Insulation – The forgotten upsell
While insulation is probably deemed one of the ‘un-sexiest’ products on the market, it still can be easily upsold to the majority of customers who walk into a hardware store. Whether customers have an underlying need to top up their insulation to reduce rising power bills, or simply use it as an acoustic dulling product for a new home build, insulation is proving to be the forgotten product that continues to deliver many important benefits, according to CSR Bradford National Key Account Manager, Neville Taylor.
Reminding retailers of the ongoing benefits in upselling insulation is still not implemented enough, according to Mr Taylor, who said there are definitely windows to upsell insulation to customers, particularly when it comes to acoustics.
“A lot of customers automatically think that they have a builder do the job for them and depending on the requirement for a house build, they will already have wall or ceiling insulation organised for the project. Retailers and builders do not always use insulation as an upsell option, but all they need to do is tap into a customer’s needs,” Mr Taylor said.
“Customers might also need to be reminded of the need to insulate walls to the absolute maximum whilst they are completing a new build, because they only have one chance to do this. They cannot remove walls once a new house is built. However, when it comes to a customer’s ceilings they can potentially go in and top up the insulation a little bit later if they need to, which is where the opportunity for both thermal and acoustic insulation comes in.”
“If a customer does browse for insulation in-store, retailers can also encourage them to think about insulating under their floors with ‘Optimo’, as this will keep 25 per cent of heat in their home. Retailers could also suggest a customer to consider insulation’s acoustic benefits, particularly between toilets and bathrooms. If they are building a double storey home, they should also enquire if their customers have thought about putting ‘Soundscreen’ insulation between the floors to eliminate noise. These are just some of many upsell opportunities retailers should consider,” he said.
Mr Taylor said it is just a matter of retailers reminding customers about the ongoing benefits of installing quality insulation, because often customers do have the money to invest, they just think of insulation as something they will look into down the track.
“There are some things you simply cannot do later. I think what many people do not understand is they think insulation is going to cost them a lot of money. But if they are going to be in house for 20 years, they are not only saving money on power bills, they will also be comfortable in not hearing the noise, the kids running around upstairs or banging the doors, or turning up the TV. It is quite a reasonable investment when you think of it like this,” he said.
Mr Taylor said CSR Bradford continually reinforces the message to retailers of the need to upsell through insulation via TV campaigns, “just to create brand awareness and opportunity. We can also reinforce the message to the retailer via websites, and print, like AHJ.”
“Obviously we have our account managers calling on the stores and reinforcing the message but we also understand we are one of probably thousands of products that these people deal with so we are fighting for time and space. As soon as we stop doing that then we are left behind,” he said.
While insulation has always been a competitive market, historically it is not a ‘sexy’ product, which makes it even more difficult to sell, according to Mr Taylor.
“Insulation is not like a new bench top or modern tap where people will spend a lot of money. You do not get a lot of retailers saying to their customers, ‘come up and have a look at my insulation’. Also most of the regulation and legislation is prescriptive in that the product needs an R wall batt, or 2.5 wall batt.”
“This means that our competition, and ourselves, have to make all of our products to the same Australian standards. Therefore, there is a plus or minus tolerance, and there is no significant advantage that one has over the other.”
When it comes to innovative products, Mr Taylor said fire protective products have become increasingly popular, particularly since the tragic Grenfell Towers fire in the UK.
“Commercially, things have changed but this washes across the whole industry, including ensuring the capabilities of the products meet appropriate fire standards and those fire standards have obviously been lifted.”
“Consumers have also become more aware of acoustic products and are showing more interest in the thermal benefits of these products as well. Noise is much more noticeable now there are a lot more multi-res unit developments and people live closer to one another. There is also a lot more external noise with trains and freeways constantly being built. While this infrastructure has an upside, they also need to be guarded against and legislators are much more aware of that,”
With changes to the new 2019 building codes of Australia due out on February 1, 2019 (effective from May 2019), Mr Taylor said this could also potentially see significant requirements changes across new builds and within insulation materials that need to meet the new criteria.
“By the sound of it the industry will become a bit more prescriptive. Whilst this is something we are preparing for, and certainly there is no doubt there will be changes required, what they are and to what degree we are not going to know until the documents are released,” he said.
