Marketing to Contractors


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Marketing to Contractors

  1. 1. A report from Point to Point B E S T P R A C T I C E S F O R S E L L I N G B U I L D I N G P R O D U C T S T H R O U G H C O N T R A C T O R S
  2. 2. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S EXECUTIVE In the past year, residential contractors spent an estimated $39 billion on building products.1 Overall spending SUMMARY for the construction industry in 2010 is projected to be $869 billion.2 And 99% of contractors are involved in some way in their organization’s building product purchases.3 Contractors have tremendous influence over the purchase of building products, and manufacturers must develop sound strategies for approaching this group. Building product marketers who recognize specific contractor needs and create strategies to meet these needs will ultimately succeed in selling through this audience. But with a number of rapid changes occurring in the • Reaching Hispanic contractors industry, it is becoming increasingly difficult to gain a solid (who will make up an estimated 63.2% of the workforce understanding of contractors in the U.S. Using third party by 2025)4 data, interviews with individual contractors, and our own • Knowing how to address either broad audiences or specific industry experience, we have identified major market trends, segments of the contractor audience and the challenges they pose for building product marketers: (residential vs. commercial, new vs. remodeling, small vs. • Addressing a disparate, fragmented group large, one trade vs. another) • Connecting with contractors through a variety of outlets • Connecting with suppliers (who often serve as a direct line of communication between • Approaching individuals who are resistant to change in manufacturers and contractors) product use • Creating product trial offers and guarantees • Marketing during economic downturns (a sure way to gain loyal customers) • Understanding the impact of technology on contractor • Using interactive marketing decision-making (the Internet, mobile marketing, and mobile apps) • Reaching time-starved small businesses For more insight on selling through contractors, read the In a changing market, savvy building product marketers can following white paper. To learn how an in depth knowledge transform these obstacles into opportunities. Some of these of the contractor cohort and an integrated marketing strategy lucrative possibilities for marketers include: can be tailored to best meet the goals of individual building materials manufacturers, contact advertising and interactive marketing firm Point to Point today. 2
  3. 3. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S INTRODUCTION IN SHEER NUMBERS, CONTRACTORS Developing and implementing a strategy for reaching ARE POWERFUL contractors is complicated. The contractor market is multidimensional. Contractors are highly fragmented • This year, spending in the construction industry was and hard to reach. And the fact that the industry is $869 billion.5 constantly evolving poses a challenge for building materials • Before the recession in 2006, residential contractors alone manufacturers who must connect with contractors at exactly spent $83 billion on building products.6 the right time in exactly the right way. • In 2007, residential contractors spent roughly $27 billion As building product marketers, what are best practices on building products at The Home Depot.7 for reaching contractors? What trends in the market are • In current terms, adjusted for the recent decrease in important? And how can you utilize knowledge of these residential construction spending, residential contractor trends to win contractor support? This paper will provide a spending for 2010 is an estimated $39 billion.8 method for understanding the contractor, highlight some of the most challenging aspects of reaching contractors, and In many of the instances where contractors do not have sole suggest solutions for addressing these issues to successfully purchase authority, they maintain involvement in building sell building products through this complex group. product decisions. • 99% of general contractors say they are involved in some way in their organization’s building product purchases.9 Given their influence, it is obvious that effectively reaching, connecting with, and selling through contractors is imperative for building product manufacturers. So who exactly are the members of this important group? Contractors are a diverse audience of painters, plumbing & hvac tradesmen, electricians, carpenters, plumbers, and other professionals who specialize in new and remodeling construction for both the residential and commercial segments. 3
