Selling & Servicing Home Networks: 4 Simple Rules for Success
CE Pro 100 integrator Audio Video Interiors adds $100,000 in annual service contract revenue with these four simple steps for selling and servicing home networks and maintenance contracts.
Home networks might be the Holy Grail for recurring revenue that integrators are seeking. CE Pro 100 integrator Audio Video Interiors (AVI) in Middleburg Heights, Ohio, is one company that has seen success in the category in the past year.
At the recent CE Pro 100 Summit in Houston, AVI CEO Michael Pope revealed his strategies.
Never Rely on Client’s Existing Network Infrastructure: AVI completely tears out the existing network equipment on every job and installs professional-grade equipment. That means replacing routers, WiFi infrastructure, including WAPs, adding power supplies, resetting all IP devices, etc. Pope says customers immediately recognize the difference in the networking gear he installs versus what they had previously, which is usually cheap off-the-shelf routers and modems.
“Our projects were suffering because we were relying on the client’s network infrastructure,” admits Pope. “Now, we will not work with a client’s existing network. I tell them I will give them their money back if our equipment does not work 10-times better.”
“Most people have no idea how bad their internet speed and service is until you give them a new network,” Pope continues. “Now, we get big ‘thank yous’ from clients. If we ‘own the network, we own the client.’”
Discuss Network Service Plans at Point of Sale: Instead of waiting until the conclusion of the installation to mention the availability of service contracts, AVI’s sales team talks about its multi-level service plans upfront. This conversation plants the seed with the client. AVI’s remote maintenance plan packages the IT network service with cleaning equipment, putting IR emitters back on, discounts on repairs and parts, discounted labor rates, regular inspections, etc.
“This approach has added $100,000 in service plan revenue in the first year,” says Pope. “One account is a $20,000 service plan. A few years ago, I would have grumbled at let that opportunity go by.”
Bill Annually for Network Service: While most integrators focus on the term “recurring monthly revenue,” AVI has found that sending an annual bill for service plans works best.
“The psychology of not handing them a bill after you have solved a problem is amazing,” says Pope. “There is nothing for them to be irritated about. You are doing all the same work except you just don’t hand them a bill.”
The annual term also allows AVI to examine its expenses at the end of the year and adjust the cost of the service plan if necessary.
Allocate Service Hours Based on System Size: When devising a service plan for the network, AVI allocates the number of “free” service hours the client will receive based on the system size. There is no formula. According to Pope, the first year of the service plan he derives those estimated hours using “voodoo magic.”
Jason has covered low-voltage electronics as an editor since 1990. He joined EH Publishing in 2000, and before that served as publisher and editor of Security Sales, a leading magazine for the security industry. He served as chairman of the Security Industry Association’s Education Committee from 2000-2004 and sat on the board of that association from 1998-2002. He is also a former board member of the Alarm Industry Research and Educational Foundation. He is currently a member of the CEDIA Education Action Team for Electronic Systems Business. Jason graduated from the University of Southern California. Have a suggestion or a topic you want to read more about? Email Jason at firstname.lastname@example.org
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