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Capitol Sales has decided to put an emphasis on the No New Wires approach to home automation and custom installation so its customers can go after consumers who have been targeted much before.
Jeff Kussard is a custom-installation industry veteran who heads its strategic development efforts at Capitol Sales and is a major proponent of the No New Wires approach. The technology is based on the HomePlug Alliance’s initiative to push Power Line Carrier technologies.
It is his belief that this will open up a wide world of retrofit opportunities that will eclipse the market for opening walls and adding systems to existing structures.
“Copper infrastructure is the best solution, the most reliable solution” in custom installation, but it limits the customer base.
For instance, Kussard said, there are many cases, even in this economy, of consumers who want a multi-room audio/video system. In fact, a recent Consumer Electronics Association (CEA) study called “Trends In Multi-room Audio Video Usage” found that 82 percent of those owners would recommend their systems to friends.
The problem is that many consumers who would like the A/V experience that are supplied in new homes either don’t want to go through the construction process of opening walls in older homes, or live in co-ops, condos or regular rental apartments where such hard-wire construction is often-times not allowed.
“Let me put it to you this way: If new home construction is 5 percent of the total U.S. housing stock and systems are installed to 20 percent, which is optimistic, you’re only getting 1 percent of the total households in the U.S.,” Kussard noted.
He added, “CEDIA has built a business with that model and many are satisfied with that business,” but he stressed that with new technology other choices are available.
Kussard reported that Capitol will be publish a new product catalog of No New Wires products in the summer which will include “products from established suppliers who get it and a new guard of suppliers, to develop a merchandise mix and a selection of products that are full of solutions.”
Among the new suppliers will be Lagotek of Washington and Audioengine of California. The latter supplier offers speakers with Wi-Fi audio-sharing capabilities, which possibly could be used in some types of systems. Kussard said.
“Many installers are enthusiastic about this approach and have the business-savvy to be successful with this,” he noted.
“[With No New Wires] we want our customers to go after the other 95 percent of the business,” Kussard said.
Concerning current business conditions Kussard said that even though the recession hit with a vengeance last fall Capitol “went against economic trends” with October 2008 being “one of the company’s strongest sales months in its history.”
One of the reasons was that Capitol generated more sales from one of the four channels it serves — retailers. The other three are residential contractors, commercial accounts and the marketing/premium incentive business.
Kussard said that the retail channel generates 30 percent to 35 percent of its total sales and the retailers it serves are mostly “single-store electronics or electronics/appliance stores.”
Capitol began to focus on them and it noticed that in its business consumers are turning to more of these local stores “and build relationships with people you know.” It also didn’t hurt that Capitol’s sales group was “more active in communicating” with potential retail customers.
In terms of product categories being sold “flat panel TVs are still the key,” Kussard said, but installers of all types “have to sell attachments — cables, speakers, remote touchscreens.” And video distribution management and control are also critical.
New technologies and products will be part of the Capitol Sales Learning Institute. The program begins in San Francisco (May 3-5), then goes to Dallas (May 17-19), Philadelphia (June 7-9), Chicago (July 12-14) and Tampa (Nov. 15-17).
Exclusive partner of the tour is CEDIA On The Road. All Capitol Sales class attendees will receive CEU credits through CEDIA University. (Visit www.capitolsales.com for further information.)
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.