The building materials industry has always been slow to change. The way products are specified and sold and the way buildings are designed and built is very inefficient but it works. Because it works, no one has been in a hurry to update the way things were done.
Companies who break out of this mold will be the most successful ones. Wayne Gretzky was great at what he did because he focused on where the puck was going, not where it was. But most building materials companies are still focused on the way their products have been sold instead of the way their products will be sold in the very near future.
That’s been changing, even before the Coronavirus. Today’s customer is vastly different than they were even five years ago and some companies are responding by finding new ways to sell to them.
Four Drivers of Change
1. Customers Moving Online
Customers are relying less on relationships and face-to-face interactions. Instead, they go online and do their own research and decide which products to use.
2. Changes in Communication
Younger customers prefer newer methods of communication that don’t always make sense to older, experienced salespeople.
We still have customers who use fax machines, while texting and social media are preferred by many younger customers.
3. Lean Construction
There’s been a growing focus on reducing waste and inefficiency in construction. Smart builders, owners and developers are thinking more about the costs associated with every extra day it takes to complete a project more than worrying about the cost of your product.
4. Changing Priorities Confuses Customers
Customers used to be more loyal when they felt they could count on building materials companies. However, many companies change their priorities based on the whim of a new leader who wants a quick win regardless of what the customers expect.
Loyalty is built from consistency. Look at Apple. They are notorious for their frustrating customer service. Yet, the customer adapts to it. You would think the customers would get fed up and buy from a different company but they don’t because Apple is consistent.
Even Apple could lose their customer loyalty, though. All it would take is a new CEO stepping in and finding different ways they were leaving money on the table. If that CEO shakes things up and makes Apple feel less familiar, it could cost them customers.
Fortunately, the board and major investors realize what a mistake that would be. Most building materials companies aren’t so lucky. They are focused on the short term and make decisions that confuse their customers and make them less loyal.
The Pace of Change Is Accelerating
We are coming out of social distancing and quarantine, but customers won’t be going back to the way things were. They are going to adapt quickly to the new realities of construction. They are going to rethink things like the role of their offices and how to better serve the needs of their customers.
They are looking for the kind of guidance they simply won’t find from the building materials companies that will choose to follow rather than lead their customers.
Fear of Failure Is Holding You Back
Building materials companies avoid failure at all costs. If they have a new idea, it tends to be viewed as a sure thing that they are 100% committed to. Differing opinions are not welcomed.
Even when there are signs that the new idea is not working or needs some tweaks, they stay the course. When the program is eventually evaluated, people spend their time finding a way to shift the blame.
Many building materials companies have enough inertia that they can avoid looking at their own failures. They can blame the competition, the sales force or the customers instead of looking at themselves.
Your customers don’t have that kind of luxury. It’s not that they don’t focus on success. It’s just that they see the results of their actions on a daily basis, whereas building materials companies see things over a longer period of time.
I started my career by working for my father’s ad agency. We had many different types of clients, including some retailers. While I preferred working with the B2B clients who had to sell through a channel of distribution, I learned how they were at a disadvantage.
We would present retailers with a creative idea for an ad that was designed to grow their business. It might be aimed at a new customer, give current customers a new reason to buy or to introduce a new product.
We would run the ad and in a few days the retailer could tell us if our idea worked and how well. I don’t know the numbers but my memory tells me that we failed one time out of five. Of course the retailer would have preferred to have no failure, but they realized that failures led to bigger successes.
B2B companies like building materials companies need to find faster ways to measure the success of their programs. They also need to assume that every program will have some issues that need to be addressed in order to maximize results.
Software companies assume that no matter how well they test a program some problems will only reveal themselves after the program is in use. Building material companies need to adopt this attitude. They need to get over their fear of failure.
Failure should be celebrated for the lessons it teaches – lessons that can only be learned by trying something new.
If I were a leader in a building materials company, I would ask my staff, “What did you fail at today?” and “What did you learn?”
A Unique Moment in Time
Your larger competitors are now at a disadvantage. They can’t change as fast as a smaller company or a company that acts like a smaller company.
Larger companies are also culturally set up to avoid failure and to not speak up even when people can see the weaknesses in a program.
There are no rewards without risks. If you want to make the most of the current opportunities to dramatically grow your business, you need to do four things:
- Speed up your pace of change to better meet the new needs of the marketplace.
- Try more ideas and accept that some will fail (if you have no failures, you aren’t trying hard enough).
- Try lots of small ideas – it’s the only way to find the big idea. You can change the headline on your website with an uncomfortably bold statement and know whether it got better results in a matter of weeks.
- Ask your customers. Stop assuming you know what they need or how to sell them. They are changing and whatever made you successful in the past will not make you successful today.
If you want to win, don’t wait for your competitors or customers to lead the way. Chart your own course to growth.