How iDevice GUIs have taken away your "magic," forever changing the Custom Integration market and some suggestions on growing your business in spite of them.
Preface: Thanks to everybody that has taken the time and effort to read my thoughts on my first blog attempt! This post concludes my series on the Magician. Remember, these are my thoughts and I'm sure there will be people that disagree with me and that's .....okay. If you have not read the first 3 parts of this series, please go back and do so now. If you don't, this continuation of the magician's story will not make any sense to you. Let's pick up where we left off......
Present Day and Future - So, where does all of this leave the magician and his industry and how do we go forward?
Let's see where we stand today:
- No margins left on flat panels.
- Margins dying in automation.
- No new construction recovery, so pre-wires and multi-room audio
are slow.
- Systems are getting simpler so we have to turn more with
fewer billed labor hours.
- Gas is $3.50 to $4.00 a gallon! I thought I would just throw that
one in there.
- Fighting for every retro job we can get.
So what should we do? One suggestion is:
Get back to your audio roots!
Let me ask two questions:
1. When was the last time that your hair stood up on the back of your neck when you were listening to music, much less when your clients were?
2. Have the margins in higher-end audio and speakers changed in the past twenty years?
There is a crazy trend (in our eyes) happening today and that is the re-birth of quality audio and even 2 Channel (that's right, you read it right- 2 Channel). A lot of dealers and even the industry is not understanding and is dumbfounded about how this is happening. I think I can explain if you will follow my logic below:
- Audio is the only sense that can give you that euphoric feeling of goose bumps.
- 25-38 year olds are who I consider to be the iDevice generation. They grew up listening to iPod and never have been presented with an audio demo that gives them "The Experience."
- They’re bored with 1 million songs in their pocket because they have lived with it for so long that it has become commonplace and they’re searching for something to fill the void.
- They’re stumbling upon vinyl again and the resurrection is beginning. Sales for vinyl have grown the last four years and in the last two years, have grown 33% and 14% respectively. Even though the numbers represent less than one percent of total music sold, 2.8 million vinyl albums were sold in 2010, up from 2.3 million in 2009. The demographic buying these albums aren’t your dad and mom's generation; they are the 18-38 year olds. If they’re buying vinyl, they’re interested in quality audio and looking for equipment and speakers to play it on because they’ve never owned it or even known that this level of playback ever existed.
- They’re the demographic that have at least a little disposable income.
- They still have some "kid" left in them and, like their parents were with 2 Channel at their age, are susceptible to the idea that making their system sound just a touch better for $1,000 dollars, is worth it.
- The best thing about this revival is that it is being pushed up from them to the industry instead of the other way around. Usually the industry tries to shove things down the consumer's throat. Just look at all of the manufacturers that were scrambling to show their re-worked turntables just in time for CEDIA last year!
What do you have to do to garner these new clients ?
Automation - You still have to do automation and do it right. Today, you have to sell and properly hang a flat panel with hardly any margin, don't you? The same will apply in the next few years with automation. If it is not a DIY project, you will have to do it correctly and at a fair price and it will have to be reliable and be user friendly. Your only concern needs to be to make sure you are partnering with a company that is respected, makes a reliable product, has a good track record and, last but not least, has the most legitimate margin that you can find.
Demo Space - You will have to have some type of demo space to raise hair on clients’ necks again with an audio demo. This can be a showroom, your home or a client's home. Your competition, more than likely, will be showing automation very similar and at the same pricing that you will be, so you really need to have audio equipment and speakers that set you apart from them and are capable of emotionally moving the client. If the rest of the job is similar in pricing and quality, the client will remember the dealer that "moved" them and which dealer just showed them a pair of dumb-dumb in-walls.
Education - Get a re-fresher course or learn everything you can about sound and the physics of sound. Don't just talk the talk. You really need to understand sound and learn to present it to a client in a simple, non-technical way. Most clients get turned off when technical jargon starts spewing out of our mouth.
Product Mix - Develop a high margin/high quality audio equipment mix that is hard to shop on the Internet, but keep your offerings slim so that you are important to your manufacturers and not the other way around. Keeping your lines to a minimum also cuts down on a lot of client confusion. They are coming to you because they see you as the expert. It's up to you to confirm that to them and relate to them that you chose this manufacturer because you (the expert) see it as the best. Why would they want anything less?
Salesmanship - The art of actually selling will have to make a comeback into your model. The easy sell is over and very few jobs are being delivered to your door like they were in the mid 90's. Focus on your selling techniques. Educate your staff on this fundamental talent and practice it with them in your down time.
To sum up: Things have changed rapidly in the past 14 years since I’ve been in the industry, but one thing has not changed. If I know more than my client about what he is interested in and can give him an "experience" he will always put me on the pedestal as his magician. True magic comes in trying to figure out what act our client will want performed 2 years from now and prepare for it starting today.
The magician is not dead, he is just changing his set.
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