If all it took to sell six-figures-worth of loudspeakers is a piano, a piano player, a few bottles of wine and a catered lunch, then every integrator would be doing it. But Definitive Electronics in Jupiter, Fla., can tell you that it isn’t as easy as it sounds.
The custom integration company recently conducted a well-planned, well-appointed, one-day, invitation-only high-performance audio demo event in its showroom that quickly resulted in commitments to purchase six-figures worth of its newly adopted Brodmann Acoustics loudspeaker line.
The event is a great blueprint for other CE pros looking for ways to jumpstart their high-performance audio business.
Of course, it helps that Definitive Electronics’ target market is affluent homeowners primarily living in Jupiter Island, Fla., where celebrities like Celine Dion hobnob with famous athletes like Tiger Woods. Empty dirt lots in the area can sell for millions and homes sell for as much as $40 million. The enclave is host to about 800 homes in one of the most exclusive zip codes in the nation. Definitive has been successfully serving the elite clientele of the island for years.
It is against that backdrop that Definitive Electronics hosted 16 clients to a demo event featuring the U.S. debut of loudspeakers from Vienna, Austria-based Brodmann Acoustics. Definitive recently became of the first integration companies in the U.S. to carry the ultra-high-end line of floorstanding speakers.
The event featured two sit-down luncheons for eight people: one at 11:30 a.m. and another one at 1 p.m. Definitive president and CEO Don Dixon, along with product specialist Ron Lennox, dined with their guests, which included homeowners as well as luxury homebuilders. Other guests at the table were Di Bernd Gruhn, CEO of Brodmann Acoustics, and Brad Paulsen, national sales manager for Brodmann in the U.S.
The company regularly hosts events like this.
“We bring in builders, architects and upper echelon customers. We want to re-educate them on some of the advancements with some of the products out there,” says Dixon. “Mainly we do these events around new audio introductions. It is hard to keep clients' attention talking about automation. With audio, we can bring out the true emotion, the true drama that music brings to people’s lives.”
Lennox notes, “At every event we try to mix up the guest list, so we have some people who are here are customers who we did systems for many years ago, some people who are new to high-performance audio, and a luxury builder. They all have different questions, thoughts and perspectives.”
“Selling high-performance audio is 100 percent dependent on a demo. You can absolutely hear the difference,” says Dixon emphatically. “Selling audio without a demo is like asking you to buy a Ferrari but not having one for you to drive. The hardest part is getting the people here. Our close ratio is extremely high once we can get the people here.”
Using two separate setups, Lennox conducted the demos, which each lasted less than 20 minutes. Guests were guided through a series of tracks, starting with Diana Krall’s version of Gershwin’s “They Can’t Take That Away From Me” to The Who’s “Pinball Wizard.”
Lennox answered questions from the attendees and even asked for requests. Definitive had set up easels with more information on both the Brodmann speakers and the entire set of components used for the demos.
2-Channel on the Upswing
Definitive’s high-end audio sales are trending up, thanks to these events that Dixon says are helping to kickstart the category.
“Interior designers don’t ever want to hear the word ‘floorstanding,’” remarks Dixon, because the idea of having speakers sitting in the room is not design-friendly in their opinion. But, he has had instances where within the first 30 seconds of an audio demo using floorstanding speakers, the homeowner and designer shifted their opinions, and “two minutes later they are trying to figure out ways to make floorstanding speakers work in the design. The common response from a demo is, ‘I have never heard anything like that before. I did not know it could sound so beautiful.’”
Dixon was first introduced to the Brodmann line about six months ago, adding he was “intrigued” by the line. “I love products with heritage,” he says.
Brodmann is certainly a company with heritage. The company was founded in 1796 as a piano manufacturer. In fact, in 1821 Beethoven purchased a Brodmann piano to compose his most famous work – Symphony No. 5. The company started making speakers 40 years ago, and in 2004, the Brodmann brand name was spun out from its parent company, Bosendorfer, with the aim to expand the brand to speakers.
“Music is the most emotional thing a human can experience besides a relationship,” says Gruhn. “Think about how many times you will listen to the same song versus how many times you will watch the same movie.”
Gruhn says it is frustrating that U.S. consumers are not more aware of the luxury audio brand names, while other industries like watches, cars and handbags have been able to generate consumer awareness for their brands.
“Nobody knows the names Esoteric, Focal or Brodmann … nobody knows these brands. That is why we are not approaching the U.S. market via stereo shops; we see they are dying. So we are going through custom installers who have access to affluent people. Music lovers who have a lot of money are our target market,” says Gruhn. He is excited to see the revival in interest in 2-channel audio and vinyl.
Strategic Approach to U.S. Market
Brodmann is relying on industry veteran Brad Paulsen to identify and select the integrators who will carry the line. “Brad has a very clear strategic picture of the top of the market, and I have a very clear business plan of where I want to go.”
Paulsen, who has been in the industry for years with companies like Sooloos, Totem Acoustics, Thiel, PS Audio and B&K Components, is director of U.S. sales. He says the lingering effects of the recession have brought 2-channel audio back to the attention of many integrators.
“I would say 80 percent of the truly high-end audio is being sold through integrators, not through stores. Most retail stores are gone, and three-quarters of the ones that are left are not making money. They have no high-end clientele whatsoever. The hobbyist market is dying. At CES this year in the high-performance audio area at the Venetian Suites, there were suites from AARP and a mattress company. They would not have exhibited there unless they looked at the demographics of who was walking through the Venetian,” says Paulsen.
He has specific criteria for selecting the integrators, including their ability to demo product, typical client demographics and geographic coverage area. Definitive is among the first integrators Paulsen has brought onboard.
Dixon notes, “Some of the things they are doing with the line technology-wise will dumbfound you. When you look at the product, you wonder how it is doing it. For example, how is a speaker that is only 5 inches deep producing so much bass? Once I heard a demo, I was hooked … line and sinker.”
Currently, Definitive Electronics is the only integrator in the state of Florida to have the JB-175 speakers. The speakers come in various finishes: Piano Black ($50,900/pair); White Veneer ($59,700/pair); and Special Finishes ($69,900/pair).
Definitive also demo’ed the smaller Brodmann VC7 (Vienna Classic) Series speakers, which also come in three finishes: Piano Black ($18,900/pair); White Veneer ($21,800/pair); and Special Finishes ($24,900/pair).
Brodmann has models of on-wall speakers ranging in price from $5,000 to $20,000, and in 30 days the company will be debuting four4 models of in-wall speakers exclusively for the North American market, also in the $5,000 to $20,000/ pair range.
The architectural speakers will also feature the same technology as the floorstanding lines, including the soundboards.
Dixon says Definitive carries five different speaker lines in all, ranging from $1,000 to $85,000 price points. He says about 80 percent of speaker sales are in-wall/in-ceiling speakers, but he is hoping to bump the percentage of floorstanding speakers he sells.
He has advice for other technology managers who might be ignoring audio.
“Take a look back at high-performance audio. Take a look at lines you might have turned away in the past,” says Dixon. “Take a look at your eroding profit margins. Half of the work we do now is in home automation, and every integrator knows the margins are extremely small in that market. If you want to increase your net profit, you should look at 2-channel audio.”
