How to Revitalize Profits by Selling More Stereo

Reverse the curious case of declining two-channel stereo sales in the residential integration channel with a new sales approach, a showroom and the perfect music demo.

If there is more music being downloaded and listened to today than ever before, why are sales of high-performance stereo systems on the decline? Integrators cite various reasons for this trend, including the fact that some higher-end audio brands don’t interface well with certain automation and control systems, and prices for high-performance stereo (often called two-channel) can seem hard to justify when the TV is so inexpensive, or it’s too easy to sell Sonos throughout the home without any attempt to upsell to higher performance options, plus many more.

By far the biggest reason for slowing audio sales is that for the past several years, most showroom-based integration firms have spent time and energy figuring out how to properly design, engineer, program and install automation, control, lighting and network solutions (which is very understandable because when you don’t get those things right, systems go down and clients get mad).

That is all well and good except that lately integrators everywhere have started to bemoan declining profit margins on networking and automation sales as more and more systems move to the cloud, and bigger technology companies get in the game.

Many integrators now realize that while they were so entrenched in network and control, they completely took their eye off the ball regarding selling and upselling high-performance stereo.

Many owners now realize that while they were so entrenched in network and control, they completely took their eye off the ball regarding selling and upselling high-performance stereo, a category that arguably represents today’s most compelling opportunity for adding profit dollars to any custom integration firm.

Unfortunately for most companies, learning or re-learning how to sell more audio will not be as simple as bringing in some more expensive models of loudspeakers and separates, and asking everyone to please sell them.

Instead, just like when companies first made a deliberate business decision to sell networks or lighting control and they went through all the steps to find the right products, get everyone trained (in some cases hiring people with better IT skills), and develop a design and project management infrastructure for things to run smoothly, integrators who want to sell more high-margin stereo will need to take a similar approach — to embrace selling more stereo as a discrete new business opportunity, and take the time to make it work.

I presented my “10-Point Strategy for Selling More Audio” during a spring HTSA two-day Masterclass training in Atlanta, and offer some highlights here as well as feedback and current strategies from several attendees (see testimonials here) who are addressing audio sales.

Testimonials: Hear from five integrators successfully increasing stereo sales

Understanding the Value Proposition

The beauty in selling more stereo (also known as two-channel audio) components goes beyond the fact that speakers and high-performance electronics and cabling have significantly more profit margin built into the selling price than most video, control or networking products.

When you sell a $4,000 pair of loudspeakers instead of a $2,000 pair, or upgrade 20 in-wall speakers from $150/each to $225/each in a client’s home or install a $1,200 receiver instead of a $650 entry model, it doesn’t take one minute longer to install these more expensive products, so all those extra profit dollars fall straight to the bottom line. Multiply that across the board when you learn to upsell in every category and the results can be astounding.

When you sell a $4,000 pair of loudspeakers instead of a $2,000 pair or install a $1,200 receiver instead of a $650 entry model, it doesn’t take one minute longer to install these more expensive products, so all those extra profit dollars fall straight to the bottom line.

Given the current uptick in custom sales in many areas of the country, several dealers have told me they have too much business as it is and can’t even get to it all, so why invest valuable time and money to learn how to sell or upsell more audio?

I say, all the more reason to maximize the value of the customers you already have by selling them more, higher-margin and better stereo components without doing any more marketing or adding less-profitable labor hours. Doing more business with fewer people is always the way to go.

Selling More Requires You to Offer It

The crux of the sell-more-stereo strategy is that a customer cannot order it if it’s not on the menu. The audio world has changed dramatically over the past decade. Today, there is little to no retail in the home entertainment space and very few people come to you asking for a new stereo system.

Most new business comes through referrals from architects, designers and builders where the focus is on lifestyle, convenience and invisibility. Sadly, for integrators who choose to pursue a sell-more-stereo strategy, selling more audio will NOT be a market-driven enterprise. You will need to create your own market, one customer at a time.

What does that mean? Clients may not be coming to you for a stereo, per se, but when you turn them on to the visceral connection in owning a great sound system, and take the time with every prospect to ask, “Do you have a minute? Can I show you something kind of awesome? Have you thought about a dedicated music system in your 9,000-square-foot house?” amazing things can happen.

South Miami, Fla.- based Sound Components effectively sells high-performance stereo gear, evident by president Mark Goldman’s “Art of the Demo” presentation at HTSA’s Masterclass.

This strategy is not unlike home theater when it debuted 20 some years ago. Nobody knew what home theater was so it was up to the stereo specialist to have a great demo set up and to have invested the time, money and energy to teach everyone how to sell what was really more of a concept sale. Then, one customer at time, the dealer exposed everyone who came into the showroom to home theater. Specialty dealers created the market that many years later allowed Best Buy to sell Home-Theater-in-a-Box and everyone knew what it was.

The crux of this strategy involves finding innovative and repeatable ways to both surprise and delight every single client with a music or home entertainment experience they’ve never heard before, and stimulate their desire to recreate that experience in their own homes. You must bring it up and if at all possible, get them into the show to experience a great demo.

