HVAC Marketing and Advertising: Should You Target Installs or Maintenance Business?

As a small business owner, you already know that you have to spend money to make money. However, your overhead and payroll can eat up so much revenue that an unlimited advertising budget simply is out of the question. So how do you decide where your priorities lie when it comes to planning and executing your HVAC marketing and advertising campaign?

Service calls are always going to form a baseline of business and profitability for HVAC contractors, and it’s a core strategy to dedicate a healthy portion of your advertising and marketing campaigns toward generating these leads. However, the two major growth areas for contractors are new system installations and maintenance plans/preferred customer agreements. Here’s what you need to consider when formulating an advertising strategy to target either of these growth areas.

How Much Should You Spend and Where Should You Spend It?

On average, SMB owners invest just two to five percent of their sales in marketing. Considering the Small Business Administration recommends putting between 7 to 8 percent of revenue into marketing, that translates into a pretty anemic figure. Particularly when you consider that sales also, by definition, tend to be modest in small-to-medium-sized operations.

Spending less than five percent on your marketing and advertising efforts is going to yield less-than-ideal results. If you spend at this level, you will also get results at this level. In other words, small investments yield small returns. You’ll essentially be treading water, and you probably won’t have enough budget available to target anything but service calls.

This is true for all but the largest, most established players in the HVAC market — and even they need sizable marketing and advertising budgets to avoid losing marketshare to upstart competitors. In other words, your budget needs to be based on your specific business needs and growth goals, and it needs to be realistic for what you’re trying to accomplish.

Your HVAC Advertising Focus: Installations vs. Maintenance Plans

The decision to invest your marketing budget into installation or maintenance plans really should depend on how consumers actually buy. On one hand, moving boxes (that is, targeting new installations) may seem like a high-value proposition in terms of your ultimate return on investment (ROI). However, you’re likely to find that search volume for installations alone is limited, and that the buyer’s journey for installations almost always begins with a repair call or a maintenance visit.

By contrast, targeting preferred-customer agreements and maintenance programs drives customer retention and increases the lifetime value of your customers. After all, the cost of acquiring new customers is five times higher than engaging and marketing to existing ones. If you look at it that way, your initial acquisition efforts are an investment that only pays off in full if you can close the deal with a maintenance plan or preferred customer agreement. And at the end of the day, you’re much more likely to leverage that relationship into an installation down the road.

Of course, there’s also always the problem of logistics. Targeting installations aggressively, for example, requires you to have a staff of installers onhand to do the teardowns and generally support this line of business. On the other hand, growing your maintenance business is going to require having the maintenance resources available to support this line of growth. Dealers are advised to engage in deep HVAC industry research so they can understand fully how to support growth in these areas. The last thing you want is for your phone to be ringing off the hook with new business that you have no ability to service.

Growing Your Installation and Maintenance Programs

The following channels and strategies can help you maximize your marketing and advertising efforts, no matter which direction you take:

• Paid search. Bid on keywords related to installs with a pay-per-click (PPC) campaign. There isn’t as much search volume for these keywords as there is for HVAC service, but the payoff is higher. PPC campaigns aren’t as effective for maintenance plans, though, so instead try to coordinate a Google Display Network (GDN) campaign with other display options to increase visibility on your message.
• Social media. Social can be an effective channel for both installation and maintenance campaigns. Advertising campaigns in this channel can drive a lot of traffic to your conversion-optimized landing pages and create a lot of visibility for your message.
• Direct mail. Mailers are useful for targeting homes surrounding recent customer installations and households with existing maintenance agreements through door hangers or neighborhood marketing campaigns.
• Mass media. Positioning creative content in mass media spots including television, traditional radio, cable, and digital radio will increase visibility for financing and rebate offers over $1,000 for top-of-the-line units. The trick lies in planning these campaigns so you minimize waste; you’ll need to choose the media channels that best align with your service areas.
• Website and SEO. From both an SEO and a user experience (UX) perspective, your website needs to be easy to use and optimized to be found organically in search for the right keywords. It needs to have strong pages focused around maintenance plans and installations, and they needs to be conversion-optimized. Regardless of the advertising channels you use, most leads will ultimately convert through your website. If your site is tough to navigate or can’t be found in search, you’re ultimately failing to fully capitalize on your advertising and marketing efforts.

Each one of these individual components can help to grow your installation or maintenance business. But the real payoff happens when you take a holistic approach that marries all of them together. Only then will your marketing and advertising efforts reach their full potential.

Aligning Goals and Growth for Your HVAC Business

At the end of the day, the choice depends on your goals as a business. With co-op funds being a main contribution to advertising spends, the more units sold will allow for businesses to receive more co-op dollars. This means that your co-op advertising spend can grow each year, and that growth will achieve a snowball effect as it continues year over year. On the other hand, if you can successfully sell maintenance plans, then you’re increasing brand loyalty, ensuring the solidity of your customer database, and getting everything you can from your customer acquisition efforts.

No matter which growth area you ultimately choose to target, Mediagistic’s holistic HVAC marketing and advertising campaigns are built to create results. We’ve generated almost 2.5 million leads for our clients, and our focus is on growing your business according to your goals. Contact us today to get started on a customized HVAC advertising and marketing plan for your business.

Glenn Ireland is an Account Development Manager for Mediagistic. He has more than 20 years experience in advertising and marketing.

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