We surveyed commercial property decision makers in both 2001 and 2004 about their thoughts related to our industry. Those market research initiatives demonstrated what we all thought we knew - manufacturers, contractors and consultants are being asked for products and services that are better, quicker and cheaper.
Roofing Contractor magazine teamed up with two other magazines, Sustainable Facility and Environmental Design + Construction, to conduct a follow-up study. The research was conducted by Clear Seas Research, a company that specializes in providing industry knowledge and insight for its clients.
About the ResearchThe 2007 research study focused on three key areas:
- Who evaluates and recommends types and brands of commercial roofing products?
- What is their current usage of materials and scheduled maintenance?
- What are the most important factors in selecting a roofing contractor?
The majority (57%) of respondents are managers and senior managers (see Figure 1), and about a quarter are in facility management (24%) as a profession (see Figure 2). The majority are involved in either commercial (33%) or educational (30%) properties (see Figure 3).
They are very busy people. They typically manage 14 properties with 650,000 square feet of responsibility (see Figure 4). They represent a broad spectrum of the United States (see Figure 5). The majority of materials used are asphalt (33%) and single ply (33%). (See Figure 6.)
Client Perceptions - Before You Walk in The DoorYou get the call stating “We have a leak” and you show up for the lead. What perceptions do your potential clients already have? As you’d expect from all of the various articles in the past several months in trade magazines, energy savings (83%) is important. Commercial property decision makers are suspicious of providers that focus on single technologies (76%); therefore, it is important to demonstrate that you focus on understanding their specific needs and matching the right technology that best provides solutions they need. They also know that leaks affect the morale and productivity of employees (74%); therefore, it is important to share your insight that your solution is more than fixing a leak - your solution affects the economics of their business.
They know that some roofing systems may be easier to repair than others (73%); therefore, it is important to talk about the life-cycle costs of your recommended solutions. They are suspicious of manufacturers that utilize salespeople to perform inspections (64%); therefore, it is important to use a manufacturer that utilizes full-time professional quality assurance representatives. They are also more likely to utilize a contractor to replace their roof if that contractor has been doing the repairs on that roof (55%); therefore, it is a strategic advantage to invest in and market a quality roof preventive maintenance program and 24/7 repair capability.
Maintenance Remains an Opportunity for Proactive ContractorsScheduled maintenance is used in almost half of all properties (46% mean), but less than two-thirds of decision makers utilize this important service. When scheduled maintenance does occur, it is most likely performed by a professional roofing contractor (53%) or internal people (38%). Also, we see that only 8 percent of respondents believe maintenance is a waste of money. This data suggests an opportunity for marketing-oriented roofing contractors.
In my opinion, the more educated decision makers (those managing the most square footage) are more likely to understand the importance of scheduled roofing maintenance. Further, there is significant upside in helping decision makers understand that problems and risks are reduced or eliminated with scheduled maintenance. Since contractors perform the majority of the scheduled roof maintenance, it is smart to focus on this area of business opportunity. It may also be advantageous to consider a hybrid maintenance service that trains clients’ staff members to perform most temporary repairs and follows up with permanent repairs as a service performed by the contractor.
When you combine this insight with data that suggests that the contractor who performs repairs and maintenance work is most likely to replace the roof (55%), you can see why marketing this service can be so important. Remember, every time you repair or maintain a roof, it is an opportunity to earn trust and educate the customer and, as a result, increase the likelihood of a referral or further business. And when you consider that a well-maintained roof is most likely to perform as expected, providing this service is more likely to result in a satisfied client that generates even more business.
Warranties - Another UpsideProperty owners and property managers participating in this research study perceive that they enjoy the benefits of a “no dollar limit” (NDL) warranty on 43 percent of their properties. Industry data suggests that the actual amount of square footage with NDL protection is far less than that level; this is an opportunity for professional contractors to demonstrate the advantages of an NDL warranty in general, the differences in the manufacturer’s NDL warranty that they are recommending for use versus competitors, and the fact that owners and property managers may be receiving warranties that provide less coverage than they actually expect.
