Homeowners’ expectations have evolved. From Amazon to CarMax, both younger and older generations expect instant information and seamless online experiences in practically all aspects of their lives.

As a result, home service businesses face a unique set of challenges associated with increasing consumer expectations. They must adjust to the higher expectations of their customers or risk losing out on important business. By employing new digital tools to adapt quickly to these expectations, companies not only meet them; they can thrive in this rapidly changing environment.

Picture yourself as a homeowner: You know your furnace is on its last legs, you’ve heard about heat pumps, you know they are likely more expensive than buying a new HVAC system and you’re trying to figure out how much such a new system might cost. You search for contractors on Google, but all the websites you visit make you call or fill out a form just to schedule a visit and get an estimate. 

You start to get frustrated—you know these companies have prices for their services, but you feel like it’s somehow being withheld from you. Then, you finally land on a contractor’s webpage that provides what you’re looking for: a straightforward online estimate. All else being equal, if you are like many consumers, you’re probably reaching out to that company.

Instant Access

Modern consumers, especially millennials and Gen Z, have grown up with instant access to information, and homeowner demographics are shifting. According to the National Association of Realtors, 65 percent of homebuyers today are Gen X or younger. These digitally native generations expect rapid responses and prompt information from businesses.

Still, high upfront costs can be a deterrent. 

For example, consumers definitely interested in heat pumps might initially experience sticker shock upon learning that a high-efficiency heat pump system costs more than $20,000. However, once the full picture is presented, including the various rebates, tax credits, discounts, and incentives available, the picture that consumers see changes drastically.

Consider this scenario: If the initial price of a high-efficiency heat pump is $20,000, then depending on the customer’s income level, they may be eligible for an $8,000 IRA HEAR rebate. There is also a $2,000 federal 25C tax credit for households with a tax liability. A local utility’s incentive may cover $1,500, and the manufacturer’s seasonal promotion could reduce the price by another $1,000.

Once incentives are clearly and transparently communicated to consumers, their final price drops significantly from its initial $20,000 figure to $7,500—this dramatic difference not only reduces cost, but also triggers positive emotions.

Brain’s Reward Systems

These reactions are deeply seated in our neurobiology. There are reward circuits in our brains, which are part of the brain’s limbic system. When we believe we’re getting a good deal, these areas become activated. This results in positive emotions such as excitement or contentment that make us more likely to make a purchase or move forward.

Conversely, when we encounter what we perceive to be “unfair” prices, our brain’s insular cortex activates feelings such as pain and disgust that researchers at Stanford have discovered is crucial in dissuading purchases (tinyurl.com/yc5ze9wa).

However, by showing discounted post-incentive prices, we shift the focus. Instead of disgust and aversion, you’re activating the brain’s reward systems and focusing on how much they can save.

Considering this psychology, it’s easy to see why a poll by Midea America, Coyne Public Relations and Atomik Research, published in the 2024 AHR Trend Report, showed that 68 percent of homeowners are more inclined to consider heat pump installations upon learning about incentives (tinyurl.com/4j7xaud5). We all know that incentives motivate consumers. The question is awareness and availability.

Clear communication about rebates and incentives enables companies to improve the purchasing experience for homeowners. Such efforts reduce negative emotions associated with high prices while creating positive ones associated with value and control. Instead of being perceived as pushy salespeople, companies become trusted partners who prioritize customers’ best interests.

“Buying” vs. “Sold To”

As consumers, we prefer “buying” and making our own decisions rather than being “sold to.” According to researchers at Babson College and Boston College, pricing transparency builds confidence and trust in consumers (tinyurl.com/bdf6w8wt), resulting in increased satisfaction and stronger loyalty. When customers feel that they are making smart and informed decisions, they are more likely to take the next step in the purchase process.

As expectations of convenience and immediacy increase, customers can be easily derailed by the slightest inconvenience. Conversely, customers are less likely to leave when processes are simple and frictionless; reducing barriers within the purchase process is more critical than ever. Digital tools help unlock great customer experiences, including speedy, accurate quotes and providing customers with frictionless scheduling.

If contractors can grab their customers’ attention with rebates and incentives, the odds further increase in their favor.

Putting pricing online is crucial to maintaining the engagement of prospective customers who are looking for this information. It’s crucial to keep these customers engaged with your business instead of providing them with an excuse to explore options from competitors due to a perceived lack of transparency.

There are many tools available to drive business growth. New generations of CRM systems, chat platforms and tech-driven in-home consultation tools can help companies respond swiftly to customer needs.

At the end of the day, though, it’s about placing the customer at the center of the experience. Businesses that understand modern consumer habits and psychology and shape their operations around creating a delightful experience will thrive. These new digital tools are just the enablers of that experience, and success depends on how they’re used. Companies that put this mindset at the core of their business and leverage these tools will lead the way in the digital world of tomorrow.

Josh Koplin is a co-founder of EDEN, a Seattle-based startup with a mission to empower contractors with innovative technology. Visit www. e-denhomes.com