Exclusive Q&A: ADI President Rob Aarnes on Snap One Plans
President of ADI Rob Aarnes is one of our industry’s brightest executives. He shares his insights on ADI and Snap One and much more.
DENVER — In this exclusive interview, I chatted for about 20 minutes at CEDIA Expo and Commercial Integrator Expo with ADI president Rob Aarnes about the Snap One acquisition, how ADI positions itself to empower and benefit its partners and how the distribution landscape has evolved.
Enjoy this illuminating conversation with one of our industry’s brightest executive minds.
Security Sales & Integration: Tell me a little bit about Snap One and ADI coming together. How are things going?
Rob Aarnes: During my 12 years with the company and 10 years leading ADI, this is the most excited I’ve ever been about the future of the organization. I’ve emphasized that point many times with integrators, buying groups, and suppliers at CEDIA, and of course since we closed on June 14.
I’ve always held Snap One in very high regard, and we had been exploring this opportunity for some time. Finally, the stars aligned this past year, and we announced the deal in April and closed in June. Since then, the impressive way that these two teams have come together speaks volumes about the complementary nature of the entire acquisition itself and the new company we’re building.
There are so many great cultural pieces that the legacy Snap One team had in place, and, of course, ADI had its own culture as well. Some of those elements are the same and some are different. But watching the two teams come together and see what we pulled off in the last couple months is remarkable.
For example, just nine days after the acquisition closed, we had the entire WattBox offering in all of our 115 North America ADI locations. We stocked stores, ensured full replenishment stock in the DCs, and had all of the SKUs up on our website.
Now, when customers buy a camera or anything that they need, WattBox comes up as the recommended accessory. That was a major lift to get done in only nine days, and we couldn’t have done it without both teams working together.
Aarnes Seeks to Combine Best of ADI and Snap One
Another good example of the teams coming together was for the critical operating model workshops we held with about 100 people from both organizations — 50 from Snap One and 50 from ADI. Collaboratively, they discussed how we combine the best of both businesses together, including best processes, standard operating procedures, how we go to market and provide service to customers.
The teams approached each meeting openly and honestly, with no egos involved. And, as you can imagine, many different aspects of each business were reviewed in detail. If we found that Snap One does one particular thing better, maybe ADI does another thing better, and we wanted to build those elements into the new company operating structure so that we really see a 1+1=9 kind of effect.
While some of those things are already starting to come to fruition, we’ve still got a lot of work to do going forward. As much as we pulled off in the last few months, the hard work is still ahead of us with systems integration. But I’m thrilled at where we are right now.
SSI: Bringing together ADI and Snap One is not purely additive, is it? It’s really about amplifying each other’s strengths to reach new levels.
Aarnes: That is the drumbeat and the motto behind the combined business, and it really starts with the leadership team. On day one we announced that my direct reports are about 50/50 from both Snap One and ADI.
Snap One leaders from the legacy business include the chief revenue officer, Ryan Marsh; the chief product officer, G. Paul Hess; and the chief operations officer, Nathan Porter. The remainder are legacy ADI.
We’ve also taken that same approach as we continue to build out the rest of the organization to make sure that we’re actually bringing the best of both companies together. We aim to have a healthy combination of both Snap One and ADI teams throughout the organization and we are very committed to that balance, or we won’t be able to achieve all that we aim to.
SSI: How is this going to enrich, empower and benefit your partners in the integration channel?
Aarnes: That’s a great question that really gets at the heart of what we’re aiming to do as a new, combined business. From the time we announced, and even coming into CEDIA Expo, there were some questions around things like if service levels would be impacted, if the ADI team would open up Control4 to their 100,000 customers, or now that we’re a $4.6 billion company, if smaller dealers get lost in a big company environment.
Over time, through our communications with our custom integrators, we’ve been able to address some of those things and reassure them that we’ll treat them the same way Snap One did. We hosted over 1,000 integrators at our CEDIA Partner Party and I was fortunate to talk to directly with them about any specific concerns they might have.
Rob Aarnes Says ADI and Snap One Will Continue Investing
Another open question was, “Are ADI and Snap One going to continue investing in products, innovation, sales, and marketing?” The answer is an emphatic “yes.” As we looked at the criteria we used to justify the combined business, we determined that we need to increase our R&D spend going forward to continue driving innovation, introducing new products, as well as ramping up sales and marketing efforts. We’ve also had several product reviews with G. Paul Hess and the teams from Salt Lake City to Serbia to evaluate what’s in the pipeline and what we need to add for 2025 and 2026. We have some really exciting stuff coming, and we’ve really been able to fortify that roadmap.
Those few areas were probably the biggest concerns I’ve heard, and I think we’ve been able to alleviate some of them. As we continue this drumbeat into the foreseeable future, we need to prioritize and focus on starting to prove it out in the market. Fortunately, we were able to begin that process in person at CEDIA.
In terms of our integrators, one of our top priorities is to significantly invest in building a world-class omnichannel experience. Currently, an integrator who shops with Snap One has multiple ways they can buy. In the future, they will enjoy one dynamite experience – no matter how or where they want to shop with us.
For example, if dealers want to buy products online, they can do that easily and efficiently. Everything will be available on one website that’s best in class across content, speed, search, you name it. We are investing quite a bit in building a dynamic B2B website that has B2C functionality and we’re very close to our target even today. That is a big lift — bringing all that together and doing it in a way where our current custom integrators can easily navigate and get exactly where they need to without spending time clicking through multiple pages and options. We want to prioritize offering dealers an easy and intuitive experience.
