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A Convergence of Custom and Consumer at CEDIA 2015

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This year’s CEDIA Expo is seeing a lot of change. First off, it’s not called that anymore. It’s now dubbed the Future Home Experience. We’re not sure how long that moniker will stick, but one thing is sure: the home of the future isn’t just for homeowners with tens or hundreds of thousands to spend on technology. Today, you can buy into this world for as little as tens or hundreds of dollars. As the connected devices market continues to grow in the space associated with buzzwords like Smarthome and IoT, the home of the future is attainable by all.

Perhaps not coincidentally then this show, once catering to custom installers (CEDIA stands for Custom Electronic Design and Installation Association), is now a showcase of near future and current technologies for any household so inclined to embrace this connected world. And while this might seem like a “duh” realization, it poses some interesting challenges for the companies serving these very different markets—installer/distributor channels and direct-to-consumer sales.

NestPro vanTake Nest as an example. They’re in the interesting position of offering a product that appeals to the masses at a price point that, to the average consumer may seem quite high at about $250. And yet they’re doing quite well with this product. For a homeowner who’s designing a custom-built smart home, though, that $250 is a drop in the bucket. And yet this product appeals to those people, too.

You don’t have to wander the CEDIA show floor for too long to understand why this is so. The market for connected thermostats is littered by a sea of beige rectangular panels with cheap, segmented LCDs—even at the high end. So while general consumers may not have realized they wanted or needed a beautifully designed, $250 connected thermostat until the past few years, those with the bills in their pocket have been starving for something better.

And so Nest can appeal to both segments—a premium upgrade for one and an object of great comparable value for the other. But if you’re Nest, how do you serve both markets? Nest has made their product accessible to the masses partly by making it crazy easy to install—it even comes with its own tools! For the average consumer, that’s great. For the high-end market consumers, that’s probably useless. They’re likely not going to be picking up that screwdriver—even if it did come with the thermostat.

Nest has embraced the custom community by partnering with installation professionals. Their program, called Nest Pro, trains and (don’t call it) “certifies” installers on Nest products. So HVAC, electrical, … even A/V installers can be prepared to offer Nest products to this higher end market.

Why risk alienating your core installer base by selling products directly to consumers?
Other companies, like Sonos, seem to be riding their success without even a nod to the professional installer community. Sonos is again at this CEDIA event this year, even though they don’t offer professional installation products, like rack-mountable amplifiers, and have a limited API with few opportunities for deep integration. Their product is just so good that there’s a high demand for it in multiple markets.

A similar cross-over is happening on the other side of the market. Let’s say you’re a company that creates hardware and software for high-end home and A/V control. You offer a leading solution to installers that they make a living by incorporating into clients’ homes, and your business model provides them with sufficient margins to make the business profitable and worthwhile.

Savant_01_RemoteSavant is a big player in this space, and this year they’ve made the bold move of developing a new product for the consumer market—a single-room universal remote control for A/V with infrared and WiFi, voice control, and outstanding ergonomics. It comes at a premium price at $500, but Savant believes that they’ll be serving a growing segment through online and brick-and-mortar outlets like Magnolia Design Centers (at many Best Buy locations).

So why risk alienating your core installer base by selling products directly to consumers? Savant recognizes the demand for high quality, well designed, easy-to-use products in the consumer space, and they believe they can address that need with what they’ve learned in the AV and connected home market. Savant also believes there’s opportunity for conversion. In fact, they’ll be releasing a Pro version of this same remote early next year with greater, whole-home capabilities.

Savant isn’t the only company crossing these lines. Lutron now offers inexpensive lighting and shade control to consumers, Legrand offers its Nuvo multi-room audio solution through some online retailers, and Control 4 has long been rumored to be considering a consumer offering.

As the connected home market continues to grow, we’re bound to see similar moves by many companies. Young startups are introducing innovative products that appeal to consumers in all markets, and they have the agility to bring products to market quickly. Meanwhile, those in the professional space have much to offer consumers if they can do it without negatively impacting their core businesses.


About the author

Richard Gunther

Richard is a product experience consultant with a life-long interest in consumer electronics. He has been immersed in smart home tech for decades now and hosts The DMZ's home automation podcast, Home: On and co-hosts Entertainment 2.0 with Josh Pollard. Richard looks at products through an experience lens, always seeking the right mix of utility and delight.