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CE Pro Brand Influence Study

Exclusive CE Pro research shows 98% of integrators acknowledge that product brand names have value to their clients … a complete sea change from past attitudes.

There is a growing boxing match between manufacturer brands and integrator brands. Which will win?

Photos & Slideshow

Jeff Kussard · September 17, 2013

“My brand is the only brand that matters to my client” is a constant refrain that has echoed throughout the custom electronics industry since its inception.

But if you still believe that statement to be universally true, it’s time to rethink your marketing plan. Things are changing.

It’s been long held among custom installers that the brands of products they specify are foreign to their clients. They observed that clients found themselves in an esoteric environment with little or no understanding of the technologies or brands. But not any more. Today, manufacturers are more adept than ever at marketing their brands directly to consumers in an effort to create “pull-through” for their dealers, or even to sell direct, bypassing the custom channel.

New exclusive data from the first-ever CE Pro Brand Influence Study of consumers and integrators show that both integrators and the high-income consumers they target now acknowledge that manufacturers’ brand names are increasingly important. Among integrators, a remarkable 98 percent now realize that equipment brand names have value among customers. Moreover, 55.8 percent of dealers now believe the product brand names that they sell and install are equally important as their own company brand name.

There is also an evident strain in the relationship between manufacturers and dealers. Seven out of every 10 dealers said they are displeased with the growing trend of vendors marketing directly to consumers, they also complained that manufacturers do not feed them enough leads, with 87 percent reporting they get zero leads from their vendors.

Meanwhile, half of all consumers polled said product brand was “extremely” or “very important” to their purchasing decisions; however, an integrators’ installation reputation is valued as the most important criteria in the buying decision process.

The data are revealing, but the study is merely a backdrop to a larger conversation facing the custom electronics industry about brand influence.

What is Brand

According to the marketing blog iuriel.com, the practice of branding began in Scandinavia in the Middle Ages when the Norse began burning symbols into the hide of livestock as proof of ownership. The word “brand” is believed to derive from the Norse word “brandr.” The Vikings are believed to have introduced it to the English who later adopted the word. But the English employed the practice of “branding” differently. In the late 12th century when a criminal was rejected by English society or exiled from the country he was an “abjurer” and branded on the thumbs with the letter “A” to announce to the world at large he was not be trusted.

In the American Wild West, branding was used to mark cattle as property of specific ranches. Sometime prior to the Industrial Age, the definition of the word “brand” evolved beyond describing a purposeful burn as means of identification to also relate to trade, emotions and trust. A trademark became the symbol to differentiate manufacturers and establish an emotional connection with the brand. Some of the oldest established brands are Twining, Schweppes and Ballantine’s registered in 1706, 1798 and 1809 respectively. They were created in a time when investing in brand offered value to commodity items with a reasonably long shelf life and (for the time) broad market reach.

Today we’re surrounded by brands. The logos of mass brands are emblazoned on the everyday things of our lives, and the best of marketers have created logos that convey ideas beyond simply the name they represent.

The Way We Were

Conventional thinking among integrators says that clients who are new to integrated systems seek the counsel of experts to inform and guide them. They may seek references from those in their social or business circles, but ultimately the uninitiated come to rely upon the dealer for guidance. As a result, it is easy to assume the dealers’ brand is the only one necessary to create the sale.

Today, that same belief continues to be held by many custom installers: That the marketing initiatives of the brands they sell are of no value. Some even assert that interest in a brand on the part of the client can be counterproductive.

Yet to the dealer, vendor brands are important. Brands of vendor partners are emblazoned on service vehicles and showroom doors; custom installers’ websites use vendor brands as badges of credibility.

There have also been notable changes in the economic landscape and in communications mediums. In the CE Pro 100 brand preference survey there was a dominance of value-oriented brands. That trend arose from dealers seeking high value brands in response to the demands of their clients.

How consumers and integrators experience brands can instill extreme loyalty or evoke deep and lasting distrust. For example, kitchens have tiers of brands that are well known to the average consumer. Highly specialized brands, like SubZero, are known not only by cooking enthusiasts, but also by contractors and cooking professionals. A kitchen designer can routinely expect to meet a client with a predisposition toward, or loyalty for, a particular brand or brands of kitchen appliances or materials.

But that loyalty may not come from an ownership experience. It likely developed because the manufacturer/brand regularly advertises in popular food/cooking magazines or on TV.

And while the migrations of channel marketers to digital media may not be as advanced as other consumer goods, leaders in the industry are developing ways to take advantage of modern digital media tools.

Paul Starkey, former senior vice of marketing for CORE Brands, says the dealer’s value equation began changing in 2008. “Focus on margin and brand exclusivity were trumped by ‘I need customers.’ Social media and the web now make it possible for a brand to engage interested prospects and deliver them to partner dealers. Dealers don’t have the time or resources to implement a strong digital strategy. Looking forward, vendors that establish brand awareness in the consumer’s mind and can leverage it to drive business to the dealer will win.”


Data: Conflicting Emotions

The CE Pro Brand Influence Study questions were designed to help understand the current brand influence mindset of custom installers. The 150 respondents provided enlightening information.

In all, 55.8 percent of integrators believe their own company brand and the equipment brands they carry are “equally important.” While we have no historic data to compare, it seems likely that this is a marked change from 10 years ago.

Also, nearly three out of every four integrators (74 percent) said that clients come to them recommending specific equipment brands that they want. Of those, one in five (19.7 percent) said clients “frequently” ask for specific equipment brands. Again, while there is no historical data on the subject, those percentages demonstrate a strong shift from the past when homeowners were mostly unaware of custom-installed product brand names.

A whopping 98 percent of integrators acknowledged that equipment brand is of at least marginal value or greater (almost 25 percent said it was “very” or “extremely important”) to their customers. The answers in 1999 would probably have been 100 percent “Never” and “Not important at all.” It would appear then that dealers recognize the growing influence of brand in the channel.

But the paradox in the trend arises when marketing enters the picture. When asked about their view of their equipment brand partners selling direct to consumers or extending their relationships to include “big-box” retailers, integrators are markedly not pleased: 53.8 percent of respondents said they were unhappy about this type of move by their vendor partners, while 16.6 percent of integrators stated they “drop” brands that sell to consumers.

  About the Author

Jeff Kussard is a recognized industry leader and CEDIA Fellow, specializing in A/V technology, the retrofit market, and business strategy for the custom installation channel. He can be reached at jckussard@comcast.net. Have a suggestion or a topic you want to read more about? Email at jckussard@comcast.net

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