As HVAC contractors gear up for the year ahead, emerging data and trends are vital to your go-to-market strategy. At Valve+Meter, we constantly research, design, and test new HVAC marketing plans and tactics. From search engine optimization to paid advertising and web design, digital marketing keeps evolving. Our testing culture helps us know what to measure and deliver insights to our partners.
Focusing on spending preferences and leading indicators shapes how homeowners hire HVAC contractors. This understanding strengthens your business and drives sustainable growth.
The most successful home service providers thrive by improving lead management and speed to response. As Valve+Meter’s Speed to Lead study shows, HVAC companies boost revenue, growth, and net profitability by responding to leads faster.
Throughout 2023, new trends emerged across the HVAC industry that help chart new pathways to capture homeowners and set your business apart from competitors.
In a marketplace crowded with transactional businesses, nimble HVAC contractors connect with homeowners through meaningful, relationship-focused go-to-market strategies.
2023 Key HVAC Data
The first half of 2023 tested many HVAC businesses, especially those serving commercial and multi-family accounts.
Commercial Backlog
As manufacturers cleared the commercial backlog from 2022 and supply chain issues eased, many contractors felt a false sense of growth through Q1 and Q2.
SEER2 and Price Increases
New equipment rollouts with SEER2 standards resulted in price increases. This made perceived revenue look stronger without actual growth in units sold.
Mild Weather
2023 was the mildest summer in the Midwest since 2017. Mild weather meant fewer demand calls than years past. From April through September, the Residential Energy Demand Temperature Index (REDTI) was 56.2, down from 87.4 in 2022 and well below the 86.55 average since 2018.
A graph showing the projected growth of the HVAC market in the U.S. for 2024 and beyond.
Lower Demand
Valve+Meter tracked year-over-year search shifts. A July snapshot revealed 20% fewer homeowners entering the market for air conditioning installation and 20% more searching for air conditioning repairs.
Industry-wide, ducted split and gas furnace sales dropped, with greater stability in ductless solutions. Commercial sales flattened with single-family declines and AOR between 25-30%. Homeowners clearly respond to price increases by asking for more competitive estimates. When Valve+Meter checked July searches, we found a 28% jump in queries containing “cost” and related terms.
2023 Summary
Known and unknown market conditions hurt consumer confidence and spending. This led to more repair calls than replacements and fiercer price shopping than in past seasons. Overall, private spending on home improvements fell 1.87% (IBIS World, October 2023).
This mix of variables made 2023 humbling for HVAC. Yet this is where small business resilience shines. What lies ahead in 2024 and how do you make the most of it?
Emerging Homeowner Buying Habits in 2024
What sets great HVAC businesses apart is exceptional service delivery. While consumer demand shifts, the definition of excellence never changes—treat people as you’d want to be treated.
During the pandemic, homeowners rewarded businesses that responded quickly and finished on time. Some HVAC contractors turned down work due to overwhelming demand.
If your HVAC business became transactional, you’re not alone. Consider this question as you review your data:
How do you serve your customers, company, employees, and community with the most good?
Delivering comfort to homeowners goes beyond climate control systems. Trucks rolling, jobs booked, and systems installed matter—yet that’s only part of why homeowners call you. Real growth starts by listening to customers and building stronger community relationships.
New data shows a homeowner type that’s informed and motivated by personalization, not just price.
A New Type of HVAC Buyer
As you look into 2024, no one predicts the future perfectly. Yet HVAC industry trends merit serious consideration.
At Valve+Meter, we study data to understand HVAC homeowners, and there’s no single buyer portrait. Many new prospects focus on price while others want something different.
Many buying decisions hinge on homeowner values, including buying local, cutting carbon footprint, and supporting companies with shared values.
Let’s examine a few homeowner types and ways to connect your business to their needs.
Price-Focused Consumer
In recent Valve+Meter surveys, homeowners shifted focus from speed to price. During initial calls, price-focused homeowners ask about service costs.
