Business

CEDIA Founding Member: Let’s Get Back to Luxury Roots, Stop Messing with DIY

Richard Stoerger, one of the original CEDIA guys, says home-technology association should promote luxury products and services, stop muddling the core mission with me-too smart-home products, services and messaging.

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13 Comments
Posted by TheDarkKnight on May 17, 2017

Being a CEDIA member/dealer should mean something to the general consumer. Regardless of whether the customer can afford to do business with them and/or even knows what the acronym stands for…they should aspire to have technology installed by a CEDIA dealer.

Today, I believe this is not the case. CEDIA should pay more attention to educating the consumer on the differences between DIY and true custom. They should pay less attention to making money by getting more people to come to the Expo and/or take their training courses. The more consumers strive to purchase from a CEDIA dealer, the more dealers will aspire to attend the Expo and training.

Posted by antoniohardeman on May 17, 2017

This is nice but I was left wondering how he is defining luxury.  He mentioned the customer is luxury.  Does that mean a high net worth individual?  It sounds that way.  I see no problem with CEDIA members going after the luxury market, as they should.  But that market is a small percentage of the overall pie and everyone will not be able to eat from that small slice of pie.  So if you want to eat on a regular basis you may have to embrace the individual that doesn’t have a high net worth and meet those individuals where they are. 

Look; like it or not and a lot of CEDIA folks can’t come to grips with the fact that technology has become democratized and what was once the realm of CEDIA professionals has become disaggregated by advances in home automation tech.

I think that the other thing that rubs some CEDIA members the wrong way is the fact that individuals that don’t have a high net worth can create a very nice orchestrated connected home automation system where the majority of control is in one app and homeowners (DIY) can create these systems at a relatively low cost versus $20k to automate their 2,000 sqft home. 

Posted by jhamill1 on May 17, 2017

Amen, Brother Stoerger!

How is he defining luxury? How would anyone define luxury? Is an Acura or Lexus a luxury vehicle? Of course, Are they ever going to launch an $18,000 car under those brands? No. How many people make a living off of just those brands each year? Plenty. Those vehicles are out of the reach of many people. And not one technological breakthrough will change that. Yet, many more find it within their budgets to buy what is important to them.

It’s not really the question whether there are enough of these customers. It’s really a question of whether there are enough of us willing to take care of them.

Posted by Chris dePaola on May 17, 2017

#antoniohardeman well said!

#TheDarkKnight, customers don’t care about cedia and no level of consumer education will change that.  Being able to tell a customer that your team has degreed electrical, network, sound engineers, now that helps. 

People can fight over the 1%, the true luxury market.  I’ll take those with income levels from 100k - 500k.

Posted by Seth_J on May 17, 2017

If CEDIA wants any relevance whatsoever in any future economy it needs to embrace DIY and move on. Otherwise electricians, HVAC contractors, and even plumbers will continue to whittle away at what work we have left until there’s just a hand full of “CEDIA” dealers left to serve “luxury” clients. Good luck with that.

I look forward to continually having the “Have you heard of CEDIA? Oh, no… well, we’re a member… never mind.” conversation with every other trade and profession in the future.

Posted by Richard Stoerger on May 17, 2017

So to make this clear, first and foremost, this is my vision of what CEDIA is all about.  As a poster noted, it is our collective job to make people want to “aspire” to something better, from whatever base point they are beginning.  And when it comes to aspiration, I believe that an emphasis on the concept of “luxury” is a very good catalyst for us to get them there. 

Luxury isn’t something that is exclusive to only the big project guys.  It is what all of you are doing each and every day, whenever you step into a home, and whatever customer type is your base customer.  To them, whatever you are doing is a luxury service unlike the plumber, electrician, cleaning person or gardener that they view as essential services.  It is why during hard times, when their system has an issue, they still pay for essential services but call you only once they have money in the bank to pay you.  You are the last service person to be called upon to fix or upgrade stuff.  Why?  Because you service their “luxury” lifestyle. 

