Security consumers up until now have often seen electronic security as a kind of "pain issue". For them, an alarm system is an unfortunate necessity that provides the piece of mind that they can have a fighting chance to limit losses if there is a break-in. Others have employed security systems as a result of insurance industry discounts or demands. When a monitored alarm system is an "unfortunate necessity" or an insurance requirement, you don't tend to have great customer loyalty (and as I wrote in a previous article, loyalty isn't what it used to be anyway).
To keep ahead of the attrition curve, and to attract new customers - especially those tech savvy customers - I think our industry needs to examine itself and then look at expanding to include more technologies.
First, I think we need to look at how we are modeled. Our industry has been built on protecting fixed assets. We do a great job of adding electronic security systems to fixed assets such as homes, buildings, and offices. Meanwhile, the world has gone from being "fixed" to becoming incredibly mobile. Our industry needs to consider mobile things (like cars) and people as the kinds of assets it might be able to better protect or provide status data upon.
Finding Technology at the Tradeshow
That move from a fixed world to a mobile world leads me directly to global positioning satellite (GPS) technology. It's a technology that I believe the industry can use to drive revenues. And I'm talking about really using GPS, not just using it get to 1224 North River Parkway to complete that next job installation.
Fortunately the GPS industry has already recognized the security industry, even if we're slow in giving them the "hello" back. As I walked around the floor at the 2006 ASIS Seminars & Exhibits in San Diego this past September, I was truly surprised at just how many vendors were there representing one form or another of GPS services. At the same time, I was equally surprised at how few of them provided a means by which to allow the dealer (large or small) any opportunity to generate recurring revenue in a way that would not only 1) add value to the service they provide, but also 2) create a tangible means to increase customer retention and perceived value.
Many corporate fleet managers have employed some form of GPS on their vehicles to track and measure the performance of their drivers. In doing so, they are seeing an inherent benefit in terms of turning around downtime, fuel costs, routing efficiency, as well as the added benefit of knowing where a particular driver is at any given time.
But looking forward, the question is whether using GPS technology can increase recurring revenue, manifest growth beyond fixed asset protection, and lower attrition for alarm dealers? My answer after some months of research is a resounding "Yes!"
Bundling GPS and Alarm Monitoring
Before I get you excited about GPS, I must tell you that there are less than a handful of companies who have really figured out how to provide this service in a highly reliable platform that works for our industry. But there are a few really good ones, and those companies have established a reliable back-end infrastructure set up in a way that provides dealers with very little (if any) out of pocket costs to get started.
In the cable TV industry, recent business strategy has been to sell you digital TV, VoIP phone service and high-speed Internet "at one low price". The fact is that bundled packages add RMR and reduce attrition.
We can do the same thing in our industry and for our customers. In fact, since recurring revenue streams are the lifeblood of our industry, alarm dealers are always looking into ways to generate more RMR by selling maintenance agreements, additional monitoring services such as verification, guard response, and so on.
You already have a central station set up. Maybe it's your own or maybe you use a third party central station, but the point is you're probably already starting to bundle services - and GPS just might be your next step.