Business Development Resources

Defining Your Services

What are you selling?

If is vital that you are able to clearly define and communicate to potential customers what it is you are selling. This is easier said than done. First, take a few minutes to capture in a few words what it is that you do. These definitions will of course change with the customer. Here are just a few examples of definitions of rating services used by raters across the nation:

• Applied Building Science Diagnostics
• Verification for ENERGY STAR
• Verification for the Tax Credit
• EEM Inspections
• Access to Preferred Financing
• Identification of Cost-Effective Improvements
• Healthier Living Environment
• Solutions for Added Homeowner Comfort
• Builder/Buyer Quality Assurance

Any effective marketing strategy will define the value of your services to your customers.

By considering the value of your rating services to your various customers you will be able to tell your story more effectively.

As a starting point the following are potential benefits of ratings to builders, lenders, marketing agents and consumers:

Benefits of Ratings to Builders

• Tap the Growing Market Trend Toward More Energy Efficient Homes
  Across the nation there is a growing consumer demand for high performance, energy efficient homes. This growing market demand is best illustrated by the fact that in 2002, 3% of all new homes built met the ENERGY STAR Homes standard.
  
  Another illustration of the potential market power of homes that are rated to be energy efficient is a consumer survey completed by Pulte Homes in Tucson, Arizona. The Pulte study found that 88% of the consumers who purchased Pulte ENERGY STAR Homes listed the energy features of the home as important in their decision making. Click on Pulte Homes Market Survey.
   
• Present the Energy Efficient Builder the Opportunity to Differentiate Their Product Through Marketing of the Energy Efficient Features
  A home energy rating provides proof for a builder to demonstrate the energy efficiency of the home through an independent on-site inspection by a qualified building performance professional - a home energy rater. The energy efficient builder can differentiate his homes in the market place through this verification.
   
• Increase the Buying Power of Consumers
  An energy efficient mortgage increases the buying power of consumers purchasing an energy efficient home by crediting the home's energy savings in the loan qualification process and the home's appraised value. This not only increases the number of families able to afford a home but also allows consumers to afford more of a home. A home energy rating is the key that unlocks the access to an energy efficient mortgage.
   
• Demonstrate Good Corporate Citizenship by Enhancing the Quality of the Environment and National Security
  Responsible builders like to be perceived as responsible corporate citizens in their community. The energy we use in our homes is responsible for a large portion of pollution caused in this nation. In addition, the large amount of oil imported to our nation from the volatile Middle East raises serious national security concerns. An energy efficient home reduces pollution and the demand for Middle Eastern oil. Builders can demonstrate their corporate responsibility by building and marketing energy efficient homes.

For more information on the benefits of home energy ratings to builders click on Energy Rated Homes.

Benefits of Ratings to Lenders

• Qualify more first time home buyers for mortgage loans
  Having enough money for a down payment is a major barrier to home ownership for many families. The energy mortgage addresses this problem through crediting a home's energy savings in the loan qualification process.  Analysis by the Environmental Protection Agency projects that an average of 6.8% more families would be able to qualify for a mortgage through an energy efficient mortgage.
• Reduce the cost of home ownership
  The cost of heating and cooling a home is the highest cost of housing outside of the mortgage loan. The impact of energy costs presents a special burden to lower income families. Estimates show that low income families spend an average of 19% of their annual income on energy bills. Energy efficiency reduces this burden thus freeing more money for housing.
• Participate in energy mortgage programs
  Energy mortgages increases a consumer's home buying power by crediting the monthly energy savings in the mortgage. All energy mortgage programs require a home energy rating to estimate the savings and verify the home's energy efficiency. The rating report provides all of the information a lender needs to underwrite the loan.
• Determine the relative energy efficiency of the home being financed
  The energy rating presents information on the energy efficiency of a home in non-technical and easily understood terms (the star rating). This will allow a lender to know at a quick glance the relative energy efficiency of a home. The rating will tell if the home meets the minimum energy code (4 Stars) or meets the ENERGY STAR Homes standard (5 Stars).
• Increase confidence in the home's marketability in case of default
  Of vital concern to mortgage to the marketability of a home if the loan goes into default and the lender must foreclose the home. A lender should feel more confident financing a home that has been verified as energy efficient by a rating because it will be more marketable. In addition more families would be qualified to purchase the home through a energy mortgage.
• Receive Community Reinvestment Act credits
  Congress requires that lenders target a certain percentage of their loans to meet the needs of low income and minority families (the Community Reinvestment Act - CRA). A lender must receive a set amount of CRA credits to keep their license. The Federal Home Loan Bank sets the policy for the issuing of CRA credits. The Federal Home Loan Bank has ruled that energy mortgages targeted to low income and first-time buyers qualify as CRA credits.
• Reduce America's dependence on imported oil and aid the environment
  A mortgage lending firm can differentiate their business as responsible corporate citizens by promoting energy efficiency housing that not only fosters more affordable housing to more families but also addresses the national concerns over the environment and national security.

