Consumers can be forgiven if they believe the retail price of new flooring is a never ending race to the bottom. Newspaper and TV ads touting lower and lower prices are splashed across nearly every ad. Flooring priced at 99 cents per square foot is commonplace, as are taglines that taunt flooring shoppers by asking “Why pay more?” No wonder a shopper unfamiliar with the business could easily get the impression that flooring is little more than a commodity item and that comparison shopping is merely a numbers’ game.
This type of marketing pitch may do little to advance flooring’s image as a highly fashionable, very personal adornment to a home or business. But veterans of the industry assure that there is more to the story than that. Low prices, they say, serve the same purpose as a carnival barker. The idea is to lure people into the tent. It has been a long-held belief that the promise of rock bottom prices draws shoppers into the showroom. What compels them to spend is a stunning array of beautiful flooring, lovingly presented by highly knowledgeable sales people who can gracefully shift the discussion from economics to emotion.
That, at least, is the game plan. And while pricing has long been a hot button issue in the industry, there is no question that the high-end is where profits reside. At a time when downward pricing pressures are coming from big box retailers and overseas suppliers, manufacturers say the opportunities in the high-end have never been stronger.
“High-end products are very important,” says Pergo’s marketing director David Small. “Depending on the consumer’s needs, high-end products provide the latest innovations in appearance and performance and yield the most margin dollars to the retailer. Higher-end products are also supported by the longest and most inclusive warranties.”
Small notes that high-end products are what give specialty stores a point of distinction. Like a number of manufacturers, he says smaller retailers should not be alarmed by big box stores elbowing their way into the flooring business. Their efforts are mostly helping to raise awareness.
Of course top quality products are unlikely to catch the eye of shoppers unless they are backed by knowledgeable salespeople. Indeed, when asked the best way for retailers to sell the high-end Teragren’s vp, sales/flooring, Mike Conneen offered a concise answer: “Product knowledge, product knowledge, product knowledge,” he says. “Generally, lower priced products also come with lower margins. If the salespeople are thoroughly trained on the products offered in their store, they should be able to differentiate them to the customer based on their attributes- or lack thereof.”
Then there is the matter of merchandising. “Make better quality goods a focal point in the showroom, and be sure upscale products are properly merchandised,” advises Mike Zoellner, vp, marketing services Mohawk. “And don’t be afraid to show customers better quality, higher priced products. Some of the research we’ve seen indicates that consumers come into stores ready to buy flooring at higher prices than salespeople think, and that if they’re not careful, salespeople actually sell customers down, rather than up,” adds Zoellner. He notes that Mohawk has worked to advance product knowledge. “With co-branding programs like Mohawk Floorscapes and Mohawk ColorCenter, which educate consumers on their floorcovering choices, we see higher ticket sales and higher average price points. If customers are properly exposed to good merchandise, they appreciate the styling and quality. They have the money. They just need a good reason to spend it on flooring.”
Scott Sandlin, vp, residential marketing for Shaw notes that the growing popularity of hard surface flooring has helped steer more consumers to the top shelf. He adds that shopping patterns have shifted and more emphasis is being placed on individual rooms. “The popularity of many hard surface products has initiated many upper-end transactions at retail,” he says. “The interesting thing about this is that the consumer no longer takes a ‘whole house’ approach to design their floors, the focus is on ‘room-to-room’ design.”
Sandlin maintains that the consumers are ready to step up if sales people give them a reason to make the climb. “We need to understand that she is ready to spend more. Research tells us that the majority of the consumers spendlesson flooring than they felt would be necessary to complete the project.” He encourages retailer to have “an in-store system that will drive trade-up business.”
“For example, we have many retailers who utilize our three, four and five star upgrade system,” says Sandlin. “It is a simple way to explain added benefits to the consumer. She wants a qualified person to sell her on why she should use better products. We feel this system helps. The most important item to remember is that we are selling fashion!”
Often the ability to generate high-end business comes down to sales technique. Homeowners eager to increase the value of their investment and add a personal touch to their space are prime candidates for upscale flooring. “An increasing number of customers are realizing that investing in a high-end, quality flooring really pays off in the long run,” comments Carlo Di Pietro, marketing services manager for Lauzon Distinctive Hardwood Flooring. “The look, durability and quality invariably increase the value of the property and are an investment that will outlast any other decorative element found in a home.”
Yet, while manufacturers are sensing the demand for higher-priced flooring, there is also pressure to keep prices low. “High-end manufactures have to deal with an increasing number of inferior quality imports from Asia that tend to draw the attention of the consumer based solely on price,” says Di Pietro.
At the same time, he cautions that there are always customers who cannot be “sold up.” “Not every customer can be sold up from a Chrysler to a Mercedes,” he says. “The goal is to avoid selling down the clients who are ready to upgrade and/or invest in the high-end floor, but have not been convinced, at the retail level, of the value added benefits.”
Di Pietro offers these tips to retailers selling his company’s line of hardwood flooring: “The key here is to minimize the importance of price as the sole differentiator. The retailer needs to capture the attention of the potential customer by using essential words that will speak directly to the customer and convince him that he is making the right decision. Words like ‘quality’ and ‘warranty’ are over-used, and no longer do the job. The retailer needs to capture the attention by using features and benefits that stand out like ‘piece of mind,’ ‘investment,’ ‘made in Canada’ and ‘environmentally friendly.’ Commodity products are not our core business. We want every customer to get that WOW feeling when they walk into their homes.”
The perspective of flooring shoppers also favors those angling for the high-end, says, T. Fred Roche, president of Parterre Flooring Systems. “Whereas consumers once placed a heavy emphasis on function and durability, many are more focus on the look,” says Roche whose Brooklyn-based company recently launched the Urban Collection consisting of a three-dimensional tread-plate design. “Today there are so many flooring choices that fashion has taken priority over durability,” says Roche.
He adds another key reason high-end customers can be a for specialty flooring retailers: They are far more active. “The high-end, fashion-driven customer will renew and replace their flooring three times as often as most other customers, making them a more profitable long term relationship.”
SIDEBAR: Armstrong's new high-end bid: Do-it-yourself styleIn a bold move aimed at encouraging self expression among consumers shopping for flooring, Armstrong is launching a high-end collection of Luxury Vinyl Tile that, the company says, “combines installation options, durability and exceptional design flexibility exclusively for the independent retailer.”
Its new MODe flooring– short for “My Own Design expressions”-is designed to offer “considerable latitude for self expression” while showing “all the flair a person’s comfort zone will allow.” The line consists of several collections named to reflect their individual theme: Stones, Global, Cork, Retro, Solids, Parquet and Planks. All told Armstrong notes that the line includes more than 80 visuals that replicate natural materials as well as designer colors and patterns. Varied sizes, including 16” by 16” and 12” by 12” tiles, as well as 4” and 6” wide planks, contribute to the collection’s design versatility.
The new entry from Armstrong has also been created with an eye toward addressing installation concerns. The company says it features an “easy down/easy up” installation option also allows retailers to give their customers a choice of installation methods and allows homeowners to update their floors according to their changing tastes.
“It’s really a new form of flooring category and selling opportunity exclusively for the retailer,” says Armstrong’s vp Judy Grillo.