HP Biz Models: Understanding the Opportunities & Marketing Power of the Whole House Approach

Transcription

1 HP Biz Models: Understanding the Opportunities & Marketing Power of the Whole House Approach Peter Troast, Founder & CEO Energy Design Conference & Expo Duluth, MN February 24, 2016

2 Peter Troast Founder/CEO of Energy Circle Linked In: Peter Troast G+: Energy Circle Facebook: Energy Circle Volunteer/Pro Bono Efficiency First Home Performance Project Home Performance Coalition 1000 Home Challenge CHERP 2/24/16 2

3 The Energy Circle Sandbox 340+ Home Performance Businesses auditors/raters, HP contractors, builders/remodelers, HVAC, non-profits, architects 49* States 3.2 Million Web Visitors Thousands of Leads Lots and lots of experiments $787+ million in Home Performance Work 64,000 Tracked Search Terms in HP 2/24/16 3

4 What We ll Discuss WHAT DO WE MEAN BY HOME PERFORMANCE? THE BUSINESS CASE FOR THE HP MODEL LEARNING FROM GOOGLE: WHY HP MAKES LEAD GENERATION EASIER (AND CHEAPER!) 2/24/16 4

5 1 WHAT THE HECK IS HOME PERFORMANCE?

6 A Definition 2/24/16 6

7 HOME PERFORMANCE Envelope Mechanicals + Testing? 2/24/16 7

8 Peter s Definition If you work on buildings, and believe a house is a system, you re a home performance company 2/24/16 8

9 Existing Home Models Envelope (Shell or WX) Insulation Contractor Spray Foam Contractor Cellulose Installer New Construction Insulator Mixed New & Retrofit Insulator Air Sealing Specialist Weatherization Crawl Space Mold Remediation/ Basement Waterproofing Mechanical Traditional Heat and Cool Geothermal Heat Pump Specialists Plumber/Furnace Ventilation Other & Related Solar Mold Remediation Healthy Home Handyman Connected Home (Home Consultant/Technician Energy Auditor Pure Auditor Auditor/ Recommender Auditor/Construction Manager Network Auditor/Inspector Rater Production Home Rater Solo Rater Passive House Rater Certified Passive House Consultant LEED Rater Indoor Air Quality Tech 2/24/16 9

10 2 NEXT, THE BUSINESS CASE

11 Homeowners have problems Hot Rooms Poor Air Quality High CO Wet Crawlspace or Basement Cold Rooms Foggy Windows Drafts Mold & Mildew Noise from Outside Want to Be Green Excessive Dust Allergies High Energy Bills Old HVAC 11

12 Size of the Opportunity $80,000 How much of this do you want to capture? Mike Rogers 2/24/16 12

13 Home Performance Means Bigger Jobs and Higher Margins HVAC Average Ticket Size HVAC + HPC $5,500-7,500 $8,000 - $15,000 Gross Margins 38% - 45% 45% - 50+% Close Rates 35%?? As good or be*er! 13

14 THERE ARE MORE THINGS TO MAKE THE PHONE RING Furnaces Air-Conditioners Insulation Windows & More w/ COMPREHENSIVE SOLUTIONS TO APPLY EACH VISIT Furnaces Air-Conditioners Insulation Windows & More 14

15 "Half the money I spend on advertising is wasted; the trouble is I don't know which half. John Wanamaker 2/24/16 15

16 Typical 2015 Marketing Mix Organic Search Paid Search Direct Mail 15% 1% 12% Paid Social Print Ads Referring Traffic 4% 3% 16% Online Directories Home Shows Community 10% 3% Organic Social Past Customers Referral Program Lead Gen 3% 8% 8% 8% 3% 7% 2/24/16 16

17 Working Backwards From Your Goals Revenue Goal: $1,750,000 Average Ticket: $7,500 # of Jobs: 233 Close Rate: 30% YOU NEED 778 LEADS 2/24/16 17

18 Working Backwards From Your Goals Revenue Goal: $1,750,000 Average Ticket: $7,500 # of Jobs: 233 Close Rate: 30% YOU NEED 778 LEADS Marketing 7%: $122,500 Cost Per Acquisition: $526 Cost Per Lead: $157 2/24/16 18

19 The Impact of Ticket Size Scenario 1 Scenario 2 Scenario 3 Revenue Goal: $1,750,000 Average Ticket: $7,500 # of Jobs: 233 Close Rate: 30% Leads: 778 2/24/16 19

20 The Impact of Ticket Size Scenario 1 Scenario 2 Scenario 3 Revenue Goal: $1,750,000 $1,750,000 Average Ticket: $7,500 $9,000 # of Jobs: Close Rate: 30% 30% Leads: /24/16 20

