Comtronics’ Success in DIY Market Complementing Traditional Business

Discover the ROI, sales compensation and go-to-market retail and online strategies that are giving the company a competitive edge.

Two-Phase Go-to-Market Strategy

The go-to market strategy has two phases. First, Comtronics is displaying the box in its Verizon stores for walk-in customers who saunter in looking for new cellphones. According to Campau, the box itself drives interest.

“We get those customers all the time that look at it … they think it’s a beautiful kit … they love it,” he says. “They’re already making a decision to pay Verizon $200 per month for all-you-can-eat plans for data, text and voice.”

In addition to customers walking out of the store with the kit in hand, many of them request professional installation. “They don’t want to do it myself. They ask, ‘Can you send somebody [to install it]? We say, ‘Absolutely!’ We’ve sold 16-camera video systems to DIY customers. We’ve sold all kinds of access control systems and door systems because of DIY, so we’re selling above and beyond just what this kit represents,” claims Campau. The company will even do the installation for $100 for the client. Among the options Campau is exploring is waiving the $100 installation fee in exchange for an additional year on the monitoring contract.

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Inside each of Comtronics’ 12 Verizon Wireless stores is an attractive demo display table that allows prospective customers to play with the home automation equipment.

Phase 2 of the sales strategy is online. The company also bought an 800 number to field purchase calls and built out a separate Web site with an E-commerce component and activation portal. The company is working with DocuSign to capture legally binding E-signatures. Of course, rolling out a nationwide online sales program means Comtronics must be licensed to monitor alarms in every state (if required) in which it sells a system.

This second phase also includes a social media and Google SEO component to the marketing plan. Also, Comtronics is extending the program so other integrators can become resellers of the kit and share the RMR. Campau says he already has 10 dealers from various parts of the country involved.

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Comtronics also has well-done marketing collateral describing functions like Z-Wave lighting control and IP cameras for monitoring babies in their cribs. Even though Comtronics just rolled out Phase 1 of its DIY program last fall, it is already selling about 30-4
0 systems per month. That compares with selling about 100 traditional professionally installed monitored systems per month from its experienced, six-person in-home sales staff.

The company’s traditional alarm sales staff can also sell the DIY offering. “And they have,” remarks Campau, who says any sense that it is cannibalizing his traditional security business “is really a nonissue. Think about how much we spend [in marketing] to get a sale … $100? That’s to get a $45-a-month customer for two or three years. It’s a small price to pay for a referral, plus it gets everybody on the bandwagon.”

They’re these people that paint their own house, and that want to mow their own lawn. It can be a doctor … a really smart person, and it can be somebody who really doesn’t want someone in their home. The guy who puts his own kitchen in and fixes his own plumbing. There are millions of people. This is not a fad.– John Campau

Calculating Costs and ROI

The business plan for Comtronics’ DIY solution is definitely subsidized. Campau calculates the equipment costs at $483.75 per job. To create the fancy box itself is another $16.25. The salespeople earn a $100 fee for a referral that turns into a sale, or a $200 commission fee if they close the deal on their own. The kits themselves are compiled in-house by staff in their spare time. The company’s breakeven ROI is about 11 months. If it adds in G&A expenses, it’s probably around 14 months.

Will Comtronics’ bold move represent a blueprint for other security integrators? Campau thinks it should. He recognizes that most integrators do not have retail showrooms like he does, but he believes that should not matter. Indeed, as part of the company’s Phase 2 rollout to online sales, Comtronics is extending an opportunity for other security dealers to also become resellers of its packaged kit.

Besides, “Every alarm company in essence already has a retail store … your Web site,” says Anne Campau.

Another misconception, according to both the Campaus, is “who” the customer is.

“It’s the people who are part of the $21 billion do-it-yourself industry. They’re these people that paint their own house, and that want to mow their own lawn,” says John. Referencing a wealthy cardiothoracic surgeon friend of his who replaces his own iPad touchscreen, he adds, “It can be a doctor … a really smart person, and it can be somebody who really doesn’t want someone in their home. The guy who puts his own kitchen in and fixes his own plumbing. There are millions of people. This is not a fad.”

Channeling his best Donald Trump, Campau emphasizes, “It’s huuuge. We think it is huge.”

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About the Author

Contact:

Jason Knott is Chief Content Officer for Emerald Expositions Connected Brands. Jason has covered low-voltage electronics as an editor since 1990, serving as editor and publisher of Security Sales & Integration. He joined CE Pro in 2000 and serves as Editor-in-Chief of that brand. He served as chairman of the Security Industry Association’s Education Committee from 2000-2004 and sat on the board of that association from 1998-2002. He is also a former board member of the Alarm Industry Research and Educational Foundation. He has been a member of the CEDIA Business Working Group since 2010. Jason graduated from the University of Southern California. Have a suggestion or a topic you want to read more about? Email Jason at [email protected]

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