Creating a Marketing-Technology Complex: Strategizing for the future

By George R. Pilcher

Everyone loves “executive summaries,” so let’s start this article, which deals with the current economic state of the U.S. paint and coatings industry, with one: In the U.S. paints and coatings market, circa mid-2015, margins for coatings producers will continue to strengthen amid a more stable growth environment, supported by recovering end markets and favorable raw material pricing and availability.

Titanium dioxide dipped yet again in Q1, and there are those who are predicting that it is likely to fall further prior to year-end. Softer pricing for oil-based derivatives are also contributing to the health of the paints and coatings industry, which ended 2014 at an estimated 1,260 million gallons, valued at $22.1 billion (Figures 1 and 2).

In the United States, and to a somewhat lesser extent, globally, consolidation continues to be a key theme: with PPG’s Comex acquisition, the top three global coatings firms account for 62% of the top 10 global coatings firms’ sales, up from 48% 10 years ago (Figure 3). Overall, the tone remains upbeat for the major coatings producers, and—as long as the recovery continues its steady (albeit slower than most companies would wish) upward trajectory—things look pretty good for the regional producers, as well. Thus endeth the Executive Summary . . .