The following contractors participated in this year's roundtable and will be contributing to future articles on the opportunities in the hydronics business:
For a complete list of all the participants, and more on the roundtable, go to www.contractingbusiness. com/burnham2004.html.
What does it take to be successful in the hydronics business today? By being successful, I'm talking about profitable. The answer is very multi-faceted, but comes down to doing many of the things your warm-air brethren do to make their businesses successful.
Part of that answer involves something that many contractors don't understand, and few do very successfully ¯ marketing. This is one of the conclusions that came out of a roundtable discussion on the hydronics business this past June. The event, sponsored by Burnham Hydronics, brought together contractors, wholesalers, builders, and architects for a day where ideas on how to be more profitable were bandied about in a swordplay of anecdotes and brainstorming.
In the end, 10 key marketing ideas emerged that can help lead your company down the road to better profitability.
Diversified picture of hydronics. “The secret to successful marketing,” says Bob Miles, Jr., of Robert Miles and Son Plumbing and Heating, Portland, ME, “is to be able to present a diversified picture of hydronics. In other words, you need to be able to offer an entire package, including air conditioning, and have a media kit with which to present all the benefits of this form of comfort conditioning.”
Miles adds that if you have the proper presentation materials that highlight a basic hydronic system, and include lists of add-ons, customers have a menu from which to choose and are more likely to buy on that basis.
“If you have a marketing/sales piece like this, you won't have to worry about being held back by your competition. Why? Because you're in the driver's seat,” Miles adds.
Natural ability to zone. Zoning is nothing new. Those in the hydronics business automatically zone spaces by the very nature of the system. Yet those in the hot air business are doing a great job of marketing zoning, and it's time that hydronics contractors do the same. So says Jim Reid, of James Reid Plumbing and Heating, Portland, ME.
“It's all about comfort. Zoning certainly helps make it easier to be comfortable anywhere in your home. The problem is most builders don't understand the benefits and are reluctant to provide for it without some convincing on its value.”
Radiant technology. “I'd say that 50% to 60% of the homeowners in the U.S. have heard of radiant heating in some form,” says Gabriel Santoro of B&G Heating, Batavia, IL. “Home shows, magazine articles, and other marketing vehicles have helped to make radiant the cream of the crop in the hydronics business.”
Air conditioning. Once the bane of the hydronics business, now it can be included. Gabriel Santoro says, “I use high velocity cooling. The biggest selling point is that in higher end homes, most people don't want ductwork running all over the place. With high velocity cooling, I don't have to run ductwork, and that creates more space for the homeowner. That's a huge selling point.”
Working with builders. “If you have a good relationship with your local builders, approach them with the idea of offering radiant as an option on higher-end homes,” says Rich Goelz, T&F Enterprises, Long Island, NY. “It would help if you could do some grass roots advertising, maybe with the manufacturer's help, promoting the radiant system that the builder is offering in their latest development.
“This way, the builder gets exposure for his project, and the manufacturer gets exposure for his product. Once builders see the advantage of offering radiant and/or hydronics as an option, they'll help push that to homeowners, expanding your business.”
Working with realtors. Mike Christensen of Christensen Heating says that residential-realtors may also be a major marketing factor-for hydronic systems, especially radiant systems. “Radiant is often looked upon as a premium option in upscale homes, and real estate agents always are looking for hooks to differentiate their listings from the rest. And realtors are experts when it comes to marketing homes.
“Plus, we can work, as an industry, with realtors through their associations to get hydronic systems listed as premiums in their promotional brochures and premiums lists.”
Radiant-ready homes. One comment from a number of roundtable-participants involved a small trend where some builders work with their contractors to build homes that are radiant ready.
This means that, even if the builder doesn't install radiant during construction, the homeowner can readily add it later. That works for the builder, the contractor, and even the distributor who can sell more radiant tubing as a result.
New markets. In addition to the new construction market, there could also be opportunities for hydronics contractors in the “re-building” market. Pat Panza, a general contractor from Connecticut, predicts that as residential new construction declines, the industry will move to demolition and re-building of older homes. This opens up more opportunities.
He sees this trend becoming more prevalent in the years ahead and thinks contractors and manufacturers alike should begin looking at where hotspots will crop up and begin preparing to market to those demographics.
Snowmelt systems. Hydronic equipment easily ties into snowmelt systems that can also be sold as a premium by homebuilders and realtors.
Parade of homes. Marketing hydronic system through events such as the Parade of Homes will help to continue educating the public about the benefits of wet-heat and will help builders better understand the sellable aspects of offering such systems as premium options.
Hydronics is a Premium Offering
The conclusion that our roundtable participants came up with is that hydronic heating is a premium that needs to be better explained, demonstrated, and talked about with homeowners, builders, and realtors.
By taking advantage of some of the marketing ideas above, you too can grow your hydronics business and be more profitable.
Stay tuned over the next few months for more articles on how to be profitable in the hydronics business.