  4. 4. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S UNDERSTANDING Contractor businesses range in size, capabilities, and Also of note, one of the overarching characteristics of THE MAIN TRENDS: expertise. While there are over 330,000 businesses in the contractor firms is their status as small businesses. THE MARKET category, it can be divided into subcategories based on trade. AT A GLANCE CHART 3 | PERCENT OF FIRMS UNDER 10 EMPLOYEES (AS OF 2006) CHART 1 | CONTRACTOR FIRMS BY TRADE (2008) Percentage of firms Trade Number of Firms Trade under 10 Employees Plumbing & HVAC 96,821 Plumbing & HVAC 77% Electrical 61,400 Electrician 78% Painting 41,415 Carpenters 89% Carpentry 34,577 Painters 87% Masonry & Concrete 30,000 Drywallers 74% Glass Glaziers 74% Source: Roofers 7% Masonry 81% CHART 2 | WORKERS BY TRADE (2008) Flooring 88% Trade Number of Workers Source: Plumbing & HVAC 864,100 Electrical 694,900 In the United States, the contractor industry has been Painting 450,100 undergoing significant transition, and these changes are Carpentry 1,300,000 affecting the way in which building product marketers should Source: think about this target audience. The majority (80%) of these companies specialize in Some noteworthy trends include: plumbing & hvac, electrical work, carpentry, concrete and masonry, or painting, but glass glaziers, flooring contractors, • The increased utilization of information technology and drywall contractors are also included in this segment. • A greater focus on eco-friendly building There are currently 832,100 residential building • Higher customer awareness of construction materials.11 contractors in the U.S., and 827,200 nonresidential building contractors.10 As the economy changes and one The most notable change, however, has been the economy. market becomes more profitable than the other, these While predictions suggest that there will be a need for an categories begin to merge because some contractors take additional 1.1 million special trade contractors within the jobs in both areas. next few years, the trend toward higher unemployment has been dramatic.12 The unemployment rate in construction has climbed from 6.2% in 2000 to 19.0 % by the end of 2009, and up to 20.1% most recently.13 4
  5. 5. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S In spite of these changes in the construction industry, As a result of the transitions within the contractor market contractors continue to have a steady influence on building and its tendency toward fragmentation, building product product specification and purchasing. According to one manufacturers hoping to connect with contractors are prominent contractor trade publication reaching over faced with a number of obstacles. The most pressing 80,000 individuals in the industry, its readers have challenges include: specifying and purchasing authority over:14 • Addressing a disparate, fragmented group • Doors 87% of the time • Connecting with contractors through a variety of outlets • Windows 87% of the time • Approaching individuals who are resistant to change in • Cabinets 82% of the time product use • Floors 76% of the time • Marketing during economic downturns • Siding 75% of the time • Understanding the impact of technology on contractor • Tiles 75% of the time decision-making • Plumbing fixtures 73% of the time • Reaching time-starved small businesses • Insulation 73% of the time By understanding contractors’ interests, behavior, thought • Lighting 72% of the time processes, desires, and concerns, manufacturers can transform these obstacles into tools for improving their • Faucets 71% of the time marketing approach. Leveraging contractor market trends and characteristics will allow building product marketers to reach contractors at the right time in the right way, with as little waste as possible. 5
  6. 6. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S CHALLENGE 1 With new tradesmen entering the profession, businesses Manufacturers who create Hispanic-directed messages restructuring due to economic downturns, and immigration and place them in areas where there is a large Hispanic FRAGMENTATION AMONG CONTRACTORS influencing the demographics of the trade industry, the population can successfully take advantage of these contractor market is becoming more and more fragmented. opportunities. According to recently released data, Not only are contractors divided based on trades, but also California had the highest number of Hispanic-owned in the sizes of their firms, the projects they undertake, and businesses (566,000) in 2007, with Florida coming in their backgrounds. second, and Texas in third.18 Messages in these areas will be particularly influential because not all marketers are focusing SOLUTION: Building product marketers should on this group. understand the differences that emerge between contractors while simultaneously taking into account overall trends in the UNDERSTANDING YOUR AUDIENCE BEYOND THEIR industry. For those that do so, a number of opportunities for PROFESSION. Marketers must learn to view contractors improved marketing strategies will emerge. as people rather than businesses. Those who wish to gain a complete understanding of contractors should REACHING HISPANICS. As of 2007, 690,000 think of them as people outside of their professions. Hispanic-owned firms in the U.S. operated in the One study of contractors who make purchasing decisions construction, repair, or maintenance industries.15 In and work at companies with fewer than 10 employees 2008, 30% of the U.S. building maintenance/construction indicated contractors:19 workforce was Hispanic.16 By 2025, Hispanics within the construction workforce are estimated to reach 63.2%.17 • Believe they are good at fixing