RU domesticated?

A few months ago I listened with interest to a second generation security industry person state in a presentation: "The definition of insanity is carrying on doing the same thing in the same way and expecting the results to be different".

So, to open up the dormant domestic market – an area long highlighted by the editor of this magazine as an opportunity – it implies doing something different.

And it's a big market. There are over 23m homes in Britain, and if 20 per cent have alarms already that still leaves over 18m. If only a quarter of these are possibilities, we are still close to 5m prospects. Really speaking though, the 5m with alarms are probably even better prospects as almost certainly fewer than one in twenty of these have monitored systems.

So where are the keys to opening up the market? In this article I will look at some of the more recent significant developments I believe will benefit the installer …

What's the deal?

'Repeat revenues' are the goal of most thriving businesses. That means maintenance and monitoring ("M&M") contracts to you and me … and you do not need telling that bells-only systems and great bottom lines are not related.

Selling to this market is not that easy. End users need to see that the object of the exercise is not just to find ways of moving cash from their pocket into yours. Not all installation companies manage to overcome this customer reluctance.

So let’s start with dealerships. Are they the real thing or a great deal of trouble?

Love it or hate it, many business ideas make the hop from the USA to the UK and become a success in business terms. True, they do have their ups and downs but McDonald's, Pepsi, Hertz, Starbucks and co have all changed habits and made millions. Dealer programmes in the UK security industry have not hit those heady heights since arriving from the US, but not so long ago, according to insiders, around 8000 systems a month were being installed by ADT's dealer network – big numbers for our industry and the most successful scheme by far.

Classic kit

ADT have recently introduced their Authorised Dealer Programme, replacing the ADT dealer network. So what's different?

Well, the tried and trusted Ademco kit remains the same. Centred around the industry classic Galaxy panels, the package offered usually starts with three or four PIRs (maybe one a dual technology detector), one or two decoys (no SAB) one internal sounder, PAB from the RKP, maybe a smoke detector or a door contact or two, upgradeable to suit individual needs.

End users signed up for around £25 per month for three years and in some cases paid nothing up front. Understandably some installers selling the traditional way sometimes felt that their market was being ruined, and some were none too complimentary about organisations selling in this way.

On the other hand, the number of systems sold was impressive and also on the plus side a lot of subcontract installation work was carried out by SSAIB and NSI inspected companies, many of whom were, and still are, more comfortable with installing than selling and marketing. Security industry analysts generally agree that there is no surplus of quality, ethical productive salespeople, so the ADT dealer programme offers one solution.

ADT Authorised Dealer Paul Delaney from Affinity One of Welwyn Garden City is an SSAIB installer and, in his opinion, "If you are an established alarm company with your own customer base, ARC etc, this may not be for you, because it's about providing the company infrastructure.

"There were a few resellers who gave the scheme a bad name, but they've now gone. We're not into scare tactics or door knocking – personally I wouldn't want to discuss my security with someone on the doorstep. We've never done zero down (i.e. "free" installation).

Give client time to think

Delaney continued: "High churn is no good. Of the several hundred we've installed we've had less than ten clawbacks inside the warranty period. We give clients written quotations, don't push for a sale on the night and give clients time to think about it because we believe in ethical selling. You can't say ‘the alarm is free but there's a £500 admin fee’. That's rude to the client.

"People are comfortable with the name 'ADT'. With ‘Affinity One’ we would not sell so many. We've been going four years now and we didn't have huge sums to invest. It took nine months to learn the market – clawbacks and so on – and insurers didn't want to know. (Author's plug: you should have asked SISS at Okehampton!). We walked away from a lot of deals where people said they could get it for free. We told them to take it! Today we sell tens rather than hundreds. We have noted some dealers who have taken the ADT model and are doing it independently".

One installer who did just that is Trevor Clifton-Sprigg of AM Fire and Security Group in Hove, a traditional independent NACOSS Gold installer:

"We had become tired of chasing residential business. It was the ‘what are they doing it for, we'll do it for £50 less' syndrome. We had heard of the First Alert Dealer Programme in the States so we went for it here, but Ademco withdrew it about that time, so we contacted Colin Brown who had run it here and set up cbt training to help companies to get growth. We followed his formalised training programme.

We've walked away from a lot of deals where people said they could get an alarm for free … We told them to take it!

"We discussed key areas with the client and confirmed with them at the end that what we offered met their needs. It was not hard sell. In fact it was just like the risk survey that is required for EN 50131. A lot of people want alarms but it is whether they want one now that is important.

