Design Centers represent an interesting hybrid retail experience in that they are places where a specific subgroup of consumers makes home-related purchase decisions.
This subgroup represents new home buyers, usually in new construction developments. Design centers allow them to streamline an otherwise complex and dizzying process filled with many critical decisions affecting construction, over a very short period of time, and many months before even taking possession of the property.
The decisions range from siding choices to interior floor plan modifications, to qualities of appliances, flooring options and cabinetry. Consumers start from a base-grade package and - should they upgrade - can bundle any additional costs into their mortgage for a negligible monthly increase.
Here, we learn more about the level system for selecting flooring products as Shannon explains:
For a Design Center that caters to several builders, the process would start with the builder informing the Design Center designers to expect new home buyer clients. That would trigger the builder to send over blueprints to estimate the amount of flooring needed. These measurements [i.e., Takeoffs] would then be entered into an estimating program that allowed different flooring choices and quantities to be calculated quickly and easily. In anticipation of the first client meeting, designers would work from the selections originally made between the builder and client (e.g., carpet in the living room, tile in the baths, hardwood in the dining).
Instead of having products all over the Design Center showroom with different prices, products were organized by price level. Levels were set by cost. Each builder had a unique pricing structure with markup built in. So, Client A with builder A might have a $20 per square yard allowance and Client B might have the same allowance with Builder B, but their allowance might fall into different levels.
Setting up the system was interesting. To prepare for data entry, a spreadsheet was created to outline price, ounce weight, stain protection, fiber type, etc. Comparing the products with a quick visual glance and then a quick comparison of features really made it easy to see what each manufacturer offered in each price range. Also, if a client had specific needs, it was easy to find the product on the spreadsheet, go right to the sample without having to remember every detail or flip over every sample.
A designer would create a price sheet for each client so that with the calculations made from the takeoffs earlier it took only a few seconds to calculate the cost of any upgrades. This meant that clients could easily get multiple quotes for options they might not have considered.
By the way, this approach was not used in the retail showroom. Rarely would we see a walk-in client arrive with their plans and with enough time to wait for takeoffs to be done. Having that information in advance was what made the process so effective.
The Design Studio employed Designers rather than salespeople as on the retail side because selections other than flooring were made. These different items needed to coordinate. For items not sold directly through the flooring business, vendor partners were used. This means that items like cabinets, counter tops, plumbing and lighting were all selected but not sold through the flooring business. The point was that all of the selections were made under one roof instead of the home buyer having to run around town to all of the different suppliers businesses and generated loyalty.+ Loyalty from the client because no one else in town offered all of these services under one roof.
+ Loyalty from the builder because the time to make all of the selections was significantly faster.
+ Additional loyalty from the builder because the client enjoyed the experience so much and gushed about how positive the experience was back to the builder.
+ A strong community network from the vendor partners as well as referrals from them that might never have come to fruition without the vendor partnerships.
To keep product selection fresh, Design Center Designers sorted through the best carpet options for each price point on a quarterly basis. The levels started with the lowest possible allowance a builder could offer up to the most expensive patterned wool. Within each level, at least one plush, loop and texture were displayed. In the higher levels, patterned loops were included. The levels in the middle might have more than one “rack” to include more options.
Compared to the floorcovering store, the Design Center displayed less product - taking up less square footage - but it gave clients a better, more complete process for selecting carpet.
Of course, we couldn't show every color for every style. So, we chose the best neutrals and colors for each style and displayed them from lightest to darkest. The top of each level began with the plush carpets, then textures, then loops so each section was consistent. If the tile, paint colors or fabric swatches were already chosen it was simple to walk right up to the style and choose a color. If by chance, the right color was not available a backup deckboard was available with all of the colors. Larger samples were offered to be shipped directly to the customer’s home. Often, the carpet selection was made because the color was so easy to shop for. The client would find the perfect color and then worry about what price point it fell in.
In the rare event that a client didn’t feel like they had enough selections to choose from, they were taken into the retail showroom. It rarely ever took more than 5 minutes in the wing rack jungle for the client to realize that it was much more simple on the design center side!
Thanks to the level system, clients with a budget could easily go straight to their level to see what was included from their builder or predetermined budget. At the same time, it was easy for them to look to the left to see what was cheaper, and often less desirable, than their level. To the right, it was painless to see what spending just a little more could get them. A little further to the right, it was simple for the client to fall in love with a product a few levels outside their budget resulting in quick upgrades and promptly finalized selections.
Next, Part IV of The Flooring Display Challenge and how consumers react to the Design Center retail experience.
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