Creatively connected

By Lauren Duensing

March 2014 - Word-of-mouth advertising has evolved with technology. When customers talk in person with their friends and acquaintances about their experiences, the information might reach a couple dozen people. Those opinions have a much further reach when posted online. 

Companies today interact with customers beyond the actual transaction of buying and selling goods and services. They offer promotions on Twitter or Facebook or reward repeat customers with store credits when they get their friends to complete signup links. Fashion designer Marc Jacobs recently opened a pop-up store that bartered fragrances and accessories in return for social media posts. Shoppers who attached a specific hashtag to their tweets had the opportunity to snap up the free items.

I’m confident I won’t be writing about metals companies trading steel coils for Twitter promotion anytime soon, but they also are implementing strategies to connect with current customers and reach out to new ones. Sapa recently added its design manual to Apple’s App Store, which, according to a company press release, will give the aluminum extrusion manufacturer “a new channel to reach customers, architects, designers, engineers and students who are eager to learn about aluminum and aluminum profiles.” The manual also is available on the company’s website and has more than 4,500 registered users. 

Efforts to attract new customers and provide better service to current ones will pay off as the economy continues to rebound. And, for the most part, the numbers are trending upward. “Forging Ahead,” PwC’s annual analysis of global deal activity in the metals sector, reported M&A value topped $15 billion in the fourth quarter of 2013—the highest quarterly value since the first quarter of 2012. 

“The bounce-back in demand from end-use markets and healthy company balance sheets all contributed to a consistent level of activity throughout the year and a strong rebound in total deal value during the fourth quarter,” said Sean Hoover, U.S. metals leader at PwC, in a statement. “Metals companies are positioning themselves for an improved U.S. and global economy and consolidating to improve efficiency, lower costs and drive bottom-line growth. The fundamental factors that drove the fourth quarter’s healthy rebound remain in place, indicating a sustained level of deal activity going forward.”

Four of the five mega deals in the quarter involved steelmakers. “A traditionally more fragmented category relative to the others, the steel sector’s enhanced activity may be indicative of acquirers’ efforts to consolidate capacity and become more cost efficient to help grow their margins in the face of an improving economic environment,” Hoover said.

In this year’s roundtable, Modern Metals’ editorial advisory board discussed connecting with customers and running businesses efficiently despite economic challenges. Richard McLaughlin, partner, World Steel Dynamics, noted in the article that the financial pressures of the past few years have caused the industry to accelerate its pace of change. “Nothing focuses the mind like a crisis,” he noted. MM

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