The most recent National Kitchen and Bath Association (NKBA) Market Outlook Report projects 2023 bath and kitchen revenue will reach $162.4 billion, a 14% decrease when compared to the previous year. With potential recessionary pressure, high mortgage rates and a cooling residential housing market, Supply House Times chatted with a few showroom professionals from around the country to gauge what’s expected in the 2023 showroom sector.
Despite the challenges listed above, the general consensus is that showroom business is still extremely strong, and the remodel market will remain a key driver throughout 2023.
Jay Robinson, manager for Irmo, South Carolina-based Bath and Bronze, says he expects business to grow in 2023. “I am seeing more and more customers wanting to buy quality product from a locally owned business rather than big box stores,” he says. “We are a newer showroom, so I anticipate strong growth throughout 2023.”
Director of Showroom Operations at Massachusetts-based Republic Plumbing Supply, Gary Cedrone, agrees. “Remodeling is strong in the greater Boston area and continues to account for the majority of our showroom business. Customers are still willing to spend money despite climbing interest rates,” he explains. “They also realize that they have to exercise more patience due to the availability of contractors and especially those who are doing multiple jobs at once. “
Cedrone’s remarks are on par with the 2023 NKBA Bath and Kitchen Market Outlook. The report states that, “86 percent of outstanding mortgages are locked in at rates below five percent, so these homeowners are choosing to remodel rather than to move.”
Up in New York, Jack Bernstein, founder and CEO of Kurrent Kitchen and Bath, says business is booming. “The showroom business in our market has not slowed down. We did see a slight dip in Q3 and Q4 of 2022, but it seems this year is off to a strong start,” he says. “While we are investing in our online presence, we continue to see the most return from our in-person showroom customers; they want to touch the product and enjoy value add services we do for them. Customers who are spending thousands of dollars on product are likely not going to buy online without seeing the product.”
DESIGN AND TECH TRENDS
Bold colors, unique designs and mixed metals are back in showrooms, according to these pros. “Color schemes, black, gold and mixed metal finishes are trending up while oil-rubbed bronze is trending down,” Robinson says.
Cedrone agrees, noting, “We anticipate 2023 to be a little stronger with bright, bold designs in tile, lighting and colorful cabinetry.”
Bernstein agrees, noting that he’s seeing a lot of color and accents. “We’re seeing more brands come out with color – blues, greens and other colors that can be used as accents,” he says. “We are also going to see more wood accents and earthy tones such as wood handles on faucets, wooden doorknobs and natural wood cabinetry.”
Robinson adds that variety is important to today’s customer. “Customers want to see variety, even if they don’t like it all. At least they can tell you with confidence what they don’t want and that helps narrow down what you show them. We have some amazing tubs with funky colors right as you walk into our showroom that always draw attention,” he says. “Whether they like it or not, the customer will always give us their opinion and it opens the door for further communication about their preferences, wants and needs for whatever project they came in for.
Bernstein adds that the wellness trend isn’t going anywhere, and he’s seeing an increasing demand for saunas, steam showers and smart showers.
Digitization and artificial intelligence are also leading showroom trends. John Gosselin, CEO of ShowroomMarketing.com says there will be a gigantic rise in how AI impacts how products display online.
“Truthfully, this trend is already in motion for advertisers using Google Ads (Pay-Per-Click) and for showrooms and wholesale distributors with best practices in place to grow sales via on-page and off-page Search Engine Optimization (SEO),” he explains. “If turning online insights into income is your goal, the best way to approach the web is to maximize your 'free' listings to increase your company's visibility and to maximize the best practices of paid ads to grow sales and find searchers with the highest intent to buy.”
Cedrone echoes the importance of digital presence, noting social media is a key driver for showroom business. “Social media continues to drive business through our brick-and-mortar outlets. Showrooms need to stay ahead of the tech curve and continue to stress to their customers that after they’ve done their research then it’s absolutely critical to visit their showrooms and work with the professionals to get their projects done right,” he says.
AI also continues to dominate new bath and kitchen product development. “Technology enabled and smart home devices are desirable right now. If it has an app and can be controlled remotely, we are seeing a rise in interest,” Robinson says. “Interactive displays and working displays are our best investments. The advantage of a showroom that can not only show you a product in person but show you how it actually works is a huge in getting a customer to commit to the sale, while providing education on the product as well.”
