Branching Out

Diversification is a familiar point of interest for heating oil and propane dealers looking to build market share and protect their businesses against competing home service providers. So, it came as no surprise that many seats were filled for the “Extreme Diversification” session presented Tuesday, May 22 in Grand Pequot Ballroom B at the Foxwoods Resort Casino.

Likewise, the presenter, Robert Williamson, general manager of Moyer Indoor | Outdoor, was no stranger to addressing his industry peers about this topic. When asked by one attendee, the owner of a Long Island-based home comfort company, about ways to tap into the expertise of business leaders from adjacent industries, Williamson acknowledged that he finds these opportunities primarily by speaking at trade shows just like this one.
Still, this was no entry-level talk on expanding from heating to air conditioning services, or from HVAC to plumbing and refrigeration. To the contrary, the “extreme” angle comes from the simple fact that Moyer Indoor | Outdoor serves customers in eight different segments: lawn care, tree care, pest control, heating oil, HVAC, plumbing, swimming pools, and home security.

And while the story of this company’s expansion touches on several themes that are well known to fuel dealers who’ve branched out over the years, it also offers a number of surprises … and maybe some valuable lessons about what does and doesn’t work in diversification.

From the Inside
It’s a tale as old as the industry itself: an established heating oil company expands into propane delivery by acquiring an established propane company, its gallons and customer list. Historically, that’s not the way things work at Moyer Indoor | Outdoor, though.
The company, which started as a feed mill in 1869, moved from delivering coal to delivering heating oil around 1950, then naturally progressed into HVAC, plumbing and pool services. Similarly, its fertilizer business, another holdover from the feed mill, grew into lawn care and then tree care.

“We’ve never started a business with an acquisition,” said Williamson. “We’ve always started it internally and organically got it up and running.”

Division of Labor
That doesn’t mean that the divisions share technicians or salespeople — quite the opposite actually. Williamson emphasizes that each of the company’s departments has its own specialists who work primarily in that division. The pest control segment, for example, includes three certified etymologists.

The only interdepartmental employment occurs between seasonal gigs like heating oil delivery and pool service. In these cases, Williamson says, the transitions help with employee retention — a common challenge for businesses in both sectors.

In any case, specialization applies from the top-down in each department. “If we don’t have a manager who gets up in the morning, lives, eats and sleeps that business, it doesn’t work,” says Williamson.

Indeed, not every attempt at diversification has been a win for Moyer. Businesses that they’ve tried and eventually shut down include irrigation and TV repair/installation.

Cross-Selling
Many ideas do work for multiple segments, Williamson says. However, he cautions, cross-selling is much tougher than it looks, because homeowners feel inherently loyal to the service companies they’ve already decided to let into their homes. “They like their guy,” Williamson says. How then does Moyer Indoor | Outdoor manage to carry customers over from one division to the next? “It takes time,” he explains. “You [keep at it], and you don’t mess up the opportunities.”

Many of these come from the company’s online rewards program, which offers outside incentives like Amazon Gift Cards, as well as complimentary Moyer Indoor | Outdoor services from any of the eight departments. The challenge, Williamson relates, has always been in getting customers to choose these services rather than the other rewards. Additionally, customers often lose track of their usernames and passwords.

Because of this, Williamson says, a few months ago Moyer Indoor | Outdoor started calling customers with unused company credits to let them know there were free services available to them. When customers responded positively, or returned the call, a sales rep would point them toward the company’s different business channels and help them get there by redeeming the rewards points on the back-end while the customer was still on the phone. It’s a new tactic for Moyer Indoor | Outdoor, but one that Williamson thinks shows great promise.

In addition to incentivizing customer loyalty, the company encourages service people in each department to generate leads for multichannel conversions. Moyer Indoor | Outdoor provides $10 for each tip a technician calls in to the company’s lead-dedicated phone line, whether or not the lead generates a sale, as long as the tech spoke to the customer about it in advance. In fact, each technician — and even Williamson himself —wears a bracelet with the number on it, as a constant reminder to call in those leads.

8 Branches, 1 Brand
As one might imagine, a company with as many segments as Moyer Indoor | Outdoor must have a pretty big reach. Williamson says the company spends approximately $250,000 per year on brand marketing efforts, including Little League team sponsorships and other community programs, as well as internet, pay-per-click, radio and newspaper advertising. “We spend a lot on the brand in the community, because we are a community company,” he states.

Hence, spring is an especially busy season for Moyer’s sales teams, as it’s during this time that all of the company’s different service vehicles are on the road together. And while customers rarely, if ever, sign up for all services at once, Williamson believes the diversity and size of the business help promote a “spirited core” as well as general brand recognition. Which, of course, leads to additional opportunities.

Pin It

Comments are closed.