March, 2006

In Depth: Windows

Stricter codes, emerging technologies and a desire for more amenities spur growth in high-end window designs across all materials.

By Craig A. Shutt

Predictions for a cooling housing market have created concerns about the total size of the window market in the coming years. But one thing isn’t doubted: windows of all types are moving to the higher end. Changes to building codes, new technologies and new approaches to selecting products for homes have turned windows, like many other products, into feature-rich items. As a result, dealers often can sell up customers to units with more amenities if they position themselves well and have the knowledge to convince their customers of the benefits.

"Products are getting higher and higher end,” says Jeff Lowinski, acting president of the Window & Door Manufacturers Association in Des Plaines, Ill. "This is happening throughout the home in all products, especially in kitchens and baths.

Windows are past the hump of selling on energy efficiency—everybody offers that.” Low-end products have raised their quality, to where many offer low-emissivity coatings on glass and gas-filling, he notes.

In part, the emphasis on more amenity-filled windows has been driven by the Baby Boomers, who are moving into their empty-nest years, notes Tom Sinning, director of dealer sales for Marvin Windows & Doors in Warroad, Minn. "Houses in that market are becoming smaller, as they want less room—and they’re using that money for more nice amenities, including their windows.”

With experts predicting total housing starts to drop this year, marketers are unsure what to expect—particularly since experts have been predicting a drop for some time. "The market isn’t doing what the market should do,” Lowinski says. "Both new housing and remodeling have been setting records, and that’s unusual. It’s a very difficult market to predict.”

Window Sales to Grow

Indeed, even with some faltering in the housing market, window sales are anticipated to continue to grow. The value of window shipments in 2004 was estimated at $11.68 billion by Specialists in Business Information, the publishing division of MarketResearch.com. That was a rise of about 18.5% from 2002, when shipments were estimated at 9.85 billion. The group estimates that shipments rose to $12.36 billion in 2005 and forecasts a rise to $13.15 billion in 2006. By 2009, the group forecasts that shipments will hit $16.51 billion on a steadily rising line.

Of that $11.68 billion, vinyl windows represented the largest segment, the report says, garnering 39.4% of the market. That total was followed by wood with 33 %, metal with 25.5% and other types with 2.1%.

As the market grows, the types of windows being sold also have begun to shift. Nowhere can that be seen more dramatically than with impact-resistant windows, which are being specified in code requirements along the Eastern coast. The changes result from the recent tragic hurricane seasons and expand on code provisions that have been in place for the past few years along the Florida coast.

"We’ve seen a huge increase in impact-resistant products,” says Andrew Karr, vice president of marketing and advertising for Silver Line Windows in North Brunswick, N.J. "The products are mostly located in areas where the codes are requiring them, but that code has spread over a much larger area, from Texas through New England.” Adds Chris Monroe, vice president of marketing for Simonton Windows in Parkersburg, W.Va., "The adoption of impact codes along the coast is the most pressing trend we see in the market.” That trend is made even more imperative by local municipalities, which can add restrictions to the more generally accepted code requirements.

Virtually all manufacturers now offer an impact-resistant product, notes WDMA’s Lowinski. "Impact-resistant products have come of age,” he says. "And since they are available along the coast, others are using them, too.” These laminated products offer additional benefits, notes Monroe, including more security from intrusion, which can be a key benefit in urban areas. Lamination also provides more UV protection than is offered from low-emissivity film, as well as sound-deadening properties.

"These products are growing in awareness due to the codes, and that is creating a halo effect as consumers learn about all of the properties,” Monroe says. "So we’re seeing the impact of the code requirements even further inland.”

The key point for dealers to stress to their customers who are considering options for impact-resistant products is that glass is only one part of the equation. "Throwing laminated glass into a window isn’t enough,” warns Karr. For example, vinyl windows need reinforced frames and sashes. Silver Line also uses an interlocking latch design and more aggressive sealants to help withstand impact, as the system is only as strong as its weakest link. "There is a difference between impact-resistant windows and impact-resistant glass,” agrees Monroe. "The whole system must be tested, and sometimes even the local code inspectors don’t understand the difference.”

Energy efficiency also remains a key concern, but it’s become less of an issue today, says Steve Brant, product marketing manager for wood windows at Jeld-Wen Windows & Doors in Klamath Falls, Ore. "There’s a constant movement to create more energy efficiency in products,” he says. Argon gas-filled thermal breaks and low-emissivity film are standard on all of the company’s products, he notes. "People understand the benefits of low-e glass, and now they’re looking for it.”

The importance of energy efficiency as a selling point varies with customers’ attitudes, manufacturers say. "Energy moves to the front as heating bills rise, and that should occur this year,” says Simonton’s Monroe. "But when prices drop off again, the interest drops off, too.” Katie McCormick, sales and marketing manager for Therma-Tru in Sauk Rapids, Minn., agrees. "Energy efficiency can be a driver, and we expect increased interest from homeowners as they understand efficiency ratings and see heating bills rise.”

The 2006 energy tax credits may raise visibility for the value of energy efficiency, but most marketers don’t see the credits providing significant impact to the market. "They will help, but how much is hard to say,” says Marvin’s Sinning. "They may sell people already in the market on low-e glass options, but I don’t expect they will convince more people to buy windows.”

WMDA’s Lowinski agrees the impact may not be significant. "It won’t cause many people to buy windows who weren’t planning to already,” he says. "I don’t anticipate it will be as major a topic as the energy crisis was in the 1970s, which gained a lot of publicity.” Indeed, the program, in late December, was still not finalized sufficiently for marketers to be certain what the benefits would be.

"The government might be a little ahead of things in introducing this now,” says Monroe. "It’s important for dealers and builders to learn about the program’s details when it’s fully introduced to take full advantage of it.”

