By Lisa Johnston
New products on display at the American International Toy Fair, held in N
Should members of the Mobile Enhancement Retailers’ Association (MERA) - the car stereo industry’s version of CEDIA - vote in favor of InstallerNet’s bid to buy out the organization and open it up to all 12-volt retailers, not just the specialists?MERA members started voting on the issue on Aug. 17 and the final votes should be in by Aug. 31, said InstallerNet.
On its own, MERA has been losing retail members for years; suppliers tired of shouldering the entire burden for MERA and the organization wound up canceling for this year its popular KnowledgeFest trade convention, and MERA’s key event.
So why not support InstallerNet’s bid to infuse the group with cash and energy and swell its dealer base with more than 2,000 InstallerNet retailers? It makes sense to me, but here are a few facts, issues and opinions:
InstallerNet coordinates more than 3,000 installing retailers (2,000 of which sell car audio) by selling installation gift cards that these stores honor. So Walmart, Amazon, Crutchfield, etc., which don’t have installation service, can sell these gift cards alongside car stereo products. The customer buys the card and calls an 800 number to be directed to a local InstallerNet retailer who performs the installation for a preset fee.
Tony Frangiosa, CEO of InstallerNet, said he’s already starting to organize a new KnowledgeFest, and MERA is seeing renewed interest from suppliers, who are eager for better ways to train retailers.
It seems like a win/win situation - InstallerNet needs to keep its network of retailers informed and trained for the business model to work, and dealers and suppliers need training for the industry to work.
But here’s the rub for the 12-volt specialist: If they support InstallerNet, are they supporting the big-box stores like Walmart and Amazon?
All InstallerNet installs are performed at a lower labor rate, so under that model, the specialist is giving away at a discount his key edge over Walmart. And he’s empowering Walmart by supplying it with installation service.
InstallerNet’s answer is this: It provides the specialist plus business and improved store traffic. And when Walmart customers walks through the door with a head unit, the specialist can sell him car speakers, etc.
But some retailers wonder what will happen down the road. Will they get enough new business, or will they just become low priced installers for Walmart who are ultimately driven out of business?
Barry Vogel, MERA executive director, said, “Most of the people who purchase an InstallCard are people I wouldn’t see anyway. So the question becomes, ‘Am I better off taking a little bit of a hit on the labor or am I better off never seeing them at all?’” He continued, “Most of our customers start out as low end customers anyway, either because of their budget or they don’t know any better. Someone buying car audio online has probably only been exposed to their buddy’s car and what they read.” Vogel said InstallerNet gives the retailers an opportunity to demonstrate what car audio can really sound like.
He further noted that MERA is going to be run as a separate subsidiary of InstallerNet, and added that, in general, the specialists have an image problem that must be addressed. Research that came out of the 12-Volt Initiative showed 65 percent of consumers don’t even know what a 12-volt specialist does and most consumers don’t trust a 12-volt specialist, said Vogel.
Frangiosa added that the industry needs and wants a healthy 12-volt specialty channel. “Even if we sent these guys a ton of installation work, they need to be a full business … if we don’t help that channel, InstallerNet won’t have anyone left to send their work to.”
It would be great to see a thriving MERA and a bustling KnowledgeFest, full of ideas. Yes, there could be Best Buy blue shirts sitting in the training sessions. But then the industry might unite against the OEMs, against lagging consumer awareness and generate some excitement. Together with the plan from the 12-Volt Initiative that suppliers are voting on at the moment, the industry might get a much need shot in the arm.
This TWICE webinar, hosted by senior editor Alan Wolf, will take a look at what may be the hottest CE products at retail that will be sold during the all-important fourth quarter. Top technologies, market strategies and industry trends will be discussed with industry analysts and executives.