Aarnes Talks Bringing ADI and Snap One Store Locations Together
Now, take the local stores. In areas where we have both ADI and Snap One stores near each other, we want to bring those locations together and create a footprint that is very uncommon in B2B – think 20,000 square feet, high ceilings, warehouse racking, with an assortment for our residential AV integrators that will now be enhanced with ADI products, as well, those in security, datacom, pro AV.
Anybody who’s shopping with us can take advantage of the technology convergence that’s happening. Whether you’re strictly residential AV, whether you’re residential AV and you want to play in security, or if you’re a commercial integrator that wants to get into pro AV, the website and the stores will all provide the same shopping experience with the same assortment – truly a one-stop shop.
More ADI Third-Party and Exclusive SKUs Heading to Snap One Locations
For cross-selling, I’ve already mentioned WattBox. But going into Q4, a couple hundred more ADI third-party and exclusive brand SKUs will be heading into the Snap One locations, and vice versa. We’ll continue to accelerate that until the time where we start merging websites and moving stores.
In terms of credit lines, ADI has a very strong balance sheet that offers a number of options dealers will benefit from once we are integrated onto a single platform. We’re planning to have new stores rolling out next year and we’re already starting to make website enhancements.
SSI: It seems like your goal is to make it easy, so you can be their trusted partner and their trusted advisor with minimal friction.
Aarnes: One of our top priorities is to be the easiest for our partners to do business with. In fact, our chief experience officer uses that terminology all the time: “frictionless customer experience.”
We’ve spent a lot of time and resources on soliciting partner feedback and taking it into consideration – it’s clear that both organizations are relentless in understanding how customers want to shop with us, both today and in the future.
Additionally, both organizations have spent quite a bit of time building capabilities to capitalize on those specific customer needs. Legacy ADI, for example, launched over 70,000 surveys a year to get feedback from our customers not only on how we’re doing, but also the journey.
Questions like, “What do they expect? What criteria do they use to pick one distributor versus another?” Help us tailor our business strategy on an ongoing basis.
Aarnes Says Partners Want True Omnichannel Features from ADI
Five or six years ago the top three criteria were things like “knowledgeable sales staff,” and “product available when I need it.” Today, it’s true omnichannel features like “functioning website,” “digital content that I can navigate” and “unified pricing” across web and store. And that’s just over the last five years.
How our customers shopped back then and how they’re shopping today is very different and continuing to adjust our operations to fit their needs is essential. Going forward, as a combined organization, we’ll continue to listen to our customers and evolve our business to support them.
SSI: It’s notable that an organization the size of this combined entity seems to be leaning into humility rather than hubris and being openly solicitous of partner feedback.
Aarnes: There’s no question. This is a culture both companies have created. Again, I talked about this complementary nature and I can tell you, when I’m sitting with my leadership team and a new proposal comes up — an idea to maybe invest in a particular area or shift gears — the first questions are, “Why are we doing that? How does it benefit our customers? Are our customers asking for this? What kind of data supports that?”
We always aim to make sure that those decisions are rooted in what our dealers are telling us. That’s the critical component. There are other things we look at, including industry trends and leading indicators, but ultimately, we look at what our customers are telling us and use that as a guiding principle.
SSI: It seems like imperative is really to remove as much friction as possible.
Aarnes: Without question. When I walk into our integrators large or small, I always want to visit the purchasing department because they’re the ones buying products. The demographics of purchasing teams continues to change and how they purchase is a lot different now.
Many of them have multiple screens up and are using software to compare products in real time. They’re making decisions based on content, price, availability, everything that they’re seeing on the web today.
Five years ago, if I looked at the total number of transactions in a week at ADI, 10% of the customers that bought from us — no matter where or how they bought from us — went to the website first. Fast forward to today, 65% of our customers that shop with us visit the website first in the week before they made a purchase decision. That clearly represents a huge shift.
This is how customers have told us they want to shop and the reason why we’ve invested so much time there, and we know Snap One has as well. We’re excited to imagine what that’s going to be when we bring it all together.
SSI: Already, this early on, we’re starting to see the hints of what’s to come for ADI and Snap One.
Aarnes: Keep in mind that, before we closed, we couldn’t do a whole lot as two publicly traded companies. While we had ideas of what we wanted to do, we couldn’t get started.
The very next day after we closed, we brought teams together that had never met before and asked, “How do we get all the WattBox product into the ADI stores in nine days?” Operations, marketing, and sales, all came together to make this happen, and, at the same time, we launched product training for over 700 ADI salespeople to get them familiar with the OvrC software ecosystem that goes along with WattBox.
Our teams had to get all that done before the product showed up. It was a massive effort across multiple teams and I’m just so proud of everybody involved in that.
SSI: When the ADI and Snap One deal came to fruition, you really didn’t waste a minute in terms of executing.
Aarnes: That’s right — not a minute once the deal officially closed. That was a great testament to the two teams and what we can do.
SSI: Any closing thoughts?
Aarnes: As I told the group at the CEDIA Partner Party, we are committed to bringing these two organizations together and taking it up a notch. We’re committed to making ADI and Snap One a real game-changing organization that has the ability to impact all industries that we play in.
Looking ahead, we’re going to continue to keep customer insights front and center, and we’re going to continue navigating through the very technical part of the integration. There will inevitably be some slips along the way, but one thing I love about this team — and what I’ve seen already — is that they are fast to execute and find a way to get back on track and hit a deadline.
You can expect that mindset and level of execution from us, through both the milestones and challenges we face.
ADI and Snap One truly are Even Better Together.
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