Energy efficiency adds new importance these days as homeowners look to expand the glass area of their homes. "More builders are using larger and oversized windows plus combinations of sizes together to create a window wall,” says Jeld-Wen’s Brant. "The goal is to bring the outside in and open up the interior.” Adds Silver Line’s Karr, "It’s gotten to the point where homeowners are trying to create glass homes. And it’s driven partly by the energy efficiency that windows can provide as well as the desire to expand the view.”

That trend also can be seen as a rejection of 1970s styling, which squeezed down windows space, says Marvin’s Sinning. "Today, there’s more desire for brightness, transoms and large patio doors working in relation with windows.” Those changes are being felt by remodelers in the ways that homeowners are reworking those 30-year-old homes today. In some cases, marketers note, half-rounds and transoms are used in addition to roundtop windows to add more space. But some options are limited because the homes being remodeled don’t have high enough ceilings to allow for great creativity with window designs.

Unusual shapes also have become popular, but the addition of new options may have reached its limit, says Silver Line’s Karr. "Over the past 10 years, shapes have come to maturity, and there aren’t many more being added now. But the plethora of shapes available now is beyond anything I would have imagined.”

As sizes and shapes change, the colors and styling are expanding, too. "There are more choices now in vinyl and aluminum windows in particular,” says WDMA’s Lowinski. "It used to be that you could only get white, beige or dark brown, but now some manufacturers will have five standard choices and another 10 premium choices.” Vinyl interiors also are expanding, to offer wood veneers that are prestained or stainable, he adds.

Wood windows also are expanding their options by offering new species. In part, these choices can help wood products regain some of the market share that the products have lost to vinyl windows in recent years. "Wood-window manufacturers have realized the importance of style to customers and have expanded their color, design and cladding options accordingly,” says the SBI report.

Marvin Windows, for instance, now offers cherry, oak, mahogany and fir in addition to their traditional pine windows. Jeld-Wen too has expanded its offering to include mahogany, alder and Douglas fir. It also has introduced a process that adds durability to the wood, called Ora-Last Wood, and offers a 20-year warranty on windows made with this process. "Wood has been rediscovered,” says Brant. "Builders prefer the look of wood, and the warranty gives them the confidence to use it. They and homeowners both love the warmth and beauty of wood, and they see it as the top of the line.”

Composites Are Growing

Composite windows also are gaining ground as more manufacturers see potential in such materials. "Hybrids of all types are growing—cellulose, alternative vinyl mixes, fiberglass,” says Lowinski. "They are seen as addressing the shortcomings of other materials.” These include the low energy efficiency of aluminum, the brittleness of vinyl and the maintenance requirements of wood.

Marvin has introduced the Integrity line using composite materials, and Sinning reports it’s growing quickly. The company also is looking at an all-fiberglass line. "These materials will impact the market segment,” he says. "We see them growing in demand quickly. They will have some significant advantages over vinyl, especially at the higher end of that market. We see composite alternatives as a real winner.” The benefits aid both installers and homeowners and include no finish requirements, easy installation and high durability.

Dealers in particular are keeping a close eye on this emerging market, notes the SBI report. "Dealers are getting more involved in fiberglass products as a differentiation strategy,” it says. "The rise in demand for value products that are reliable, energy efficient and require low maintenance contribute to the growing popularity of fiberglass products.”

Detail amenities also are creating more high-end options for windows, notes Lowinski. Self-cleaning glass, decorative glass, simulated divided-lite styles, leaded-glass simulations, false grates, grilles and other options help add customization without harming energy efficiency. Builders also are using windows as a showpiece element, adds Marvin’s Sinning. "We’re doing a lot more signature-style one-off windows as feature-type showpieces,” he says. These can involve fancy or period hardware and unusual profiles.

Because of this expanding range of feature options, sizes, shapes, species and colors, it’s become more difficult for dealers to actually stock the windows, Sinning notes. "Very few dealers, as opposed to the big boxes, are actually stocking the products, because there are so many unique designs and different options. Consumers have driven the products that direction with complex home configurations and unique designs, and dealers are responding. Today, even production builders are offering a variety of options.”

Displays Explain Options

As a result, it’s become even more imperative that dealers provide point-of-purchase materials and displays that can help explain the range of options. Therma-Tru, for instance, offers a rolling floor unit that can be moved wherever necessary to create interest. "Having P-O-P displays can really help, because people want to touch it and feel it and see how it works,” says McCormick. "Larger displays, especially in showrooms, can be a big help. It’s good to see the products life-size, but it’s not always practical.”

Showrooms offer the best potential, all agree, especially if window specialists have been trained to help explain the options. "Dealers who really use window specialists to good advantage have the best chance to grow the business, because they can really add value to the purchase,” says Marvin’s Sinning. "Homeowners today may be spending $80,000 on windows, and they’re not excited about ordering them from a catalog or from a display that shows a corner of a window.”

Standalone showrooms separated from the lumberyard are growing in use, he notes. "These products have high margins and are more complicated than they used to be, and they require more time to select,” he says.

Because of that complexity, suppliers and dealers are communicating more about the most effective selling processes and tools. That cooperation also grows as dealers expand their service to builders by offering installation services, for which windows are a focus. "We’re moving toward a supply chain of manufacturer and dealer working together so the dealer is less of a supplier to the builder and more of a subcontractor. As that service expands, more training is needed,” Sinning says.

By supplying both a consultative service in helping to select the exact right options for each customer, and then supplying the installation, dealers make themselves invaluable to their customers. Staying abreast of code requirements, new technologies and new style options also ensure that dealers can differentiate their service and meet their customers’ needs in a product area that continues to expand its rich feature presentation.