Plumbing Marketing Blog


Race to the callsIf 2008 was an interesting year, then 2009 ought to be fascinating in plumbing and HVAC.  I've resisted the temptation to comment on the state of the economy through the year, because to a certain extent it's always crystal ball gazing, and it's generalizing too.  Things can change fast out there.  For example saving money on heating oil was big news only a few months ago, now it's cheaper than it has been in years.  By the time you read this, who knows.

Nevertheless here are some thoughts for the year ahead, some obvious, some perhaps less obvious:

- The phones are still ringing and the service work is still out there.  Repairs are a resilient market, and more often than other industries the customers are property owners with access to equity and finance.  People aren't going to choose to live without heating or a sewer service.

- Some clients are growing in this market, with record lead numbers in the past few weeks.  That's because they've been unlocking latent potential within the business. (As in, regardless of the market, their business practices have been improving)

- That creates a follow-on point.  When any company's call numbers are down, the solution is to go and grab somebody else's calls.

- There's another important point too.  I've seen a lot of companies come to us this year that have been misdiagnosing their problems.  When a company is in all sorts of trouble, the economy is an obvious and convenient scapegoat.  But in many cases it's not the problem at all.  Sure, it's not helping, but plenty of companies out there have the phones ringing hot day in, day out.  Or to put it another way, companies that are in trouble now, were almost certainly already in trouble for other undiagnosed reasons before.  Very often they've been missing completely what other companies have been doing very successfully - especially their capacity to change gears and tactics with speed, and outflank their competitors' in their respective markets.

- The upshot is that there are positives out there too.  In some markets it's likely that we'll see clients' competitors disappear from business - which is a great opportunity to grow market share.  Successful companies are sharpening their competitive edge too - when economic conditions improve they'll be very well positioned to benefit the most from any upswing.  A lot of the groundwork for future success is being put in today.

- Big ticket replacements and upsells are (anecdotally) trickier than normal to sell at the moment.  There seems to be greater demand for 'quick fix' short term solutions.  As you'll all know, there can be a difference between repairing something so that it works for a month, and a more comprehensive solution that keeps the customer trouble-free for years to come.  The good news is that this just builds up future work in the marketplace - old furnaces and boilers will still need replaced, and collapsing sewer lines will need repaired.  If a customer wants a quick fix solution, then at least it is an opportunity to wow them with your service for when the big ticket sale comes around.

- On the economic crystal ball gazing front the downturn that affected new construction, custom home building and remodeling was part of a separate property speculation cycle.  That has been followed up by a whole new economic challenge, which isn't going to help any of those sectors, but now impacts on residential service spending much more.  When people lose jobs, that's when they become lost to the market as potential customers.  That's perhaps the biggest risk factor in the market over the year ahead.

- Print Yellow Pages deserve a special mention.  If you're advertising with print YP (and many companies don't of course) then you've probably never been in a stronger negotiating position with them than right now.  Be cautious of books that are over-cluttered: some simply don't have enough work in them for the number of advertisers.  Also be wary of books with tiny circulations - the price has to be related to the number of pairs of eyes reading it.  Print Yellow Pages still has a significant number of calls as a medium, the question mark is over the premium price tag that is often attached to them.  That's where the negotiating comes in, because several of the YP companies are really hurting right now.  Over the past year the share price of Idearc (Verizon Super Pages) and RH Donnelly (Dex) have collapsed to only one hundredth of their previous value.  [The collapse in those share prices is related to the high level of debt that they carry, both companies have revenues and assets in the billions, but debts in the billions too.  As of time of writing, Idearc's entire market capitalization was only $11.5m.]

- At the end of the day, market conditions are like climbing a hill.  When you reach a steeper part of the hill, you can still climb, it just takes more muscle and effort than it did.  Many companies can and will be growing in 2009; it's just going to take rolling up the sleeves and getting stuck into their respective markets harder.

Just as a final note: we're fortunate enough to speak and meet with many hundreds of plumbing, HVAC and electrical contractors, suppliers and manufacturers every year - and if there's one thing that always shines through is that they are always an absolute pleasure to speak to and work with.  If we didn't enjoy it, we wouldn't be doing it.  Continuing apologies too to the companies that, unfortunately, we have to turn away from time to time.  In some cities, alas, we're not looking to take on any further clients.

Best wishes to everyone in the year ahead.


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