Is DIY in Your Business’ Future?
It seems everywhere you turn, another DIY alarm product or smart home offering is entering the market. At some point, you may be considering offering a similar service so that you can compete with that segment as well.
One school of thought is if you can build a relationship with the entry-level DIY customer now, you’ll be in a better position when they graduate to a full system later.
However, this is not a decision you should take lightly. Here are some key issues you should consider before entering the DIY arena.
How well are you capitalized?
It takes deep pockets and detailed planning to assemble the elements of your DIY system, including equipment selection, branding and generating web-based sales. This cash outlay comes before you get your first sale, so look closely at your business projections, and make sure there is a clear path to profit. How many customers will you need in what timeframe? How long will you need to finance this business extension before you see a return?
Now, there are ‘business in a box’ type offerings available where you don’t have to purchase/stock/ship the equipment, so there is less of a cash outlay up front. In this scenario, you are likely immediately giving up ownership of that customer. If you go this route, you are also limited to the features in that particular system. If you or your customers need something beyond the simplest features, you may be out of luck.
On top of that, those businesses in a box won’t carry your brand, so while you make a quick buck, it’s not really helping you establish a long-term relationship with your customer. However, this may be a great way to “get your feet wet” and see if DIY is right for your company.
Do you have the support staff?
If there is one thing you can count on, it’s the fact that no matter how good the instructions in your kit, there will be a number of customers who’ll have questions. And you need to be prepared to handle those support calls 24/7, as most DIYers are doing it themselves after typical working hours or on weekends.
They’ll need help walking through the install, testing when the signals are sent, and confirming the account is online. Their expectation is that you’ll be available on their schedule. If you are not, it will reflect poorly on your brand, defeating the purpose of building a longer-term relationship in the first place.
Are you prepared with a long-term marketing plan?
This is another deep pocket issue. The market is severely fragmented, meaning every DIY product and service is battling to differentiate themselves. It’s going to take some effort, time and money on your part to attract enough attention and keep a steady stream of customers coming your way.
Think through how this new offering is going to be positioned – is this an add-on line extension, or a major direction in your business plan? Your marketing will change accordingly.
Our guess is just adding a page to your website and hoping for the best is not the answer.
Either way, this is not just a challenge when you launch your new offering, but ongoing for the life of the product. You’ll need to have or acquire the marketing chops to support this new venture.
DIY is definitely trending in our security space right now. Whether or not you should consider offering DIY alarm solutions is a decision only you can make for your business, keeping in mind it’s a decision that should only be made after some strategic thinking and not just in reaction to what others are doing.
What ARE your plans to compete with the growing number of DIY solutions? Send us a note with your thoughts, or the challenges you are facing, and we’ll do our best to help you address them. The good news is that there are a lot of companies considering their options for DIY, making the information you need much more readily available!