Annual Roof Budgeting Can Cause Pain, FrustrationBudgets are a huge issue for commercial roofing buyers and decision makers. In fact, 29 percent of expenditures were not even budgeted. Specifically, 20 percent of roof replacements, 25 percent of consulting and 40 percent of roof maintenance and repairs were not budgeted. The results were worse in the 2004 study, when a total of 32 percent of all roof-related services were unbudgeted.
These data points can be a blessing or a curse for professional roofing contractors. For uninformed roofing contractors, this data can be a curse. Here’s why: When you walk into a decision maker’s office, how good do you think they’re feeling about roofing? On average, they’re way over budget. Doesn’t being over budget potentially lead to a great deal of stress? Maybe the person got yelled at by other employees who are becoming more than annoyed by roof leaks. Isn’t it possible they’re catching heat from senior management and owners due to the surprise expenses and related negative effects on their company’s profitability? Is it possible that they didn’t get a holiday bonus, and are therefore experiencing strains at home? And, what does this attitude mean for the roofing contractor? You represent roofing. You represent an area of their responsibility that has become, at best, embarrassing. Face it - they hate you when you walk in the door.
For progressive roofing contractors, insight into these budget issues can be a blessing. The key to value is a very simple equation: “The more the potential customer understands the potential risks and problems of their decisions, and then recognizes the unique processes in which you can help reduce or lower those risks, the more value you’ve added.” Clearly, decision makers understand the risks and problems related to inadequate budgeting. This means there is an opportunity for roofing contractors to demonstrate how they can help with this process and, as a result, add value by reducing these problems and risks.
What about providing roofing surveys? What about scheduled maintenance contracts? What about the utilization of more NDL manufacturer warranties? Wouldn’t these help reduce the risk and help eliminate roof-related budget issues?
Who Makes the Roofing Decisions?Interestingly, decision makers often see themselves as making the recommendations for both the type and brand of roof used on facilities they are responsible for. Specifically, decision makers claim they are most likely to make the new construction choices for both type (45%) and brand (41%); the same is true for retrofit roofs, with survey participants responding that they make the recommendation for both type (53%) and brand (50%). This seems different than the “value chain” perception, as contractors, consultants and distributors seem to believe that they influence most of the decisions on both the roof system type and brand.
What are the implications of the data? I believe it demonstrates the strategic importance of my personal belief about business: “The competitor that earns the most trust and educates best will earn more than their fair share.” Why? First, picture in your mind the people that you listen to most closely and ask yourself, “Do I trust them?” My experience is that people do not listen closely to what you have to say until they first trust you. Education is going beyond what you’re going to do and focusing on what’s really important: why you are going to do it. The “why” provides the “WIIFY” (“what’s in it for you”), and that’s what people tend to base their decisions on.
Here’s the key point: If the property owner or decision maker sees themselves as the primary influencer of both roof type and brand, then it is a competitive advantage to provide superior education that helps the decision maker become more comfortable about making an informed decision. Informed decisions come from superior education.
What's Important for Roof System Solutions?It is not surprising that conformance with codes (85%) is the most important criteria for selecting a roofing system solution. A few things did surprise me. First, that NDL warranties were important 44 percent of the time, since far less than that percentage are provided with commercial roofing installations. A second surprise was how low UL fire ratings (58%) and FM approval (37%) were rated, since it is common to hear contractors, consultants and distributors claim that these are usually required.
What Do Decision Makers Think of Providers?Overall, decision makers have better perceptions about roofing contractors versus consultants and manufacturers. Specifically, they have higher ratings in every category measured except for “effectively explaining why to use their service versus competitors.” However, while the scores are higher for contractors than for consultants and manufacturers, there is still a great opportunity for improvement.
Specifically, when you consider the reverse of this data, you see opportunity. For example, this data suggests that 31 percent of responders either had “no opinion” or disagreed when asked if they trusted their roofing contractor. If I were a contractor, this response specifically shows that I can build competitive advantage by responding more quickly, demonstrating appreciation for my clients’ business, providing information during the budget process and recommending cost saving options. The most important lesson is how much competitive advantage can be built by simply demonstrating differences in the way a contractor provides services compared to typical competitors.
Again, if you go back to the principle I shared earlier - “Whoever earns the most trust and educates best will win more than their fair share” - it becomes evident that you can build your business by educating the customer on how your specific processes and procedures lead to lowering or eliminating risks and problems.