For cash-strapped homeowners, average HVAC repair costs have climbed with inflation. Throughout the cooling season, Valve+Meter tracked “HVAC quotes” searches in Indianapolis. From June through September, estimate searches jumped 10.5%.
Lower demand and plentiful supply drive this trend. New home starts fell 3.1% year-over-year from 2021-22 (IBIS World, October 2023). Margin limits push homebuilders away from single-family focus. With rising housing costs, higher rates, and limited inventory, multi-family construction hit a 50-year high in March 2023 (Harvard).
Fewer homebuyers enter the market, but existing homeowners stay in aging homes longer. Median homeownership is now 13.2 years, up 3 years over the last decade and more than 5 years longer than 2010.
(Zebra)
So how do HVAC businesses win amid these shifting conditions?
Buyer Persona
Consider Jane Doe, a working mother whose air conditioner breaks. Like half of all Americans, she has less than $5,000 in savings. Financing remains vital for the HVAC industry—more than 23% of revenue comes from repairs and maintenance.
The average HVAC repair costs approximately $1,100. A YouGov survey from January 2023 shows 1 in 10 consumers have no savings, while 13% report less than $100.
Jane Doe needs financing to repair her system. How do you help her?
HVAC businesses can adjust and improve to connect with price-focused homeowners. This consumer isn’t just hunting the lowest price. Most face an immediate broken system.
Your digital marketing, sales, and support help this buyer purchase with confidence.
Meeting Inflation With Dignified Buying Options
Even for repairs, financing must anchor your HVAC website, support messaging, and service visits. Online finance applications help homeowners apply for credit discreetly.
- Pre-approval reduces anxiety and awkward questions during sales conversations.
- Second-look financing offers alternatives beyond prime-only lenders.
- Revolving credit lines help offset repair costs and build relationships as aging systems near replacement.
Proactively offering solutions helps community homeowners apply for credit privately. In 2024 planning, HVAC companies connect with price-focused homeowners through:
- Finance Webpage: Add or optimize the financing page so visitors apply before your tech arrives.
- Search Engine Optimization: Ranking for financing keywords boosts conversion rates. Create content including blogs and service pages about your financing options.
- Encourage Pre-Approval: Optimize financing messaging into your process, including discussion during scheduling calls or pre-visit emails.
Also note that financing approval rates dropped from roughly 94% to 68% depending on the provider. Offering a second-look option beyond your primary lender helps.
Once a homeowner gets pre-approved, they focus on making the best choice. Providing revolving credit on a repair builds the relationship. You’ll follow up and help them plan for eventual system replacement.
This opens opportunity to discuss additional comfort solutions. Most pre-approved homeowners receive approval for higher value than your quoted unit. While price-focused homeowners start hunting the lowest price, investing in a more efficient unit or air quality solution increases comfort and your margins.
The bonus is that the homeowner feels they’ve chosen something for their home rather than simply facing an unexpected bill.
Smart Consumer
Regardless of age, buyers are more informed than ever. With over 90% of millennials and Gen X using the internet, decisions start with search engines and social media. This drops for baby boomers, yet more than 40% prefer discovering products online, with another 10% choosing social media.
It’s not just where people find your HVAC business, but how they search. A Forbes survey found 80% of shoppers research online to find, compare, and contact businesses. Since June 2023, Google noted product searches (such as “review” and “comparison”) align with deal searches (like “deal” and “offer”).
The smart consumer is your present and future prospect. Years ago this buyer was young, professional, and tech-savvy. In 2024, expect every audience to be more informed and eager to educate themselves before contacting your team.
Buyer Persona
John Jones has an aging gas furnace. He researches heat pumps, and since his wife has allergies, he digs into air cleaners and purifiers. He installed a Google Nest and Chime after reading reviews. If he’s millennial, he may use up to 23 sources before calling you (Forbes).
Sound familiar?
How to Attract and Engage the Smart Consumer in 2024
84% don’t have a company in mind when they start shopping for home services, and 62% of homeowners seeking HVAC services start with an online search. Securing your digital footprint is critical. This includes your HVAC website, digital ads, email, and social media to showcase all products and services.
