Our market research team at The Farnsworth Group conducts an annual survey among Builders, Remodelers & General Contractors across the United States to understand the degree to which Pros’ Brand Loyalty behaviors are changing and staying constant, specifically related to their purchases of building materials and home improvement products.
In the latest Building Products Customer Guide, the sentiment is clear: modern Pros continue to be less brand loyal than prior generations, primarily due to market forces, increased access to product variety, and satisfaction with new brands and products that they are trying.
Drivers of Brand Loyalty Among Builders and Remodelers
For those who remain brand loyal, the primary motivators are quality, ease of use and availability. Price is the leading driver prompting builders to explore new brands. This underscores the importance of a well-crafted pricing strategy, at least in the short term, which can be addressed through effective merchandising, product development and pricing options.
Drivers of Brand Switching Among Builders and Remodelers
45% of Pros will purchase a different brand in order to save money and 43% will switch brands because they perceive an increased ease of use. Commercial remodelers and GCs need products that expedite projects and reduce reliance on skilled labor, with a focus on high-quality, easily installable products that offer cost savings.
For 1 in 3, product quality and switching to a premium product is a driving force, but largely, product quality is a point of stickiness among existing customers, moreso than a selling point when trying to attract new customers.
The Home Improvement Research Institute (HIRI) has published further information regarding Contractor Brand and Supplier Loyalty, as of November 2023 and available to HIRI members.
Sources Used to Research New Brands
Builders acquire knowledge about new brands through diverse channels, both in-store and online, which varies primarily based on if the Pro is focused on residential or commercial projects.
More than 1 in 2 residential remodelers, GCs and home builders discover new brands via in-store research, compared to only 42% of commercial remodelers and GCs.
In contrast, online sources, including supplier website’s, brand websites, social media, and online ads, are top sources among commercial remodelers and GCs, with half of these Pros using these online sources to find new brands. The efficacy of digital mediums as a source for new brand awareness efforts among residential Pros is much lower, according to the study findings.
This divergence highlights the role of procurement departments, where the purchase decision maker is more likely to be in more of an office role, rather than frequenting job sites.
Customers Are Satisfied After Switching Building Product Brands
As observed in the 2023 Building Products Customer study, and again in the 2024 study, Pros who switch to new brands report high satisfaction rates.
Among residential remodelers, 85% were satisfied with the new brand, but only 54% deemed the new brand as performing better than their prior brand. 44% deemed the new brand to perform the same as their normal brand. Keep in mind that when quality/performance is deemed comparable between choices, then price and availability become an even larger purchase driver.
Among residential home builders, 93% were satisfied with the new brand, and 62% deemed the new brand as performing better than their prior brand. 32% deemed the new brand to perform the same as their normal brand.
97% of commercial remodelers and GCs were somewhat or extremely satisfied with the new brand and 84% deemed the new brand's performance to be superior to their regular choice.
How to Increase Market Share Among Pros in 2024
Pricing must be at the forefront of your go-to-market conversations. If you want to keep your current customers and win more market share, you need to examine your pricing strategy for 2024, no matter which audience you are trying to target.
Since Q3 of 2022, we've been harping on the reality that price is the new availability. With increased competition, changing consumer behaviors, and inflation, Pros are actively analyzing their pricing strategies, and that change in buyer behavior passes upstream to necessitate that you, the manufacturer and supplier, also adjust your pricing strategy in order to maintain and gain market share.
One strategy is to refine your "good, better, best" model by de-engineering products to reduce costs while still delivering critical features, articulating value propositions more clearly to justify higher prices, and offering products at various price points through different suppliers. This enables sales reps to take a value-based approach, where-in they showcase how a builder will get exactly what they need, without paying for unnecessary frills when competing for the sale.
Your team may also consider reintroducing existing “good” and “better” SKUs that were able to be taken off the market in 2021 and 2022, but can now create a competitive advantage as Pros are price sensitive and willing to make trade-offs in features and brand in order to reduce costs.
To mitigate some of the risks posed by Pros switching brands at higher rates, consider adopting these other go-to-market strategies to win in 2024 and 2025, which emerged during presentations and attendee discussions at our Building Products Customer Workshop.
Get Accurate Insights To Make The Right Decisions
At The Farnsworth Group, we’ve helped hundreds of building products manufacturers, retailers, and industry associations go from a place of uncertainty about what to do next to a place of clarity in just a matter of months.
We’re in your corner to reduce your risk of launching the wrong marketing campaign or a product line that won’t perform. We’re here to help you understand how your brand is perceived and where there is white space in the market for your company to get your product in the hands of Pro and DIY customers.
Because our team works exclusively in the building, home improvement, and lawn & ranch industries, as we have for nearly 4 decades, you can trust that our insights and recommendations take into account the complex variables that impact your end to end go to market situation in the complex building materials environment.