The Farnsworth Group recently sponsored and participated in the Home Improvement Insights Summit in Chicago, held the last week of September. This is an annual event conducted by the Home Improvement Research Institute (HIRI). This is the foremost home improvement event for companies vested in serving the home improvement market.

At the summit, we heard valuable insights on the home improvement market, channel and customer from experts at Houzz, Lowe’s, Home Depot, NAHB, Google, Harvard and many more. Overall, these speakers conveyed that the home improvement industry is ready to adapt and remain optimistic even when faced with difficulties such as climate change, recession and rapid transformations in how customers get information and make purchases.

Market: Industry must adapt to climate change realities and prepare for a potential slowdown.

Those of us focused on building and home improvement are very attune to challenges with labor, land prices and material prices. Brought to the forefront of the Summit was the increasing implications of natural disasters and climate change. Industry leaders described the challenge of facing an increasing number of climate change-related natural disasters such as floods, hurricanes and drought.

These weather events often cause job delays and cancellations in construction jobs, while also placing strain on communities and laborers as they try to rebuild damaged infrastructure and homes. Nino Sitchinava of Houzz raised the question of how home improvement manufacturers and suppliers are supporting workers and communities as they respond to climate change-related disasters, calling the home improvement and building industry “first responders” to the damage caused by weather catastrophes.

Market experts were also concerned about the forecasted recession. While no one at the Summit predicted a large recession, experts did offer advice on how manufacturers and suppliers could prepare for a softening in the housing market. According to Todd Tomalak of John Burns Real Estate Consulting, expensive home improvement materials driven by the luxury market are expected to have a worse outlook in the coming years, whereas lower-price point, entry-level home products will fair better.

Boomers are also a critical part of the near term, given their levels of homeownership and wealth. Their homes are aging, they’re staying in their homes longer and they have the capital to invest in their home.

Channel: Mobile is crucial, but in-store still counts.

In terms of channel, the present challenge lies in creating a convenient and pleasant customer experience that easily integrates both online and in-store channels. Industry experts discussed the importance of seamless, curated omnichannel shopping and how in-store still makes up the bulk of home improvement product purchases despite increases in online shopping.

Speaker Brendan Baby of The Home Depot emphasized how the home improvement industry should adapt to consumers’ desire to shop anywhere and highlighted the ever-increasing importance of mobile purchases. Leen Nsouli of NPD Group also brought up the industry’s need to adapt to the online channel by following the example of mattress companies Casper and Purple, who offer 100-day trial periods after customers buy their mattresses online. She challenged manufacturers to consider how they can bring the “touch-and-feel” aspect of in-store shopping to the online experience.

Customer: Customers increasingly expect premium experiences and brands that address social and environmental issues.

Both Professional and DIY customers want convenience, authenticity and brands that align with their values. Michele Booth of Ipsos said that customer experience is now the true differentiator, as competitive pricing and fast delivery have become virtually essential for many brands and retailers. She said that “customers, not brands, control the narrative.”

Speaking on Generation Z as customers, Therese Caruso from Zeno Group said that Generation Z appreciates brands that take a stand on social issues and do something to make the world a better place. They aren’t interested in lip service; they want to see brands take action. And perhaps other generations stand with Gen Z on this issue as well.

Suzanne Shelton of The Shelton Group said that 25% of consumers in 2019 can name a brand they purchased or did not purchase based on a company’s environmental actions, up from only 6% in 2009. Additionally, Shelton explained that cost savings are not an effective way to market sustainable products to consumers. Instead, brands and retailers should center their messaging on safety and comfort in the home.

Also discussed was the connection between professional customers and homeowners. Grant Farnsworth, of The Farnsworth Group, led a panel with representatives from Google, ANGI Home Services and Houzz. It’s clear that the ‘uberization’ of home services will continue to grow as it improves solutions for more convenient communication, pricing and financing.

HIRI’s Home Improvement Summit explored the home improvement industry’s challenges, opportunities and near-term outlook. These conversations were underscored with research and data that supports several critical takeaways.

To learn more about the Home Improvement Summit or discuss how research can help your organization stay in front of industry challenges contact us at results@thefarnsworthgroup.com or schedule a time to discuss your needs.