things Although there are a large number of Spanish-speaking • Want to get to the top of their careers contractors in the United States, manufacturers, by and • Consider themselves creative people large, do not focus on this group to the same degree they do • Look at the work they do as a career, not just a job English-speaking contractors. • Listen to the radio every day The opportunities for marketers are numerous. • Believe it is worth paying extra for quality goods • Cost savings. Spanish-language advertising venues After having made the effort to understand contractors as are less expensive. more than just building product consumers, manufacturers • Segmentation opportunities. Marketers can target can create messages that appeal to contractors in a deeper, specific regions with a high density of Hispanics in order more meaningful way. to reach the most relevant audience while mitigating marketing waste. 6
  7. 7. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S One way to do this is to understand their hobbies and interests. A survey of over 1,000 contractor trade publication subscribers detailed some of these notable facts:20 • 84% of contractors are male • 82% are married • 93% are homeowners • Dining out is their favorite way to relax • Going to movies is their second favorite leisure activity • 70% vote • 47% volunteer with nonprofits • Enjoy bicycling, boating, fishing, golf, and swimming • Enjoy travel Taking these and other components into account, building product marketers can make informed decisions about promotions and media buying. In these instances, marketers can place ads where they know contractors will see them (at the movies, for example) and offer promotions contractors will genuinely want (such as contests for free trips, boats, or golf equipment). In this way, marketers can further overcome the obstacle of fragmentation within the market. 7
  8. 8. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S CHALLENGE 2 Since contractors are a diverse group, it is no surprise that REACHING SPECIFIC SEGMENTS. Those who want to their methods for obtaining building product information focus on one type of contractor must have different strategies CONTRACTORS LEARN ABOUT BUILDING also vary. While some contractors get product information based on where their target groups most often obtain PRODUCTS FROM A from wholesale suppliers, fellow contractors, and trusted product information. In instances where contractors rely VARIETY OF SOURCES sources at big box retailers or local hardware stores, others on big box stores, the opportunity for relaying information rely on their own knowledge and experience with products is very limited, and the best approach is a direct line of or take into account architect and design specifications and communication from manufacturer to contractor. customer preferences. For those who want to win the support of small contractor In a recent study of construction buyers, respondents said firms, making the “little guy” feel as if he is important (by they consulted professional publications, manufacturers’ assigning him sales reps and communicating with him websites, Internet searches, and took into account word of frequently) is one of the best tactics. mouth when making purchasing decisions.21 CONNECTING WITH SUPPLIERS. When it comes Even on the individual level, contractors are relying on to new products, contractors often listen to suppliers. multiple resources to learn about building products, making A 2006 Readex research study of masonry contractors it difficult for product marketers to understand how to best acknowledged, “To help them evaluate masonry materials, reach them. [masonry contractors] tend to favor information directly from other people rather than non-personal sources like the SOLUTION: Contractors cannot buy a product if they don’t Internet. Most rely on dealers/distributors for this type of know about it. So in order to ensure they stay up-to-date on information.” 22 Based on this finding, one of the best ways building materials, manufacturers should communicate with to keep contractors informed about your products is them based on where they are getting their information. to constantly keep suppliers and dealers up to date. REACHING BROAD AUDIENCES. Marketers hoping When it comes to communicating with suppliers, to reach all contractors (of any size and any trade) should similar methods apply. Be sure to maintain clear product be sure to educate suppliers (wholesale, big box stores, and information on your website, and have your sales reps reach localized hardware stores), create word of mouth among out to suppliers and dealers either in person or over the contractors, and advertise to the end consumers who will phone. With suppliers, just as with contractors, you will potentially request products. be most effective if you only initiate contact when you have valuable information for them. 8
