Retrofit jobs—you either love them or you hate them. And unless you’re a glutton for punishment, rarely will you strive to make them the bulk of your business—that is, unless you’re Joe Steggs from Phoenix-based Mythic Home Theater.
Over the past two years, this sales-minded integrator has focused his energy on selling technology to two markets that have historically been tough to crack, must less make a good profit: retrofit and mid-priced homes.
Since Mythic Home Theater opened its doors in 2013, its sweet spot has been a sale between $3,000 and $15,000.
“We have the ability to do larger, more expensive automation jobs, but we’ve chosen to structure our business around simple, affordable audio systems for retrofit clients,” Steggs explains.
It’s a bold business decision that’s enabled his company to more than double its gross profits in two years. Steggs’ strong retail background as a Best Buy home theater advisor and a Magnolia rep has helped him develop a sales formula that works by allowing Steggs to make money on products instead of installation.
So what’s the secret?
“Top-down selling of a high margin product,” Steggs says.
“The Elura speakers are a perfect fit for our demographic of customers,” Steggs says. “Our customers are looking for simple, basic surround sound and the ability to distribute audio to a second zone, and they want it to sound good without having to spend a lot. Elura’s speaker solutions come in at the right price point for our market, and once our customers hear the audio quality, they’re sold.”
Not that Steggs doesn’t have to lay at least some groundwork to get his customers on board with the notion of owning an audio system. After all, Elura is a name that’s likely unfamiliar to most consumers; some form of introduction to the brand is necessary, and here’s where the art of a demo comes into play, Steggs continues.
To showcase the quality of Elura speakers, he often invites potential clients to the WAVE store to conduct a demo of Elura’s three lines of products: black label, red label, and blue label, presenting them with good, better, best options.
“I make sure to tell them what they should be listening for in a movie or music clip, and I also point out how the top-of-the line Elura speaker produces bass noticeably better than its lower end models.”
Steggs attributes the ability to compare models within the Elura line as instrumental to Mythic Home Theater’s sales success.
“Most times, the customer will end up buying the higher end model, especially when they discover that they can step up and still usually be below their budget.”
Steggs says that for $6,000 he can set up a client with a 5.1 surround-sound system complete with a universal remote and installation when using Elura speakers; a similar setup with an equivalent yet different brand of speaker would settle in a closer to $7,000.
Even with the affordable price tag, Steggs says he is still able to enjoy a 70 percent profit margin with Elura speakers.
“With another line of product we might see a 40 percent profit margin,” he says. “Our customers love the way Elura speakers look, sound, and we look like heroes when we can sell and install them for significantly less than other speaker brand. Elura has come to represent 90 percent of our audio installations, and during the nine months that we’ve carried them, our sales have increased significantly.”
Elura’s attractive price points and solid-quality audio, along with Mythic Home Theater’s focus on mid-price retrofit projects, has become a winning combination for the company. It’s a product that hits both the company’s target market and its sales goals.