When talking on new products, Mr Taylor said it is important to continually provide products that meet all niche markets.
“In regards to our new products, such as our Bradford Black product, which is again a glass wool product but just made with a slightly different melt, this is just the next step in us being able to provide a product that meets all the niche markets that different people require. It has nice handle ability, and is National Asthma Council Sensitive Choice Approved, so it is great for anybody with any allergies and issues. It seems people are a lot more sensitive these days so they need to be comfortable that they are putting something in their home that is nice to handle, and retailers can pass this message onto their customers,” he said.
Growing daily sales through insulation
Retailers promoting the ongoing benefits of quality insulation to their customers, including reducing energy costs, is an important avenue in growing sales, Mukesh Desai, Fletcher Insulation’s Marketing Manager – Residential and Retail, said recently.
“Retailers can easily reinforce to their customers how insulation reduces energy costs by reducing the need for air-conditioning to control temperature in homes during winter and summer periods. As an added benefit insulation improves the overall comfort of homes by insulating against noise,” Mr Desai said.
“Importantly our national team will help our retailers understand the benefits of insulation and train them on how to help their customers select the right insulation for their requirements.”
“Insulation can sometimes be a product that retailers will not put a lot of focus on, but they need to remember that there is a substantial amount of homes across Australia that had insulation installed many years ago and would now need to replace or top it up. This is a topic of conversation retailers can use to talk to their customers about insulation, because their customers may not be aware that insulation needs topping up or replacing after several years to deliver ongoing benefits.”
“It is a great upsell for retailers and an easy message to convey to their customers with rising energy costs being at the forefront of everyone’s minds. How many other products have a story around return on investment?” Mr Desai said.
Point of difference
Like any product category, innovation remains important to encourage growth and sales in insulation, according to Mr Desai, who said there is always a demand for innovative products to fill gaps in the market or provide new alternatives.
“We are also seeing this with permeable membranes, where there is an increasing demand for this product over the traditional wall wrap products. Fletcher Insulation also supplies a comprehensive range of membranes to the retail channel.”
“On the other hand, the traditional glasswool wall and ceiling batts are still by far the most dominant product in the batt category. This is due to the fact that they are proven to provide energy efficiency, reduce energy costs, reduce noise and have been formulated to improve the softness of the product,” Mr Desai said.
Fletcher Insulation continues to implement a number of strategies to create a point of difference to its range, including leveraging the Owens Corning technology licences.
“Owens corning was the first ever manufacturer of Glasswool and continues to innovate in its field. We are excited about some of the new technologies OC is bringing to the market that we are in the process of leveraging,” he said.
Further to Fletcher Insulation’s product development, the company continues to invest in retailer training programs, a national sales network and a national distribution network.
“Pink Batts and Sisalation brand names are two factors that make us stand out from our competitors. Both are two of the widest known brand names in the insulation category, with Pink Batts being the name that people associate with and ask for in insulation,” he said.
State of the industry
Ongoing issues facing the insulation market include changes in requirements by governing bodies, which continue to determine new standards to insulation products.
“With the ever increasing demands on reducing greenhouse emissions, rising energy costs, suppliers often face new manufacturing challenges and provide products that meet the required standards.”
“Our belief is that our product delivers the best benefits that insulation can provide due to product consistency. It has been tested and designed to deliver maximum performance and importantly recover to its design thickness, something which can be easily missed with some insulation products. The fact that Fletcher Insulation uses Owens Corning technology means we have a tried and tested product that meets the needs of the market and will perform as we state,” Mr Desai said.
While the insulation industry has remained extremely competitive over the past two years, with a number of importer distributors entering the market, rivalry amongst local suppliers to grow share and maintain customers, has added to this competitiveness.
“At the end of the day only those suppliers, such as Fletcher Insulation, that can provide a full range of products, full training support along with a timely and flexible delivery service, will be the ones that are seen as truly supporting the retail market.”
“Fletcher Insulation strives to meet the highest level of national and international standards for its products. We also hold the credentials granted by Global Mark (Quality Management Systems), compliance with the National Construction Code (NCC) Safe Work Australia and other national and global organisations,” he said.