  9. 9. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S UTILIZING THE INTERNET. As is evident from recent research, building product manufacturers should also remember that contractors are increasingly using the Internet for product information. 70% of contractors research new equipment online, and more than 60% visit manufacturer websites.23 And the number one thing “If a customer has seen a construction buyers want from manufacturer websites, after commercial on a product they product pricing, is ease of navigation.24 Manufacturers may request it, so we want should have product details easily accessible on their to be knowledgeable.” websites and focus on simple site design. Contractors are busy individuals, and although this is a challenge in and of - David, Carpenter itself, it is important that manufacturers use the Internet as an efficient means of communicating with contractors. And although social media isn’t particularly strong among contractors today, marketers should view it as an opportunity to capitalize on an emerging trend. Particularly during difficult economic times, when contractors are looking for free access to advice, marketers have the ability to pave the way for effective social media marketing and communication with contractors. 9
  10. 10. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S CHALLENGE 3 Another hurdle for marketers is building brand loyalty. Contractors use multiple building products on a daily basis CONTRACTORS ARE RESISTANT TO CHANGE and come to trust certain brands. Once a contractor has become comfortable with a specific product or brand, he is PRODUCT GUARANTEE: understandably hesitant to switch. A manufacturer may have When we asked contractors what a better product, but it is difficult to convince contractors single action manufacturers could that this is the case. Contractors often think like Eric, a take to gain their loyalty, here’s carpenter, who said, “if a brand has been reliable in the what they had to say: past, we continue to use it.” • “If there is an issue with a “Using a new product or brand product, knowing there is a SOLUTION: In order to convince contractors to become guarantee is the number one would make me nervous.” your loyal customers, there are several steps you can take. thing that will keep us with [the manufacturer]” -Christy, Painting Contractor TRIAL OFFERS AND GUARANTEES. If contractors have the opportunity to try your product and see how it performs, • “Manufacturers should demonstrate support for their they will be more likely to trust your brand and welcome products. I want to know I can the changes or improvements your product can provide. If talk to someone who is going contractors know manufacturers will back up products with to provide a guarantee for the guarantees, they are more willing to become loyal supporters. product if I have any problems.” • “Give contractors a small free DEALER SUPPORT. The Readex research highlights sample so they can try dealer support as being one of the top criteria in masonry the product on their own. contractor selection of brands.25 Additionally, an Energy Contractors want to try new Smart Marketers study of electrical contractors indicated products before they will trust that contractors felt they could sell led lighting more them.” effectively if manufacturers provided samples, sales brochures, and product application guides.26 Manufacturers who recognize the anxiety produced and the risks faced when contractors switch products have an opportunity to demonstrate a deep understanding of their customers. 10
  11. 11. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S CHALLENGE 4 When the housing and commercial construction markets CHART 5 | BUREAU OF LABOR STATISTICS DATA: MASS LAYOFF EVENTS FOR SPECIALTY undergo slower periods, contractors experience a number ECONOMIC TRADE CONTRACTORS DOWNTURNS IN of economic challenges as they struggle to keep their Year Mass Layoff Events CONSTRUCTION MARKET businesses afloat. 2000 546 2001 684 Evidence of this phenomenon is apparent within Bureau 2002 832 of Labor Statistics data about mass layoffs and employment 2003 880 2004 807 within the industry (Charts 4 & 5). But on a more individual 2005 868 level, one contractor told us, even when you get work, you see 2006 641 less on the bottom line: “I’ve had to come in lower on bids 2007 842 and to under-price things just to maintain jobs.” 2008 1,111 2009 1,392 2010 (As of April) 390 During periods of economic decline, two potential Source: Bureau of Labor Statistics, challenges for building products companies emerge: SurveyOutputServlet?series_id=MLUMS00NN0059003&data_tool=Xgtable (1) contractors change buying habits, and (2) messages to a financially strained group may fall on deaf ears. SOLUTION 1: The challenge of selling through contractors whose buying practices change during economic downturns CHART 4 | BUREAU OF LABOR STATISTICS DATA: EMPLOYMENT OF SPECIALTY SUBCONTRACTORS can be viewed as a branding opportunity. When the economy Employees takes a dive and contractors lose work, those who survive Year (in thousands) do so because of their commitment to quality work at low 2000 4243.7 prices. During tough economic times, contractors rely more 2001 4245.9 2002 4214.2 than ever on their reputations, on receiving bids through 2003 4332.8 referrals, and on giving customers low bids. 2004 4528.4 2005 4799.5 STRESS QUALITY. Marketers can connect with 2006 4899.3 contractors during economic downturns by highlighting 2007 4758.3 2008 4255.8 quality. Manufacturers should demonstrate their ability to 2009 3615.1 help contractors by offering products that will bolster their 2010 (As of April) 3522.7 ability to get and maintain work. Source: Bureau of Labor Statistics, SurveyOutputServlet?series_id=CES2023800001&data_tool=Xgtable 11