After all, if people don’t know what it is, how can they know if they want it?

6 Guidelines for Increasing Stereo Sales

A full-blown sales and marketing strategy should address everything from:

  • Analyzing your audio product lineup
  • Re-merchandising your showroom or design center and creating a tour
  • Evaluating your sales team
  • Creating a plan to teach everyone the art of the demo
  • Deciding on a sales approach
  • Creating a plan to upsell headphones, personal audio, distributed audio, landscape sound, and add-ons Addressing sales training and compensation issues
  • Creating a marketing plan to sell more audio to new and existing customers of all ages
  • Figuring out how to capitalize on high-res audio and the latest home theater sound technologies
  • Creating a strategic and tactical blueprint to help you set goals and schedules to implement your plan

The following ideas and suggestions are offered to help you determine if, in fact, selling more stereo is a direction you want to pursue. This is not a strategy that abandons automation, control and the custom business. It’s a decision to add and upsell higher-performance (and higher-margin) stereo components and standalone music systems to your core service offerings.

Unlike other lifestyle technology solutions, for this strategy to succeed, someone in the company needs to be the point person — ideally one who sincerely loves music, cares about great sound, and can impart that enthusiasm and passion to everyone inside and outside the company. Part of the return on investment when you start to sell more stereo is a new energy that revitalizes your staff as well as your bottom line.

1. Evaluate Your Product Lineup

Look at your loudspeaker and electronics brands by category and price range to be sure you have a smart good/better/best assortment where salespeople can easily move up and down your product roster without big gaps in price. 

Choose high-profit lines that tell a story and where possible, create systems with the fewest possible brands to simplify the selling process and make your firm important to a few key audio manufacturers.

Companies with showrooms have a major competitive advantage, yet most integrators today fail to maximize their space.

It may be prudent to think about going one step higher in price point across the board to help you showcase flagship brands — and ultimately sell more systems one notch below that.

2. Choose Your Sales Approach

Though most showroom companies go with a top-down strategy where everyone is first exposed to the very best, and then shown alternatives in various price ranges (no one is ever insulted when you let them test drive the Ferrari), some integrators prefer a bottom-up approach, breaking the sale into chunks, educating the customer at a price point where they feel comfortable, and then moving up the ladder one performance  level at a time.

This would be in addition to the “how do you want your sound to look?” lifestyle approach, which is still appropriate for certain types of customers and in certain residential applications.

Another sales approach that can work for almost everyone is the concept of selling up one level in every category for a given amount of time. When you feel comfortable at that price point, move up another level. Before you know it, you’re selling $10,000/pair speakers without blinking an eye.

3. Design Your Showroom Tour

Companies with showrooms have a major competitive advantage, yet most integrators today fail to maximize their space, using sound rooms as high-priced work-spaces and failing to maintain working systems and displays.

For those without showrooms, there are many interesting ways to upsell stereo when selling in the client’s home, but it will be difficult to sell high-performance products without some form of demonstration facility. Even a fully loaded conference room can accomplish a great deal with a few key A/B demos, gear installed all around.

Ideally, showroom-based companies would create a complete “store tour” with the goal to:

  • Give every client an amazing demo that excites and engages them and creates real value and desire for better sounding components
  • Educate clients that they need better audio to deliver that experience (when they can hear the difference, they start to upsell themselves)
  • Show them that audio is, in fact, the critical component in an amazing home theater experience, not the size of the TV
  • Expose them to a broad array of lifestyle solutions e)  Stimulate trust and credibility when part of the tour features racks being built, technicians programming and projects being staged in a professional setting

Special touches that stimulate all five senses and make each client feel special contribute to a memorable showroom experience. The best, most immersive experiences happen in the sweet spot that combines education, entertainment, aesthetics and escape. A well-designed showroom tour contains prompts along the way for clients to ask questions and salespeople to remember to show and tell.

Part of Doug Dushan’s strategyis to serve espresso to clients asthey enter his showroom, pictured here.

You can create long and short versions of the showroom tour for different types of customers. It will be important to set some ground rules for keeping the space neat and clean and all systems and displays tweaked and meticulously maintained so that every single client enjoys a memorable listening experience, the best you have to offer.

It takes a lot of work to get this going, but you will see that giving everyone the whole store tour creates excited clients, excellent word of mouth — and you never know what people are willing to spend when they’re having such a good time.

If you don’t have a showroom, there are ways to create desire anecdotally by painting an immersive picture with words such as, “Imagine coming home from a stressful day at work, pouring a nice glass wine, sinking into your easy chair, turning on the stereo and immediately being transported by your favorite music” … or bring some components with you to educate and demonstrate in the customer’s home.

Testimonials: Hear from five integrators successfully increasing stereo sales

4. Perfect the Art of the Demo

Art of the Demo @ CEDIA

Fred Ampel will be teaching a two-hour “Art of the Demo” course at CEDIA 2017, reviewing the art and the science of selling with a focus on the psychology of the buyer. The session will include interactive presentations on listening, asking questions and the critical Art of the Demo.