I am simply saying that we should embrace and herald this perception of luxury (or any other word that might be appropriate).  Who are we; we are CEDIA.  What are we; we are a luxury solution provider.  Who do we serve; the customer that is seeking a luxury experience.  What do we provide, luxury services.  How do our customers feel about what we do, “luxurious.”

As for the premise for this article, it is a counterpoint to those that felt this or that about our next CEO.  But I do love the direction this discussion is taking.  I believe it is high time that we find our mojo again and I relish this conversation.

Posted by robgerhardt on May 17, 2017

I have always enjoyed Rich and respect his perspective.  But, I think we can look at the continuing failure of luxury endeavors to project our future.  Via and Hauss would be the most recent example of this dissolving future.  The obvious transition of so many dealers away from Crestron to C4, RTI, etc, and soon to the cloud based platforms, Alarm.com (approaching 5M accounts), Honeywell is underway and it is good. 

The future of the dealer is Recurring Monthly Revenue and it is not going to come from maintaining a network.  The removal of the monthly fees from OVRC, Packedge, and the cheaper other boxes are recent proof of that. 

The size of a typical transaction according to your magazine is down by 35% because the stuff simply costs less.
The disappearance of the audio retailers that defined CEDIA 28 years ago should convince us that we cannot use a retail mindset and succeed.

We have always been enablers and dependent on providers over which we have no control.  The movie industry created surround sound, the recording industry provided something to send to those multi-rooms, as did the cable, satellite, and now streaming industries. Just because they (Luxury Clients) are rich, does not mean they are anxious to pay more when they can see impressive functionality and access for investments that are at least an order of magnitude less expensive. 

This is what it is, and we cannot change it, no more than we can roll the clock back on steel mills and coal mines.  What we can do is recognize the increasing and widening appetite for these new systems that justify the valuable recurring revenue that has historically enriched the security dealers we often make fun of.

Every time CEDIA embraces a technology from Resi THX (in 1991), to flat screens, to the recent “own the network” message, it goes away as the major manufacturers take it mainstream.  Google WiFi, Google Home, Amazon, and Apple something are our future because people have to have something to control.  The fact that we do not make margin on those devices is not so different from never making margin on movies, DVD, CD, cable, or satellite. 

Research shows that the traditional security market is shrinking while the “Smart Home” and “DIY” markets are growing.  Each of those markets has a monthly fee that can build your future. The home installer finally has an opportunity to build a future with more systems that cost less (but with good margins), available to the existing home market and with RMR that is 3 times what enriched the security industry.

These are exciting times, some will make a lot of money and do some good.

Posted by antoniohardeman on May 17, 2017

@Chris dePaola,

Hey Chris, I’m/was *your* customer.  My income is in the bracket that you mentioned and as you said I & most like me probably don’t need to be educated on what we need in home automation.  More and more people understand tech and what they need the tech to do.  However, as Seth_J mentions others are getting into the game introducing consumers to this environment before the integrator reaches them.  See my story below.

@Seth_J

Don’t forget about the home builders bc they’re encroaching upon this space; see Lennar and other builders with Home Kit and Nexia.  When I bought my home in 2013 the home builder threw in a Z-wave hub, Trane Z-wave thermostat & a Schlage Z-wave door-lock.  From there I added more Z-wave devices expanding upon what the builder provided & I was able to setup modes & scenes via the hub manufacturer’s customer website.  Four years later my HVAC, A/V, Lights (indoor & outdoor), Ceiling Fans, Entry Points, Garage Door are integrated in one app and I have voice control via Amazon Alexa & all devices are orchestrated together.

If you overlook what’s happening in the industry and how consumers are discovering connected home devices, you may lose out on potential customers.  But maybe they’re not the consumers you want.

Posted by Audioplus on May 17, 2017

I whole heartedly agree with Richard’s comments. CEDIA shifted course when they wanted to control education, and shifted focus from Trade Show. This industry, common issues reflected monthly in articles, the need for entry level installers. Obviously education has embraced a wrong path, not productive enough, and as Buzz Jensen commented in days gone by era 1998, “I send my guys to CEDIA for training, they come back and 30 days later, have not learned
anything”. Anot her age old comment, why should I share my secrets with my competition? Markets change, CEDIA obviously changed, losing the trade show in exchange for assumably bigger payroll is a mistake. I remember when we were all volunteers, manufacturers wanted to encourage their own training, and still do.