  12. 12. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S PROMOTE PRICE. According to a 2008 study, remodelers felt that the number one thing manufacturers could do to help improve their financial conditions was to offer discounts and rebates.27 In reality, contractors (like most customers) want the biggest bang for their buck. Getting the best quality for the best price becomes an even bigger part “Products aren’t maintaining of the decision-making process in a bad economy because quality, so we have had a lot of contractors must continue to produce solid results for their loss because my business is customers, even as they are dealing with lower work volumes 100 percent referral, my word is and competitive pricing. In this environment, manufacturers all I have. I have to do things for who are able to offer deals on products while maintaining the integrity of those products will succeed. free when there are problems with products, just to keep SOLUTION 2: When the economy takes a dive and clients happy…my biggest contractors lose work, building product companies challenge with this economy are hesitant to implement any kind of marketing that has been that the quality of targets contractors. materials has gone down.” BE INFORMATIVE. Even when your customers are – Eric, Carpenter struggling financially, it is important that they stay abreast of new technology and services and invest in the future. Manufacturers who advertise during these slow growth periods can therefore gain a competitive edge.28 During hard times, contractors continue to plan for the future, meaning they still seek information about new products and pay attention to what marketers are saying. 12
  13. 13. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S CHALLENGE 5 As we have all experienced, there has been a rapid growth “We use computers a lot, we find our bids online, and we in Internet and cell phone use over the past decade. Back in look at manufacturer websites for product information.” TECHNOLOGICAL 2000, only 46% of adults used the Internet. In 2010, that DISRUPTORS Staying up-to-date on technological changes and knowing number reached 79%. In 2000, 50% owned cell phones. how contractors are using technology remains a constant 82% owned a cell phone by 2010.29 For contractors, challenge, but it is beneficial for manufacturers to be aware technology has become an important part of keeping up with of these changes in terms of what they mean for marketing. business and conducting product research. At the same time, many contractors are just beginning to fully embrace the SOLUTION: Although contractors may not be early Internet and often remain skeptical of complicated websites adopters of technology, the overall trend in advertising is that do not allow them to easily access information. a transition away from print and toward online. A recent report quantified this shift: in 2009, online ad revenues Increasingly, contractors are turning to the Internet to continued to climb to $24.2 billion, while print ads fell get information about building products, obtain bids, 28.6% to $24.8 billion. Additionally, the report suggested and participate in online forums (Chart 6). In fact, one “I always speak with contractor forum had over 60,000 members and almost that by 2014 online ad spending would increase to $34.4 customers in person or on billion, and “digital technologies will progressively increase 950,000 posts at the time this paper was written, and the my cell phone. It is easier to their impact across all segments of entertainment and network of which it was a part had 112,00 members.30 More communicate with customers media as digital transformation continues to expand and importantly, a staggering 98% of general contractors used when I can hear their voices escalate.” 32 It is already becoming clear that interactive the Internet for product research in 2008.31 has become the dominant marketing medium. Although and understand how CHART 6 | WEB PERFORMANCE OF CONTRACTOR-RELATED contractors may not have fully embraced the Internet, they’re feeling.” WEBSITES 2006-2010 building product manufacturers should understand Website % VAR Page Views -David, Carpenter interactive as the future of marketing. Remodeling Online Growth of 48.8% Replacement Contractor Growth of 266.9% GO ONLINE. In business-to-business marketing, there Masonry Contractor Growth of 265% was an increase in online marketing revenue of 7.5% Source: Hanley Wood Business Media Web Performance Statistics for 2006, 2007, 2008, 2009, and 2010 during Quarter 1 of 2010.33 While 68.7% of the B-to-B marketer respondents in an American Business Media study Manufacturers should be aware that contractors are anticipated increasing their spending for online marketing not flocking to the Internet as quickly as other groups, in 2010, only 27.9% planned to increase their spending and contractors are not uniform in their acceptance of in print. And, between December of 2006 and March technology. Eric, a carpenter, told us, “I hate email. I hate 2010, there was a 51.76% decrease in ad pages in building, the computer. I prefer the phone or being face to face with engineering, and construction trade publications (Chart 7).34 customers and suppliers.” Masonry contractor Josh, on the For building product marketers, as for marketers in other other hand, found the Internet invaluable to his work, saying, areas, the trend toward online advertising is clear. 13
