German Vaillant has launched a project which has stirred controversy among installers: Online platform heizungonline.vaillant.de can be used by manufacturers to directly address those end customers who wish to shop online – and send them a “price indication” for a complete heating system. Recent discussions have revolved around the question of whether this is a help to installation companies or if it interferes with their entrepreneurial freedom.
Vaillant, a German manufacturer of boilers and heating appliances, has launched an online sales platform for heating systems called HeizungOnline. The process is not so easy to understand: Customers going onto the platform will first be directed through a questionnaire gathering information about their desired heating system and can then request a price indication. Vaillant has emphasised the “indication” part of the statement, which means that the price will only give customers an idea of how much money they will have to spend according to typical market offers. In a next step, an installation partner will visit the premises, after which the prospect will receive an offer that has both logos and names on it – the one of the installer and the one of Vaillant. Prices and conditions will be provided by the installer. Still, Vaillant is officially the company offering the service and will also be the contract partner to the customer.
Installers to benefit from supplier’s accounting system
The advantage of Vaillant entering into the contract with the customer is that installation partners also benefit from the company’s accounting system, including dunning processes (a weakness of many installers), which will make it easier for them to concentrate on their core business. Vaillant emphasised that it would transfer the full invoice amount to the company installing the system.
The German magazine for building services engineering, TGA, has pointed to the benefits this collaboration offers to installation companies: While Vaillant uses the online interface to attract internet-savvy prospects, an installation partner will later get the job and will not have to worry about accounting or late payments.
Although Vaillant has said that the approach was developed in collaboration with installation companies, the strategy was heavily criticised by one of the German major installer organisation. The delicate question is: Does the company interfere with installers´ autonomy or even downgrade them to mere providers of installation services? In a May 2016 statement after its general meeting, the North Rhine-Westphalian branch of installer association SHK (the German equivalent of an HVAC organisation) has called it “nothing less than a wilful attempt to restrict installers in their entrepreneurial freedom.”
Advertising campaigns showing fixed end-customer prices spell trouble
The campaign by SHK NRW shows how difficult it is for heating manufacturers (and solar system suppliers) in Germany to devise new market strategies, especially if they touch on the sensitive issue of communicating end-customer prices. This has spelled trouble for other market players, too. A couple of years ago, Viessmann ran an advertising campaign stating a fixed price for a heating system. After the resistance of installer organisations, the company had to stop the campaign and apologise to its customers, the installers.
Strong and fair relationship between partners on equal footing
However, HeizungOnline is another story. It addresses the difficulties that installers have with online marketing, which could ensure their interest in cooperating. In response to ZVSHK’s general assembly statement, the editors of TGA said: “The fact of the matter is that Vaillant’s approach focuses on an increasingly important sales channel. Anyone who takes a long, hard look at the situation must see that the decision on a growing number of jobs for heating and bathroom modernisation will be made differently from today and yesterday.” Added TGA: “This is not necessarily a negative development for installation companies: Employing new strategies will be expensive and won’t be profitable for every enterprise, depending on its size.”
Vaillant said that the programme was in the pilot phase and that the company was still in discussions with installers and installer associations. The entire process may look quite different in the end. Vaillant’s Head of Marketing, Nicole Dunker, said that the programme had elicited a very mixed response – some like it, some don’t. “It is not at all our aim to put experienced technicians under tutelage. Over decades, we have had a strong and fair relationship with our installers, which is firmly based on a collaboration between equals. We have no wish or intention to end this partnership with the introduction of HeizungOnline.”
HeizungOnline by Vaillant: https://heizungonline.vaillant.de/