Our industry is changing and 2017 was an indication of just how important it is to embrace that change in order to succeed. Let’s reflect back on what happened in 2017 and look ahead to 2018.

From a macroeconomic perspective, the U.S. economy strengthened in 2017. The unemployment rate was at a historic low, modest interest rates drove home purchasing, and consumer confidence was on the rise.

For roofing, 2017 was a year of positive growth. Storm-driven activity coupled with a more confident economy promoted residential roofing and reroofing demand while driving growth in the commercial roofing sector. TPO and ISO led the charge, particularly in the West.

The distribution channel consolidated further this past year and manufacturing expanded into new growth areas. Contractors adopted new technologies and processes including drones, mobile apps, solar, and financing to improve customer service, increase close rates, and save labor time. 

As we look ahead to 2018 amid a strengthening economy, demand for roofing materials remains steady with U.S. demand for roofing expected to grow one percent annually through 20211. Aging homes, a more favorable lending environment, and increases in housing starts will help buoy that demand. With job market growth, expected wage increases, and the recently-passed tax-reform legislation, analysts expect to see continued strength in the housing market this year2. On the commercial side, according to Dodge Outlook, commercial and institutional buildings will grow 2.6 percent in 2018.

Reinforcing our industry’s perspective on 2018, 65 percent of respondents in Roofing Contractor’s 2017 State of the Industry Report said they expect next year to be as good as or better than 2017 in terms of revenue, and more than 76 percent said they believe sales will continue to grow through 2020.

Although we predict continued growth in 2018, we cannot be complacent. As trends shift and homeowner buying habits change, there’s a significant opportunity for contractors and manufacturers to adapt their thinking and business strategy to ensure we’re meeting the demands of the market. Let’s review some of the key trends and shifts that will shape our industry in 2018 and beyond.

The Pressing Need for Talent

The leading issue facing the industry continues to be the labor shortage. In Roofing Contractor’s 2017 State of the Industry Report, approximately 85 percent of residential contractors and 88 percent of commercial roofers said finding qualified workers was their chief concern.

Older workers are leaving the roofing profession and the younger workforce does not always readily grasp the opportunity of a career in the skilled trades. Consequently, it’s increasingly important for contractors to focus on strategic workforce planning and continuous education and training to retain and recruit talent. The NRCA’s national certification program, set to launch this year, will help build a foundation to address this issue by creating skillset industry standards, laying out a career path for roofing professionals, and improving the perception of the roofing industry as a whole. NRCA CEO Reid Ribble is making this effort a major focus in 2018. Manufacturers will also help alleviate the labor shortage with the introduction of labor-saving products that can reduce the complexity and cost of roofing jobs.

Digital Tools Create the Opportunity for Better Engagement

While contractors remain an indispensable resource and authority for homeowners making home improvement decisions, the pervasion of social media and online sources has changed the way consumers make and validate their purchasing decisions. While more prevalent in younger generations, according to a Pew Research Center Survey, 82 percent of adults in the U.S. say they sometimes read online customer ratings or reviews before making purchases, including 40 percent that say they always do3. When looking at consumers who are actively seeking home improvement work, 96 percent conduct online research, with 71 percent of millennials referencing social media. For roofing buyers, 62 percent researched a contractor online4. Rather than simply relying on the recommendations of their contractors, owners now have a host of online resources at their disposal that allow them to research the many options and products available and weigh the pros, cons, and costs of each.

They’re also taking it one step further. With social media platforms, consumers are more likely to comment on service, quality, and their experiences. This is a significant development for our industry. How can we keep pace with a new generation of savvy, vocal homeowners?

There is no singular answer, but an important component is establishing a connection to these buyers. Websites have been the current method used to establish this connection. There’s a growing importance to include compelling assets like photos of completed jobs, testimonials, community involvement, and employee bios as homeowners are basing more of their decisions on the research they do online and on their peers’ opinions. 

How Technology Impacts B2B

For manufacturers and distributors, increasing trust in online sites and peer reviews makes it much more important to have a strong digital presence focused on providing real-time information that can improve the selling and customer experience.  

New technologies are improving the way we do business. Drones, for example, are becoming more prevalent as contractors increasingly use them as a measurement, visualization, problem-detection, and selling tool. Artificial intelligence and the use of “big data” and analytics are helping manufacturers develop improved supply chain plans and helping contractors create customized weather mapping. The path to a more innovative roofing industry falls on our adoption and investment in technology and new capabilities. 

All signs point to 2018 being another successful year. With this positive momentum, we can collectively focus on making improvements that will propel our industry forward this year and in the years to come. While digitization and a changing customer base with higher expectations continue to shake up the status quo, these challenges represent significant opportunities to enhance our value to the customers and communities we serve.