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Cover Story

Insights, Solutions and a Few Discoveries
Comments on the state of the industry and the role Hunter Douglas plays in it from the company’s president and CEO.

By Howard Shingle
Photography by Jim Robinette

you cannot be in the window coverings industry very long without hearing the name Hunter Douglas. It’s spoken with pride, envy and sometimes a bit of animosity. The company’s leadership role makes it a target for criticism as often as an example to follow.

As president and CEO of Hunter Douglas Inc., Marv Hopkins often becomes the personification of the one company that arguably has the biggest influence on the custom window coverings industry. In this exclusive Q & A with Draperies & Window Coverings, Hopkins offers some thoughts on this “underdeveloped” industry and how Hunter Douglas fits into the industry’s big picture.

D&WC: In your opinion, what is the state of the window coverings industry today?

Marv Hopkins: It’s always challenging and competitive and a bit unpredictable because it’s populated by many smart, hard working and aggressive entrepreneurs. At the same time, there are many attractive opportunities for continuing growth and success because this is also an underdeveloped and relatively unsophisticated industry.

We’re underdeveloped because window coverings are a low awareness and low priority category for most consumers. It’s a category that has enjoyed very little brand and image development. Hunter Douglas is the only industry company that has a consistent and significant national brand advertising campaign aimed at consumers. Most advertising that is done locally does little to build awareness and understanding of custom window coverings because the local advertising focus tends to be on price and discount and not on the features and benefits of the products, alternative options and upgrades available, how they can enhance the beauty and comfort of the home and provide critical functional benefits—such as privacy, light control and UV protection.

THE HOPKINS FILE

Distinguished Career Highlighted by Success Marvin B. Hopkins was appointed CEO of Hunter Douglas Inc., Upper Saddle River, NJ, in January 1995. He took on the duties of CEO in addition to his posts as president and COO, which he assumed in January 1994. Hopkins is responsible for the company’s 25 divisions and some 6,000 employees throughout the United States and Canada. Hopkins joined the company in 1986 as the first president of its new Window Fashions Division, based in Broomfield, CO. Under Hopkins’ direction, the division achieved explosive growth by introducing a series of award-winning window coverings that have become well known in the industry as well as among consumers and designers. They include: Duette® honeycomb shades, a major innovation in the industry that became the leading brand in window coverings; Silhouette® window shadings, introduced in 1991; and Luminette® Privacy Sheers launched in 1997. Before joining Hunter Douglas, Hopkins was a division president for Lenox Inc., the leading American manufacturer of fine china, crystal and giftware. He graduated from the U.S. Air Force Academy and served as an Air Force pilot during the Vietnam conflict.

The category can be quite confusing and intimidating to the consumer because the products are custom and there are so many different types of materials, fabrics, shapes, styles, colors and options. We, as manufacturers, have to do a far better job of helping our retailers present our products attractively, effectively and competently in their stores and communicate the key attributes that separate one choice from another. Most importantly, the retailer needs to have the confidence and ability to “start at the top” and aim his clients at his more profitable, upscale and innovative products. Furthermore, the difference in retailer profit on the sale of Silhouette® with PowerRise® versus a standard faux wood blind, for example, is quite substantial and over the course of 12 months, such distinctions could have a critical impact on overall profitability. Too many retailers start at the “bottom” with a customer and as a result their profits fall far short of what they should be.

Keep in mind that the American consumers will be spending lots of money on their perceived priorities over the next 12 months. Those priorities may be home furnishings, electronics, SUVs, jewelry, golf clubs and on and on. Unfortunately, because of the lower awareness and weak brand building of our industry, window coverings are not as high on the list as we should and can be. This hurts all of us in the industry. The money is being spent, so let’s capture our share.

Why should we move up on the list? For many reasons—custom window coverings are among the most prominent and visible features of the home, from inside and out. The consumer will see them and can enjoy them every day and all day. They enhance and highlight the beauty of the window and the entire house; they protect the interior and the furnishings from destructive UV rays; they provide privacy and light control and they will last for many years.

Finally, there are about 100 million households and at least one billion residential windows in the United States. As long as American consumers continue to buy new homes and renovate their old, the industry will have almost unlimited opportunities to grow and improve and to do so profitably. And, at Hunter Douglas, we intend to lead the way.

D&WC: Just how important is consumer demand as a factor driving the industry?

Hopkins: Consumer demand is vital. Custom window coverings are not impulse purchases. They are major investments, which should be carefully considered, because they will be among the most prominent and visible features of the home interior for many years. They are also necessities for most windows because they provide privacy, light control, UV protection and temperature control.