Posted by dbendell on May 18, 2017

The first place it can start is with CEPro who spends countless energy promoting the DIY category instead of focusing on industry level articles and interest for the professional!

Posted by Richard Stoerger on May 18, 2017

Rob, I have always appreciated your perspective.  No doubt from a revenue standpoint there are more ways to skin this cat.  Recurring revenue, perhaps the holy-grail for some operations, is most certainly one vertical. 

But I believe there are other verticals out there.  Yes, there will be waves of households that will employ technology to improve their lifestyle – from entertainment to security to environmental control to communication to automation and beyond.  But there are limitations to several of the over-the-counter/Amazon solutions and for some a more advanced solution is required.

For example, my favorite sales tool is the Sonos commercial – “Fill Your Home With Music” that first aired during the 2014 Super Bowl.  I strongly suggest everyone in our industry take a good long look at this wonderful sales tool.  My first observation: this is not a Sonos house this is a luxury home.  Second: there is no way one can deliver the unspoken promise of immersive sound, presented by way of the spreading of colored light across rooms and corridors, through just three speakers and a sound-bar.  Not to say that 3 Sonos speakers and sound-bar aren’t a form of luxury for some, but they will never deliver on the promise that this commercial implies.  Here Sonos has actually provided us with a tool to help educate customers on what might be a “luxury” solution, perhaps using in-wall/in-ceiling speakers and a multi-channel amplifier.

Luxury is not a specific line in the wallet.  Luxury is all about walking the walk and talking the talk.  It is not about specific products or for that matter, specific solutions.  Luxury, instead, is a state of mind.  And in my memory, CEDIA use to own it.

Posted by RobMacK on May 19, 2017

Richard Stoerger for new CEDIA CEO…

Posted by Outofsight on May 24, 2017

HAHA dbendell you took the words right out of my mouth! Nothing more to add

13 Comments
Posted by Outofsight on May 24, 2017

HAHA dbendell you took the words right out of my mouth! Nothing more to add

Posted by RobMacK on May 19, 2017

Richard Stoerger for new CEDIA CEO…

Posted by Richard Stoerger on May 18, 2017

Rob, I have always appreciated your perspective.  No doubt from a revenue standpoint there are more ways to skin this cat.  Recurring revenue, perhaps the holy-grail for some operations, is most certainly one vertical. 

But I believe there are other verticals out there.  Yes, there will be waves of households that will employ technology to improve their lifestyle – from entertainment to security to environmental control to communication to automation and beyond.  But there are limitations to several of the over-the-counter/Amazon solutions and for some a more advanced solution is required.

For example, my favorite sales tool is the Sonos commercial – “Fill Your Home With Music” that first aired during the 2014 Super Bowl.  I strongly suggest everyone in our industry take a good long look at this wonderful sales tool.  My first observation: this is not a Sonos house this is a luxury home.  Second: there is no way one can deliver the unspoken promise of immersive sound, presented by way of the spreading of colored light across rooms and corridors, through just three speakers and a sound-bar.  Not to say that 3 Sonos speakers and sound-bar aren’t a form of luxury for some, but they will never deliver on the promise that this commercial implies.  Here Sonos has actually provided us with a tool to help educate customers on what might be a “luxury” solution, perhaps using in-wall/in-ceiling speakers and a multi-channel amplifier.

Luxury is not a specific line in the wallet.  Luxury is all about walking the walk and talking the talk.  It is not about specific products or for that matter, specific solutions.  Luxury, instead, is a state of mind.  And in my memory, CEDIA use to own it.

Posted by dbendell on May 18, 2017

The first place it can start is with CEPro who spends countless energy promoting the DIY category instead of focusing on industry level articles and interest for the professional!

