Published on October 2nd, 2011 | by Dustin Baerg0
Don’t Sell Boxes
There are a lot of factors that make it clear to me that our industry has undergone a shift in the last decade. Sure, the economic downturn has played a huge factor on the spending budgets of our clients. The instability in the entire monetary system has definitely made it harder for economic growth to occur on both small and large scales.
Despite all this, there are some fundamental changes that have been happening that make the landscape different. Once things finally get back to “normal” it will be clear that normal isn’t what it once was. Selling Boxes just isn’t a sustainable business model for our industry anymore.
What has changed?
1. The Internet is driving down margins
This technology which brings us all closer has a dark side for established businesses. It takes very little resources for someone to run a website selling products at razor thin margins, made possible by the aforementioned low overhead costs. With the much larger costs of running a “bricks and mortar” business, the AV industry has trouble competing on price.
2. Customers are getting smarter
Having the ability to jump online and research, a lot of customers are coming to us with a pretty good idea of what they want. We can spend a lot of time with these people designing and explaining a “proper” system to them, only to learn that they ordered all the gear online and will hook it up themselves.
3. Equipment Doesn’t Last as long
Given the rapid speed that technology is advancing, equipment sometimes becomes obsolete before it needs replacement. Manufacturers have caught onto this trend, realizing they don’t need to make products that last 10 years when they will only really be used in the 3-5 year window. This doesn’t apply to every product, but I have definately seen this trend with projectors for example.
4. “Consumer” technologies are more common in a business environment
We have seen this effect with the iPhone vs. the BlackBerry. Corporate IT departments initially implemented BlackBerry due to its robust configurability and policy management. People started bringing in iPhones and Android devices, demanding that they be able to use them. Executives got on board with the idea, and the IT departments were forced to figure out how to make it work.
What Can we do about it?
As Professional AV providers, we have to recognize these changes and find ways to work effectively in the new arena. There is always a “proper” way to do things, but with a little ingenuity you may find that what you thought was the “wrong” way could actually work if you just added a piece or two.
Focus on providing value that can’t be sold as a commodity. There are many things the internet can do, but people still need to be involved to roll out an AV solution. Take an honest look at what differentiates your company’s offering from other options the customer has. If there is no additional value by going with you, it becomes a numbers game that you are unlikely to win.