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3 Biggest Remote Service Mistakes Integrators Are Making

Former CytexOne exec Martin Roseman is 'shocked' at how integrators are still reticent to offer, sell and price service agreements. New RMR Marketing Kit aims to help.

3 Biggest Remote Service Mistakes Integrators Are Making

Jason Knott · June 12, 2019

Anyone remember Certified Cyber Solutions, Nuage Nine and CytexOne? Back in 2009, those pioneering remote systems management (RSM) companies were among the first to tout the potential for a recurring monthly revenue (RMR) service business model in the custom installation industry. As is often the case, bleeding edge firms end up in the dustpile. 

“I literally thought [in 2009] everyone in the industry would be earning RMR and selling service agreements within 2 years."

— Martin Roseman, MC Group

Back then, one of the key executives at CytexOne was Martin Roseman, who today runs MC Group, a marketing and consulting firm for the industry, where he shares with clients some of the painful lessons he learned from being on the forefront of the RSM trend.

“I literally thought [in 2009] everyone in the industry would be earning RMR and selling service agreements within 2 years,” says Roseman. “But it wasn’t until 2016 that many integrators really started to play with remote systems monitoring when Domotz, Ihiji [now Control4], and SnapAV’s OvrC opened the door.”

Today, Roseman sees the positive momentum in the industry among many integrators, but still sees room for improvement.

“The world is moving to the cloud and subscriptions. The custom electronics industry should have embraced this model top to bottom,” adds Roseman, who is collaborating with long-time industry veteran Richard Frank of Frank Marketing as a coach for the development of a new RMR Marketing Kit. The kit is an agnostic program on how to establish RMR that can be used for any platform.

Roseman believes every integrator, at minimum, needs to address the gap between the manufacturer’s warranty and their own installation warranty.

“It’s only a matter of time before manufacturers start charging for their software. Dealers need to have service agreements in place so they can roll five or six manufacturers’ software fees into a single, comprehensive service and maintenance contract for customers,” he speculates.

With that, Roseman identifies the three biggest mistakes integrators are making in regards to RMR.

Mistake #1: Integrators Are Not Charging for Remote Service

“It’s 2019 and many integrators finally installing remote managed systems hardware and software, but they aren’t charging for it. I am shocked,” exclaims Roseman. “With new customers and with existing customers, deales need to reset the clients’ expectations.”

He believes every integrator—even a one-man shop—should be charging for service.

“Clients expect their systems to require service today. Dealers are already servicing those systems… why not get paid for it?” he asks rhetorically.

He recommends integrators creating tiered service plans and contracts and then stratify their client base into each of the tiers.

Mistake #2: Dealers Are Not Sure How to Price Their Service

Once an integrator makes the determination to charge for remote service, then they encounter the question of how much to charge for it. Roseman says that stumbling block forces many dealers to abandon the idea.

“I recommend dealers find their own ‘sweet spot’ for pricing based on what their average system installation cost is,” he says.

Read Next: 14 Service Functions More Integrators Should Consider Providing

So how does a dealer do that exactly? Roseman has developed a formula for integrators that is based on not just the installation price, but adjusted for the region and the metro area, such as Los Angeles, Chicago and New York City.

The formula also accounts for various exceptions based on the complexity of the client’s personality, the distance to the job site from the office, the reliability of the local ISP, and other factors.

Mistake #3: CE Pros Don’t Know How to Sell Service

“Integrators need to express the value of a service contract to clients,” he says simply. “It needs to be weaved into your sales pitch ‘early and often.’”

He believe is it vital for dealers to write down talking points for the value of service, then put it on their website and in all their literature.

“The biggest obstacle many times is the owner. I find that the customers are often wondering why it took so long for the integration company to offer service,” he points out.



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  About the Author

Jason Knott is Chief Content Officer for Emerald Expositions Connected Brands. Jason has covered low-voltage electronics as an editor since 1990, serving as editor and publisher of Security Sales & Integration. He joined CE Pro in 2000 and serves as Editor-in-Chief of that brand. 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 has been a member of the CEDIA Business Working Group since 2010. Jason graduated from the University of Southern California. Have a suggestion or a topic you want to read more about? Email Jason at jason.knott@emeraldexpo.com

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  Article Topics


Business · Service & Recurring Revenue · News · Business · Control4 · Domotz · Remote Management · RMR · Service Contracts · SnapAV · All Topics
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Comments

Posted by Chuckanderson on June 21, 2019

I bet you’re right Frank.

Posted by Walt_Zerbe on June 21, 2019

I couldn’t agree more rfrank!

Posted by rfrank.fma2 gmail.com on June 19, 2019

Hi Walt - I think you are spot on! Establishing a real value for the safety and security of a monthly service agreement is the responsibility of the installation expert that designed and installed the system in the first place.
But it is no small task: they have to define their tiered pricing, train their staff on how best to explain and sell these services, weave it into their operation - materials, letters of agreement for new and old customers, integrating the value of service agreements into their website, etc., etc.
And - as per your highlighting Best Buy getting deeper into the process, integration specialists need to realize how important it is for them to do it better than the big box guys. So - is it worth the time and money to get coached on how to set up RMR, train your staff, make sure your marketing materials, docs and website are all top notch and in tune with your RMR program? You bet it is…

Posted by Walt_Zerbe on June 17, 2019

I’d say that consumers are getting conditioned to it if the benefits are laid out or we wouldn’t have seen this article.  https://www.cepro.com/article/best_buy_total_tech_support_1_million_members

Posted by Bruno Napoli on June 13, 2019

I think the consumer industry in general does not help Custom Installers and does not create a room for maintenance. It’s rare to find any tech/electronic consumer magazine (online or paper) that will finish an article by “Super product, but might require a professional to install, service and maintain”. Same for manufacturers, I never saw the mention on the box of a product to say “This product might require yearly maintenance by a professional”. This “culture” of using a professional to install & maintain is not created by the consumer industry, so everything is supposed to work like that, out of the box, for ever and of course, no need for service and maintain. And if ever you asked a pro to install because you are too lazy to do it, as the manufacturer and consumer press said it is supposed to work like magic or never talk about maintenance, why the hell would it need maintenance. I can really feel the pain and why custom installer can feel uncomfortable to talk about service and maintenance. Now the reasons for that are clear: sell more stuff first, then let people sort out the problem.