  14. 14. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S CHART 7 | CHANGE IN AD PAGES FOR BUILDING, MAKE AN APP FOR THAT. We now live in a world where ENGINEERING, AND CONSTRUCTION TRADE PUBLICATIONS there is an “app” for pretty much everything. In fact, the Year % VAR Ad Pages mobile application marketplace is predicted to grow at a rate 2006-2007 -1.92 of 807% in the next three years.36 With the advent of the 2007-2008 -12.22 smart phone, it can be assumed that even the less-techno- 2008-2009 -37.62 savvy contractor will eventually access apps on his cell Total (2006-2009) -51.76 “My office is in my van. Source: phone. Especially if those apps are easy to use and helpful. I have a wireless laptop in my Network.asp?SnID=666088281 This explosive technology provides an excellent marketing van and I constantly use it to opportunity for manufacturers, a handful of whom have REEVALUATE YOUR WEBSITE. Knowing that the visit manufacturer websites.” already created apps that aid customers and drive purchases. Internet has a bright future among contractors and B-to-B -Michael, Plumber marketers alike, building product manufacturers must view Sherwin Williams, for example, introduced ColorSnap, their own websites as valuable marketing tools. Contractors an award-winning mobile phone application that allows are becoming more acclimated with the Internet, but it is still customers to capture a color and get the closest matching imperative that manufacturer sites are clear, easy to use, and Sherwin-Williams paint color, obtain coordinating colors or have logical layouts. By having a user-friendly site, you will create a custom palette.37 be more likely to command contractor attention, even among Similarly, Benjamin Moore’s app, ben® Color Capture,™ those who are just beginning to use the Internet. As one is an iPhone application that, with the tap of the screen, lets study concluded, with contractors “it’s really about being you snap a picture of any color inspiration, anywhere in the easy to navigate and providing product…information. It’s world, and instantly match it to one of the more than 3,300 about the substance, not the style.” 35 hues that comprise Benjamin Moore’s color system.38 LOOK TO MOBILE MARKETING. Contractors widely Another example of the building product manufacturer foray use cell phones to conduct business, and knowledgeable into this area is LumberCalc, a specialized lumber calculator marketers should view mobile marketing opportunities as that allows you to quickly convert a unit of lumber’s given a lucrative possibility. Manufacturers, for example, could dimensions to board feet, and calculate order totals given build databases of customer phone numbers and send an MBF price. It also allows you to submit a request for a convenient messages about discounts directly to contractors’ quote to Bear Creek Lumber directly from your phone.39 cell phones. As we will explore in the final section, Particularly among busy contractors who crave quick and contractors do not always have time to speak with sales easy access to information, mobile apps present an exciting representatives or seek out discounts, and targeting them new marketing possibility. via cell phone, their lifeline to the outside world, could be a hugely rewarding tactic. 14
  15. 15. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S CHALLENGE 6 As of 2006, 82.4% of the top five contractor trades had BE AN ALLY. Due to the time constraint associated with fewer than 10 employees.40 As small business owners, contractor-manufacturer interaction, manufacturers can CONTRACTORS ARE benefit from knowing what contractors will consider useful contractors must focus on obtaining new bids, advertising TIME-STARVED information. For example, since contractors struggle to their services, and managing employees, in addition to working on construction jobs. maintain workloads during a bad economy, marketers can provide tips for winning bids. Alternatively, understanding All of these factors combined mean contractors are time- that contractors must be comfortable with new products “I can’t spend hours on a starved individuals who must constantly prioritize in order before they use them could lead manufacturers to include manufacturer website…so to balance their outside lives with managing successful free samples in product demonstrations. Overall, marketers manufacturers need to have businesses. Connecting with a group of people who have hoping to win over contractors should take into account the a basic search system I can very little time to dedicate to building product research is straightforward advice of one contractor: “we are busy and an immense challenge for manufacturers. working, and manufacturers should come directly to us and use to obtain product details quickly.” SOLUTION: Reach contractors at their convenience, show us new products.” and only when you have valuable information for them. -Eric, Carpenter If marketers can prove they understand the contractor schedule, they have one more opportunity to win support from this audience. Once a building product manufacturer proves it will not waste a contractor’s time, contractors will be more likely to trust the manufacturer and listen to what it has to say. “I am busy and I appreciate those [manufacturers] who come to me and are willing to meet with me for ten minutes, and show me new products.” -Michael, Plumber 15
