Security Dealer & Integrator

MAY 2015

Find news and information for the executive corporate security director, CSO, facility manager and assets protection manager on issues of policy, products, incidents, risk management, threat assessments and preparedness.

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Page 22 of 95 / Security Dealer & Integrator 23 W alk the foor at the CES show; browse the shelves at your local Costco, Home Depot, Best Buy or Walmart; fip through your junk email — the chances are good that you will run across quite a few do-it-yourself home security sys- tems. From self-installed, to self-moni- tored, to even un-monitored, your cur- rent and potential customers are seeing literally hundreds of ways and options to replace the traditional residential secu- rity service provider every day. Even traditional security vendors and service providers are dipping their toes into the DIY arena —launching prod- uct lines and services designed to attract this growing market. "Te DIY market is here to stay," says current Electronic Security Association (ESA) president Marshall Marinace. "I was reading some predictions, and I couldn't believe it when it said that DIY will be a billion-dollar market soon. I think the traditional alarm dealers must certainly keep an eye on what's going on and be fexible and nimble because when it comes into their territory, they better fgure out how they are going to compete against it," Exactly how does a "traditional alarm dealer" compete with DIY solutions? Believe it or not, there are several ways to not only compete, but to also lever- age it to draw new customers into your fold and expand your reach. So, the next time you see an "all-in-one kit that provides dwellers with a simple alarm system solution with no monthly fees or long-term contacts" (true market- ing promises from an unnamed DIY security vendor) — you can feel secure knowing that these aren't lost-forever customer acquisition opportunities. A Look at the Threat Make no mistake, the do-it-yourself security market is growing fast. When a major player like Google steps into a particular market — with its acquisition of Nest Labs and Dropcam — it is assuredly a hot one. In fact, the smart home, mobile and the cloud are coming together to form a perfect storm for the DIY secu- rity market, which NextMarket Insights recently predicted would hit $1.5 billion over the next fve years. "Te traditional home security mar- ket in the U.S. has plateaued at 25-per- cent market penetration," NextMarket Insights chief analyst Michael Wolf said in a statement. "Te reason is that while most consumers want to feel safe, only a segment of the market is willing to pay a $40-$50 recurring monthly fee and com- mit to a three-year contract." Tat recurring fee — the lifeblood of many residential security companies — has spurred the creation of myriad pay-as-you-go and monitor-it-yourself options in the market. Many of those services are seeing major capital invest- ment. Aside from Google's acquisitions, venture capitalists have poured millions into direct-to-consumer security ven- dors such as Simplisafe and Canary. Security dealers may see do-it- yourself solutions as a threat, but the potential is there to turn it into an opportunity By Paul Rothman Traditional alarm dealers must certainly keep an eye on what's going on and be flexible and nimble because when DIY comes into a their territory, they better figure out how they are going to compete against it." — Marshall Marinace, president, Electronic Security Association

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