The key message from Azione Unlimited buying group president Richard Glikes to his dealer members was to take voice control and AI seriously; sell performance audio when possible; find better ways to work with architects, interior designers, and lighting designers; and learn to market your business while the economy is strong.
The topics weren’t necessarily new to the CI crowd on hand for Azione’s spring conference in Philadelphia, but they served as a necessary reminder to keep innovating and improving even as a stabilized U.S. economy and a bullish stock market drive more profits back into the industry.
While some of the topics were familiar reminders of categories and business strategies, the structure of the event itself was a bit different than prior conferences. Rather than schedule a dozen or so one-on-one vendor meetings for each dealer in attendance, Azione created Experience Rooms for the spring conference where a collection of vendors collaborated on a small demo space, each getting five minutes to describe their offerings to roving groups of 10-15 dealer members who cycled through every room or space (in the case of the service provider and distributor members) over the course of three days. This, Glikes said, enabled every vendor face time with the 150 members in attendance. As an extra incentive to dealer members, only those who had a card stamped by all vendors would qualify for a raffle to win an all-expenses-paid Aruba getaway for five days and four nights with a spouse or friend. Other sales milestones over a seven-month period will also qualify five other dealer couples and five vendor couples for the trip.
The 12 experience rooms proved to be an especially effective way for vendors to see more dealers and for dealers to have a more compelling meeting than simply moving from table to table in a loud ballroom. And, because vendors were matched up in each room, many of them found interesting ways to collaborate to present their products in an integrated fashion. In one room, for instance, SurgeX power protection linked to Access Networks network gear, which fed a Savant control system and Meridian audio equipment.
Other highlights of the conference included a panel discussion on voice recognition and artificial intelligence, featuring insights from Google Assistant’s Daniel Clarkson, Sonos’ Andrew Vloyanetes, and Josh.ai’s Alex Capecelatro. Also, a panel on how architects, interior designer, and lighting designers work with AV integrators featured Tim Lucci of Peter Zimmerman Architects; Rafael Novoa of Rafael Novoa Interior Design, and Jennette Kollman, lead lighting designer for Wolfers.
Wolfers, a Boston-based lighting design showroom, recently merged with Azione member System7, and that combined company has agreed to “vet” lighting fixture products for the buying group to ensure that they will properly integrate with lighting control systems sold by its members.
“Some of the [lighting fixture] vendors think that integrators are going to have a very steep learning curve to be in the lighting fixture business because [involves] parts and pieces,” Glikes said in a conversation with reporters. “It is not the same thing as putting up a six-and-a-half-inch speaker in the ceiling; there’s a lot more to it. So we are very fortunate to have this relationship with Wolfers, where we have lighting and design.”
The group also has added Light and Green as a lighting vendor partner. Light and Green is particularly compelling because of its gypsum-based lighting fixture that eliminates the need for a trim ring. The group recently added LumaStream’s fully low-voltage lighting system to their mix and has been working with Coastal Source as an outdoor lighting provider for some time, and Savant’s USAI products, as well.
Several of Azione’s 11 small group meetings focused on selling lighting fixtures, but one specific workshop topic was “How to Sell Performance,” which Glikes also broached in his conversation with the press.
“Integrators are typically solutions based, but we think they can take that to the next level. Higher performance makes the customers more happy and the dealers more profitable,” Glikes said.
Another small-group session keyed in on how to make the most of a marketing budget. This topic, Glikes said, was motivated by the fact that most the group’s dealer members don’t advertise the same way that retailers do. Azione, he said, is trying to help its members with better marketing opportunities.
“Integrators tend to sit in foxholes and wait for a referral to come in,” he said. “We’re going to invest in marketing for our dealers. We have Laura Koster [on staff] and she’s been great [at leading marketing efforts.] We’ve put out some very nice marketing pieces. We’ve changed the way we communicate with our dealers. We have a single weekly email that goes out on Tuesday that’s called 5@5 because people are bombarded and we don’t want to be part of the cacophony that exists out there. We also have a seasonal spotlight and a beautiful marketing brochure that is brand agnostic that we offer to dealers.”
The group tested out a pilot program on Facebook with a handful of dealers that Glikes and Koster hope to offer across the group and with Google advertising added into the mix.
“We think that marketing is one of the key things that we need to do this calendar year,” Glikes said to Azione members. “We spent $10,000 with Facebook and OneFirefly and had 7,600 people click through to the landing page. We did it with eight dealers over three months, and we had 205 people turn into client leads. We thought it was pretty successful campaign, and we’re determined to make it bigger. We’re looking at doing it in thirds, where vendors kick in third, dealers kick in a third, and Azione kicks in a third.”
In addition to its new lighting members, Azione recently welcomed Atlona, Audioquest, Sonos, James Loudspeaker, and Google Home to the group. Glikes also hinted that Barco would join soon, as well. Azione’s president said that he feels his vendor line up is just about where the group’s 188 members needs it to be. He also mentioned that he’s no longer fixated on reaching the goal of 250 members. That’s a number, he said, that was derived from common wisdom about the number needed for a manufacturer to have full dealer representation across the country. Instead, Glikes explained, he’s more focused on expanding the group’s presence in states that may only have one or two members, like Indiana, Kentucky, Michigan, for example. He also doesn’t like the impression that the group is driven by adding members.
“People seem to feel that we’ve been aggressive about membership, and that hasn’t been the case for a couple of years,” Glikes said. “When we got to 50 dealers, I felt pretty good. When we got to 100 dealers, I felt pretty good. When we got to 150, I said, ‘Now, it’s going to [grow] by itself.’ It’s about the right dealers in the right locations. I’ve said ‘no’ to probably 40 dealers because their mix isn’t right. They don’t sell our brands, or we have conflicts. Whenever I add a dealer, I call the dealer in the market to make sure they sell products for the right price and that their labor rate is fair. We don’t want to poison the well.”
The goal, Glikes said, is to create a captive market, so that if a new brand or technology came out, they could come to Azione.
“You see that Sonos came to Azione. Why? Because it’s a pure play. We’re the integrator channel. They went right on our Slack channel. They’re so active on Slack. It’s back and forth with our dealers. It’s just fabulous for them. They didn’t think their business was going to be integrator based. They thought that integrators would be 10-15 percent of their business, and they’re 50 percent of their business, and they didn’t really understand the channel.
Google Home, Glikes said, also wanted to find some traction in the channel. “We do work in some big homes with very influential people,” he explained. “Although we’re not going to satisfy Google in any means in units, we can take care of them in who we work with and where we place their products. There’s a trickle down, obviously, from that. It’s relationships. We want to have great relationships with vendors, and we’re fortunate when you look at our lineup.”
Azione shares around 30 of its 48 vendors with its competitive buying groups/trade consortiums, but keeps their overall number at about 50 percent the total number of those other groups. Again, Glikes said, it’s quality over quantity, acknowledging that he’s turned down around 20 vendors that weren’t a good fit.
Looking ahead, Glikes hopes to accomplish what yet another of conference’s small group discussion meetings focused on: growing $1.5-million dealer members to $4-million. “What vendors get excited about and what keeps the groups alive is growth. If you get a company to grow like that, they will love you forever. They’ll also have the infrastructure to be stable in an unstable environment.”
Azione Unlimited has made “Perfect Partners” its theme for 2018. Glikes acknowledged that "perfect" was an “aspirational” notion.
“We can’t be perfect,” he said, “but boy can we try.”