From Generic to Luxury Building Product: How One Company Made the Leap

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

In this episode, Zach and Beth talk to Armen Alajian, partner at ARTO, about how building products brands can evolve, and why your brand’s biggest superpower may be hiding in plain sight.

Source: arto.com

It was 2008 and Armen and Vod Alajian had a problem. Their family-owned business, ARTO, had been in operation since 1966. They made clay and concrete tiles for walls and floors by hand, and sold them to everyone from gardeners to teachers to Greg Soros. But the company was struggling as the economy crashed around them.

When business is faltering, many owners will take every opportunity and every customer they can find, just to keep cash flowing. Instead, ARTO took a different approach and rebranded itself as a luxury product, accessible to only the highest-paying customers. As Armen says, “It was survival of 2008 that got us to this place.”

Now, instead of competing in a race to the bottom to survive on price, ARTO has made a name for itself as a high-end product enabling them to set their own price, because their customers expect to pay more for craftsmanship and quality. They are able to thrive and pay their employees a decent wage in Los Angeles, where the cost of living is high.

Source: arto.com

For Armen and ARTO, becoming a luxury brand didn’t involve a huge overhaul of their product and processes. In fact, the elements that made them distinctive were already in place; they just didn’t realize it.

“We took for granted that we were handmade because that's how we lived. Took for granted it was made in California: That's who we are. But as we listened to our customers, we realized that we were special.”

With orders as far away as Oklahoma and Miami, it was hard to deny that theirs was a specialty product. Homeowners and designers could order generic tile from local suppliers. If they were ordering ARTO and shipping it across the country, there must have been something special about it.

“All these things that we took for granted, people appreciate. And the authenticity of us not knowing what we do, I think people like that. I hope as we realize our superpowers, that we don't ruin it by becoming less humble. By becoming arrogant. Because our superpower is honesty.”

Source: arto.com

A willingness to learn from their customers about what they thought the ARTO brand was has been critical to its success. And it’s a philosophy that Armen has embraced throughout his career as an entrepreneur. In 2009, he was part of the Goldman Sachs 10,000 Small Businesses program, where business owners learned from instructors and their peers.

"Peer learning is important and peer accountability is important because it helped me get to the word luxury."

“For me, peer learning is important and peer accountability is important because it helped me get to the word luxury. When you tell strangers what I do, they think I lay pile because tile usually is considered being machine made. They say, ‘So you install tile?’ ‘No, I make tile.’ ‘Okay, then what kind of tile.’ ‘Luxury tile.’ That's how we got to that place.”

Honing your elevator pitch on what your brand is and what makes it stand out is one of the greatest skills any entrepreneur can have. For every hour-long lunch and learn presentation, they will have a thousand opportunities to tell people what they do or what they sell in a succinct thirty-second pitch that has to be clear and unique in order to be memorable.

Source: arto.com

Even today, as a luxury product, Armen acknowledges that much of his early success was through what he calls “poverty marketing.” He can recall putting money into a single billboard advertisement that got him a job that kept them going for the next month. He purchased domains for specific terms back before digital building materials marketing was commonplace.

In all his efforts, his key focus is forward momentum. “So the first thing of fight club is don't talk about fight club, right? The first thing about strategy is pretend you know what you're doing. I don't know what I'm doing. I know that I have to move forward. Well, that's my strategy in marketing. So we're always testing.”

He acknowledges that a product like theirs makes certain types of digital marketing easier. “I'm a pretty thing. I'm on the outside. I'm not brick behind you. I'm not plaster. And influencing is way easier on Instagram and on YouTube and on our site because we use pictures to sell.”

Zach likes the simplicity of this complex answer. “What you're basically saying is ‘We make no assumptions and we try everything. We drop the things that don't work, and we keep picking up things that do work.’”

Ultimately, since ARTO aims to reach everyone from the A&D world to homeowners, their marketing strategy is twofold. They work hard to build a digital presence through social media and SEO, but they also work with a dealer network so that potential buyers can hold the product in their hands and see what the fuss is about.

“We’re either pulling to the dealer by having displays and showrooms, or you're pushing from the digital world or print world into the store.”

Source: arto.com

Zach wants to know if we can have a closer look at Armen’s secret sauce. “Something we talk a lot about is finding the right ways to either drive traffic to a dealer distributor or, if you're selling direct, how do you get that sale online? I'd be very curious, regardless of [who our listeners are] whether it's a manufacturer, whatever they sell, what advice would you give them on?”
 

“One of the first things we learned at Goldman Sachs was to write our exit strategy down on a piece of paper and put it in an envelope."

As Armen sees it, you need to be aware, both of yourself and your professional goals and your customers. “One of the first things we learned at Goldman Sachs was to write our exit strategy down on a piece of paper and put it in an envelope. And then we opened it on the last day of our class. So my current exit strategy is death.”

Humorous as this might sound, knowing your personal vision for yourself and your role in your company goes a long way to making strategic decisions when it comes to everything from driving growth to building marketing campaigns.

Armen says, “For me, it's brand building. That's my game. I like to build a brand. My goal is for this to live one day past my death. So for me, it's about getting awareness of the company. That's why I'm doing this.”

The other side of that is also to know your customers and what story they want to be a part of. “You know our customer appreciates, I guess you might say, slow cooking. They appreciate the handcrafted, the story, the irregularity of the product, you know? It's not porcelain that's made perfectly on a machine and rectified.”

Source: arto.com

If all that self reflection sounds like a lot of work, gaining traction in the marketplace may actually be easier than it first appears.

Zach says, “I mean you're talking about real estate. I would call it attention. Like the cost of attention today is so little. It's so little. And I think what's interesting, on this show, is that when we interview luxury brands, they get this idea. It's not just about the product, it's about the brand.”

The good thing is that a well-defined brand transcends marketing channels. As Armen describes it, the focus should be on trust. “How do I get them to trust ARTO? How do I get them to trust Venveo? How do I get them to trust? So regardless of your point, if iTunes goes away or GooglePlay or Spotify goes away, my brand doesn't go away.”

Both Zach and Armen agree that there are still many affordable digital marketing opportunities available, particularly where platforms roll out new features. While those are still in the test phase, they tend to be underpriced, but companies who take advantage of them while they’re still new can see a great ROI.

Ultimately, when it comes to being a luxury product, one of Armen’s biggest recommendations is to give something away.

“Maybe you could get my wife to order a free sample kit. That costs me 10 bucks to remake me 10 grand and I'm making my dealers happy too. That's a no brainer. Instead of making 25 print ads and having 14 social media platforms, you know, you can do simple stuff like that.”

Options like ordering a free sample online help start that conversation. While consumers need to trust your brand before they’ll spend money with you, they’re happy to take a chance on an unknown for free. And if that sample turns out to be a quality product they can’t get somewhere else, they’re going to come back.

Identifying those opportunities is how brands find their superpower.

Got a Question?

Armen left us with a bunch of great ways to get in touch and find out more about ARTO, including:

• Instagram
• YouTube
• ARTO website
• Pinterest
• Twitter
• Facebook
• LinkedIn

If you have questions about how to find your brand’s superpower, let us know! Shoot us an email at podcast@venveo.com with all of your questions.