Money isn’t everything
Better prices allow installers to make more money. They can either have higher margins by charging their customers the same, or pass discounts on and win more clients and consequently turnover. Theoretically, that might be true, but as it turns out, pricing does not have that much of an influence on installers’ brand choice.
Only 35% of European Electrical installers agree that price is the main criterion to switch brands, and 23% say annual bonus agreements, in other words discounts, have a strong influence on their brand choice. Of course, there are differences per country, but on average price does not seem to push installers’ brand choice over the edge. But as surely everyone likes to pay less and have more money, the remaining question is why money does not seem to trigger installers enough?
Habit and happiness
As mentioned before, European electrical installers are relatively traditional, behaviour that is also influenced by demographics. Europe’s population is ageing, and so is the population of electrical installers, giving the older generation of installers the upper hand when it comes to brand decisions. It is understandable that if you have worked and been happy with a brand for decades, the barrier for changing brands can be quite high.
Time or money
On top of that, there is the time barrier. To get familiar with and confident in using the products and solutions of a new brand takes a significant amount of effort and time. Time spent on training is taken away from the job-sites, which would be feasible were it not for another effect of the demographics of European installers.
Due to the ageing population, a significant amount of installers is leaving the market to retire, leaving a gap. The influx of new generations of installers is not nearly enough to fill those experienced shoes, which leads to a labour shortage. That causes labour prices to rise and increases workloads of installers to a point at which time has a value that brand and product discounts cannot budge. In other words, the possible gain of changing to a brand with lower prices does not outweigh the value of the time needed to make that change happen.
Time is money
So if price alone does not seem to reel in installers to change to your brand, what does? That is of course the key question, the specific answer of which is depending on your product category and on contextual trends and parameters of your target audiences, as these differ per region and country. One general answer should be clear from the above by now: offer time.
The same time pressure due to labour shortage that prevents installers to switch brand for price alone might be the key to increase the value of your brand for them. If you are able to save them time by offering products that allow fast and efficient installation, you will be more appealing in times of labour shortages. Aside from products, do not underestimate offering services and trainings that save time spent on the job. As we saw earlier in the Q3 2020 report focusing on services in the installation market, those are the services that electrical installers need most from manufacturers.
Of course, the influence of pricing and trends like labour shortage differ per country and region. For more detailed insights we refer you to the Q4 2020 European Electrical Installation Monitor.