Posted by Audioplus on May 17, 2017

I whole heartedly agree with Richard’s comments. CEDIA shifted course when they wanted to control education, and shifted focus from Trade Show. This industry, common issues reflected monthly in articles, the need for entry level installers. Obviously education has embraced a wrong path, not productive enough, and as Buzz Jensen commented in days gone by era 1998, “I send my guys to CEDIA for training, they come back and 30 days later, have not learned
anything”. Anot her age old comment, why should I share my secrets with my competition? Markets change, CEDIA obviously changed, losing the trade show in exchange for assumably bigger payroll is a mistake. I remember when we were all volunteers, manufacturers wanted to encourage their own training, and still do.

Posted by antoniohardeman on May 17, 2017

@Chris dePaola,

Hey Chris, I’m/was *your* customer.  My income is in the bracket that you mentioned and as you said I & most like me probably don’t need to be educated on what we need in home automation.  More and more people understand tech and what they need the tech to do.  However, as Seth_J mentions others are getting into the game introducing consumers to this environment before the integrator reaches them.  See my story below.

@Seth_J

Don’t forget about the home builders bc they’re encroaching upon this space; see Lennar and other builders with Home Kit and Nexia.  When I bought my home in 2013 the home builder threw in a Z-wave hub, Trane Z-wave thermostat & a Schlage Z-wave door-lock.  From there I added more Z-wave devices expanding upon what the builder provided & I was able to setup modes & scenes via the hub manufacturer’s customer website.  Four years later my HVAC, A/V, Lights (indoor & outdoor), Ceiling Fans, Entry Points, Garage Door are integrated in one app and I have voice control via Amazon Alexa & all devices are orchestrated together.

If you overlook what’s happening in the industry and how consumers are discovering connected home devices, you may lose out on potential customers.  But maybe they’re not the consumers you want.

Posted by robgerhardt on May 17, 2017

I have always enjoyed Rich and respect his perspective.  But, I think we can look at the continuing failure of luxury endeavors to project our future.  Via and Hauss would be the most recent example of this dissolving future.  The obvious transition of so many dealers away from Crestron to C4, RTI, etc, and soon to the cloud based platforms, Alarm.com (approaching 5M accounts), Honeywell is underway and it is good. 

The future of the dealer is Recurring Monthly Revenue and it is not going to come from maintaining a network.  The removal of the monthly fees from OVRC, Packedge, and the cheaper other boxes are recent proof of that. 

The size of a typical transaction according to your magazine is down by 35% because the stuff simply costs less.
The disappearance of the audio retailers that defined CEDIA 28 years ago should convince us that we cannot use a retail mindset and succeed.

We have always been enablers and dependent on providers over which we have no control.  The movie industry created surround sound, the recording industry provided something to send to those multi-rooms, as did the cable, satellite, and now streaming industries. Just because they (Luxury Clients) are rich, does not mean they are anxious to pay more when they can see impressive functionality and access for investments that are at least an order of magnitude less expensive. 

This is what it is, and we cannot change it, no more than we can roll the clock back on steel mills and coal mines.  What we can do is recognize the increasing and widening appetite for these new systems that justify the valuable recurring revenue that has historically enriched the security dealers we often make fun of.

Every time CEDIA embraces a technology from Resi THX (in 1991), to flat screens, to the recent “own the network” message, it goes away as the major manufacturers take it mainstream.  Google WiFi, Google Home, Amazon, and Apple something are our future because people have to have something to control.  The fact that we do not make margin on those devices is not so different from never making margin on movies, DVD, CD, cable, or satellite. 

Research shows that the traditional security market is shrinking while the “Smart Home” and “DIY” markets are growing.  Each of those markets has a monthly fee that can build your future. The home installer finally has an opportunity to build a future with more systems that cost less (but with good margins), available to the existing home market and with RMR that is 3 times what enriched the security industry.

These are exciting times, some will make a lot of money and do some good.

