PxPixel
RMR for Dummies - ResidentialSystems.com

RMR for Dummies

Do you have a Recurring Monthly Revenue (RMR) program (security system monitoring, service plan, etc.)? RMR as a buzzword is omnipresent in our channel while actual RMR results seem to elude most of the custom installation world. I recently stumbled on a solution that goes a long way to solving the typical CEDIA company’s RMR struggles. It’s called the System Enhancement Module (SEM) from Alarm.com. If you’re not careful, you could make some money with it.
Author:
Publish date:

Do you have a Recurring Monthly Revenue (RMR) program (security system monitoring, service plan, etc.)? RMR as a buzzword is omnipresent in our channel while actual RMR results seem to elude most of the custom installation world. I recently stumbled on a solution that goes a long way to solving the typical CEDIA company’s RMR struggles. It’s called the System Enhancement Module (SEM) from Alarm.com. If you’re not careful, you could make some money with it.

Image placeholder title

Our businesses aren’t worth much without a stream of RMR. Consultants and industry thought leaders chide us to create RMR. We greedily eye the vast sums of cash that security dealers rake in. Should we sell service plans, go into the security business, or offer a remote-managed services solution with ihiji or OvrC?

Who will buy our newly created product offerings? That’s where a solution like the SEM comes in. For $139, you can go into any home with an old school dial-up Honeywell/ADEMCO Vista security system and upgrade it to full cellular monitoring with home control capability. Instead of having to compete head to head with a large security company for a customer, you’re a hero providing a high level of service with very little upfront investment to a customer you’re probably already doing business with. Think of this as an order of fries added to an existing sale or easy post-sales checkup campaign.

Chances are, many of your clients have Honeywell/ADEMCO Vista security panels installed in their homes (one of the most common). Imagine telling them that you can breath new life into their old system while seamlessly adding the benefits of lighting control, electronic door locks, HVAC control, garage door control, etc. All you need to do is install a small part (the SEM), which takes 15 minutes to put in. You give the part away or charge a small activation fee and change their monitoring over to your company. Congratulations, you’re now in the RMR business!

Right now, there are thousands of security system connected to central stations via plain old telephone service (POTS) lines. The sea change taking place right now is converting those systems to cellular connections. Larger players like ADT and Vivint are keenly aware of this and marketing to these customers with enticing offers we could never dream of matching (because most of them make no financial sense). What about those customers who want a more personal relationship but would’ve never considered a traditional (Control4, Crestron, Savant, etc.) home control system? What about your existing customer database? You have thousands of customers in there. How many of them would go for an offer like this?

There are a few solutions similar to the SEM, but I picked the SEM because it’s simple and Alarm.com is emerging as the leading player in the cloud space between “Do It Yourself” (DIY) and “Pays For Service.” From a business perspective, installing the SEM binds you to Alarm.com, but most of the other cellular radio solutions (Honeywell Total Connect, Uplink, Telguard, ADT, Vivint, etc.) follow the same end-to-end philosophy.

I know what you’re thinking; “Nice puff piece for Alarm.com, Clifford, how much did they pay for that one?” I have no dog in the fight here other than writing about the SEM because it’s a good idea and taps into a completely underserved segment of the market. These customers want the features they see advertised on TV everyday, and someone’s going to get their business. Will it be you? There are other SEM-esque products on the market, but none that work so simply. If you find one that works better, post about it in the comments. We can all benefit from shared experiences and I’m far from the smartest guy in the room.

The SEM is in its final beta stages now. We’ve installed a few, and our technicians love it. What do you have to lose? Sign up to be an alarm.com dealer and take a swing at the ball. If it’s not using the SEM, pledge to create at least a flavor of RMR this year. You owe it to your employees, clients, and families to stay in good financial health.

Stay frosty and see you in the field.

Correction: This story initially priced the SEM solution at $125.

Related