  16. 16. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S SUMMARY OF BEST Best practices for selling building products through PRACTICES FOR SELLING contractors center on creating customer loyalty based on THROUGH CONTRACTORS a thorough understanding of the customer. If contractors view a manufacturer as being trustworthy, dependable, Best Practice: Having and attuned to their needs, this will lead to a mutually Coordinated Sales and beneficial relationship. Marketing Departments For this reason, best practices include: Having marketing and sales teams with aligned strategies • Understanding fragmentation within the industry contributes to overall company productivity. A disconnect • Reaching contractors through a variety of outlets between sales and marketing • Allowing for product trial and creating product guarantees hurts the flow of information and causes problems for • Using Internet, mobile marketing, and mobile apps the manufacturer. The sales department should be in • Having flexible and informative sales representatives communication with marketers (and knowing which contractor type will benefit from and keep them informed speaking to your representatives) about which products they are currently selling, and report back • Recognizing the demanding contractor schedule about what drove the sales. • Knowing how your brand and products fit into the market Marketers, on the other hand, should give the sales department Although this white paper presents a basic strategy for all an idea of which products they plan to market and when. Open building product marketers, a comprehensive and integrated lines of communication between marketing strategy must be tailored to best meet the goals of sales and marketing will make building materials manufacturers on an individual basis. As the odds of conversion from an advertising and interactive marketing firm with extensive prospect to sale much higher. experience in business-to-business and building materials marketing, Point to Point can build upon these ideas to help manufacturers develop specific methods for overcoming the challenges that arise within this sector. 16
  17. 17. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S 1 28 2009 Economic Uncertainty American Business Media d=a1FQ2lxxMkEY&refer=home Report, 2001 Yankelovich Harris Study, Pennsylvania State NOTES 2 University: ISBM Report, Raji Sriniva, Gary Lilien, and 3 Internet Use of General Contractors Hanley Wood eMonitor Arvind Rangaswamy, 2002, Buchen Advertising Inc. 1949, Report 2008 ’54, ’58, ’61, Harvard Business Review: 1923 4 Source: 2000 – 2008, Bureau of Labor Statistics, US 29 Department of Labor (Projections are based on a linear trend Media-Consumption-Has-Changed-Since-2000.aspx using 2000 – 2008 Bureau of Labor Statistics data.) 30, http:// 5 6 31 Hanleywood eMonitor Report 2008 d=a1FQ2lxxMkEY&refer=home 32 7 revenue_will_soon_surpass_print.php d=a1FQ2lxxMkEY&refer=home 33 8 34 9 Internet Use of General Contractors Hanley Wood eMonitor Information_Network.asp?SnID=666088281 Report 2008 35 2010 BuyerZone Study 10 36 11 mobile-application-market-could-grow-to-over-15- 12 billion-by-2013/ 13 37 14 releases/2010/0614_colorsnap_v2/ 15 38 owners iphone-36775/app 16 2008 U.S. Department of Labor Bureau of Labor Statistics 39 17 Source: 2000 – 2008, Bureau of Labor Statistics, US 40 Department of Labor (Projections are based on a linear trend using 2000 – 2008 Bureau of Labor Statistics data.) 18 sid/42337/ 19 Spring 2009 SMRB Simmons Report 20 Hanleywood American Housing Conference Report 21 2010 BuyerZone Report 22 2006 Hanleywood Masonry Construction Buying Practices Study 23 Reed Construction Data 24 2010 BuyerZone Study 25 2006 Hanleywood Masonry Construction Buying Practices Study 26 27 Hanleywood M2 Research 2008 17
  18. 18. B E ST P R AC T I C E S F O R S E L L I N G B U I L D I N G P R O D U C TS T H R O U G H CO N T R AC TO R S 23240 Chagrin Blvd, Suite 200 Cleveland, Ohio 44122 P O I N T O P O I N T 216 831-4421 Point to Point is an advertising and interactive marketing firm that helps our clients identify, bring into focus and overcome complex marketing challenges. Our expertise in branding, interactive marketing, social media, SEO and media planning allows us to solve each client’s unique problems in ways that maximize results. Our goal is always to be a catalyst of change for our clients by moving them from where they are to where they want to be. To find out how we can help you build a more prosperous future, contact us: Scott Moss Director of Business Development 216-364-0432 18
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