Showroom professionals agree that customers today are more educated than in previous times, and it’s vital to have an online presence that draws them in.
“Today’s consumer is very well-educated and they spend a lot of time researching products and services before they venture out to shop for these items. Quality and value seem to be the recurrent theme when customers come into our showrooms,” Cedrone points out. “Realizing this, we ask our showroom consultants to exceed our customer’s expectations and present them with higher end products that will last them longer and provide the best value.”
Gosselin shares the importance of building out all facets of your website. “At ShowroomMarketing.com, we have accumulated search data from hundreds of Google Analytics accounts showing how an About Us page, Meet Our Team page, pages that highlight your brick and mortar locations, a Contact Us page and pages that highlight many of the top geographic areas a business serves get 100X more visitors in one month than any specific product page will see in a lifetime,” he explains. “Therefore, having a website that displays the people at your business, areas you service clients, and the causes you support vs. solely having a website that is all about the product, product, and more products is a business principle that should be utilized at your company.”
One challenge that boutique showrooms are facing stems from the excessive online research customers are doing today. “Many customers come to us after spending hours online looking at products expecting the same pricing and we just can’t do that on every product,” Robinson says. “We must sell the showroom experience to get those customers to buy from us instead of online. Having extensive knowledge of the products we sell, helping with installation questions and even selling installation labor packages with our products are all items that you cannot get from that online retailer and when a customer understands that, it makes it easier to close the sale.”
Cedrone agrees that converting online business to brick-and-mortar showrooms is a top challenge. “The greatest challenge we see for 2023 is how to convert the younger generation buyers from Amazon or Wayfair into brick-and-mortar customers. We rely heavily on contractor referrals to drive this business into our showrooms. We also offer rebates for these referrals if and when it becomes a sale.”
Showrooms are not immune the infamous nationwide labor shortages. Cedrone says it is still extremely difficult, but offering flexible schedules is one way showrooms can have an edge over retails stores. “It remains very difficult to find help as it pertains to the showroom business in the greater Boston area. We have tried every way possible—Indeed, Zip Recruiter, LinkedIn, local design schools. The last couple of viable candidates have joined our team used to be employed in retail stores that don’t offer flexible hours and competitive pay and benefits.”
Robinson says it’s worth it to invest in resources to help search for top talent. “Top quality employees are always hard to find, no matter what business you are in. We’ve enlisted outside companies to help us find the perfect fits for us in the past and will continue to do so. I’ve spent weeks going through resumes to narrow down potential hires to a select few and then not hired any of them after the interview. It’s worth the money to pay someone else to identify, prescreen and send me a short list of truly interested applicants that I can be sure are the caliber of employee we are looking for.”
Showrooms are making continuous operational and display improvements to stay ahead of customer expectations. For example, Republic Plumbing Supply has created a new position.
“We have recently hired a ‘trade and showroom service specialist,’” Cedrone explains. “He is an experienced former sales manager for one of our larger manufacturer’s rep agencies. He will be working directly with me to maintain all of our showroom displays, keep them current, installing and refreshing current and potential new product lines.”
Cedrone adds that showroom displays will remain branded. “We continue to keep our displays branded. Partnership with our vendors remain a top priority as is our loyalty to IMARK and Luxury Products Group (LPG).”
Bernstein says it all goes back to his team. “First off, our team is amazing,” he says. “We’ve invested a lot in our ERP and created a structure where our sales team inside the showroom can focus on sales and the support functions are happing on the outside of the showroom. This keeps things running smooth on the floor and allows our team to focus on what they do best.”
Gosselin says showroom sales associates are having to do much more than sell these days, so it’s vital to take advantage of AI, technology and resources to help support them. “One of the biggest gripes owners of distribution businesses have when we do our monthly consulting calls with clients is that their sales associates have to be much more than order takers. The "set it and forget it" mentality isn’t returning anytime soon,” he explains. “Thus, it is imperative for businesses of all shapes, sizes, and structures to have profitable B2C outreach (for showrooms) as well as high-converting B2B marketing and sales initiatives for both showrooms and wholesale distributors.”