CCTV – can hardware do better?

Look at the security departments of most hardware stores (all sizes) and there is no shortage of padlocks and traditional keyed door furniture, as well as a few DIY alarm systems – but precious few displays of top-end electronic door entry systems, CCTV equipment and associated cutting-edge surveillance ranges.

The simple reality is that hardware retailers have been content to stock mechanical and manual security devices, leaving more sophisticated gear in the capable hands of security consultants, locksmiths and manufacturers working with defined installation partners.

However, cracks are now beginning to appear in traditional beliefs that only qualified specialists can deal in sophisticated security equipment. Consider the following:

(1) The public’s attitude to electronic security equipment, particularly CCTV involving digital access and storage, has changed and top-end products are no longer as ‘daunting’ or ‘difficult’.

(2) Advanced security systems, notably in urban areas, are gaining favour in single-occupant dwellings and apartments (rapidly growing demographics) and in high-density suburbs

(3) Electronic security systems have a natural fit with increasingly popular Internet and entertainment-based integrated electronic equipment

(4) Homeowners are being introduced to top-end electronic security systems in their workplaces

(5) Previously ‘professional’ platforms are rapidly gaining DIY status.

Greg Pownall, national sales manager for ASSA ABLOY, says there are definitely opportunities for hardware retailers to gain a foothold in more advanced, electronic security product ranges.

“I think there’s no doubt that that particular segment [top-end electronic security systems] of the market will continue to grow,” Greg says. “I think we’re going to keep less and less mass-manufactured product; we actually have to customize product to allow consumers to pick and choose the right product for their own environment. And I think there’s no doubt that digital technologies are going to play a significant part – and will get to a point where they equal the mechanical solutions in the marketplace. Whether you’re a homeowner or a small business owner, there should be a solution available off the shelf for 90 per cent of that particular market. And there’s no doubt that ASSA ABLOY, with its brands Lockwood and Yale, will certainly be at the forefront of that developing technology.”

While Greg admits that specialist locksmiths have been the traditional sellers of highly sophisticated security products, he says ASSA ABLOY always welcomes hardware retailers who wish to stock latest-technology systems. The starting point involves effective training. “We run both retail training programs for traditional retail hardware outlets, and a commercial training program for the next step up, to allow people and our retail customers to better understand not only what we offer, but also how to sell it once consumers come into the store. And that covers a broad range of products from the traditional mechanical products all the way to our high-end digital technology front door entrance systems that the market is shifting slowly towards.

“We provide this training to all of our customers nationally for no charge whatsoever.” In addition to training, Greg says that dynamic in-store displays are an important part of increased customer awareness.

“We have a range of display material now, including working display mounts,” he says. “We have technology that really is plug-and-play, so a retailer can put one of our products on the display and literally plug it into a power point so a consumer can touch and feel and play with that digital technology.”

Jeremy Stewart, VP – global marketing, Swann Communications, agrees that there is room for greater exposure of top-end security systems in the hardware retail sector. “There has been a misconception that hardware stores are only suited to lower spec/lower price solutions (such as alarms, intercoms, door chimes and imitation cameras) and that the higher spec CCTV products are too difficult and more appropriately sold via consumer electronics retailers or directly by installers. This is changing because CCTV is a truly DIY category and technology improvements are making the products increasingly easier to install and use. Some of these improvements include easier network setups, remote viewing on smartphone or tablet, easier data transfer to USB device and more options for wireless solutions not reliant on cabling.”

Jeremy says there are a number of options retailers could adopt to improve premium security sales, including the use of interactive video to demonstrate products and help consumers to find the solution that’s right for them. “Retailers and manufacturers could work together to make it easier for consumers to find an installer if they don’t think they have the time or skill to complete a DIY installation,” he says. “Manufacturers, such as Swann, can offer an installation service and the retailers can help to advertise that service at the point of sale and on pack.”

In the store

If high-quality suppliers like ASSA ABLOY and Swann are keen to maximise exposure of their top-end security systems in hardware outlets, what are the retailers’ attitudes towards stocking more top-end product ranges?

Steve Sanders, managing director of the hardware store Sanders H Hardware in Clare, South Australia, says he believes there are definite opportunities for the display and sale of more upmarket security systems in hardware stores, but an important precondition would be greater involvement from suppliers.

“We have sold quite a few of the Swann security systems, and that’s very much a home handyman installation, but we’ve never stocked it on shelf – we’ve got the brochures here and their website, and if people come and ask then we order in as required,” Steve says.

“I don’t recall ever seeing a rep from any company on this [top end] product range – whether knocking on the door or even sending paperwork or an email. Maybe the hardware industry has to ask for it, but I think there’s got to be a supplier who wants to be part of it and sees it as a really good opportunity.”

