28% of Americans own a Smart-home product. Building Products industry is Changing!
Smart homes are a growing trend, and “green” businesses are more in demand than ever. Consumers and commercial building owners and operators alike want the cost-effectiveness and empowerment green technology and digital automation offer. Fortunately, this new technology is easily within reach. In the digital economy, building product manufacturers and distributors also need to tap into the extensive world of automation to reap its many benefits.
Automation is already in demand
Building product companies must embrace automation and hyperconnectivity, because their customers are already doing so. In a recent survey, Coldwell Banker found that 28% of Americans already own some type of smart-home product, and 81% of current owners say they would buy more home automation and connected devices. The company notes that automation can drive future home sales and prices.
Accordong to Forbes, consumers and businesses want smart devices that automate themselves from set-it-and-forget-it to motion detection and that offer “away” mode settings. Consumers and businesses turn to hyperconnectivity and automation for security, energy cost savings, and ease of use—but automation isn’t the only valuable connection point.
These customers, both commercial and residential, also need information. They demand connectivity long before they engage with a building product company or provider. A McKinsey survey found 70% of buying experiences occur as a result of how the customer feels they are being treated, and 80% of marketers note that social media is behind their increased leads and traffic. In other words, companies must use digital connectivity to find customers, develop relationships with them, and engage them frequently.
Changes are happening fast in the building products industry
Many factors are changing the way building product companies do business. Some companies are fully engaging in these changes in order to produce better long- and short-term results and reduce costs.
One change is the rapid pace of globalization. Companies are no longer local or even domestic. Customers are global, providing new opportunities for profit building. Globalization has also created new competitors in the industry, as most companies are no longer the only resource in their local area. Building regulations are also continuing to tighten, forcing changes that can be costly for companies that have not adapted quickly enough.
All these changes are forcing building product companies to modify their business models and transform how they do business to compete and stay relevant. A changing business model is vital to most companies in today’s business environment.
4 different digital business models
For businesses in this industry, it may seem overwhelming to figure out how to plan and implement the hyperconnectivity and digital tools needed to compete. Successful companies are changing their business models in the following four ways:
Social engagement has become the core of the new business model as digital customer engagement impacts every facet of businesses in both B2B and B2C sectors. For building product companies, social connectivity enables a better sense of demand, helps lead generation, and improves follow-up. A fully integrated social campaign turns customers into the best salespeople a company can have.
A second area of change involves individual and custom products. It is increasingly important for building product companies to offer more than just standard products. Customers want individualized products, but they don’t want to pay too much for them. Digital production methods such as 3D printing enables companies to offer a wider range of products, distribute them more efficiently, and react to customer demands more efficiently.
Building product companies are integrating new home automation and smart features such as sensors and built-in intelligence into their products. Because customers demand connectivity, more solutions with IoT integrated are essential and new business models are focusing on automation and smart products.
Finally, there’s a growing demand for integrated one-stop shopping. Businesses in the building products industry need to offer better access to product information, the ability to buy supplemental products, and more design services. Consumers also want installation services included in their purchases. Becoming a one-stop shop is a tall order, but digital business integration enables companies to offer more products and services, more efficiently. It is essential that they provide B2B and B2C customers with complete solutions.
Integrating digital business
From customer engagement to digital transformation of the business model, building product companies must try harder to reach customers and provide more comprehensive products. The good news is that it is easier than ever to create a digital business. Digital transformation can also greatly increase ROI and keep companies relevant in today’s rapidly changing marketplace. Businesses that resist change may struggle to remain relevant—but even small businesses can compete by going digital.