For every residential HVAC contractor, the shoulder seasons (spring and fall) can be a challenge — not only to keep work flowing, but also to keep people employed and busy.
That’s where a customer loyalty program can help businesses keep a more consistent schedule, encourage maintenance practices on heating and cooling systems all season long, and increase customer communication and touch points.
This approach works for Mendel Plumbing and Heating, which services Chicago’s western suburbs. They introduced the MendelCare Heating and Cooling Protection Plan 15 years ago and have noticed an increase in customer loyalty and trust, while price sensitivity has dropped, according to President Tom Mascari.
Mendel Plumbing and Heating has a 75% residential and 25% commercial business, and 95% of its business is within a 20-mile service radius of its headquarters in St. Charles, Illinois. Preventive maintenance services offered through MendelCare help bridge the gap between construction and service work. “MendelCare is like buying a car and getting a maintenance agreement with it,” Mascari explains.
Maintenance Keeps HVAC Systems Working Properly
The No. 1 cause of heating and air conditioner breakdowns is the buildup of dirt and grime, which is why regular maintenance is so important, Mascari says.
“Just one-eighth of an inch of dirt on blower fan blades reduces air flow efficiency by 30%, according to a Texas A&M study,” he explains. “Our job is to educate our customers on the importance of this cleaning and maintenance each year.”
That’s one of the reasons the company started MendelCare: to build that customer relationship and create these chances for education.
“Rather than sit and wait for the phone to ring when things break, we can increase our client impact by seeing customers twice a year,” he says.
Approximately 61% of active heating and air conditioning clients are part of the program and receive a 10% discount on maintenance and any needed repairs. They also get a three-year versus one-year warranty on parts and labor and first priority for repairs during peak weather events, which are loyalty services they receive back from the company.
“This gives them piece of mind in knowing that if anything goes wrong, we’ll fix it,” Mascari says. “Our goal is to convert 30% of non-MendelCare customers into MendelCare members each year.”
The MendelCare Phenomenon
Every other year, Mendel does a survey of customers, and there’s a correlation between the positive scores the company receives from MendelCare members vs. non-members.
“We call it the MendelCare phenomenon,” Mascari says.
In the survey, Mendel measures a figure called the net promoter score, which is an index measuring the willingness of customers to recommend a company’s products or services to others. It helps a company gauge its customers' overall satisfaction with a company and their loyalty to a brand. The survey must be conducted by a third-party company to accurately measure the score. Mendel uses a company based out of Minneapolis that specializes in statistically sound surveys. “We provide them with our database of active clients, and they randomly call customers and get good, honest scores,” he explains.
MendelCare customers that receive the exact same services as non-MendelCare customers are 79% more likely to recommend the company, the survey reveals. Non-MendelCare customers are only 49% likely to recommend Mendel’s services to others.
MendelCare’s Impact on Employee Retention
The loyalty program also helps keep Mendel’s technicians busy throughout the year. “What happens normally is when peak seasons launch, you get repair and replacement calls coming in, but then shoulder seasons are super quiet,” Mascari explains, adding that it could be so slow that employees have to go on temporary leaves.
But with MendelCare in place, the company maintains steady work throughout the year versus less predictable peaks and valleys.
In addition to union pay that helps keep a more stable workforce, making the company a magnet for good performers who want to be paid well, the consistent work MendelCare brings in helps elevate employee retention. The average employee tenure among the company’s 35 technicians is seven years. Technicians have an average 19 years of experience and the longest tenures are 31, 24, and 21 years.
As Mascari explains, “As long as we provide that steady, consistent work, our employees remain happy.”