Adapt or Die: How to Reevaluate Your Building Materials Business Strategy

Smarter Building Materials Marketing podcast helps industry professionals find better ways to grow leads, sales and outperform the competition. It’s designed to give insights on how to create a results-driven digital marketing strategy for companies of any size.

Jeremiah Hershberger is Product Manager for Key-Link Fencing & Railing, and he talked earnestly and openly with us about the value that building products need to deliver to customers today. We learned about the (difficult) decisions and strategies his own team at Key-Link undertook to ensure that kind of value.

As the product manager at Key-Link Fencing & Railing, Jeremiah oversees the development and marketing of the products they offer. Key-Link is a specialty railing manufacturer that specializes in aluminum railing systems, and they’re known in the industry for their high-quality railing and cable products.

Jeremiah says that his main role is “making sure we're delivering value to our customers because if we're not delivering value, we are not going to continue to be around as a company.”

We put Jeremiah on the spot a little bit because we wanted to understand how a manufacturer like Key-Link defines value for the customer. “Depending on where you are in the channel, you're going to define value differently,” he explains.

“For instance, when we're looking at our product and our product design, we have targeted the installer as the key customer,” says Jeremiah. “We gauge everything, pass or fail, against [the installer].”

But does that mean ignoring the homeowner, end-user or dealer who might also interact with your product? “No,” explains Jeremiah. “We take those all into account, but it's almost like weighted value feedback. At the end of the day, if an installer doesn't love to install it, he's not going to request that product anymore.”

Understanding the value that you bring to customers — the kind of value that ensures they’ll request your product — means asking a few hard questions:

“There's a number of things that we've got to be concerned about because, ultimately, that's one of the value delivery methods that we can have as a manufacturer. We're looking at product performance in terms of quality. What [are] the long-term characteristics? Is the contractor going to have callbacks? Because if they do, that's not valuable to them,” says Jeremiah.

When a product delivers reliability to installers, there’s a big opportunity for manufacturers to keep delivering value to those customers and establish better relationships with them. “For instance, how can we make every transaction between us as the manufacturer and the installer easier?” asks Jeremiah.

The Key-Link team focuses on education to support those transactions by providing information and resources to all potential stakeholders in a sale. “That's why we have, again, a business development team that's tasked with educating down-channel — because if we're not educating, then we're not going to ease that transaction throughout every point,” Jeremiah explains.

Something we’ve learned at Venveo and through our conversations on the podcast is that if you can reduce friction, you're going to win over customers. “It doesn't matter if your product's, frankly, more expensive,” says Zach, “it's not just the product that brings value, it's everything [that’s] a part of the process to buy.”

Jeremiah explains that there are a few points of tension during that process for manufacturers like Key-Link — the root of which is around communication. “It's communication of accurate lead times,” he says, “but really what the root of that is, Zach, and why I say that is number one, is accurate communication of data and information in general.”

Part of the issue is how manufacturers communicate with customers and how to agree on that communication with the rest of your team. It requires planning on an internal and external level, and Jeremiah broke down what that strategy looks like at Key-Link.

“We've got an inline product change, for instance, that we are making on a product. We send that out,” explains Jeremiah. “First of all, there's an internal and external communication that we've got to think about.”

“Because once the customer's notified, we get peppered with questions, and we need to make sure our entire team is armed with the information,” he explains. From there, the team at Key-Link ensures that their customers and audience receive that information, however they might prefer: via email, social media announcements or more traditional methods. “We do typed letters, believe it or not, some customers out there still prefer mail,” says Jeremiah.

Distributing information and updates to customers, your team and all other stakeholders keeps everyone in the loop and prevents frustration and friction in the channel. It’s all a part of adapting in today’s industry, and it’s what Jeremiah credits with Key-Link’s success: “adapt or die.”

Source

Because of how much the industry has changed recently, Jeremiah and the Key-Link team saw the need to not just adapt, but overhaul, a part of their product line.

They took a close look at how their products were performing and started digging into the numbers. “We have some products in our line that we would call legacy SKUs. They've made us who we are today, and they're great products. They've delivered value to the customer for years. However, is it the right product for today's environment? That's the question.”

“What I mean by that is you look at the big technical term of ‘SKU rationalization.’ Why are we selling what we're selling?” asks Jeremiah. “Because if we don't continue to update — not just launching [a] new product, but also making sure the product we are making is meeting the need — then, if we don't change and adapt, we're going to die.”

In order for Key-Link to adapt effectively, they made a big decision for 2022. “We are in the process of discontinuing 44% of our product line,” Jeremiah says.

The change is pretty drastic, “[what] the last two years have allowed us to do as a manufacturer is slow down a little bit in terms of, for instance, my team and my resources. And looking at what of our product is in demand, and making sure we're continuing to deliver that to the market. We were able to sit down and look at the numbers behind it.”

Jeremiah broke down those numbers for us: “We had nine or 10 different infill options,” he explains. Infill railing is the railing that’s installed between the top and bottom railing. “Only three of those infill options were accounting for 96% of all of our sales.”

“We have this much capacity being generated, devoted to only 3 or 4% of our sales,” Jeremiah explains. “Our concern is if our partners in the channel are not willing to stock it, how much of a demand is that product really having in the marketplace?”

They were hard questions to answer, but Key-Link used the process as an opportunity to adapt and learn. “We are making a conscious decision because we know that we need to market those products better. We have a great marketing team, a great business development team that's going to be able to educate down through the channel that, once we have the ability to relaunch those products, we'll be able to position them properly in the market,” explains Jeremiah.

Manufacturers everywhere have had to adapt in some way in the last several years because of supply chain issues, customer demand and labor shortages. “We've had to consolidate resources as raw material supply chains have become constrained. We've had to devote resources to top-moving product[s]. This is also a unique environment that we decided to take advantage of,” he says.

Now is a better time than ever to reevaluate your own products and how they deliver value to your customers. “Start identifying, one, if you don't have the data insights into your product line, start to look at what are your top movers? What are your categories that your customers are demanding? Really where we start is how does the customer communicate about our product?” says Jeremiah.

The data you’ll get back from that research will reveal something crucial, according to Jeremiah: "Here's the future. Here's where we need to start moving and shifting our product lines to reposition them to deliver value."

Want more? Be sure to listen to the full episode here for more insights into product development and business strategy for today’s manufacturers.

Learn more about Key-Link on their website, or get in touch with Jeremiah Hershberger on LinkedIn.