Engaging the Mid-Tier Builder
The Importance of Engaging the Mid-Tier Builder
The Housing Rebound
Business is looking up for building product companies that are ready to make an impression with the right builders. Many brands have shifted their focus to remodelers during the recession and are now returning to new construction. Single-family housing is projected to increase 15% and multifamily housing will rise 9% in 2015.*
Where Should Building Product Companies Focus Their Efforts?
The Big Builders
Most marketers are looking to land the big fish. In the building industry, pulling in an account like D.R. Horton, Lennar or Pulte homes can be a real game-changer. However, the competition is incredibly high and the situation may force you to compete on price, often eroding your margins. Plus, big businesses are often slower to adopt new products throughout all parts of their divisions.
See the Top 100 Builder List
The Custom Builders
Custom builders account for a majority of building companies. They are a desirable segment to break into because they prefer premium products that often yield higher margins. However, getting your foot in the door requires extensive relationship-building skills. It's difficult to convert custom builders for a small potential volume and then scale your efforts to win more accounts later on. Plus, many custom builders don't like taking risks on new or innovative products that may tarnish their reputation for top quality with homeowners.
The Mid-Tier Builder Opportunity
Mid-tier builders command a significant share in local and regional markets and account for nearly half of all building starts.** These builders are the backbone of planned communities, semi-custom developments and stand-alone homes based on customizable house plans. They are experts at knowing the needs of their local markets and can deliver regionally at scale.
Mid-tier builders are responsive to market changes and are early adopters of new products. They are always looking for a competitive edge or point of differentiation to outdo cheaper production builders. This is a great chance for brands to introduce innovative products and experience widespread adoption with individual mid-tier builders.
Breaking Ground With Mid-Tier Builders
Mid-tier builders are always reviewing new products to use and incorporating them every several months or when new projects begin. The key is to introduce your brand to the purchasing manager via a face-to-face meeting. Consider attending events, like the Builder's Exchange and the International Builders' Show, to meet new builders. Additionally, find ways to stay top of mind with a relevant content marketing plan.
How to Be the Right Match for Mid-Tier Builders
- Minimize the layers of communication
- Make it easy to make connections and get face time
Leverage a Variety of Communications
- Most purchasing managers rely on email for efficiency
- Relationships can be built through digital communication
Design a Turnkey Solution for Your Target Mid-Tier Builder
- Do your homework and understand how your product fits their local market needs
- Learn what incentivizes the purchasing manager — rebates, discounts, margins
- Help them sell your product through with marketing materials, especially when your product is considered an upgrade
- Show how you will stand behind your product through service and warranty to reduce perceived risk
- Reduce the perceived risk of transitioning to your products via training
Approaching mid-tier builders can be especially rewarding if you view the purchasing manager as a resource and not a gatekeeper. You'll quickly find new opportunities by connecting with other departments that can grow your relationship. Finding the perfect fit with a mid-tier builder and making adoption incredibly easy for them will help secure your position in this growing segment.
* Dodge Data and Analytics, 2015
** Builder Partnerships, 2014