One of our key strategies is to create new and greater consumer demand, for the entire category and for our brands and products in particular, through our image ads in leading shelter magazines, on cable TV and through our Web site. We invite the consumer to contact us for more information and when she is ready, we try to connect her with one of our best dealers in her locale. We also follow up 30 to 120 days later to determine what actually happened after our initial contact and what can be done to close the sale if it hasn’t occurred.

The American target consumer for our high-end custom window coverings is more sophisticated, better educated and more demanding than ever before, and we have to be more effective in anticipating and responding to her interests and needs.

If we are to capture our potential share of consumer spending and expand demand for custom window coverings, we have to learn from the more sophisticated consumer industries who “start at the top” when introducing their products to the public. The potential of this industry is really only limited by its own myopic view of the possibilities.

D&WC: Where does Hunter Douglas specifically fit into all of this?

Hopkins: We have a leadership role, which we take most seriously. We’re working to help this industry become more important to the American consumers and end users.

We intend to lead the way in ensuring that consumers enjoy a thoroughly satisfying experience before, during and after the purchase of our products and that they recommend our brands and products to their friends and families.

We accomplish these objectives with a multifaceted approach including continuous investments in new product innovations; professional training and education programs for our dealers and installers; alliance programs such as our Window Fashions Gallery®, which ensures that our products are displayed in a consistently upscale environment and complete format; and where we also benefit from the counsel and advice of these, the industry’s most experienced and successful dealers. Last but not least, we have consumer advertising and communications programs that help create demand and appreciation for upscale custom window coverings.

I believe we have the best distribution and services capabilities in the industry with our network of 28 outstanding fabricators exclusively devoted to Hunter Douglas products. These companies have their own well-trained sales and service organizations who stay close to their local customers and provide consistent three- to five-day turnaround on orders. These companies are really our family in that we’ve worked so closely together for many, many years, and we solicit regular and frequent input from them on where the business is going and how we can do a better job for them and their customers.

Our business is a work in progress in that there will always be opportunity for greater growth, learning and improvement.

D&WC: Is it possible for Hunter Douglas to get too big?

Hopkins: Hunter Douglas is not large compared to companies in many industries. We have a small company philosophy in that our organizational structure is flat to minimize bureaucracy and stay close to our customers and is decentralized to provide local autonomy to our individual operations throughout North America. Our motto is “minimum interference and maximum accountability,” and this enables our companies to remain more flexible and fast on their feet in anticipating and responding to the needs of their particular locale or product area.

Keep in mind that custom window coverings is our business. It’s not a sideline and we’re not going to sell it or starve it or combine it with unrelated businesses. We’ve been at it for over 50 years with the same stable ownership and the same philosophy and many of the same close relationships.

Our investments reflect that philosophy. For example, it takes a long-term commitment and disciplined consistency to successfully build a powerful, upscale consumer brand, and we’ve been at it—every spring and every fall of every year—since 1986. It’s a long-term building process and it’s working. Another example: We have continuously invested in new product development even though the results may be uncertain and the return on our investments may be years in coming. That’s why we can now offer the consumer honeycomb shades, window shadings, privacy sheers and many other innovations that didn’t previously exist. Yet another example: We invest in our people and they stay with us. Most of my key executives and managers have been with Hunter Douglas for 10 to 20 years and some even much longer. They know what they’re doing. They like what they’re doing. They make the difference. They keep us on top.

The good thing about our size, momentum and growth is that we have more resources to invest back into improving the business: investing in new products, investing in brand development, investing in our people and investing in programs that will serve our dealers and decorators more effectively.

If you look at Hunter Douglas over the years, we have been consistent in our strategy and our overall focus and direction. We intend to remain focused on this business and on the things we feel are most important to grow it and help our dealers and fabricators. We have been doing that for many, many years. The fact that we’ve never changed ownership and that we’ve consistently maintained very good managers and very good leaders says a lot about the company in my estimation.

We also work through a number of independent fabricators throughout the country who’ve been in the business for 20 to 30 years or more and are still there and we still have the close relationships with them.

Are we becoming too big or are we losing sight of what brought us here? I don’t think so. We have to constantly challenge ourselves to make sure we set our priorities correctly, keep the right focus and stay close to our customers. We have to communicate with them, listen to them, respond to them and make sure we’re providing better products, services and quality than any other company can or will.

I don’t want to sound like we know it all or are arrogant about where we are—we don’t and we aren’t. We’re passionate about this business. We’re grateful to all the folks who’ve helped us get to where we are. We want them to go with us to the next level.

D&WC: Who have been some of your greatest influences in business?

