The Rebirth of Residential Revenues: Homeowners Demand Interactivity
Mobile apps and Web-enabled services that allow consumers to control security and automation devices are fueling revenue growth in the residential market.
The past 10 years have seen dramatic change to the residential security system. Today’s systems can communicate wirelessly, telephone lines are a thing of the past, security panels have color touchscreens, users can interact with their system and security sensors can even be used to optimize energy use.
These advances have created fresh opportunity for dealers and integrators to offer additional services, reduce attrition and increase recurring monthly revenue (RMR). New services, driven by technology innovation, are projected to fuel overall growth in the number of homes that have security systems.
Upcoming in this article, we’ll focus on several key technologies transforming residential security today and poised to have a significant impact in the future. Plus, we’ll discuss consumer trends driving technology development, share how installing security contractors can effectively generate new revenue opportunities and grow their businesses by delivering these in-demand residential security services.
Soon to Be ‘Must-Have’ Services
The emergence of interactive services has been driven by a steady drumbeat of technology innovation during the past 10 years. What began as the core ability to send commands to the security panel from a computer interface and get notifications has given way to today’s systems that are far more sophisticated, offer better security and have made it easier to service and support customers. The evolution of interactive services from early adopter phase to a ‘must-have’ technology can be attributed to multiple factors.
First, explosive growth of mobile devices has led consumers to rely increasingly on their iPhones, iPads, BlackBerrys, Android phones and other Internet-enabled mobile devices for day-to-day activities such as monitoring and securing with their property.
The quantity and quality of interactive services continues to evolve from basic real-time text notifications to today’s set of home energy management, integrated video, and new location-based capabilities. Also, the rise of interactive services reflects the extent to which consumer perception of what security means has progressed from traditional arming and disarming to an expectation for day-to-day property awareness and peace of mind. Notably, the price point for many interactive services has come down to a level that many consumers can afford and are willing to pay for.
Interactive services technology has also driven great advancements in the service and support of customers. Interactive services has made it possible to access and change most panel settings from a Web site, greatly reducing the need for a truck roll and increasing customer satisfaction with the ability to address request almost immediately. This has resulted in decreased customer support costs for accounts with interactive services and reduced attrition due to higher engagement and overall customer satisfaction.
Mobile Apps Improve Retention
When the first Alarm.com app was released in the spring of 2009, the overwhelming majority of logins to an Alarm.com interactive account were through the company’s Web site. One year later, 50% of logins were through a mobile device and now more than 75% of remote access events for those interactive service accounts are through a mobile app.
Nearly all of the other key technologies referenced in this article are either enhanced or enabled by the ability for consumers to access these features via mobile apps. The traction mobile apps have gained for controlling and monitoring security, video, lights, thermostats and locks reflect their ability to keep customers engaged with the system on a regular basis. This has, in turn, proven effective for security dealers and integrators in improving retention of existing customers, driving new customer acquisition, and delivering additional revenue-generating services.
Mobile apps have also proven transformative for the ability to change how customers interact with their home systems. Not only have mobile apps been relied upon by users remotely (at work, on vacation, etc.), but customers also are drawn to the ability to change thermostat settings, lock doors or arm the security system from the living room couch or bedroom rather than having to do so from the physical keypad. This behavioral shift positively impacts dealers, who could see equipment costs go down as customers use products they already own — for example, smartphones and tablets — to get more out of their systems.
Video in the Home Is More Common
Video as a service (VaaS) has added a highly disruptive element to traditional home security, as much for the price point as the technology itself. Video monitoring is no longer relegated to high-income individuals willing to spend tens of thousands of dollars for a custom installation of video equipment. Everyday consumers can now take advantage of wireless IP cameras for a few hundred dollars, and because video can be stored remotely in a cloud environment there is no need for consumers to incur a local storage device.
For security dealers and integrators, affordability, higher quality IP cameras and the ability to deliver live or motion-triggered video clips directly to the customer translate into expanded RMR opportunities. At the same time, the ease at which some video monitoring solutions can be installed and compatibility with analog security cameras eliminate historical hurdles around the upgrade process. This unlocks a broader set of potential customers who have video cameras, but need interactive monitoring features that can lead to greater revenue.
Mobile apps have served as a true catalyst for generating greater value out of video for the customer by allowing for live video feeds, motion and alarm-triggered video clips, and the ability to remotely adjust pan-tilt cameras. This has transformed video from an experience that required poring through hours of video in front of a screen to being able to receive video clips to a mobile device exactly when the customer wants it and how they want to receive it.
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