Don't Ignore a Huge Market Segment

Rich Walker
October 20, 2008
COLUMN : Industry Watch | Markets & Trends

Those who ignore the knowledge, buying power and participation of women in the home improvement marketplace, a longtime male-dominated niche market, do so to their economic peril. The Lowe's home improvement chain set out to prove this premise about five years ago and came up not pink, not green, but golden. The blue's answer to Home Depot's well-established orange, which included wider aisles, brighter lighting, expanded housewares assortments and decor-themed departments, propelled it to the top of the big-box DIY pack in terms of sales and stock value.

"We took a step back and listened to our female customers," said Lowe's spokesperson Julie Valeant-Yenichek in a 2005 Business Week article. Research that started in the early 1990s disclosed that "women are information gatherers," she reported. "They want the stores to be inspirational." In the fall of 2004, the company introduced monthly how-to sessions that appealed mainly to women and "recipe cards" that explain various projects that take only one weekend.

But Home Depot, which had pioneered the warehouse-style store, responded in the same vein, initiating free quarterly "Do-It-Herself" workshops to train women on how to use tools and complete projects. The sessions attracted more than 200,000 in the first year. Women responded that the Home Depot classes helped them build confidence to tackle new home-improvement challenges. In targeting women who aspire to carry out do-it-yourself-projects conventionally considered "man's work," Home Depot tapped into a long-overlooked and lucrative market segment. While women may have traditionally been the keepers of the home, the housing boom of 2004-2006, the gradual shifts in gender roles and an increasing number of households headed by single females have helped boost women's interest and involvement in home projects.

Examples of hardware chains and home centers tailoring their products and merchandising to women have been multiplying. Not to be outdone by the big-box duo, Sears in 2004 created a Web site that provides users with resources and checklists for a variety of home projects. "We learned that a lot of women are worried about being responsible for their home on their own," noted Joan Chow, Sears' vice-president of multicultural and home-services marketing. Sears research had also shown that some 83 percent of female homeowners polled said working with tools makes them feel independent.

More importantly, bottom line results have shown that workshop participants and those who took advantage of other educational opportunities often translate their increased knowledge into purchases.

Taking the Reins
Why is this happening? Men have traditionally been the driving force behind home improvement projects, often taking the lead at the insistence of the women in their lives. A survey by the Home Improvement Research Institute confirmed that, within the first year of home ownership, women will authorize almost $9,000 on home improvement projects. However, while women may have been involved in the decision-making process, in most cases they would send men out to make the actual purchases.

One driving factor is likely to be that, after married couples, single women are the largest group of home buyers in the U.S., responsible for 21 percent of transactions, according to the National Association of Realtors. That compares to single men who account for only 9 percent. According to a 2003 Fannie Mae study, the number of women-headed households is expected to rise to nearly 31 million by 2010, representing about 28 percent of the U.S. total. Interestingly, the increase of female consumers in the home improvement industry is most significant in the East South Central region of the United States, where Hurricane Katrina caused so much damage in 2005.

"The female DIY marketplace for home improvement is growing at such a rapid pace that women are now getting involved in DIY projects at a faster rate than men are; in fact, the number of DIY products purchased by men has declined over the last few years, while women now drive 80 percent of the purchasing decisions related to home improvement and purchase 61 percent of all home improvement products personally," says Suzanne Horton, CEO of Be Jane Inc. Some say the percentage of home improvement projects initiated by women is actually more like 85 percent.

A Lesson for Window Marketers
Window dealers and manufacturers are beginning to pick up on the Lowe's, Home Depot and Sears experience.

An example recently coming to my attention is Cleveland-based Stanek Windows, which reports that more than half of the calls coming in to their showroom for in-home visits are from women. "In the last five years, the number of women requesting estimates has doubled," says Sven Kramer, general manager. "Most home improvement companies don't realize that single women account for 21 percent of homebuyers, while women-married or single-are critical to our success."

Kramer shares studies that show that, while there are exceptions, "women are often more likely to seek details when making a decision; whereas men frequently want the bare-bones facts without a lot of [what they think of as] extraneous data."

Picking up on the successful educational cues of both Lowe's and Home depot, Stanek Windows offers a hands-on showroom and education center in Cuyahoga Heights, Ohio. "The education center provides unique tools and demonstrations to help consumers gain valuable knowledge about windows," Kramer says.

According to a study conducted by Yankalovich Partners, a surprising 37 percent of women said they would rather work on a home improvement project than hit the malls, while 28 percent said they would rather work on their home than cook. Given this undeniable trend, one would think that window sellers would be getting on the bandwagon.

Unfortunately, some are still behind the curve. This is evident in a how-not-to-sell-windows anecdote told by a member of AAMA's own staff. "My husband and I just purchased new windows for our older home," she relates. "We had terribly run-down windows that were not energy efficient.

"Given my industry background, I naturally assumed the lead role for this home improvement project. When requesting quotes, I had many companies that were fine dealing with just me. One company, however, refused to meet with just the woman of the house individually. We quickly figured out that this company assumed that both homeowners would have to be present in order to lock up a sale that day. This was only my second quote, so I wouldn't do it. The whole episode was insulting, and eventually I dealt with the chosen company directly and solely. My husband's signature was never required, and he was relieved to have someone with my knowledge of products coordinate this effort. And after working with AAMA members, code officials, architects and technical staff, it felt good to know what questions to ask to determine which product was the best for our home."

Suffice to say, the stereotype of women baking pies instead of deciding on the cost-benefits of different types and brands of ovens, or of cleaning windows instead of deciding on tradeoffs among energy conservation features, is (fortunately) pretty much passŽ-with the possible exception of residual pockets in the retail sector of the home improvement industry. If your marketing strategy still supports such pockets, it might behoove you to rethink that position. It just might be one of those elements of a revamped approach that could help you get a bigger slice of a temporarily smaller pie-no matter who bakes it.

 

Rich Walker is president and CEO of the American Architectural Manufacturers Association, 847/303-5664, rwalker@aamanet.org.