October 28/November 4, 2019: Volume 35, Issue 9
By Megan Salzano
The consumer’s love affair with natural stone’s luxury and durability has raged for centuries. While consumers are often fickle with their hearts, it is unlikely this category will cease to draw demand for the long run. New shapes, sizes, colors and textures have also reinvigorated the category, allowing it to move outside the confines of kitchen and bath and drawing new consumers to the category.
“Stone continues to be a category that drives higher property perception and value and is desired by the end users,” said Mara Heras, vice president of marketing, Emser Tile.
However, traditional stone sales have been battered of late by a number of challenges the category will have to overcome in order to regain its presence in the residential market.
Like other hard surface materials, the persistent growth of resilient flooring—namely LVT/P—has left a dent in stone sales. While many in the industry believe vinyl cannot yet compete with the visuals of the stone category or even those of its ceramic tile brethren, its advantage lies in its low cost of entry as well as ease of installation and maintenance compared to stone.
The continuing visual advancements of stone’s familial category, ceramic tile, has also left its mark. “Today, ceramic tile is able to mimic the looks of natural stone at lower costs,” Raj Shah, president, MSI, explained. “In addition, due to the digital printing of ceramic tile, we can narrow down the look of the tiles, resulting in each tile being perfect. Natural stone has itsown beauty but typically has a wider variation of looks, which is difficult to explain to a residential customer.”
Perhaps the greatest challenge for the stone category, and possibly being felt more so than any other, is the loss of qualified labor. “The pool of labor with the skills and experience necessary to install natural stone has diminished,” Heras explained. “In addition, the product can have higher labor costs to install, requires more training and sales time to show the range of color and visuals for natural stone, and it has a different maintenance profile. The education and touch points required make it a longer and more involved sale.”
As with most categories, stone is also feeling some pressure as consumers pull back in a slowing economy—although it currently remains generally healthy—trade disputes with China and the general political uncertainty ahead of next year’s presidential election.
While suppliers agree that these issues haven’t impacted the category as heavily as some others, its effects are still felt. The biggest issue, according to MSI’s Shah, has been the Section 301 duties from China on natural stone. “As natural stones generally are only available from the country they are quarried, this has caused inflationary pressures on Chinese natural stone,” he explained. “This has also caused price increases as it relates to mosaics and stacked stone coming from China. And, there were also threats of Section 301 on European granites.”
A large percentage of natural stone comes from countries such as India and Turkey as well. “As we know, China is facing tariffs on Chinese products that could be up to 30%,” said Roy Viana, director of natural stone and slab, Dal-Tile Corp. “India and Turkey have experienced the Generalized System of Preferences (GSP) termination, which provided duty-free treatment of goods from designated beneficiary countries. Now, stones from these countries will be charged normal tariffs. These cost increases have made stone less affordable.”
When it comes to what to expect in 2020, Roy Marcus, Artistic Tile brand ambassador, said election years can be tricky. “Uncertainty in political life can influence the level of confidence in the stability of the economy. This can delay final decisions as homeowners choose materials.”
Tackling challenges head on
Stone has a variety of challenges to face, but suppliers agree the category will meet them head on. For example, while labor pressure has created an opportunity for “easy-to-install” resilient flooring, Emser’s Heras noted continued opportunity in the remodel business. “We continue to see aging housing stock in need of remodel. In times of economic uncertainty, homeowners continue to stay in place and update vs. looking to sell and build or purchase again. This translates to a continued opportunity for remodel business.”
Suppliers have also noted LVT fatigue within the industry due to its oversaturation and low price points, causing a shift back to more natural and sustainable materials. “The proliferation of players, assortments, SKUs and a race to the bottom on price point is causing a reverse trend of shifting back to materials like stone, ceramic and hardwood,” Emser’s Heras explained.
Marcus said Artistic Tile’s sales force is keen to tackle the competition from ceramic. “The difference between natural stone and porcelain can be sometimes subtle but always apparent. Our team is especially adept at using that difference to empower our clientele to make design decisions ideally suited to the luxury project.”
In addition, Dal-Tile’s Viana said ceramic and LVT products are generally used in floor applications, leaving a big opportunity for the installation of natural stone in vertical settings.
Taking on the challenges also means seizing new opportunities within the category. Innovation has led to new shapes and sizes, finishes and dimensional cuts that allow suppliers—and their retailers—to draw new customers to the category.
“New shapes and sizes are making an ancient material even more exciting,” Emser’s Heras noted. “Formats are getting larger and have moved solidly away from squares. Retro formats like hexagons and other shapes are popular.”
Stone mosaics have also evolved into intricate shapes, Dal-Tile’s Viana said, with multiple textures and sizes.
Bringing innovative visuals to market is also important for the category to meet new demands in interior design. Viana noted the visuals, finishes and textures that are now achievable with new equipment are setting stone apart from other floor and wall covering categories. He added that customers are now even willing and able to blend multiple materials such as ceramic, wood and metal with stone.
In addition, while stone is an ancient material, suppliers are not exempt from taking cues from new color trends. “At Artistic Tile we are rejoicing in the triumph of color,” Marcus said. “We—and our clientele—are dazzled by so many new colorful stone tile and slab choices, including a range of rosy, peachy marbles; greens that run the spectrum from brightest spring to deepest forest; delicate lilac to wine-dark purple; blues that soar skyward.”
While new colors are growing in demand, more traditional colors are still driving the market. “The market has shifted completely to white, grays and taupe colors, which remain most popular,” Dal-Tile’s Viana said. “Marbles and limestone are the two most popular stones in the industry. These two stones will continue to take market share as long as a contemporary color palette is offered.”
Emser’s Heras noted that while gray is still in demand, the company is seeing warmer tones come back in fashion. “With the cyclical nature of our industry, it is not a surprise that golds, creams and beiges are in demand,” she said. “There are definitely more marbles and limestones driving the category, but we are also seeing a return to travertines following the trend toward warmer tones.”
Building outside the box
These advances in design have helped to grow stone’s application potential, allowing it to move up the wall and outdoors, expanding not only its place within the home but its growth potential as well.
“The best way to continue the growth of natural stone is to find more uses for it from outdoor pavers, to backsplashes, to mosaics on the floor and pebbles in the yard,” MSI’s Shah said.
The move toward slab installation for bathroom walls, Artistic Tile’s Marcus noted, has been a major shift over the last few years, as has the move to rectangular tile with a 1-to-3 ratio, or longer, as opposed to 1-to-2. “And of course, the huge demand for curvilinear mosaics created via water-jet technology has been revolutionary,” he added.
Vertical applications such as bathroom walls, fireplaces, feature walls and backsplashes, Dal-Tile’s Viana noted, are focal points where customers want to make a statement and invest in more expensive and luxurious products such as natural stone wall tiles and mosaics.
Emser’s Heras said the outdoors remains an opportunity as the desire to create extended living spaces that keep us connected to the outdoors is strong. She added that the availability of larger formats has driven more interest in utilizing tile in larger living spaces such as great rooms, open concept home and living rooms.