"We obtained referrals which helped to get more business but again, no pressure selling. It's five years since we started and we still have original clients regularly paying by direct debit. As we were self financed it caused a bit of a squeeze on the finances but Colin introduced us to a finance company so we have a choice now.

"We've got several hundred clients on this scheme but the downside is that you can't take a traditional security surveyor. You do need specialist training and that's why we chose cbt training. Sales people need ongoing training and motivation which is why we work with Colin Brown. We controlled the numbers we sold because we were growing anyway and we did not want to overstretch our engineering capability – good engineers are hard to find. "

So much for dealerships … what are some of the other factors and trends that could shake up the domestic arena? One of them is that the UK is an ageing population with a considerable percentage of over 50's – some of whom find alarms confusing or even frightening.

Then there are the partially sighted, hard of hearing, easily confused, arthritic, flustered housewives (prams, bags, kids etc), estate agents or those with multiple sites, house builders, sites experiencing setting problems …

Lastly there are the 9-13 year old latchkey kids who can't be trusted to remember a code (or can be trusted to blab the code to all their pals if they do remember it). Apparently 56 per cent of children come home to a house where both parents (or the single parent) are out working. Obviously there’s a need for a more simple approach ...

Fob factor

One company with an awareness of this is Bootle-based manufacturer mdt. It is headed up by Graham Whitehead who, as former MD of one of biggest panel manufacturers, used to sell 35,000 panels a month. The company has noted the mobile phone/text revolution and the awareness that the police are not responding as quickly as they used to (and maybe the feeling that "3 and 2" is pretty close to becoming "2 and 1"). They have also taken into account feedback from installers that DD243 and keyfobbing has presented particular problems with regards to "part guard" options. The result is the fiendishly simple Red4Bed keyfobs that are coloured red on one side and grey on the other. Show the red side to the reader to retire at night and grey to leave the building fully armed "Grey4Away"

mdt panels (AvantiXP), in conjunction with Initial Rentokil's Burnley based AM Monitoring ARC can text alerts to three end users ("guardians" as they are referred to) within twenty two seconds, of any activation.

One enthusiast of the system, NSI Silver installer Peter Lewis from Direct Alarms Ltd on the Wirral, says: "We've got a demo case and when customers see the Mezzanine service text message flashed up on the mobile they are really impressed." ("Mezzanine" indicates the package offers a half-way house between bells-only and fully monitored systems, since calls are handled by a fully spec'd ARC but using automated handling – although human assistance is available.)

Another comment that some installers will sympathise with is “Don't call the police, because they don't come anyway" … and that's the theme taken up by David Rimmer of Intamac, another company at the forefront of texting (SMS, or short message system) for transmission of alarm signals. He says:"We think you are more likely to get a police response with someone looking over the fence ... You don't need to be inspectorate approved to connect to our service. If there's a false alarm only the home owner gets pestered. There's no hassle with URNs, no £30 police charge, no police rules. We do provide an ongoing revenue stream for the installer though."

End users are given an internet account which they can monitor and change instantly.

"And we paste all the alarm details online. You can look to see if you've (remembered to) set your alarm system, and we can enable them to do it remotely if necessary via the internet. Some traditional companies are uncomfortable with that, but we have significant fire walls and 128 bit encryption – it's very secure."

Flood of work

The system also opens up another potential profit area for installers – environmental protection.

Says Rimmer: "The Intamac Monitoring Service works for installers who know how to sell, we have an installer in Weston-super-Mare and one site has a cellar full of wine. With a £15 Risco flood sensor we can tell him – or anyone in Tewkesbury or Gloucester or anywhere else with flooding issues – when water is starting to rise.

"It's not always an easy sell as alarm installers look for PIRs and door contacts rather than CO2 and water sensors. But in Carlisle people came downstairs to find three feet of water. No one told them. Thirty seconds after any water arrives we contact the client. It doesn't stop the water but it gives them the opportunity to save their belongings. Fit environmental sensors by the front doorstep. Environmental monitoring is a key area. Many installers ignore it. Housebuilders and electrical contractors are picking up the work."

Interestingly, most of these ideas have common themes and pick up on real changes that are taking place in technology and society as a whole. They provide simple and often inexpensive solutions … and, most importantly, they provide revenue streams for the installer.

As far as the domestic sector goes, installers face two choices. So (paraphrasing Caroline Whitehead) will you carry on doing the same thing in the same way, or dare to do it differently? As some say "He who dares wins".