White Knuckles Under Blue Skies: A View from the Leading Edge of Recovery
by Greg Sherry, Managing Director, Consumer Marketing, Gibbs & Soell
Apparently, the economic recovery starts at home. Encouraging news from the U.S. housing sector holds the promise of better days ahead for the broader markets and white-knuckled businesses coping with the global economy’s wild rollercoaster ride. While business and communications leaders exercise “cautious optimism” in their short-term planning they are also looking to those on the leading edge of the recovery for guidance.
G&S Insight sat down with a few of its clients in the Home & Building market to discuss their outlook for the year, challenges to overcome, and changes happening in their business.
Paying Attention to Shifting Preferences in Demand
Jim Shelton, director, sales & marketing for Panasonic Eco Products Division, knows the economic rebound will bring heightened competition, and he believes his business is more than ready for it. A division of Panasonic Corporation of North America, the company develops and provides customized and integrated technology-based energy solutions for the private and public sector.
“Overall, the outlook is very positive, but we also realize it has become a much more competitive business,” said Shelton. “More and more competitors are coming into the market, with the great majority of these products coming from offshore imports. We believe we have a distinct advantage with an award-winning family of the highest quality, best performing, energy efficient products on the market, and a team that is committed to strengthening our position as a leader in the industry.”
According to the latest forecast from the National Association of Home Builders, virtually every segment of the home building industry is expected to grow in 2013, with single family and multi-family construction leading the way, followed closely by remodeling. In particular, the residential construction market is a steady standout for the company, according to Shelton. Within the market, cost-saving and environmentally responsible moves toward green building and energy efficiency represent strong trends, and Panasonic Eco Products has positioned itself to take advantage of these opportunities.
Other areas are also outperforming because of shifting preferences among key demographics. Shelton said: “We also saw a significant increase in activity in multi-family housing, as college kids now move out and baby boomers start to retire. The overall remodeling market is also growing well, and we actually see remodeling as a category that will significantly strengthen in 2013.”
Shelton will also be paying close attention to opportunities in the hospitality industry and other high-value vertical markets. “An increased number of larger hotel properties are now being updated, and many smaller hotels and motels are being acquired and need to be renovated,” he said.
The company is in the process of winding down its fiscal year ending March 31. Shelton remains very optimistic about 2013, but understands the business needs to finish this year strong. By keeping up with unprecedented demand and taking a disciplined approach to market opportunities, his Panasonic Eco Products team is better prepared to anticipate the new competitive environment ahead.
Getting a Handle on the Value of Face Time
As president of Häfele America Co., Paul Smith oversees the U.S. operation of this worldwide supplier of furniture and architectural hardware components that improve the functionality of cabinets, doors, kitchens, bathrooms, and other living and working environments. These products include decorative hardware, opening and closing mechanisms for doors and drawers, LED lighting, furniture fittings, and electronic locking systems.
From manufacturers, architects and designers to contractors and construction professionals, there is a wide audience with whom Smith must ensure a meaningful dialogue. He believes in creating value on a one-to-one, face-to-face basis.
“When I officially took over as president of Häfele America Co. in January 2012, I had already been traveling the world for six months to understand how the company’s diverse range of products and the industries it serves all fit together,” said Smith. “It’s now a year later and I still do a lot of traveling. Our customers are in a broad range of industries, and each has very different needs. We work closely with each customer to understand their specific needs, and then customize an approach specific to those needs.”
Trade show marketing was one form of face-to-face outreach that suffered greatly in budget cuts within the Home & Building industry during the darkest days of the recession. However, trade shows remain front and center at his company, according to Smith.
“I’m especially excited for many of our customers to visit our booth at this year’s Kitchen & Bath Industry Show (KBIS),” said the Häfele America president. “Working closely with several of our partners, we’ll be demonstrating how our products can be used to create more efficient and accessible work spaces in the kitchen, which I think will be very exciting to our customer base.”
Smith says that many of his customers recognize that there is still more work needed to bring about a strong turnaround in the housing market – and the overall economy. Some of that work may be focused in our nation’s capital.
“If I have one concern, it might be the potential for political gridlock in Washington, and the impact those self-inflicted wounds would have on the recovery and our overall economic growth,” said Smith.
As he turns his attention to Main Street and Häfele, he reasserts his optimism: “Housing values have started to recover, and people are re-investing in their homes. A year ago, that wasn’t necessarily the case. Many people just couldn’t get their heads above water. Overall, I think Häfele is well positioned for the coming year.”
Feeding the Turnaround
Headquartered in Montréal, Canada, Trudeau Corporation and President Philippe Trudeau embrace the opportunity in 2013 to significantly strengthen its business in the United States, where the company has major operations in Woodridge, Ill. Unique products for food and beverages are Trudeau’s stock-in-trade: kitchen tools and gadgets, pepper mills, bar and wine accessories, and on-the-go thermal drinkware.
Trudeau is excited about one specific growing trend in the United States. “Consumers are cooking and entertaining at home more than ever,” said the Trudeau Corporation president. “As just one example, in New York, known as the ‘food capital of the world,’ at-home meals actually surpassed dining out for the first time in more than 30 years, according to 2012 results of a survey by Zagat’s.”
As a family-run business now in its fourth generation of leadership, Trudeau Corporation knows the importance of focusing on the home as the center for a family’s most important moments. “Trudeau Corporation offers consumers a wide array of high-quality products that are fun, easy-to-use, and great for at-home entertaining or in the kitchen,” said the president. “We need to continue to raise our overall consumer brand awareness, specifically with cooking enthusiasts, wine enthusiasts, at-home cooks and consumers who entertain at home.”
Gaining an appreciation for the importance of audience research, prioritizing customer outreach, and investing resources to compete in the markets that matter are among the ways business leaders in recovering markets can find steadier footing. As the economy sputters back to life, businesses dependent on the housing market as a bellwether appear to be looking up. And some are willing to admit to the rest of us that the clouds are parting just enough to let some blue skies peek through.