At the core of the tour is the listening demo, where best results come from a room that has been carefully tuned and treated to sound good, with high-impact demo material that gets pre-loaded into every display, and trained salespeople who have practiced and mastered the art and science of giving a superbly controlled presentation that creates excitement and leads the client through a natural upgrade process.

A great music demo is a very powerful sales tool. It requires hours of practice and a commitment to giving it with real passion and energy for every single client. The demo is the pivotal moment in the stereo sale, when people love what they hear and want to recreate the experience at home. During the HTSA event Sound Components’ Mark Goldman offered an “Art of the Demo” presentation that resonated.

5. Evaluate Your Sales Team

Though there are many important points to consider when developing your sell-more stereo strategy, your ultimate success will depend on the skill level of your sales associates. The ability to get clients excited about a category they didn’t come in asking for, plus the ability to establish rapport, qualify needs and elicit an emotional response from a well-executed music demo requires a high level of selling acumen.

And there lies the rub. Years ago most home theater companies chose some form of a relationship-based sales training program that everyone in the company went through. Not so today … so no wonder sales of high performance audio are down.

Integrators complain that vendors and reps used to help with sales training and teach them how to do effective demos, but now it’s all about the product. Conversely, manufacturers complain that integrators don’t really have salespeople anymore, just specifiers, and all they want to hear about is how products interface with their control systems.

Though it’s a bit of a chicken-and-egg scenario, based on anecdotal accounts clearly there is a big hole in our industry where sales training once prevailed.

To further complicate matters, it would seem that some custom companies still have veteran Baby Boomer salespeople who can and do sell high-end separates and speakers, but many are increasingly frustrated trying to learn networking and control, or they may be contemplating retirement.

Most new hires tend to be younger, more technical types who understand control and networking but no one is training these newbies how to sell, upsell, or develop real passion and appreciation for the stereo part of the sale; plus they may not be the ideal personality types to excel at high-concept selling. These are the guys spec’ing lots of Sonos and in-walls into every size project.

Stereo sales are not dead. Consumer audio shows are flourishing, people are requesting vinyl, and high-res audio is hot. Most integrators just forgot how to sell it.

In addition, many former home theater companies have lost the part of their culture where being able to sell a big stereo system with separates and $20,000/pair speakers, room acoustics and the whole nine yards is highly prized and respected by everyone in the company.

Given all these factors, it’s no wonder that most integrators today declare stereo to be a dead category, that there is no real customer demand for standalone music systems, and that only very big hot markets like Seattle, Denver and New York City can support robust high-end audio sales.

Well, stereo sales are not dead. Consumer audio shows are flourishing, people are requesting vinyl, and high-res audio is hot. Most integrators just forgot how to sell it.

One need only look to the phenomenal success of first-class system integration companies like Spire Integrated Systems in Michigan or Hansen’s, in a tertiary market outside of Dayton, Ohio, to see how it’s done. They are both premium level engineering and integration companies, and able to sell very expensive stereo systems to all age groups on a regular basis.

6. Sales Training Is Non-Negotiable

The fact is, to really succeed with a strategy to sell more stereo requires taking a step back to be sure you have the right people in the right positions, in particular, you need to hire sales associates who are naturally open, friendly, curious, and capable of expressing passion and enthusiasm for music and stereo gear. This is half the battle.

The other half involves finding the right relationship-based sales training program, enrolling everyone in the company who is involved with sales (including yourself) and sticking with that program with refreshers and boosters and whatever it takes to get everybody up and going full board. It will make a world of difference, even for your best salespeople who will only get even better, faster.

At a price tag of $3,000 to $5,000 per person, it will surely pay off over the first two or three sales as each salesperson finds it easier to establish rapport, qualify correctly and upsell in every category.

Several prominent showroom companies have reported excellent results using Sandler sales training ( Sandler is franchised nationally, though I am told that quality levels can vary from market to market. I recently met a veteran Sandler trainer who knows all the trainers across the country. He can vet and recommend the right trainer for your market (I am happy to share his contact info with anyone interested). The program is excellent and offers several options for ongoing training resources.

Getting Started Selling More

If you want to transition from a company that regularly sells Sonos and $1,000/pair loudspeakers to a company more fully committed to selling and upselling higher-performance stereo components, the good news is that it’s not rocket science, but it will take time, effort and some expense to fundamentally change the sales culture of your company to one that values both music and sound quality, excels at giving great demos, regularly delights customers with memorable showroom experiences, retains a highly trained and effective sales staff who love coming to work — and promises long-term profit prospects for years to come.

To create and implement a full “sell-more stereo strategy” will most probably take between four and six months or more to execute. As a way to test the waters and begin today, you might try taking just one stereo category, say in-walls, and look at your product lineup, find a way to demo at least two pairs, pick some music and practice a simple A/B demo.

Even without a demo, ask every salesperson, for one month, to sell up one price point from the model they normally spec, and see what happens. Then do the math at the end of the month and watch your profits start to grow, all the way to the bank.

Hear from five integrators successfully increasing stereo sales here.