Benefits of Ratings to Marketing Agents

• Have a larger pool of potential buyers who can afford more of a home
  An energy efficient mortgage increases the buying power of consumers through crediting the energy savings of a high performance energy efficient home documented through an energy rating into the mortgage loan. An energy efficient mortgage will not only qualify more families for a mortgage loan but will allow a home buyer to afford more features in a home than they would have otherwise.
• Present information on the energy efficiency of a home in non-technical and easily understood terms
  The energy rating presents information on the energy efficiency of a home in non-technical and easily understood terms (the star rating). This will allow a lender to know at a quick glance the relative energy efficiency of a home. The rating will tell if the home meets the minimum energy code (4 Stars) or meets the ENERGY STAR Homes standard (5 Stars).
• Market the energy efficient features of the homes they are selling
  Presenting information on the energy efficiency of the home in non-technical terms allows marketing agents to market the energy efficiency of the home in terms that a consumer can readily understand.
• Mitigate the lower selling price of inefficient, existing homes through energy improvement mortgages
  In most cases when a home needs repairs such as a new heating or air conditioning system either the seller has to make the improvements prior to closing or the seller has to reduce the price of the home. An energy improvement mortgage presents a real estate agent with a solution to the problem. The agent can market the energy improvement mortgage to the prospective buyer as a way to finance the energy improvements in the mortgage loan without additional loan qualification or, in most cases, without any additional money down.

Benefits of Ratings to Consumers

• Determine the relative energy efficiency of a residence when purchasing a home
  Many of the energy efficient features of a home are hidden once the dry wall goes up and it is difficult for a consumer to know the energy efficiency of a home. A home energy rating involving diagnostic testing, will give a home buyer a third party verification of the home's energy efficiency.
• Make educated decisions when investing in cost-effective energy improvements to the home
  Besides providing a rating of the home and projecting its energy costs, a home energy rating provides a home owner with a listing of cost-effective energy improvements for the home and the economic return on investment from making those improvements.
• Add the cost of making the energy improvements to the mortgage loan through an energy improvement mortgage
  An energy improvement mortgage will finance the energy improvements recommended by an energy rating as being cost-effective into the mortgage loan at the time of the purchase or during refinancing. An energy improvement mortgage does not require any additional qualification and in most cases does not require any additional money down. Mortgage interest terms are much more attractive than credit card or consumer loans.
• Qualify for a higher quality, energy efficient home
  An energy efficient mortgage increases the buying power of consumers through crediting the energy savings of a high performance energy efficient home documented through an energy rating into the mortgage loan. An energy efficient mortgage will not only qualify more families for a mortgage loan but will allow a home buyer to afford more features in a home than they would otherwise.

Market Considerations

What is going on in your market?

The second step is getting to know your potential market.

The following is a short list of market considerations to keep in mind:

• Current Building Practices
• Characteristics of Builders
  • Production
  • Custom
• Robustness of the Housing Market
• Demographics of Buyers
• Rate of Homeownership/Housing Costs
• Cost of Energy
• Common Building Problems
• Availability of Utility Programs

Know Your Potential Customers

Learning as much as you can about your potential customer's motivations and needs, will pay big dividends in the future. Based on your knowledge, you can better tailor your message to them. Depending on your market, there are many ways to obtain information about them. Here are just a few examples to get you thinking:

• Study potential customer's web sites
• Google potential customers to see if they have been features in any recent publications
• Where did they start and where are they going?
• Research whether their sales are up or down
• Find out if they have problems with warranty calls
• Dig for information on what their company aspirations are