How to Cultivate Home-Automation Sales

By displaying home-automation products in its residential design center showroom and upselling those products for its builder partners, Dickman Supply, Sidney, Ohio, has built a solid presence in the residential datacom market. With three northwestern Ohio locations and $35 million in 2005 total sales, Dickman grew its residential sales by 40 percent last year, with about 10 percent of those residential sales in home-automation products. Three years ago, only about 0.001 percent of the distributor's sales were in structured wiring products.

“We might have sold some telephone jacks and maybe even a couple Cat. 5 jacks, but that was about it,” said Doug Borchers, vice president, Dickman Supply.

Traditionally catering to industrial customers, Dickman started testing the home-automation waters in its markets about three years ago. In a few short years, Dickman Supply has elevated its home-automation stature in the rural market it serves to the point that last spring the hosts of PBS's “The American Home Shop” invited Dickman Supply to guide viewers through the components needed to establish a fully connected automated home. The television show takes viewers through every step of planning and building a custom dream house, in this instance, a French country lake home built about 15 miles south of Dickman's headquarters. As a guest on the show, Dickman's Borchers walked viewers through Internet connections, security cameras, intercom systems and whole-house sound.

Borchers and Dickman's residential design consultant, Shelly Rohr, also served as experts for other electrical and lighting considerations on the show. Borchers appeared in three episodes, and Rohr appeared in five episodes.

“It was pretty significant for Dickman from an exposure standpoint,” said Borchers. “We hit the front page of all the area newspapers the day of the first show. A lot of people sent us e-mails and commented that they saw things they want to do in their houses.”

Breaking into Resi Datacom

Early in 2003, leadership at Dickman Supply identified home automation as a market it should pursue. The electrical distributor had witnessed several of its electrical contractor customers launching datacom divisions. For many of those customers, the nearest source of supply for structured wiring products was 40 miles away.

“We thought, well, if they're going to do datacom, maybe that's something we can supply,” said Borchers. “They were buying from us already. It was just kind of a natural thing.”

The distributor assigned Aaron Egbert, an inside salesperson who had experience with a contractor as an installer of low-voltage systems, as a specialist because he knew the lingo and was already familiar with many of the products.

A year later, early in 2004, Dickman brought Shelly Rohr onboard as its residential design consultant. Today, Rohr spends much of her time acting as a salesperson for the homebuilders with which Dickman partners. Rohr meets with people building homes and guides them through a book the company created to address the numerous home-automation and lighting options that anyone building a home should consider.

“We take the approach of promoting lifestyles,” said Rohr. She walks the homeowner through a series of questions to help everyone get a better feel of what the home-automation needs in the home might be. For instance, “Do you have a home office? Do you have teenage kids? Are they on the Internet? Do your kids have phones and computers in their rooms?”

“There's a different avenue I might take if they have small kids or teenagers than if they're empty nesters,” said Rohr.

Internet access and file sharing in homes with more than one computer are high on the list of many families' priorities, said Rohr. She's also seeing demand for whole-home audio and home theaters. “People like the fact that you can home run your video connections back to one location and have a crisp clear signal throughout the house,” she said.

Dickman's redesigned residential design center, formerly its lighting showroom, also helps homeowners sort through the structured-wiring options available to them and is a key to the success Dickman is having in the market. When homeowners come into the design center, they see how occupancy sensors or whole-house audio might enhance their home lives. “They can play with the stuff and get a better feel for it,” said Rohr.

Going forward, after successfully tapping the area's datacom installers and partnering with more than 50 homebuilders, Borchers sees training Dickman's electrician customers on low-voltage home-automation installations as one way to grow the resi voice/data/video market.

“Training is the key now,” Borchers said. “It wasn't in the beginning because nobody would come to the training.” Borchers said that smaller electrical contractors are now seeing their competitors getting voice/data work, and they need the training to stay competitive.

“Now they're knocking my door down and sending me e-mails, ‘When's the next training?’ I've probably got two sessions a week for the next three or four weeks,” said Borchers. “From this point on, training is the key.”

Growing Home-Automation Sales

• Partner with vendors that provide sales associates and customers with good training.

• Dedicate an inside and an outside salesperson to the home-automation cause.

• Partner with builders. Your dedicated VDV salespeople can act as virtual salespeople for the builders, guiding the homeowner through the VDV/lighting options to consider early in the build process. Encourage homebuilders to create various home-automation packages as bundles with emphasis on how those packages will make the homeowners' lives better. In effect, your salespeople can upsell for both the builder and your electrical supply house.

• Make sure vendors provide access to plenty of good sales literature.

• Build your own sales literature. Dickman Supply put together a book that guides the homeowner through options and considerations best brought to light early in the build process.

• Get training from vendors and reps, as well as CEDIA and BICSI, for both distributor sales associates and customers.

Structured Wiring Product Savvy

How many of these home-automation products does your distributorship carry? How many structured-wiring products are displayed in your design center so home owners can get a feel for how the products could be used in the home they're building? Have you partnered with builders and positioned your own design center salespeople to upsell for the builders?

• Enclosures and covers
• Structured media panel
• Category 5e unshielded twisted-pair wire
• RG6 coaxial cable (often bundled with Cat. 5e)
• Video amplifier
• Network hub
• AC power module
• Wall plates
• Plates and jacks for telephones
• Category 5 jacks for voice applications
• Category 5 network data jacks
• Video jacks
• Category 5 patch cords
• Indoor and outdoor cameras
• CD power modules
• Room speakers
• Volume controls for speakers
• Speaker wire
• Modulators for security cameras