Purplex MD Andrew Scott says companies should be making their 2021 plans now.
Despite the economic impact of Covid-19 and uncertainty over the looming Brexit deadline, the home improvement industry continues to operate well above expected levels – giving companies the opportunity to build strong sales pipelines and, hopefully, improve margins.
However, behind the scenes, it’s a different tale. Several major suppliers have collapsed, placing even more demand on existing over-capacity manufacturers, while material shortages and supply-chain issues plague the industry.
Meanwhile, a string of installers have also gone bust. According to Insight Data, 2020 has seen more changes across the industry than in any year since 2008/09.
Not surprising perhaps, but it begs the question ‘what will 2021 look like?’
The good news is the outlook for 2021 appears positive for our industry as a whole. Economic downturns and recession do not affect all sectors equally – while some are devastated, others can grow, and the home improvement market has seen a resurgence as more people work from home and avoid long-haul holidays.
However, I suspect we will see some big changes in 2021, and that there will be more winners – and losers – than ever before.
It’s no surprise that Insight Data reports a huge uptake in new database subscribers keen to get a clearer picture of the industry and identify new opportunities and markets.
Business Titans
The two titans in any business are ‘cash’ and ‘brand’. If a company has enough reserves, it can withstand difficult trading, and, if need be, invest in new markets or acquire other businesses. Strong brands ensure customer loyalty and instil trust – crucial at times of uncertainty.
2021 will see a shift in the industry, and the winners will be those investing to acquire market share; either organically through strategic sales and marketing activities, or through acquisition.
The losers will be those that stand still – fail to invest, make cutbacks, or simply don’t react to the tsunami of change that we all face.
One thing is for sure, the opportunities ahead will be immense. Taking action now to map out your 2021 plans is essential. That means investing in operations and facilities, but it also means getting your sales and marketing strategy right.
Trade Suppliers
For trade suppliers, staying visible is crucial – even if you don’t want more new business right now. Focusing on your brand, rather than new customer acquisition, will pay dividends as supply-chains level off and capacity increases.
Now is a great time to build your new website and plan a strong PR, digital marketing and advertising strategy for 2021, while using the Insight Data Salestracker database will provide unique market intelligence for your sales and marketing team.
Don’t ignore traditional marketing or face-to-face. 2020 may have pushed people online, but the window, door and conservatory industry is all about people, and deals are done on a hand-shake (or elbow nudge). 2021 brings us both the FIT Show in May and the Glazing Summit in October, both of which will attract real industry decision-makers.
Installer Challenges
Installers will face new challenges in 2021. The impact of Covid-19 has accelerated digital migration even among more traditional customers. For installers to survive or flourish, they must invest in their website, social media channels, digital marketing and online reputation.
However, as more installers than ever invest in their digital presence and lead generation, competition increases, and the online marketplace becomes the new battleground. To stand still – or to grow – companies will need to invest in increasingly sophisticated digital marketing strategies.
So how do installers succeed in this new digital landscape? The harsh truth is that companies who fail to make the move to a strong online presence will eventually lose.
However, consumers will always gravitate towards brands they know and trust. The companies who invest not only in their online marketing, but also their brand, will emerge the winners in the long run.
And, ironically, the best way to build your brand is offline. Showrooms, radio, local PR, print media, sponsorship and leaflet drops instil trust and credibility, and as a result, amplify online results.
Taking steps now to review your business and marketing strategy will help prepare your business for a bumpy 2021.
Andrew Scott is a leading industry consultant who has acquired, built and sold several companies. He is the founder and MD of Purplex Marketing and Insight Data.
