What would you do if you had an opportunity to install specialty residential systems that would utilize the majority of your existing installation and electronics skills; have a price and profit margin larger than typical security systems; and yes, could even add to your RMR base? If this type of business fell into your lap on a regular basis would you take advantage of the opportunity? Are you interested? Then by all means read further.
Consumer technology is expanding rapidly on two fronts — home and mobile devices. Today’s customer expects to be able to take advantage of the convergence of both of these technologies and services. A smartphone is a cell phone with software applications or “apps” that enable remotely interfacing with entertainment and automation functions in their homes.
Thusly, an alarm control panel no longer merely processes alarms - it is a centerpiece for today’s connected home. This scenario is no longer a luxury but becoming a requirement of today’s residential security, bringing many opportunities for dealers to branch out.
New Study Shows Market Is Ripe
Not convinced this is a market for the standard alarm dealer? Then take a moment and listen to what your peers, and often competition, as well as your residential customers and prospects, are saying.
Earlier this year, the Electronic Security Association (ESA), formerly NBFAA, revealed the results of an extensive survey designed to assess security dealer/systems integrator offerings at present and where they are headed in the near future. The consumer part of the survey gauged the interest levels and awareness of integrated systems features and functions, as well as receptivity to various providers. The survey was conducted in April/May with input from 149 ESA members and 520 consumers.
Here are some selected results:
- Installing companies projected 415-percent and 280-percent growth from 2011-‘13 in energy information and HVAC control, respectively. These were the priority areas of home automation and typically reflect an increased interest in intelligent control of home system functions.
- 35 percent and 25 percent of alarm companies identified their biggest obstacle as not knowing how to sell/market home automation and energy management, and home networks, respectively. There appears to be a large opportunity for vendors to train resellers here.
- Installing companies anticipate 44 percent of their residential projects will include remote/mobile control features by 2013. That’s a forecasted increase from 28 percent today. This is a big one everybody, so make sure you have your marketing plans in place quickly.
- 74 percent of consumer respondents are interested in adopting new technology after it has been around for a while and shown a trend.
- 79 percent of consumers trusted security companies to offer services and do a good job. This is a biggie! Take advantage of this huge vote of confidence. The next closest group was computer/IT companies at 33 percent. Homebuilders and remodelers were at the bottom of the ratings.
Getting Up to Speed in a Hurry
What can we do to get ready for delivering new nonsecurity residential systems? Security dealers need to visit the parallel technology universe of home automation and entertainment, and mobile/remote services to learn new skills and find new vendors of these popular technologies.
In the past, the most exotic things security dealers had to interface with would normally be fire sprinkler systems and phone systems. Now they have to deal with HVAC, audio, computer networks, Internet and cellular communications, and more. These systems can be larger and often involve scheduling work with many other contractors. The scope of some systems such as home entertainment can easily dwarf the scope of typical alarm system installations.
In order for personnel to step into these “big league” projects, new organizational tools and skills, such as project management (PM), have to be learned and executed if the dealer is to maintain profitability. Simply put, the more you know about a project, the better you can manage it.
One organization security dealers may want to become familiar with is the Custom Electronic Design & Installation Association or CEDIA (cedia.net). Its education and training programs can help overcome the large obstacles of nonsecurity product knowledge and installation skills.
Similar to other trade organizations, CEDIA also offers certifications, such as the Electronic Systems Project Management (ESPM) program. This program is a descendent of PM strategies from the Project Management Institute (pmi.org). PMI serves practitioners and groups such as CEDIA by providing standards that stress the best PM practices. One important reference document from this organization is the Project Management Body of Knowledge (PMBOK). PMI also offers its own certification programs such as Project Management Professional (PMP).
Recently, in a CEDIA PM training seminar, a few key project management pointers were emphasized. These included the five phases of a project: Initiating or launching the project; planning project objectives; executing the work; controlling and ensuring the objectives are met; and closing with acceptance of the project. Additional emphasis was placed on the understanding of the project’s “Iron Triangle,” which proportionately pits project time, cost and scope against each other to maximize project quality.
Products, Providers and Profits
One of the biggest demand areas in the ESA survey was mobile services. Customers now want to not only arm/disarm their alarm system via their smartphones, but they also want to be able to turn the thermostat and lights up and down remotely. This is now being provided to resellers through services such as the emPower program from Alarm.com (see this month’s Tool Tip box).
Retrofitting home automation upgrades is becoming easier with products such as the RadioRA 2 residential smart grid solution from Lutron (lutron.com) that can be delivered through devices like the Honeywell TouchPRO wireless thermostat (see photo).
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