Posted by Joseph Kolchinsky on June 12, 2019

I think before anyone says integrators are making mistakes we should take a moment to recognize the very real challenges this industry faces.  Consider this:

When I speak in front of groups of integrators I always ask: “How many of you would interrupt your work or personal life (sleep, meetings, dinner, etc) to take a call for a client in need of service?”

Everyone raises their hands.

I then ask “how many of you are willing to guarantee a response to your clients whenever they reach out?”.  All the hands come down.

The industry’s stuck between a rock and a hard place.  The problem is we’re all breaking our backs trying to take care of our clients but we’re unable to guarantee the service so it’s not worth paying for.  Would anyone pay for AAA if they offered a “we’ll try our best to get you a tow truck” kind of response?

The demand for this response continues to grow as tech becomes a bigger part of family life, but integrators continue to lack the scale to provide 24/7 support.

I don’t believe it’s fair to expect any integrator comprehensively and properly address Mistakes 1,2, and 3 listed above without first enabling them to solve the broader service challenge tied to scale.  That’s why I founded OneVision.  When you combine the efficiency, reliability, and capability of our scale with the local relationships, quality, and skills of local integrators you create a service experience that’s hard to beat.

We’re not growing fast, we’re not trying to take over the world.  We’re focused on changing the smart home one experience at a time with a group of committed integrators who care.  Join the platform at www.onevisionresources.com.

Posted by Joseph Kolchinsky on June 12, 2019

I think before anyone says integrators are making mistakes we should take a moment to recognize the very real challenges this industry faces.  Consider this:

When I speak in front of groups of integrators I always ask: “How many of you would interrupt your work or personal life (sleep, meetings, dinner, etc) to take a call for a client in need of service?”

Everyone raises their hands.

I then ask “how many of you are willing to guarantee a response to your clients whenever they reach out?”.  All the hands come down.

The industry’s stuck between a rock and a hard place.  The problem is we’re all breaking our backs trying to take care of our clients but we’re unable to guarantee the service so it’s not worth paying for.  Would anyone pay for AAA if they offered a “we’ll try our best to get you a tow truck” kind of response?

The demand for this response continues to grow as tech becomes a bigger part of family life, but integrators continue to lack the scale to provide 24/7 support.

I don’t believe it’s fair to expect any integrator comprehensively and properly address Mistakes 1,2, and 3 listed above without first enabling them to solve the broader service challenge tied to scale.  That’s why I founded OneVision.  When you combine the efficiency, reliability, and capability of our scale with the local relationships, quality, and skills of local integrators you create a service experience that’s hard to beat.

We’re not growing fast, we’re not trying to take over the world.  We’re focused on changing the smart home one experience at a time with a group of committed integrators who care.  Join the platform at www.onevisionresources.com.

Posted by Bruno Napoli on June 13, 2019

I think the consumer industry in general does not help Custom Installers and does not create a room for maintenance. It’s rare to find any tech/electronic consumer magazine (online or paper) that will finish an article by “Super product, but might require a professional to install, service and maintain”. Same for manufacturers, I never saw the mention on the box of a product to say “This product might require yearly maintenance by a professional”. This “culture” of using a professional to install & maintain is not created by the consumer industry, so everything is supposed to work like that, out of the box, for ever and of course, no need for service and maintain. And if ever you asked a pro to install because you are too lazy to do it, as the manufacturer and consumer press said it is supposed to work like magic or never talk about maintenance, why the hell would it need maintenance. I can really feel the pain and why custom installer can feel uncomfortable to talk about service and maintenance. Now the reasons for that are clear: sell more stuff first, then let people sort out the problem.

Posted by Walt_Zerbe on June 17, 2019

I’d say that consumers are getting conditioned to it if the benefits are laid out or we wouldn’t have seen this article.  https://www.cepro.com/article/best_buy_total_tech_support_1_million_members

Posted by rfrank.fma2 gmail.com on June 19, 2019

Hi Walt - I think you are spot on! Establishing a real value for the safety and security of a monthly service agreement is the responsibility of the installation expert that designed and installed the system in the first place.
But it is no small task: they have to define their tiered pricing, train their staff on how best to explain and sell these services, weave it into their operation - materials, letters of agreement for new and old customers, integrating the value of service agreements into their website, etc., etc.
And - as per your highlighting Best Buy getting deeper into the process, integration specialists need to realize how important it is for them to do it better than the big box guys. So - is it worth the time and money to get coached on how to set up RMR, train your staff, make sure your marketing materials, docs and website are all top notch and in tune with your RMR program? You bet it is…

Posted by Walt_Zerbe on June 21, 2019

I couldn’t agree more rfrank!

Posted by Chuckanderson on June 21, 2019

I bet you’re right Frank.