Hopkins: My parents have had the greatest influence on my life. They were honest, hardworking entrepreneurs who possessed impeccable integrity and maintained the highest ethical standards. They treated everyone—big or small, rich or poor—with dignity and respect.

At Hunter Douglas, there were two individuals, now deceased, who still serve as inspirations for me and, I’m sure, for others. The first is Henry Sonnenberg, the self-made business genius who co-founded Hunter Douglas almost 60 years ago. He was an exceptionally shrewd judge of people and knew how to pick the best “horses for the courses.”

The second person was Jerry Fuchs, my predecessor at Hunter Douglas. He was a charismatic leader and a visionary who laid the foundation for much of the success we’ve enjoyed at Hunter Douglas over the past 20 years.

I have great respect and admiration for the people who now work at Hunter Douglas. They have made my life much easier and my accomplishments far greater than would have ever been possible otherwise. The key to the success of any organization is the dedication and talent of its people, and I am blessed with an extraordinary level of both in this company.

I’ve been particularly fortunate to have superb guidance and support from Ralph Sonneberg who has been leading and directing the worldwide Hunter Douglas Group for many years.

D&WC: You have been with Hunter Douglas now for more than 16 years. Are there still any surprises for you?

Hopkins: If there are no surprises or challenges, that means I’m out of touch! We’re serving a dynamic marketplace with ever more demanding customers. We always have room for improvement and we always have opportunities to strengthen our position.

We need to eliminate internal waste, perfect our outgoing product quality, strengthen our customer communications and services, build greater consumer awareness of and demand for Hunter Douglas products and introduce innovative new products for the new generation of American consumers. At the same time, we have to help our dealers, designers and installers, and our independent fabricator partners achieve success and continue to grow and improve.

D&WC: One issue that consistently rises is pricing and who gets the better discounts. Is there any end to this?

Hopkins: There is too much focus on price and discount to the detriment of far more important considerations. We know from our own and outside research that price is not the most important factor and it’s not second or third, either. The aesthetic appearance and functionality of the product, the strength and quality of the brand and the trust in and competence of the dealer are each more important.

Keep in mind that a custom window covering is a longer-term investment and will be a highly visible part of the home, with the product in place normally for five or more years. That means the consumer can have the very finest for only a small monthly premium over the very cheapest. Instead of price and discount, the dealer should be advertising the important features and benefits of the product, the trusted brand, his own value added services, his expertise and years of experience, and his showroom displays.

In most cases, the prospective purchaser knows very, very little about the exciting choices and options available, such as motorization, hidden cords, energy efficiency, light control, translucency, specialty shapes, child safety features, cleanability, stackability and on and on. Most discount ads tell him very little or nothing of what he really needs to make the best choice for his own needs.

If the industry is to grow and prosper as it can and should, we must focus on communicating the benefits of the product and the brand and the added value that we bring to the transaction.

A GALLERY OF SOLID BUSINESS SUPPORT Hunter Douglas Window Fashions Gallery Program helps dealers present, sell and install In November 2002, M.C. Weeks, Inc., Trappe, PA, became the 100th store to join the Hunter Douglas Window Fashions Gallery®. It was a milestone. Begun in 2000, the Window Fashions Gallery is Hunter Douglas’ premier point-of-sale display program created in response to consumers needs as a communications channel carrying product-focused, consumer-oriented information from the manufacturer through fabricators to dealers. The most visible aspect of the Window Fashions Gallery is the display environment. The Gallery showcases the entire Hunter Douglas line of products with large, backlit products samples, sample books and four-color photography. It also offers comfortable seating where customers can view and operate the full range of products. The full purpose of the Gallery program, however, includes providing dealers with training and support so they, in turn, can provide customers with top-notch customer service, outstanding product knowledge and exceptional installation. The elements of the Hunter Douglas Gallery program include: • In-Store Display Environment—this unique retail boutique presents the company’s entire line of products full size in a user-friendly format. The flexible configuration allows it to be accommodated in most retail showrooms. • Extensive Training—program dealers can benefit from several training vehicles including advanced training seminars to strengthen product knowledge, installation certification and customer service training available to their entire staffs. Online classes and quarterly conference calls with other dealers are available to share information and ask questions. • Dealer Support—support materials, business-building programs and in-store design seminars, leasing programs, Momentum, a monthly newletter, as well as financial services consultations are all offered to Gallery program dealers. These initiatives encourage long-lasting relationships between dealers, their employees and their customers. • Heightened Visibility—Internet programs including customized Web pages, networked links and priority lead services, public relations campaigns, customized advertising, graphic standards, and print and broadcast services are some of the tools available to help dealers strengthen their positions in their communities.