21 The Impact of Ticket Size Scenario 1 Scenario 2 Scenario 3 Revenue Goal: $1,750,000 $1,750,000 $1,750,000 Average Ticket: $7,500 $9,000 $9,000 # of Jobs: Close Rate: 30% 30% 40% Leads: /24/16 21

22 The Impact of Ticket Size Scenario 1 Scenario 2 Scenario 3 Revenue Goal: $1,750,000 $1,750,000 $1,750,000 Average Ticket: $7,500 $9,000 $9,000 # of Jobs: Close Rate: 30% 30% 40% Leads: % 2/24/16 22

23 The Impact of Product Mix Ave Ticket Quantity Revenue Air Seal/Insulate $7, $975,000 Home Performance $12, $625,000 Service Contract $ $112,500 $1,712,500 2/24/16 23

24 The Impact of Product Mix Ave Ticket Quantity Revenue Air Seal/Insulate $7, $375,000 Home Performance $12, $1,625,000 Service Contract $ $112,500 $2,112, % 2/24/16 24

25 Customer Lifetime Value (CLV or LTV) Comprehensive Air Sealing & Attic Insulation: $7500 Rim Joists one year later: $2000 Basement Wall Insulation two years later: $4000 Next level air sealing three years later: $1250 Total Value in 5 Years: $14,750 Average margin of 48%: $7,080 Minus Cost to Acquire: $300 Lifetime Value: $6,780 2/24/16 25

26 3 LEARNING FROM MOTHER GOOGLE (easier marketing)

27 Learning from Google Search 2/24/16 27

28 Learning from Google Search 2/24/16 28

29 Learning from Google Search 2/24/16 29

30 Learning from Google Search 2/24/16 30

31 Google Paid Google Local 3 Pack Google Paid Organic

32 Pay Per Click Marketing Body Level One Body Level Two Body Level Three Body Level Four Body Level Five Search Term Paying $3.64 Paying $3.20 Paying $2.17 2/24/16 32

33 Keyword Volumes: Audit Energy Rating Energy Assessment 8100 Energy Audit Energy Evaluation 0 Energy Auditor Energy Auditing Data from Google Adwords Planner 2/24/16 33

34 Keyword Volumes: the Work home performance energy retrofit 4400 weatherization energy audit energy upgrade 6600 deep energy retrofit Data from Google Adwords Planner 2/24/16 34

35 Keyword Volumes: Major Services home performance energy retrofit 4400 weatherization heating & AC insulation energy audit Data from Google Adwords Planner 2/24/16 35

36 Keyword Volumes: Insulation Category attic insulation spray foam foam insulation Soundproofing cellulose insulation blown in insulation wall insulation basement insulation fiberglass insulation Data from Google Adwords Planner 2/24/16 36

37 Furnace Repair AC Replace AC Service HVAC Furnace Install Heat Pump 2/24/16 37

38 Solar Furnace Repair AC Replace AC Service Cold Room Attic Insulation Whole House Home Performance Spray Foam Energy Audit Energy Cost EUC Rebates Furnace Install Heat Pump Health Mold Fear IAQ Efficiency Climate Change 2/24/16 38

39 HVAC Solar Furnace Repair AC Replace AC Service Cold Room Attic Insulation Home Perf Whole House Home Performance Spray Foam Energy Audit Energy Cost EUC Rebates Programs Furnace Install Heat Pump IAQ Efficiency Climate Change Health Mold Fear IAQ 2/24/16 39

40 Some Big(ish) Data 63,749 Real Search Queries ~$1,500,000/yr Google Click Spend 2/24/16 40

41 Less Expensive Leads 2/24/16 41

42 Average Cost Per Click $8.00 $6.00 $7.02 $4.00 $4.78 $2.00 $1.84 $2.07 $0.00 Home Performance Rebates/Programs HVAC/Mechanical IAQ 2/24/16 42

43 Click Through Rates 10% 7.5% Click Through Rate (CTR) = Clicks / Impressions 8.41% 5% 2.5% 6.08% 3.97% 5.5% 0% Home Performance Rebates/Programs HVAC/Mechanical IAQ 2/24/16 43

44 Average Conversion Rates 10% Conversion Rate = Leads / Traffic 7.5% 8.1% 5% 2.5% 3.2% 2% 1.9% 0% Home Performance Rebates/Programs HVAC/Mechanical IAQ 2/24/16 44

45 Home Performance s Key Success Factor Conversion from Single Interest to Whole House Perspective is Critical 2/24/16 45

46 QUESTIONS? Peter Troast