Issue link: https://read.dmtmag.com/i/406201
NOVEMBER 2014 28 THE JOURNAL MH Manufacturers – Loyalty Partners… or Commodities? BY SCOTT STROUD MARKETING CONSULTANT I've been asked to address a group of housing manufacturers about forging strong relationships with builders and retailers. If you are a retailer, what would you have me tell them? Actually, I've interviewed several builders on the topic, with varying responses. Those with strong sales teams and good marketing programs tend to view the manufacturer as merely one of sev- eral suppliers; they seem interested in only two things: deliver a good product on time… and for the least amount of money. So, to them the manufacturer is a commodity, little more than a value-added lumberyard. And try as they may, few MH manufacturers can break out of that stereotype – they jockey for position on the low end of the pricing scale. I see that as short sighted on both parts, and believe that retailer/manufacturer relationships can offer so much more for both parties. A common goal. Builders and manufacturers both have the same objective: produce, sell and deliver more homes. And you each have necessary skills contribute to achieving that goal. So, from my perspective as an industry advocate, it is disheartening when I hear a manufacturer insist that "my customer is the builder", or a retailer say, "that's the manufac- turer's problem." You are both working to please the same person – the homebuyer. So such 'pos- turing for blame' is counterproductive. Instead, let's look at reasons why your relationship should go beyond mere price. Branding A company's brand is literally the perception that company has in the marketplace - builder, retailer or home producer. A builder or retailer might think that the more brands they carry, the better. I be- lieve that, often times, the opposite is true. If your goal is to be 'all things to all people', then you won't really stand for anything and your brand will be diluted. Rather, builders that decide who they serve and what they stand for – and that partner with a manufacturer or two whose homes are in alignment with those goals – tend to build market awareness and a solid brand more quickly. Clout If you sell 40 homes per year, and those homes are spread between four different manufacturers, each will see you as a '10 homes per year' dealer. If you're working with two home suppliers, then you're a 20-homes per year outlet for each. Just one, and you're a 40-homes per year exclusive dealer. With numbers and loyalty come co-op ad- vertising, fast-track design and production services and other perks that 10-unit sales teams never get. And that loyalty can manifest itself in greater input in product design, features, and more. The Value of Loyalty A month or so ago a large manufacturer hired me to speak to a group of their retailers about market- ing strategies and converting leads. The manufac- turer had invested heavily in a new marketing vehicle and was introducing it to the group - a pow- erful program that promises to deliver and substan- tially more leads for all the dealers. But they went one step further. Understanding that those leads needed a heightened degree of immediate follow- up, the manufacturer offered to subsidize an addi- tional automated follow up system for each of their dealers for a six-month trial period. To me, that's a perfect example of a manufac- turer that understands that they can bring more to a long-term business relationship than just price. They actively addressed one of the dealer's biggest issues in closing more sales – active and immediate follow up. The fact that they were willing to help make my service ultra-affordable to their dealers shows their level of commitment, understanding, and the value they place on the relationship. In short, they extended a service that builds loyalty. Other ways that manufacturers can build loyal relationships include: • Being consumer conscious – thinking B2C rather than B2B; • Setting clear standards and expectations – make the relationship something valuable; Active and fluid communication – sharing news quickly, asking for input, and listening when it is offered; •Understand, anticipate and become involved in helping solve issues that affect builders and re- tailers (they affect you, too!) • Incentivize loyalty. Lower prices mean scaled back services. Just as most homebuyers will invest more when they understand the value, retailers re- spond to value-adds more quickly than bargain pricing. • Have a Service mentality – You exist to serve your builders and homebuyers; your builders are your front line partner to help you do that. Serve and support them, and you'll earn their loyalty. • Help them grow. Look for ways to support your retail partner's growth through education, training, marketing tools, point of sale systems and faster response times. They have to compete with all the other builders and retailers in their market. Give them an edge, and their growth will fuel your growth, too. So, how did I come up with those points? Like I said at the outset, I've been talking to modular builders and MH retailers from all over the country. That's what they are telling me will make a big dif- ference in their relationships with home suppliers and manufacturers. That's what they are craving and will earn their loyalty. However, loyalty works both ways. In any mar- ket, a manufacture (and their reputation, i.e. brand) is only as good as the company representing them. When a home producer sets a high standard for the companies representing them, that's your opportunity to establish yourself as a high caliber builder, someone worthy of representing a high- value brand. Quality and service will always be part of the equation, but in today's market, those are auto- matically expected. Price is only the #1 thing if you fail to put the emphasis on value. Value, trust, and relationships trump low price every time. Whether you are a manufacturer, builder, com- munity owner or street dealer, value the relation- ship and you'll get loyalty. Scott Stroud is Business Development Manager for Power Market- ing & Advertising, a full-service marketing firm focusing on housing companies and communities. Scott is a Certified Marketing Au- tomation Specialist with over 30 years of exceptional results in mar- keting factory built homes, and can be reached at scott@Power-marketing.com or at 240-420-6343. T J