Window market dynamics are changing – at least for the time being. Window manufacturers have spent tons of money conforming to increasingly stringent Energy Star standards. But now we find a unique situation in the market. I have not seen the final stats, but as of October 2015, the National Oceanic and Atmospheric Administration (NOAA) was forecasting the U.S. heating degree days this recent winter to be 7 percent lower than last winter and below the 10-year average. Consequently, natural gas heating expenditures were expected to decline in the U.S., with the greatest declines being in the Mideast and the South. Both consumption and pricing were forecasted to be lower than last winter.

Electricity prices are following also – at least temporarily. The U.S. retail price of electricity to the residential sector averaged 12.7 cents per kilowatt-hour (kWh) in 2015. EIA projects the residential price will fall slightly (0.7%) in 2016. This would be the first decline in annual average U.S. residential prices since 2002.

So with winters being warmer and energy prices falling, at least temporarily, what happens to your sales pitch for thermally efficient doors and windows? With lower gas bills being fresh on their minds and electricity prices for summer cooling being on the decline, will homeowners be less responsive to buying your premium energy-efficient window products and gravitate toward your lower-priced window?

This is where the art of value selling comes into play. There are so many other aspects of window design to focus on other than just thermal performance. It is just a matter of salespeople keeping up the effort to sell value.

The first place to start is the creature comforts. Window designs with warmer glass surfaces reduce the propensity for drafts to occur on cold winter days when the homeowner is sitting next to the window to enjoy the beautiful view. Drafts occur when warm air from inside the home comes into contact with cold glass. Heat transfers from the warm air to the cool glass, causing the air temperature near the window to fall. Cold air is heavier than warm air, so the cold air falls to the floor, causing a cold draft that is felt by the homeowner. Also, cold glass causes condensation to form on the surface of the glass. This not only limits the view through the window but leads to unsightly mold formation. Mold can spew spores into the air causing health problems. None of this is reflected on current window ratings since Condensation Resistance (CR) ratings are not yet required on NFRC labels but are only voluntary.

When it comes to the philosophy of selling, I see two different approaches. There are the “price busters” and the “marketers.” The price busters are looking at everything they can do to cut costs. They are demanding price cuts from their vendors, often at the risk of losing long-term supply relationships. They are shopping for substitute materials and components that are lower in cost but often unproven. Some are slashing capital budgets and limping along with old equipment that is sorely in need of upgrading or replacement. Others are foregoing wage increases and slashing employee benefits. The plan is to offer windows at the lowest possible prices and grab increased market share.

Then there are the marketers. Marketers think long term. They know that energy prices are not staying this low in the long run. They also know how to sell on the basis of value, which means pitching everything a premium window design has to offer. They are busy getting ready to roll out new window designs with exciting new features. They are working with their suppliers to release exciting new frame designs and glass packages that not only look great but also offer improved thermal performance and a host of other features and benefits as well. There are lots of options – foam-filled frames, double- and triple-stack low-e glass, internal blinds, grids, safety glass, windows with larger cavities and laminated glass for sound control, and multiple panes of glass. Also, don’t forget hardware. Automatic locks and multipoint door hardware systems can enhance security in the home. Improved balance systems can make windows easier to open and last longer without repairs. The options seem endless.

So, who will have greater success…the price busters or the marketers? Well, there is one thing bad about selling only on price…the margins are terrible. The price buster’s plan is often based on overcoming the lower margins with higher volume. However, it seems that no matter how low one’s price may be, there is always someone out there willing to match your price or even beat it. No one wins in this scenario. Window manufacturers selling on price could eventually deal with quality issues and poor reputation. These issues, combined with lower margins and high replacement costs, can put a company out of business. There is nothing wrong with managing costs. But let’s not do so at the expense of quality, performance, service and the risk of one’s reputation. And let’s not forget to invest in ingenuity.

Yes, it takes marketing to get the message across to the person holding the key to our future. His name is “Mr. Customer.” This is not easily accomplished without a healthy investment in advertising, promotion, sales tools, sales personnel, sales training and a philosophy of selling value.

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  1. […] Window market dynamics are changing – at least for the time being. Window manufacturers have spent tons of money conforming to increasingly stringent Energy Star standards. But now we find a unique situation in the market. Click here to read the entire article. […]

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