Supply partnerships aside, Steve says marketing would be an equally crucial factor in making customers aware of the existence of advanced product ranges and features. For instance, the idea of selling top-end security ‘packs’ designed to suit different types of properties (i.e. apartment, small store, small office, detached home, etc) might also assist sales.
“I think that would be a great concept. When you go to buy your car stereo, you buy your car security system as well, as part of an overall ‘solution’ – and certainly at that top end you don’t have to have stock on shelf, but it is about having displays so people can touch and feel. “But if there were a packaged solution that, for example, came with a doorbell, two cameras, a recording system and somehow it could be hooked up to your front door – similar to a Gainsborough system I saw last week – which could also sit on the shelf at a comfortable retail price, then why not?”

Keep it simple

Another retailer, Frank Penhalluriack from Penhalluriack’s Building Supplies in the Melbourne suburb of Caulfield, agrees that top-end security systems, including basic CCTV units, are certainly more viable than ever before in mainstream hardware stores, given the familiarity that most consumers now have with high-tech equipment. However, both he and his colleague Carmel Menara (who also serves as a product buyer representing Victoria for HBT) believe that the best way to embrace more sophisticated security technologies is to focus on DIY products.

“There is an opening there for the DIY market,” Carmel says, “But it wouldn’t want to be too expensive.” Frank adds: “I think the KISS principle [keep it simple, stupid] applies; if it’s complicated, then you’re not going to be able to sell it. But if you could introduce a CCTV camera package which was expandable, of reasonable quality and with a built-in recording device, such that images could be broadcast to your phone no matter where you were in the world, then – if you kept it simple – I think a lot people would come in and buy it and say, ‘This is marvelous’.” More elaborate systems requiring professional installation, Carmel suggests, would probably be harder to sell from a hardware retail store. “Certainly, I have never been approached to stock such items,” she says, echoing the abovementioned experiences of Steve Sanders. “And it has to be within a reasonable price,” she says, advising that products are tougher to sell beyond a threshold of $200 or so.

Frank says another advantage of DIY is its appeal to customers who want to avoid labour costs associated with installation, which can account for half of overall costs. In reference to CCTV systems, he says that “if you offer something DIY with good instructions, well packaged with clear instructions and nice photographs of what it’s supposed to do, then I think you’d be on a winner.” Frank also says that Carmel’s price threshold of $200 for such a system may be conservative: “I don’t agree with Carmel about the $200 limit; I think that a customer would come in and buy the first camera, then come back and get another one for the bedroom as well, etc.”

Marketing techniques like ‘packs’ tailored to different types of properties, however, might not be so straightforward. Both Carmel and Frank say stocking large ranges of separately boxed ranges would be impractical. Therefore, the sale of individual cameras and associated fittings individually might be a necessity. Nevertheless, both agree that a sensibly packaged DIY-targeted surveillance system would be viable in a hardware context.

As Carmel says, following the recent burglary of her own home, the most important top-end security feature is a useable image for police – and if that goal could be achieved simply for a DIY market, then hardware stores would have a definite role in distributing such equipment.

Other marketing

Steve Sanders says other techniques to encourage greater interest in top-end security devices might include clear in-store displays of contact details for aligned local electricians, in the event that security systems required professional installation. Steve says these contractors would also be advised to attend training sessions. Jeremy Stewart from Swann agrees that marketing has a powerful role to play, first up with the creation of understandable and attractive product packaging and point of sale materials.

“Consumers won’t always want to make a decision on the first visit to a store, so some ‘take home’ materials are advisable as well.” Jeremy is also a fan of premade ‘packs’, though based on user profiles and needs rather than property types. “There is definitely an opportunity for the creation of packages that might be appealing to consumers, for example a Home Surveillance Kit, Small Business Kit, Anti-Shoplifting Kit and even Doorway Security Kit.”

Conclusion

As Jeremy explains, the CCTV market (DIY) is worth approximately $40 million at wholesale in Australia. “This is a fraction of the size of the larger commercial market where products are sold direct and installed by professionals. The DIY component of the market is continuing to grow at a rate slightly faster than the overall market, at a rate of 10% per annum or so. Over time, hardware retailers can grow their share and, with the right amount of support and savvy merchandising, are well positioned to have 50% of the market within the next 5 to 7 years.”

More information ASSA ABLOY www.assaabloy.com.au HBT www.hbt.net.au Penhalluriack’s Building Supplies www.pens.net.au Sanders H Hardware (08) 8842 1171 Swann www.swann.com

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