22.06.16

Letter from America: Finding Opportunities in Established Channels

LfA_Heiss_June 2016 Chalk IoT

With many in the custom residential world bemoaning the impact that IoT-centric products will have on our community, one has to wonder if some might be focusing too closely on the negative that they can’t see the positives. It won’t be easy, but this is change that can be good for us if we take the necessary steps to see new opportunities that might come from all of this.

Recent announcements from Google and Apple make it clear that the “DIY-ification” of home control is well underway. Light bulbs and luminaires of all sorts here, HVAC control there, security, locks and cameras, everywhere. Seeing what is already out there in the DIY shops and available through means such as Amazon and internet direct-to-consumer channels one might worry about the future of our business.

Not so fast.

Yes, it is true that all of this new kit brings with it the possibility of competition, but that should only make us stronger. Think about it: Did videocassettes, DVD, Blu-ray or now, streaming services put movie theatres out of business? No. Theatrical releases have long been regarded as an important “sampling mechanism” for consumers. After all, without a film becoming a hit in cinemas, who would pay to watch it, or for a service that delivers it in the home? Without commercial theaters, particularly the newer ones in the US that are billed as “Premium Experiences”, what will our clients have to use as a benchmark for home theater, particularly at the high end?

With some good promotion and public relations work on your side, all of this commotion in the popular and business press about connected this and connected that in the Internet of Things works to your benefit. Consider the following:

First, the increased traffic these devices will add to the home network eventually becomes a bandwidth, throughput and reliability consideration. Yes, the consumer might possibly be able to add devices, but do they know how to wrangle the apps? Do they know when and how to upgrade the wireless infrastructure? Odds are they don’t and the strong likelihood is that the place they bought these things from doesn’t either. Just as it is becoming increasingly harder for many to make any profit on the sale of flat panel displays, it is also increasingly obvious that the money is to be made in the installation, integration and calibration of displays. The same rule will apply here.

Let’s look further, beyond the attention given to HVAC, lighting control and similar to another hot area where those in the custom world need to pick their point of entry carefully: The connected kitchen.

I’m not advocating that you get into the sale and installation of what had long been known as “white goods — installing them frequently requires skills and licenses beyond what you might have. An electrician’s ticket? Sure, you might have that, but do you really want to have a plumber’s license or pay to have one on staff?

As shown at the stands of at least the past three IFA and CES shows, home appliances are all becoming connected, often extending to the scales used to measure in food prep and the baby bottles some of our younger customers drink from.

Heiss_June2016_Perfect Bake Scale

Here, too, it is a question of marketing your ability to “app wrangle” and mediate between devices using Wi-Fi, which most do, and the Bluetooth that others use. This “mix and match” is exactly the sweet spot you need to find and capitalize on. A warning, though, as creativity and programming skills will be required when dealing with appliances as many use brand-specific apps and closed/proprietary APIs.

Look deeper, for just as “Smart TV” sets have been targeted as a potential security hole, the same may well hold true for smart appliances. What can you suggest that would never occur to the folks who sell them? How about a separate, walled-garden network for these devices? Let them talk to each other, but use your skills to isolate them from the possibility of running on a network where the home’s sensitive data might be compromised.

Again, we’re not suggesting you sell or install the electrical and plumbing for appliances, but provisioning for them is where you must be to remain viable. Is there sufficient Wi-Fi coverage and throughput in the kitchen to handle the increased activity? Is everything secure? Are the apps properly set to the system requirements? That is where you need to be going forward.

In both of our last two examples it may be easy for some to say the competition from those who sell the hardware is a barrier for us. Let’s throw in a plug for one area where you are unlikely to find competition: good quality audio, properly configured, expertly installed and precision calibrated for stunning reproduction.

Yes, some will say that the millennials don’t appreciate good sound because they have been raised on compressed audio sources listened to through ear buds. Whether or not that is really true, and there is evidence that it is not, use the ability that you uniquely have to turn that into a profit opportunity.

Once exposed to good sound, any listener will then demand it. Thus, go back to a rule we used to use back in the early days of multi-channel home theater audio: Demo or Die! More importantly, demo something that appeals to an audience that is, perhaps, not yet ready to spring for large speakers and finicky components. Hit the millennials right where they listen: in their ears.

Whilst attending a CEDIA Tech Council meeting last month one of the more interesting after-dinner events was hosted by our fellow HiddenWires contributor, Peter Aylett. “Join us for a Can Jam?” was the question, and not quite knowing what to expect other than some craft beers, we accepted. The results are something you might want to emulate to lure new customers or build new interest with existing clients.

Back in the old days, headphones were referred to as “cans”, given that they took that shape as they covered the listener’s ears. The “jam”? No not grape or strawberry, but a jam in the sense of a bunch of musicians getting together to just hang out and play some riffs.

Thanks to Peter and my Tech Council colleagues there were a variety of headphones, two or three different DACs and headphone amplifiers, and a wide variety of high-resolution source material played from a laptop, though that could have easily been any one of the high-resolution AV players available from the likes of Sony, Pono, Astell & Kern and others. Early-stage audiophiles used to do when they gathered in hi-fi shops on weekend afternoons decades ago to compare preamps, amps, cartridges, tone arms and turntables through a variety of speakers. While the gear is now digital and compact, the liberal consumption of cigars and beverages has not changed. Nor has the idea of listening to a variety of equipment and then talking about it.

Think of this as the audio equivalent of a wine-and-cheese event to show off the latest home theater or home automation gear. The advantage is that it is smaller, easier to manage, and much more personal. Let your Can Jam’s attendees sample the music and compare the various bits of kit. Oh, and if you threw in a pair of popular, but perhaps not excellent-sounding headphones and some typical ear-buds to show the difference, that wouldn’t hurt, either.

The end goal of all of these ideas: Show how you can bring something new to products that are obtainable elsewhere. Show how your knowledge of “what goes with which” and your role as both “kit and app wrangler” and “merchant of the best” works to the customer’s benefit.

Best of all, you don’t need a showroom for this as it is all transportable just as our Can Jam came out of a duffle bag and a reasonably sized hard-sided case. Bring the beverages and munchies, thank the host with a gift certificate and you’ll be surprised at the results.

My millennial-aged son proves the point. Once exposed to the quality possible with good source material and audio/video kit,  he and his friends admitted that there is a difference and I’ve built some audio- and videophiles for the future. At the other end of the spectrum, showing consolidated apps for various devices and how they can work together seamlessly has turned the page with my own acquaintances who are, to be kind, 2x millennials. Even my 92-year-old father is into his Roku streaming box and tablet control—and spreads the words to his contemporaries!

Bottom line: Don’t be scared off by gear available elsewhere possibly getting in the way of your business. The one thing that hasn’t changed for all of this is the simple rule that if you provide a compelling value proposition and have the means to demonstrate it, you’ll win the day more often than you might expect.

Michael Heiss is a technology consultant and journalist, CEDIA Fellow, CEDIA ESC 2 Certified, and US correspondent for HiddenWires magazine. You can contact Michael via the HiddenWires LinkedIn Group, follow him on Twitter @captnvid.