For years Honeywell has hosted annual conferences for each of its three largest authorized dealer programs. The individual format changed this year with Connect 2013, which brought together installing security contractors from the First Alert Professional (FAP), Commercial Security Systems (CSS) and Honeywell Integrated Security (HIS) networks.
Held Nov. 7-10 at the JW Marriott in Los Angeles, roughly 800 attendees participated in a wide range of educational sessions, networking, entertainment and more.
Honeywell’s decision to host one conference served as a fitting indicator of how industry practitioners are increasingly linked by the same need to provide end customers — be it in residential, small to medium businesses or even enterprise-class projects — with solutions that enhance lifestyles as well as impact a business’ bottom line.
That theme was expounded upon at length during a general assembly presentation given by Scott Harkins, president of Honeywell Security Products for the Americas. He contended if the security industry can change lifestyles, then the entire dynamic of the industry will transform and open to unprecedented growth potential.
“Our industry is changing. We’re not really the security industry any longer. You now play in the consumer space. How you deliver products and services isn’t going to work if you continue to do it the way we’ve done it over the last many decades,” Harkins said.
That is largely due in part to broadband, smartphones and apps, which are providing easy access to information and altering user expectations across the entire marketplace. Harkins continued to hammer home the idea that all customer types should be viewed first as consumers, given that technology now intersects with consumer behavior and expectations.
For instance, the homeowner or the security director or the small or medium business owner might have wildly different needs for their security systems. Yet they have very similar expectations in how they interact with their home or business.
“You don’t sell to a homeowner or a business, you sell to a consumer. If you change and impact their lifestyles, I truly believe we can unlock dramatic growth in every segment of the security industry by combining lifestyle, removing complexity from the home and business, and building that on top of life safety. This is a critical element of our future success,” he said.
Expanding market penetration beyond the historical 20% ceiling will require the industry to cut attrition; driving awareness and selling lifestyle products and services will play a key role toward that goal, Harkins said. But don’t stop there. Get out and visit your existing customer base to seize other opportunities as well to create sticky customers.
Consider: about 30% of households are purely wireless today, they have no land line. According to Harkins that number has doubled in just the past three years. The trend suggests security systems that are connected to a phone line will soon require dealers to update the customer with some type of communications such as broadband, WiFi or a GSM radio.
Harkins also cited 44% of 18- to 30-year-olds — the next generation of homebuyers — don’t have phone lines today; and 50% of households either don’t have or use the phone line in the home. “That suggests those phone lines are going to go away, giving dealers more reason to update those systems to new technology to transmit alarm signals, but also offer them new remote services like Total Connect by adding simple things like the Tuxedo or Vista panel.”
And then there is the 2G sunset. Honeywell estimates there are roughly three million 2G radios still in operation that will all have to be replaced with broadband or 3G or 4G technology in the next 24 months, and likely sooner.
“This is another reason you are going to have to go visit your installed base and update them, and when you update them show them, sell them these lifestyle services,” said Harkins. “It’s a way to do two things: do the radio update, maybe even get paid to do that radio update, and add RMR to the customer and reduce attrition. Your attrition is going to be your competitor’s upgrade. If you don’t upgrade them, somebody else will.”
In other goings-on, Honeywell used Connect 2013 to make a few key product announcements for upcoming release in 2014. Namely, the company will offer a migration solution to the end-of-life Casi-Rusco Picture Perfect brand for large-scale installations. The system has been deployed for about 15 years, and its vast installed base includes many Fortune 500 companies.
Set in a faux living room space, a new iteration of Total Connect that features voice recognition was demonstrated during the welcome reception and technology expo. The system receives simple commands to execute home controls, such as turning lights on/off or dimming, raising/lowering window blinds, etc. Up to six commands can be programmed. Alarm system control is not currently part of the voice command application.
Marek Robinson, president of Honeywell’s Authorized Dealer Programs, announced a pair of new partnerships to help drive business for its members. In what looks to be a move to compete against the likes of Verizon and AT&T, which both have a strong retail presence to offer home automation and security offerings, Honeywell is aligning with Sprint to sell its systems in kiosks. Honeywell has also consummated an agreement with LifeWay Christian Stores that Robinson said will generate 10s of thousands leads for its dealers.
Finally, anybody familiar with previous First Alert Professional conferences will know the bestowing of the Life Safety Award provides a special moment to honor courageous individuals who go above and beyond to save lives. That award continued at Connect 2013. San Bernardino County (Calif.) Sherriff Deputy Arturo Ramirez Jr. received the honor for rescuing a woman and four children from a fire. Per usual, Larry King taped a video presentation during which he described Ramirez’s heroic act. Then, to the surprise of everybody gathered for the general assembly, King made a surprise appearance on stage to greet the deputy and speak to the crowd.
On a personal note, I conducted an in-depth roundtable interview with four security company executives during the conference which you can read in the January issue. Many thanks to John Campau (Comtronics), Joseph Menke (Electronic Security Concepts), Kevin Stone (Doyle Security) and Ronnie Whiddon (Custom Security Systems) for their insights and frank discussion about industry trends and challenges.
Rodney Bosch | Managing Editor