2016 Update: Even though these stats are 2 years old, inbound marketing has become even more popular with the construction industry!
According to GE Capital's Perspectives Outlook, "Several key trends promise to impact mid-market firms during 2014, presenting both risks and opportunities across diverse industries." We are launching a new series of blog posts, in which we will examine a different growing industry every Monday. GE's article on the "Top Industry Trends to Watch in 2014" warns us that "mid-market companies face mounting pressure to put data, information, and industry knowledge to work to build smarter and more agile enterprises." And this is where we come in. By identifying your industry's specific challenges and opportunities, you can capitalize on the good and overcome the bad. Employing relevant, industry-specific content to help build a company is what inbound marketing is all about, and we are here to help you do it!
In a recent analysis of the top industries of 2014, Sageworks (a financial information and risk management firm for privately-held companies) placed construction and its related manufacturing industries as 4 of the top 5 fastest-growing US industries today. Residential building construction, wood product manufacturing, and foundation/building exterior contractors have all seen a 17% sales increase since 2013, followed closely by utility system construction at 16%. And while these all fall behind the real estate industry, it is a good sign for construction that housing sales are up.
What does this mean?
GE Capital predicts that housing construction will remain strong as the growth in total housing is expected to increase by 28% to 1.2 billion homes in 2014. As a result of the Fed's slowing policy of open market bond purchases, mortgage rates will likely increase, but still remain at historically low levels. In fact, for the first time since 2009, the majority of national mortgage applications were for purchases — another good indicator for the construction sector. Rising house prices will actually help underwater owners, who over-borrowed during the bubble and were left with more mortgage debt than their houses were actually worth, as the dollar value of their homes will increase again. As the economy continues to recover, GE predicts a rise in new home sales, which drives the growth of real estate agencies and construction alike.
In its industry forecast, Wells Fargo reports, "Construction contractors and equipment distributors are optimistic that... construction activity will improve in 2014 compared to the prior year. The Optimism Quotient (OQ) — this survey’s primary benchmark for measuring construction industry executive sentiment — is at a historic high of 124, up 18 points from 106 in 2013 and up from the survey low of 42 in 2009." As shown in the two graphs below, respondents to a survey of contracting professionals conducted by Wells Fargo are confident that both residential and non-residential construction will increase compared to last year.
In anticipation of increased job opportunities, contractors are looking to increase their fleets of machinery, both by purchasing new equipment and renting additional tools, and they are using the Internet to do it! About 25% of the surveyed contractors have bought equipment online in the past year without seeing it beforehand, and Wells Fargo found that respondents were almost unanimously happy with their purchases. (Cue the Gen Y endorsement of the mighty computer!)
How Does This Apply to Me? This is where it gets interesting. Whether you are a manufacturing distributor who is indeed selling equipment online or a contractor looking to expand your client base, you will need to do some inbound marketing to take full advantage of the current construction boom. 82% of contractors surveyed by the Construction Marketing Association say that they already use inbound marketing, mostly via Facebook, SEO, and Twitter.
Your customers are likely to do plenty of research before making a decision like building a new house, so your job is to reach them as they do this, and to build your credibility through SEO and content that emphasizes your expert knowledge. Inbound marketing will bring potential customers who are looking for your service right to you, and will help them to trust that you are the best choice for the job. Given the upward trends in construction and housing, there are tons of potential customers out there just waiting to find you. Help them out by improving your inbound marketing strategies!
Not sure where to start? No problem! Look through our other blogposts for some helpful tips, like our most recent one on how inbound can get you customers. And if you still need more convincing, check out this ebook on why inbound is a vital tool in capitalizing on the opportunities provided by a growing construction sector!