In Orlando, HIRI packs a heavy research punch
ORLANDO, FlA. — If you missed the Home Improvement Research Institute’s Spring Conference, you missed the latest buzzwords and research concepts from some of the leading minds in home improvement marketing.
Justin Sutton of Decision Analyst discoursed on “In-the-moment research.” George Leon of National Analysts Worldwide enthused about the power of “Conjoint Models.” And Sarah Catlett of The Futures Company shed light on the financial pressures that create important nuances between “troubled,” “stressed” and “guarded” consumers. There was even a research device called the “Values Frequency Meter.”
So, if you like sophisticated research discussions, then this conference was for you.
“The HIRI Spring Conference set a new high for attendee ratings of the quality of the event,” said HIRI executive director Fred Miller. “The industry is always looking for ways to get new and better insights, and this year’s event delivered. The nice weather in Orlando was just icing on the cake.”
The weather factored in a not-so-positive way in a presentation from James Gillula, the managing director of consulting services for IHS Global Insight. His 2014 IHS housing forecast was reduced slightly in the past few months. Why? Part of that reduction was the result of the extra cold winter, he said. But also general cost pressures in new-home construction dampened expectations slightly.
Still, the general direction he described was toward recovery and optimism.
After a 19% gain in 2013, housing starts will continue their rise as demand grows. In 2014, IHS expects an 18% increase in total housing starts, and a big 34% gain in 2015. Growth in household-formation rates is driving a large part of the optimism in this metric.
Gillula delivered an outlook for the U.S. economy and home improvement spending that called for increases in real consumer spending of 2.5% in 2014 and 3.1% in 2015. Growth in the home improvement products market is expected to be even more robust, according to the IHS figures. Total sales in constant prices should increase from 3.0% growth in 2013 to 5.0% growth in 2014 (see chart).
But the event was more than a display of forecasts.
For instance, Catlett kicked off the daylong conference with a quick look at Target Corp.’s disappointing venture into Canada. The Minnesota-based retailer’s efforts to change the way Canadians shop has fallen short, she said, partly because the company missed consumer and cultural cues.
Her presentation, titled “Not Just Another United States: Distinguishing Consumer Attitudes in Canada, Mexico and the United States,” included the observation that Canadians don’t necessarily share the U.S. appreciation of one-stop shopping. There was also Canadian pride in Zellers stores that didn’t transfer to Target following the latter’s acquisition of the former.
“In order to understand how to do business in Canada and Mexico, you have to understand the market forces, and also the consumer and the culture,” Catlett said. “Not all North American consumers are created equal.”
In Canada, 68% say they want to show pride in domestic-made products, compared with 60% in the United States and 66% in Mexico;
In Canada, 82% of consumers say they are looking out for sales and special offers, compared with 78% in the United States and 66% in Mexico; and
In Mexico, 75% of consumers are concerned with sexism, compared with 32% in the Unites States and 42% in Canada.
The conference didn’t shy away from those blurry spots in the researchers’ field of vision. One of those spots is contractors.
Mark Delaney, VP client service for Media, Pa.-based SSRS, listed the challenges faced by researchers reaching out to contractors, who account for about 30% of sales at big-box retailers.
“Contractors by their very nature are not tethered to an office,” said Delaney in a presentation titled “Knowing Your Market: Options for Representative Research.”
It’s not only the nature of their office (a pickup truck) and their job site demands. Delaney also pointed to the language barrier. The U.S. Department of Labor projects Spanish-speaking contractors will outnumber English-speaking contractors by the year 2025. And not only that, it’s not enough to simply describe a purchaser as “Hispanic.”
“Consider that terming your audience as Hispanic is akin to talking about the home improvement industry as one industry,” he said. Major differences exist between Puerto Rico, Mexico and Cuba — just as they exist in tools, flooring and outdoor power equipment.
“A well-crafted, data-driven strategy is the first step in reaching the Hispanic marketplace,” he said.
For more information, visit HIRI.org.