Posted by Richard Stoerger on May 17, 2017

So to make this clear, first and foremost, this is my vision of what CEDIA is all about.  As a poster noted, it is our collective job to make people want to “aspire” to something better, from whatever base point they are beginning.  And when it comes to aspiration, I believe that an emphasis on the concept of “luxury” is a very good catalyst for us to get them there. 

Luxury isn’t something that is exclusive to only the big project guys.  It is what all of you are doing each and every day, whenever you step into a home, and whatever customer type is your base customer.  To them, whatever you are doing is a luxury service unlike the plumber, electrician, cleaning person or gardener that they view as essential services.  It is why during hard times, when their system has an issue, they still pay for essential services but call you only once they have money in the bank to pay you.  You are the last service person to be called upon to fix or upgrade stuff.  Why?  Because you service their “luxury” lifestyle. 

I am simply saying that we should embrace and herald this perception of luxury (or any other word that might be appropriate).  Who are we; we are CEDIA.  What are we; we are a luxury solution provider.  Who do we serve; the customer that is seeking a luxury experience.  What do we provide, luxury services.  How do our customers feel about what we do, “luxurious.”

As for the premise for this article, it is a counterpoint to those that felt this or that about our next CEO.  But I do love the direction this discussion is taking.  I believe it is high time that we find our mojo again and I relish this conversation.

Posted by Seth_J on May 17, 2017

If CEDIA wants any relevance whatsoever in any future economy it needs to embrace DIY and move on. Otherwise electricians, HVAC contractors, and even plumbers will continue to whittle away at what work we have left until there’s just a hand full of “CEDIA” dealers left to serve “luxury” clients. Good luck with that.

I look forward to continually having the “Have you heard of CEDIA? Oh, no… well, we’re a member… never mind.” conversation with every other trade and profession in the future.

Posted by Chris dePaola on May 17, 2017

#antoniohardeman well said!

#TheDarkKnight, customers don’t care about cedia and no level of consumer education will change that.  Being able to tell a customer that your team has degreed electrical, network, sound engineers, now that helps. 

People can fight over the 1%, the true luxury market.  I’ll take those with income levels from 100k - 500k.

Posted by jhamill1 on May 17, 2017

Amen, Brother Stoerger!

How is he defining luxury? How would anyone define luxury? Is an Acura or Lexus a luxury vehicle? Of course, Are they ever going to launch an $18,000 car under those brands? No. How many people make a living off of just those brands each year? Plenty. Those vehicles are out of the reach of many people. And not one technological breakthrough will change that. Yet, many more find it within their budgets to buy what is important to them.

It’s not really the question whether there are enough of these customers. It’s really a question of whether there are enough of us willing to take care of them.

Posted by antoniohardeman on May 17, 2017

This is nice but I was left wondering how he is defining luxury.  He mentioned the customer is luxury.  Does that mean a high net worth individual?  It sounds that way.  I see no problem with CEDIA members going after the luxury market, as they should.  But that market is a small percentage of the overall pie and everyone will not be able to eat from that small slice of pie.  So if you want to eat on a regular basis you may have to embrace the individual that doesn’t have a high net worth and meet those individuals where they are. 

Look; like it or not and a lot of CEDIA folks can’t come to grips with the fact that technology has become democratized and what was once the realm of CEDIA professionals has become disaggregated by advances in home automation tech.

I think that the other thing that rubs some CEDIA members the wrong way is the fact that individuals that don’t have a high net worth can create a very nice orchestrated connected home automation system where the majority of control is in one app and homeowners (DIY) can create these systems at a relatively low cost versus $20k to automate their 2,000 sqft home. 

Posted by TheDarkKnight on May 17, 2017

Being a CEDIA member/dealer should mean something to the general consumer. Regardless of whether the customer can afford to do business with them and/or even knows what the acronym stands for…they should aspire to have technology installed by a CEDIA dealer.

Today, I believe this is not the case. CEDIA should pay more attention to educating the consumer on the differences between DIY and true custom. They should pay less attention to making money by getting more people to come to the Expo and/or take their training courses. The more consumers strive to purchase from a CEDIA dealer, the more dealers will aspire to attend the Expo and training.