Growing up on the East Coast in the ‘70s, I spent countless hours being dragged around to retail stores. My mother loved to shop for clothes, and department stores like Wanamaker’s, JCPenney, and Sears were among her retailers of choice. Being a boy, I had no desire to be there, except to play within the clothes racks and drive my mother crazy trying to find me.
If it had been 30 years later, I would have probably sat quietly playing with games on my smartphone, oblivious to the length of time my mother needed to try on seven dresses and eight pairs of shoes. But technology didn’t save me then, and it isn’t doing much for my shopping experience these days, either.
Back then, the only shopping I really enjoyed was for home improvement projects.
I have always been a home project geek. Whenever we had a project to do around the house, we would go to our trusted Ace Hardware store where Charlie (the best retail store rep I ever met) seemingly always had the answer to any home improvement issue. Whether he had the product in store, needed to order it, or knew of another place I could go to find it, he created an experience that was fast, knowledgeable, and confidence-inspiring. He would even drop off the item at our home if it had to be special ordered. Now that was service! It wasn’t high tech, but we always got the guidance and the best solution and service we needed. Charlie set a high bar on shopper experience expectations, even without the benefit of technology.
And then came the promise of computers.
In the mid-’80s while attending the University of Notre Dame, I was president of the Marketing Club. And, yes, while it was sometimes a club for parties, we also did educational field trips visiting businesses and attending conferences. On one occasion, the Marketing Club rented a bus to Chicago so that 49 of us (with one seat left open for the keg on the trip back) could attend a “Retailer of the Future” conference. As self-proclaimed Future Marketers of the World, we were excited to hear about how the promise of technology would change the shopping experience going into the ’90s and—that magical benchmark that still suggested a Jetsons-style future—the 2000s.
What we heard at that conference was enthralling to us--both as new marketers just coming into the working world and as consumers experiencing the different uses and benefits of technology. We all left excited about getting into the work force and discovering ways to help retailers and manufacturers put technology to work.
We had big ideas for what we could do with technology.
The next week in class, our professor handed out group assignments with the goal of demonstrating potential future applications of technology for marketing. Since I worked the summers with a remodeling contractor, I was accustomed to the trials and tribulations of the homeowners trying to decide what they wanted on their home. Our class group looked at addressing the home’s exterior. We devised a solution that took beautification to the next level by allowing people to actually manipulate their home’s outward appearance (structure, siding, roofing, landscaping) using this new thing called a personal computer.
While computers couldn’t actually do this at the time (hence the big idea!) we demonstrated the concept with overheads—overlaying different images one-by-one to show how the various new looks could change the appearance of the home.
Other groups in the marketing class talked about the ability to order product right to your home—not by calling Sears after looking through its 452-page catalog, but by actually viewing the product on the computer and clicking a button to order. Many in the class said it could never work because people needed to touch and try on the items. To their credit, that group stuck to its guns and said there needs to be a better way and technology will guide us. I can’t fathom to think how many trees were cut down to print the Sears catalog that was delivered every year (sometimes twice) to nearly every house in the U.S.
In the end, our group got an A- (I was mad it wasn’t an A), and I was sad to see that visualization technology took nearly 20 years to become commercialized. Shame on me for not taking that business idea back then and running with it.
Seeing the potential and making it happen are two different things.
As we know, both of these ideas eventually came to fruition. While there are hundreds of companies that use visualizers to show their products, the vast majority provide the customer with a terrible experience, creating frustration and confusion, and probably a high percentage of abandonment of the buying process. The apparel industry is further along in utilizing technology, not only to order but also to customize the size for a truly custom fit. The technology to change the look of your home is just now getting to a more personalized and customized state, but it still needs to improve by leaps and bounds to take advantage of all the technological advances that have already occurred in other industries.
We still have a long way to go.
Even with all the technology I learned about as a student in 1986 at the Chicago conference, we are still nowhere near the Jetsons’ version of what the year 2000 would look like. If you ask the average person what percentage of retail sales are conducted online, most would guess 25% or even up to 40%. However, internet purchases are a mere 7% of total retail purchases in the U.S. And in building materials, that number is closer to 2% for the big boxes and nearly zero for all other channels.
Then we hear from manufacturers that “we need an app to be competitive.” While perhaps there may be thousands of apps, merely having an app doesn’t mean you are creating a great experience for the consumer and making it easier to solve their issues.
There are clear advancement opportunities in the building products industry in leveraging technology to create a better experience for the consumer. The technology is available. However, as an industry we collectively haven’t truly embraced it—or in many cases don’t believe in it. In research we have done, it’s the manufacturer that has the lowest belief in the need for technology, more so than the audiences they are trying to engage. Hence the limited investment in true innovation in leveraging technology. In the end, we are all “consumers,” no matter our day job—and therefore we have expectations of connectivity and ease of engagement to information and solutions.
We are stuck in what we know.
Part of the problem is we design solutions only for what we know. This is causing a host of issues.
One issue is that the building materials industry is woefully behind other industries in marketing approaches and the use of technology to engage, select, and sell from. Building materials is a relatively boring industry, not because of the products but because of how we think the consumer wants to be engaged. This has driven gen Y and millennials to shy away from employment in this industry. Even the children of family-owned businesses in this industry are saying they want nothing to do with the family business. Abandonment of family businesses by the next generation is occurring at an astonishing rate for the building materials industry. Therefore, unfortunately, there is limited new young thinking helping us challenge the status quo of this rather stagnant industry.
The other issue the industry faces is our use of technology to pinpoint opportunity. This industry (like most) has a limited view of current opportunity versus true possibility. For example, there are approximately 111 million occupied homes in the U.S. On average, 2% of the households (2 million homes) complete a specific type of home exterior repair and remodeling job—siding or decking, for example.
However, 65% of the nation’s homes (that’s 70 million abodes) are over 20 years old, which is the age of major replacements of things like roofs, siding, decks, doors, fencing, etc. Therefore, with only 2 million projects happening in say a category like siding, there are 68 million more homes that could actually need a siding refresh.
Technology is available to help us pinpoint neighborhoods and even exact homes that are of age and need remodeling. But instead we as competitors fight over the 2% that does this project every year, bringing done the profitability of each category.
Promise (and deliver) a better experience.
How can we as an industry utilize technology to find, nurture, and convert these homes and homeowners into doing these repair and remodel projects? The current tools and use of technology are antiquated and causing confusion and leaving the homeowner with a lack of confidence or reason to consider such an expenditure.
However, those product categories, or manufacturers, who lead the leveraging of technology in a more dynamic way will win by securing a stronger brand position and relevance within a product category. They ultimately will take an unfair share of the demand they create. Newly created demand also usually comes with higher profit.
Technology has advanced exponentially since I went shopping with my mom back in the ’70s. However, the marketing and retail experiences at places like JCPenney, Sears, and Kmart have not really changed since then. They have not leveraged technology to advance their approach to customers. No wonder these retailers continue to struggle financially today. And while old Charlie from Ace is long ago retired, his legacy of creating a better, more confident experience can be taken to an extraordinary level by the utilization of technology in the selection and buying process of home improvement solutions.
Thanks for setting the high level of expectations, Charlie. We will put you on our marketing automation list, and try to capture you with our beacon when you are in the store to provide you a relevant promotional offer in aisle. Or heck, just stay home and order online and you can brag to your friends, “I shipped my pants … and my insulation.”