With most homeowners searching online, your HVAC business must become a credible, trustworthy authority using these strategies:
- Expand Product Offerings: Create great content on each service and product. Our SEO experts note Google rewards original, accurate website content following the fall 2023 core algorithm update.
- Enhance Content Messaging: After filling website content gaps, review your brand voice. Beyond information, McKinsey finds 71% of consumers expect personalized interactions, and 76% get frustrated when that doesn’t happen.
- Retarget and Remarket: Encouragingly, 60% of consumers become repeat customers after a personalized experience. Retargeting visitors with display ads and sending relevant emails boosts conversion and brand loyalty.
- Ask for Reviews: In all interactions, including maintenance completion, invoices, and emails, add a direct Google Business Profile review link. In November 2023, Google updated its review system to reward highly reviewed HVAC businesses in search results.
Smart consumers often dig deeper than just information. Like people wanting personalized experiences, many ask hard questions before spending money. They’ve done their homework.
Google Search 8/10
80% of shoppers research online.
Personalization 71%
71% of consumers expect personalized interactions.
Buy Local Consumer
One such consumer values buying locally. Throughout the pandemic and after, more homeowners embraced the local multiplier effect. Money spent with independent local businesses circulates 2-4 times more than corporate chains. Recent data shows 68% of local business spending stays in the local economy (Small Business Association).
Buyer Persona
The buy local consumer might be another small business owner or a neighbor.
Supporting small, local businesses matters to more than 93% of consumers (Intuit). With 56% intentionally patronizing local shops or buying locally sourced products (US Chamber of Commerce), standing out in your local economy is critical.
Connecting With the Buy Local Consumer
In markets where large competitors and private equity HVAC chains focus on transactions, your strategy builds deeper community ties:
- Who Are You? Share clear messages about your past, present, and future. Personalize your business on your website, ads, and marketing materials.
- Platinum Rule: Greet every call, email, or chat with a personal touch. As corporate businesses outsource support, a friendly local voice stands out.
- Show Don’t Tell: Put faces and names to your business. Feature team members in employee profiles, newsletters, and social posts. Your About Us page gets visited often.
Eye-catching branding matters for your website and trucks. Yet your people may be your greatest asset in 2024. Small local businesses impact communities because they care about homeowners, employ them, and often live in the neighborhoods they serve.
Shop Local 93%
Supporting small, local businesses matters to more than 93% of consumers.
Local Multiplier Effect $68/100
68% of money spent with local businesses stays in the local economy
Why Consumer
Most homeowners buy locally and increasingly focus on why. More buyers ask not just where they spend money but also about brand reputation, values, and long-term service.
Buyer Persona 1
Why are you different from the other guy?
Younger homeowners and business owners are digital natives. 80% spend time researching and evaluating companies before contacting you.
Why can I trust your company?
Like smart consumers, “why consumers” use the internet and social media to decide. A Salsify study found US consumers willing to pay more for trusted brands rose from 30% in 2021 to 46% in 2022.
Review management is key in 2024. PowerReviews found 99.9% of consumers check reviews before purchasing. In 2023, Bright Local reported nearly half of consumers trust online reviews as much as word-of-mouth.
Personalizing Your HVAC Business
Demonstrating your value and commitment to homeowners sets you apart in 2024.
Personalization drives performance and better outcomes. Companies growing faster earn 40% more revenue from personalization than slower-growing peers (McKinsey).
Nearly all consumers prefer personalization, and 74% get annoyed by non-personalized websites (InstaPage). In 2024, personalization includes:
- Optimized Content: Add personal messages from you on your homepage and About Us pages. Customer quotes and reviews build strong brand identity.
- Personalized Communications: Email newsletters with distinct messages for audience segments boost open rates. Regular, interesting information keeps “why consumers” excited about your business.
- Social Proof: Social media posts engaging your community, featuring holidays, and showing your team in action build an audience.
Engaging more directly with homeowners is your first step toward personalized brand identity. In fact, 50% of consumers wanted socially conscious benefits like charitable giving or unique rewards from brand interactions (Inc).
