I have noticed a strange phenomenon over the last few months. I have been getting calls from people using terms like: “Next Round of Investment” and “Angel Investors.” Two other words that frequently enter the conversation are “MIT and Stanford”.
At first I thought they must have the wrong number as this sounds like Silicon Valley stuff, and why would recent graduates from MIT and Stanford be calling a college drop out like me?
As our conversations continue, I learn that these scary smart people see opportunities in building materials, remodeling, and construction. They see it as a market much easier to take on than the typical Silicon Valley “next great thing.” Would you rather compete with the brains, energy and money of high-tech or a stagnant industry that is overly focused on improving economies of scale?
I can’t disclose any of these companies because of confidentiality agreements, but they are developing product ideas that will disrupt some traditional building material product categories. They are also developing sales process disruptors that will take advantage of the growth of online sales in building materials. They’re working on changes in the way the channel works, apps and websites all designed to meet an unmet need.
One of the big unmet needs they see is reaching the Millennials who are starting to buy and remodel houses.
As with all new ideas, most of these companies will fail, but a few will succeed and profoundly change buildings materials and construction. Many of the ones who fail will take the lessons they learned and develop another new concept in building materials. They won’t go away with their tail between their legs.
How Should a Traditional Building Materials Company React?
1. Keep your eyes open as these new products appear on the horizon and resist the tendency to dismiss them as a bad idea. Look at them closely for what is right as they were developed by some very smart people.
2. Consider investing more in research and development based on customer needs and not just lowering your costs.
3. Hire and listen to younger people who make purchase decisions much differently than older generations.
Contact us if you’re looking for new ways to grow your sales.
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“Observe-Orient-Decide-Act … repeat to infinity.”
Field General, Inc.