The Maturation of the Alarm Dealer: Reshaping the Channel

A high percentage of the dealer market is focused on the changing needs of the commercial and institutional customer. Still driven by the predictability of recurring monthly revenue (RMR), new forms of monitoring and creative marketing alarm dealers are finding ways to continue to attract investment and competition.

A panel at Securing New Ground will include a discussion of traditional alarm company leaders and new entrants on topics ranging from investment trends and cybersecurity to the power of IT companies. Because of the factors impacting this segment of the industry, what happens here ultimately impacts the future of technology, investment and customer expectations at the commercial level.

Tracy Larson, CEO of WeSuite, and Duane Paulson, SVP, Product and Market Development, Nortek Security & Control, preview the panel discussion at Securing New Ground, which will also include panelists Amy Kothari, CEO of My Alarm Center, and Daniel Herscovici, SVP and GM of Xfinity Home, Comcast.

Register today for Securing New Ground, October 19-20 in New York City, at http://www.securingnewground.com.

How are smaller alarm dealers uniquely able to adapt and succeed in the face of all the change taking place in the channel?

Tracy Larson: The really good small to medium size alarm dealers are typically more focused on delivering strong service in their local areas. Their customers know them and feel they can be counted on for the safety and security of their families and businesses. With the right leadership, these companies are also more suited to “turn on a dime” – offering new products and services, which is critically important in today’s environment.

Duane Paulson: Small dealers can compete on local service. If they are network saavy the can compete on integration solutions. But for mass markets they are at a disadvantage. A regional can be a very successful competitor in that they have a local brand and may be able to move quickly.

How are cybersecurity issues and threats affecting both large and small alarm dealers?

Duane Paulson: Every time there is a Black Hat conference something about security bubbles to the surface.  As IoT grows there are potential vulnerabilities. But we need to keep in mind the average home burglar is a kid who lives within 5 miles and a kick on the door or a rock through a window is the likely point of entry than a cyber attack. I’m talking physical security, not your home network where your banking information may be stored.

Tracy Larson: I think there is a heightened awareness of the potential for security threats and attacks due to our connected world. IT departments are forced to take stronger and more stringent protective measures to secure the networks and devices on the networks they are responsible for.  They have an enormous challenge in continuously monitoring these environments especially considering the number and variety of devices carried by an average person.

How do “non-traditional competitors” moving into the industry pose a risk or opportunity for independent dealers?

Tracy Larson: Changes in competition brought on by new players in the market place, especially those perceived to be “major”, send ripples of concern and simultaneously drive change. Dealers are finding ways to re-invent themselves. A tightening in the market as new and larger players commoditize equipment sales and drive pricing for recurring services to lower levels, demands new ways to provide increased value and best of breed service.

What is the greatest factor that is reshaping the channel?

Tracy Larson: In talking with our panel, a number of factors were discussed. Changes in business models, such as DIY and monitoring on demand are noted as key factors. Technology is also a key driver of consumer expectations. We are more connected every day in our personal lives. Look at our phones and “watches” — we expect to be able to know more and do more all the time.

What will the channel look like in 5 years?

Tracy Larson: I suspect very different from today. Alarm dealers are facing the largest and most rapidly changing environment they have seen in 25-30 years. It’s not going to settle down any time soon. Those who embrace technology and change, while delivering to a 24×7 connected world, will do very well.

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