Video: The Key Residential Market Driver

Residential video services have emerged as a high-growth segment for the security industry over the last few years, with advancements in cloud technology, mobility and camera hardware dramatically expanding user capabilities while reducing the installation and support burden for service providers. The result of this powerful combination is a significant increase in demand for video, as well as a new category of competitors with direct-to-consumer offerings.

At ISC West earlier this year, I led a discussion with a panel of leading security service providers to discuss these dynamics in the residential video market that included Steve Butkovich of CPI Security, Robert McDonald of Vintage Security and Steven White of Vector Security. Each shared their executive-level view from the service provider perspective.

Each panel participant has experienced significant increases in residential video installations and pointed to a variety of growth drivers, including:

• New form factors, such as video doorbells;
• Improved user interfaces and experiences;
• Deeper integration with security and automation solutions; and
• Diminishing consumer concerns about having cameras in the home.

Over the course of an hour, I asked the panelists to share their expertise of best practices for marketing, installing and supporting video services, their perspectives on the emergence and impact of DIY cameras, and their predictions for the next wave of innovation in video.

The panelists were unanimously upbeat about the continuing opportunity in the residential video market and agreed that service providers have key advantages and opportunities to stay ahead of this dynamic market. Here are the key insights and takeaways that the integrators offered at the session:

1. Bundle video into integrated solutions for long-term growth.

The panelists all said they bundle video cameras and service plans as part of an integrated smart home security solution. Particularly at the beginning of the sales cycle, this approach differentiates their offerings from video-only services.

Beyond the initial sale, this integrated approach turns video into long-term business growth – the customer has a more engaging, valued service, and the service provider generates higher RMR accounts with lower attrition.

Our panelists noted that, increasingly, customers use video as an everyday lifestyle service as well as a security enhancement. Improved image quality, better mobile user interfaces and more intelligent features are making video a valued everyday experience for customers. They can check in on pets, watch their kids arrive home safely, and see what is happening at home anytime.

Like the technology itself, however, these everyday video use cases are new, and many customers will not have considered them. The panelists have embraced a new model for selling the expanded value of today's video solutions. They recommend training sales teams to better uncover customers' needs by asking the right questions and following up with the most relevant and compelling use cases.

2. Sell the benefits and capabilities of integrated video.

How are service providers successfully marketing and selling their video services in an increasingly noisy market?

The panel agreed that a key to success is to sell video within the context of a highly integrated offering. This gives the customer a single mobile app and intelligent features that are enabled through integration with the security system and other devices and sensors in the home. Instead of overwhelming the customer with irrelevant, motion-triggered video alerts, integrated solutions already ‘know' which events are useful and can discern valuable details (such as who unlocked the door), then filter the customer's video alerts accordingly.

As video analytics and artificial intelligence come to define the next generation of smart home capabilities, integrated smart home solutions will further improve the overall customer experience. This will keep service providers ahead of the rapidly evolving technology in the smart home space and give them remarkable new video capabilities and use cases to market and sell going forward.

3. View new entrants – especially DIY competitors – with caution.

The increasing demand for residential video solutions has attracted new entrants, including small startups and large technology companies. These players take multi-channel approaches to the market, selling both directly to consumers and through service providers.

What impact will these products have? What are the risks of offering them to customers?

Our panel shared the common perspective that service providers enjoy key advantages in the market. Many customers lack the time, interest or skill to select, install and configure cameras on their own; instead, they prefer to depend on a professional for a reliable installation with ongoing service and support. Many residential video installations include outdoor cameras that require wired power and broadband – an added complexity that reinforces customer preference for either professional installation or a DIY security provider that offers a more supported service than retail products.

From a business perspective, the panel raised several concerns about partnering with these new entrants. These include missed RMR opportunities as well as the potential risks and costs of installing a standalone camera that cannot be supported remotely; however, the greatest concern is that these offerings compete directly with service providers. The panel discussed how both Nest and Ring have recently expanded their product lines to include security devices that are marketed as a substitute for a professionally installed and serviced system.

Initially, these companies offered what appeared to be complementary products, but today they are clearly competitive. Service providers who installed one of these video doorbells or cameras introduce a competitor into their customer's home.

4. Operationalize video into your security business.

What practical advice did our panelists have for efficiently installing and supporting video solutions?

First, panelists agreed that it is important to demonstrate the video experience during the sales cycle. As well as helping customers understand the value of an integrated solution, it sets expectations for video performance and overall experience. A customer who views a video feed from the type of camera they are buying will have a realistic expectation of picture quality and feature capabilities.

From a performance and support perspective, panelists recommended requiring a Wi-Fi speed test as part of the sales order. This ensures a high-performing and reliable solution. Customers can address connectivity issues before the installation, while the service provider can avoid the additional support burden. Businesses can easily add a link to a Wi-Fi speed test to their websites for customers or sales representatives to access from the property.

Installation Tips

The panelists also shared several tips to improve the video installation process.

1. Always test camera connectivity at the installation location before beginning physical installation. This is the opposite of how older cameras were installed. Making this change helps avoid unnecessary headaches and costs with wireless cameras.

2. Pre-pair wireless access points with the cameras slated for installation. Wireless access points provide connectivity without the complexities of working with the customer's Wi-Fi router. This best practice speeds up installation and improves the experience for both your customer and technician.

3. Always use video cameras and services that integrate with your back-end technology partners. This best practice ensures that service providers can pre-configure devices, run system checks and diagnostics, and address trouble-shooting and support efficiently. Standalone products that do not integrate with into your operations can lead to more issues and problems than expected.

Brian Lohse is Senior Director of Commercial Platforms for Alarm.com. To request more info about the company, please visit www.securityinfowatch.com/10216128.