Suzie Wiliford, NKBA president. Photo courtesy of the NKBA.

While the world is weathering a severe economic downturn, you’d think the farthest thing from peoples’ minds would be luxury bath products, a remodeling job or any expenditure of money on fancy doodads. This isn’t necessarily so, as industry observers say the current trend is counter-intuitive. It seems the lagging economy coupled with dropping home values are a one-two punch of good news for the luxury bath product and remodeling business. 
   Want examples? Well, the early March ISH trade show in Frankfurt, Germany, featured some 700 manufacturers displaying products in the “Bathroom Experience”—a showroom filled with all the sustainability and extravagant design offered by the plumbing industry. The Bathroom Experience was, according to ISH organizers, second only to HVAC as the most popular exhibit among the trade show’s reported 202,000 visitors.
   OK, so that was in Germany. Moving quite a bit closer to home, National Kitchen & Bath Association president Suzie Williford said, “with great confidence,” in early March that the kitchen and bath industries are on the upswing. The NKBA is set to host to its Kitchen/Bath Industry Trade Show and Conference Apr. 30-May 3 at the Georgia World Congress Center in Atlanta. 
   “Yes, business is down in many parts of the country, but predictions about the sky falling are inaccurate and premature at best,” Williford said. “We don’t have our heads in the sand about the economy. Instead, we have solutions,” she said, adding the latest trends in the kitchen and bath industry are positively influenced not only the economic downturn, but also the aging baby boomer demographic. 
   “Consumers want their investment to still address their living needs ten years from now,” Williford said.
   Even though Hank Darlington said the luxury bath (and kitchen) business is, “not what it was,” luxury products are most assuredly here to stay.
   Darlington, owner of Darlington Consulting in Sacramento and a National Kitchen & Bath Hall of Famer, also pointed to “luxury” makeovers’ continued positive return on investment when a home is sold.
   “When I was starting my business [luxury products] were just starting to come in and a friend of mine said, ‘Hank, this is a whim; you’re going to spend all this money and do all the showrooms and it’s not gonna last.’ That was 25 years ago,” Darlington said. “I’d say the kitchen and bathroom are, and will continue to be, with the two most important rooms in the house.”
   Indeed. According to the “2008-2009 Cost vs. Value Report” commissioned and published jointly by Remodeling and REALTOR magazines, homeowners can expect to recoup a national average of 67.3 percent of their investment across 30 different home improvement projects. 
   “And if they were thinking of changing homes, well, with the devalued real estate, they’re probably not doing that,” Darlington said. “They’ve stepped back and are instead the thinking of upgrading the kitchens and baths.”
   Pacific Coast cities, according to the report, have a cost-recouped percentage some 14 percent higher than other areas of the country. And Seattle made the list of cities with a return on remodeling investment of more than 100 percent on decks and minor kitchen remodels. Nevertheless, luxury bath remodels are going strong in and around the Emerald City, according to Terry Love, for 17 years the owner of Love Plumbing & Remodel in Bothell, Wash. 
   “In my area I’m getting all kinds of calls for remodels,” Love, who has been a plumber since 1974, said. “I get about a call a day from people who want to do complete gut-out remodels, additions, that sort of thing.”
   Seattle, of course, is something of an economic anomaly these days in that it’s still zipping along quite well in many areas because of the presence of companies like Microsoft and a large and sophisticated work force. In other parts of the Puget Sound area, “luxury” would be a very tough sell, indeed.
   “I got a call this morning from someone outside the Seattle area and I couldn’t sell them a $45 toilet seat,” Love, who coincidentally counts one top Microsoft executive, among his clients, said. 
   [This chief executive officer, whose name rhymes with, “Steve Ballmer,” is the proud owner of at least one Toto Neorest 600, Love said.—Ed.]
   “In the Seattle area it’s almost an automatic sale. Part of it is they see their friends doing it,” Love said. “I think that, in the Seattle area, where we’re around Microsoft and the other big employers who are putting a lot of money into the area, people see the high end stuff pretty often—it’s just what they want. I remember one little starter home in West Seattle. Everything the guy wanted to do with it is what we would call high end stuff. I’m looking at it and I’m thinking, ‘Wow. You want to do that in here? This is just a little starter home’.”
   High end and luxury are relative terms, of course. Even the uber-wealthy, at least the ones who want to remain uber-wealthy for a few more generations, are looking for value. Dominic Mincieli, director of showroom operations for Hirsch Pipe & Supply Co., in Van Nuys, Calif., said the word, “luxury” has changed in the current economic environment.
   “Buyers with discretionary income will always buy luxury products, but we are seeing even this market take it down a notch,” Mincieli said. “Even if money is no issue, a $700 faucet sale last year is a $500 faucet sale today. Consumers at all levels are becoming extremely good shoppers right now. They are looking for a deal and more value in all purchases. The business is still very much out there for high end items, we are just being pushed to get more creative with our product and service offerings.”
   OK, sure, luxury products are still selling in many areas and will continue to, experts say. However, they still have to be sold—and our experts offered a few tips for showroom owners and contractors to get this done effectively. 
   “I think the higher end, luxury showrooms—especially with the independents and the wholesalers who have done a really nice job learning how to market a showroom from a retail point of view—are not feeling a drop it as badly as maybe other segments are,” Darlington said, noting that showrooms that display their products in a retail type environment instead of having dusty boxes laying around are doing it right. 
   “The ones that are open on Saturdays and in the evenings; the ones that know to serve coffee and how beneficial it is to have educational promotions in the showroom to drive people in,” Darlington said. 
   Hirsch’s Mincieli agreed, saying the days of opening the doors, having a seat behind the desk with a cup of coffee and waiting for customers to come rolling in are over: “We have always been very involved in the local community and with trade organizations but have focused more on developing these relationships as of late,” he said. 
   “For the trade market we recently started a referral program for our plumbers, contractors, and designers. They earn points for promotions that we run throughout the year and other incentives for sending their customers to one of our showrooms,” Mincieli said. “On the product side the Internet has made things quite challenging but we’re finding that most people are willing to pay a little more from a brick and mortar showroom if they feel it to be a better value or less risk. Other services such as free local delivery, design consultation, and our display loaner program help in creating more value.” 
   Darlington said many showrooms and contractors are exploring somewhat less traditional methods of advertising to clients: “I think instead of spending a lot of money for four-color, full-page ads in the luxury home magazines, they’re pulling back in favor of direct mail and upgrading their Web sites,” Darlington said. 
   “Many are doing seminars in their showrooms. You know—‘If you’re thinking about remodeling a kitchen or bath, come on in and let us show you how to go about it’,” Darlington said. “I think remodeling is going to be, for the next several years, the strongest segment of the business.”