How can you build brand loyalty?
Highlighting your brand identity and connecting with your audience in 2024 appeals to the “why consumer.” In an era where almost all new purchases start with internet searches, brand loyalty is rising.
Consumers want to buy from brands they trust. They expect businesses to build relationships. Data shows consumers engage with brands they love.
According to Deloitte 2023 survey results, consumer participation in paid loyalty programs has tripled since 2021. Currently, 53% of consumers pay for a loyalty program, up from 32% in 2022 and 17% in 2021.
Every HVAC business should offer a prominent membership program. These programs often feel transactional with new customers. In 2024, earning new customers costs more and competition rises. Yet many existing customers want a home services partner to simplify their needs.
Strengthening Your Brand:
- Membership Program: Brand dedicated member pages uniquely and feature them prominently. Share membership benefits with homeowners.
- Invite New Members: Highlight your membership program during service visits and installations.
- E-commerce: Add e-commerce to encourage easy membership enrollment. Include low monthly payment options for member programs and DIY accessories like air filters, air cleaners, and other IAQ products.
- Remarketing: Are your service visits and installations linked to customer nurturing campaigns? For members and non-members alike, personalized messages about maintenance, energy savings, indoor air quality, and community involvement keep your brand top of mind.
Membership programs, social media, email, and other brand-building efforts do more than bridge installation to service gaps. From price-focused homeowners to busy professionals seeking the best system, a unique experience makes your HVAC business indispensable.
How Relationship Marketing Instills Operational Excellence
At Valve+Meter, we research and design methods to accelerate your business by capturing new customers and retaining existing ones.
For HVAC contractors, where maintenance and repairs drive ongoing revenue, relationship building achieves operational excellence and outperforms competitors.
Transactional marketing targets new customers. This includes website content emphasizing urgency, Pay Per Click ads (PPC), Google Local Services Ads (LSA), and Search Engine Optimization (SEO) capturing ready-to-buy homeowners.
Transactional marketing is essential to attract, engage, and convert leads into customers.
Why is transactional marketing so effective?
- According to a report by Invoca citing LSA, over 55% of homeowners search the internet before booking a home services appointment.
- For paid search advertising, average cost per lead varies widely. Air conditioning services average $55.15 CPL, though Valve+Meter observed CPL reaching $200 in 2023.
- 45% of customers find home service providers through social media.
Every HVAC business needs PPC, LSA, and SEO to capture new audiences. In 2024, smart marketing recognizes leading consumer interest indicators.
How do you keep new customers engaged?
Personalization and relationship building set you apart from transactional-only competitors. Customer lifetime value includes maintenance, accessory purchases, and eventual equipment installations. Considering 23.5% of all HVAC revenue comes from maintenance and repairs (IBIS World October 2023), relationship marketing impacts your bottom line in 2024 and beyond.
How relationship marketing personalizes your brand
Relationship marketing builds credibility, authority, and relevance with homeowners. Become essential to your customers by focusing on long-term, personalized tools:
- A clear brand identity that showcases you and your team as individuals serving your community.
- Content marketing, email, social media, and sales practices with frequent, meaningful community engagement.
- Easy online application methods for revolving credit so homeowners pay with dignity.
- Maintenance programs with personalized communications for members.
- E-commerce integrations for membership programs, air filters, and accessories.
These strategies are already being tested by Valve+Meter in the HVAC marketplace.
Working With Your Heart And Your Head
Operational excellence isn’t just responding to calls and lead forms with speed. The right message resonates with homeowners and drives more service calls and installations.
When business owners create brand messages featuring positivity, loyalty, and commitment, benefits ripple outward. Once relationship marketing takes hold, it’s not just homeowners who stay loyal.
Homeowners want to hire great people. Employees want to work for great companies. Growth flows from the roots up.
At Valve+Meter, we’re excited when our partners excel. As you head into 2024, we’re ready to help set up tools that empower ongoing growth for your HVAC business.