Proposals: Where the Rubber Meets the RoadWhen you ask people who are involved in the value chain (contractors, distributors and consultants) what’s important, they’ll say price is the most critical thing for decision makers who purchase roofing services. Is this what the research suggests? No. Low bid was characterized as important by only 45 percent of the responders - which is lowest on their list of criteria. The 2004 study had similar results.
This should not be surprising. Watch somebody purchasing a Cadillac. Are they a price buyer? No. They’re investing because they believe that a Cadillac will provide a superior value. But that doesn’t mean they don’t try to negotiate the best price they can get. The same is true of roofing. Most buyers are actually looking for their best value.
Want to build your business? There’s likely nothing more important than understanding what’s important to property owners and decision makers, and ensuring that these items are in your proposals. Almost one-third of the proposals lack critical elements that decision makers want to see to help make their decisions. It is amazing to me how big the “missed opportunity” is within our industry. What is the missed opportunity? It’s simply the percentage of decision makers that think something is important multiplied by the percentage of proposals where this element is not included.
What are the biggest missed opportunities? First, are you including references from architects, roof consultants and other property owners? Testimonials are a great way to generate trust and improve the effectiveness of your proposal. Second, are you sharing your specific processes and approaches to ensure a quality installation and commitment to punch lists? Almost one-third of your competitors are not; this makes addressing these issues a tremendous opportunity to stand out in a pile of job quotes. Do you share your services related to 24/7 response for issues and detail your firm’s capabilities to provide scheduled maintenance? These are areas that will make your proposal stand out from more than 40 percent of your competitors.
Implications for ContractorsThis data leads me to a key question: “If I were a contractor, what are the implications of this data?”
If I were a contractor, I would remind myself and my team that before going on sales calls, we have to adjust our attitudes to the fact that decision makers involved in roofing are stressed. Budgeting is almost impossible for them to get right. I would ask existing and prospective clients if I would help them with the budgeting process, with no obligations. This gives the contractor an opportunity to earn trust and demonstrate an ability to educate the client.
If I were a contractor, I would demand that my estimating, sales and marketing teams were constantly striving to communicate our services of 24/7 repair, the importance of scheduled maintenance and our capabilities in performing this service, and the benefits of an NDL warranty in general, as well as the specific advantages of the NDL that we’d be providing.
If I were a contractor, I’d be investing much more time in ensuring that our proposal template was more comprehensive and acted as a marketing tool to attempt to both win the specific bid and help increase the probability of being invited to submit future bids.
Specifically, my proposal template would include checklists that demonstrate several areas where risks and problems can occur, including design, preparation for the project, daily quality assurance and safety protocols, punch list resolution and servicing procedures. Think about this, especially if you do a lot of public bid work: If you have the typical 10 percent close rate and do 100 public bids, and generate invitations to just four extra negotiated bids as a result of approaching the proposal as a tool to generate more trust and better education, and you have a close rate of 25 percent, then that’s one extra job or a 10 percent business increase! Just do the math.
If I were a contractor, I would remind my sales and estimating staff that while price is important in any purchase, including luxury goods, it is not the most critical element of your success. The company and individuals that earn the most trust and educate best will win more than their fair share.
If I were a contractor, I would look at every contact point my company has with potential clients and ask two simple questions. First, how could we increase trust? Second, how could we educate better? This is a business of numbers.
In baseball terms, the more times you get to bat and utilize a quality swing, the more runs you’ll score. The great part about our business is that you can keep swinging the bat without striking out. And, you can perfect the swing to put even more runs on the board. Like all businesses, disciplined people with a disciplined approach implemented in a disciplined way will result in building the most successful and profitable teams in our industry.
About The SurveyThe complete study, “Survey of Commercial Property Decision Makers on the Roofing Industry,” is available for purchase. For more information on the 2007, 2004, and 2001 comparison report, contact Sarah Turner at 248-786-1615.
David Harrison serves as Senior Vice President, Chief Marketing Officer for GAF Materials Corporation of America. He also founded and continues leadership responsibilities for the non-profit organization CARE,the Center for the Advancement of Roofing Excellence. He is a regular contributor of both market research and articles for Roofing Contractor magazine and speaker at their Best of Success conference.