Feeling Good About Home Again

With the recession waning, albeit stubbornly slow, opportunities in the home automation and entertainment market are reemerging. Installing security pros, with the right know-how, are uniquely positioned to fulfill customer desires for new or upgraded systems.

Middle-income families — a much larger market — are showing the potential for increasing penetration by home technology professionals. Nearly a quarter of homeowners in this category already own one or more home technology products, and are prime suspects for upgrading and cross-selling.

That said, most homeowners who expressed interest in additional home technology products intended to purchase at least 12 months in the future — possibly when they buy a new residence — rather than within the next year. This suggests that despite talk of a recovery, consumers are still extremely cautious about spending the money, especially by plowing it into a home, many of which are currently worth less than the mortgage.

Because consumers are still very cautious about spending, be prepared for a slow start. In today’s environment, marketing home electronics works like a Crock-Pot, not a microwave. Consider every current customer you can reach with your crossover message to represent deferred compensation, to you! They may not purchase now, or even in the next year. But if you keep your name in front of them, they will come around and eventually purchase. Concentrate on adding more households to your client list. The first system you sell, be it security or any other, can oftentimes lead to bigger opportunities.

Select the Right Product Mix
Good news! According to CEA, the strongest consumer purchase interest in the short term (the next 12 months) is security systems. Beyond that, consumers are looking most keenly at home theater systems, with 7 percent of homeowners looking to purchase in the next year, and 13 percent within the next two years.

Intercom systems and structured wiring also showed a modicum of interest with 4 percent of homeowners looking to purchase in the next year in each of these categories.

Here’s some food for thought: Think through the logistics. Intercom systems are a relatively easy install; structured wiring could involve some major drywall breaking in a preexisting home, driving up costs. Same with central vacuum systems. Concentrate on home theater, lighting, multiroom AV, home automation, and intercom systems in preexisting homes (where your current book of business lives). Central vac and structured wiring are best tackled during the building phase.

Build a Strong Team
There is a learning curve with all trades, and home technology is no exception. If you are going to grow your business beyond your security comfort zone, you don’t want to be out there reinventing the wheel all by yourself. The most important step is to find a strong partner that can help guide your efforts and keep you from steering down blind alleys.

An experienced distributor with a specialty in audio/video lines can help keep you from making rookie mistakes. Incompatible equipment, mispricing your bid or failing to include key components can spell disaster for the profitability of the project and your own credibility as an integrator in the eyes of the customer.

Finding a strong distributor is a great place to start. Specifically, you’ll want to look for the following characteristics: A commitment to the industry — If you’re going to rely on a partner for a significant part of your business, you don’t want them to be in it as a sideline. They could pull out of the industry, leaving you scrambling. You want someone as committed as you are.

Just-in-time delivery capability — In today’s market, there’s no reason for you to sit on tens of thousands of dollars of inventory, tying up valuable operating cash and limited storage space. Get a local provider with a will-call window so you can pick your gear up on the way to the site, or who can reliably drop-ship your order to arrive a day or two prior to your install.

Training — There’s a lot to learn in this business. Look for a distributor partner with a strong training program to help you and your installers build thei
r technical skills. You shouldn’t be wiping junior installers’ noses showing them which end of the screwdriver is up; you should be out there talking to clients and potential clients, marketing, prospecting and selling. Let the distributor pick up some of that training burden from you.

Access to strong brands — You want to be selling a lifestyle. The last thing you want at the point of sale is to get bogged down trying to demonstrate the value in an unfamiliar brand. Look for a distributor that can provide you access to the household names.

Playing Defense
Just as you are considering moving into the home theater, AV and home automation business, other businesses are looking at moving into yours. Thousands of other home security salespeople are chomping at the bit to reach your clients and save them some money by moving them into their monitoring plan, cutting you out, and shutting off your revenue stream.

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