THE #1 AV NEWS PUBLICATION. PERIOD.

The DMZ for Direct Sales People

Is The DMZ About to Get Hot?I awoke Friday morning to promptly receive an email from Chief’s own Joel Hagen.  Joel emailed me a link to Scott Tiner‘s post of that day entitled “Over Here! Over Here!” in which he in essence called out his local manufacturer’s reps for ignoring him even though he specifies and even installs much of the technology on  his campus.  Scott ended his post with a challenge to see which reps would give him a call, as he was in the process of planning his summer installs.

Well, me being anything but shy, I took to Twitter and DM’d Scott to get his number and then rang him on the phone.  I had never spoken with Scott directly although we had pinged back and forth in the social media space a few times over the last several months.  Now Scott and his campus are in Maine, which is a bit out of my California, Nevada, and Hawaii territory obviously, but nevertheless we had a great talk and I found him to be very friendly and gracious, (not unlike his blogging style).

After a few minutes of discussing his experience with manufacturers’ reps not calling on him, I started to put together some conclusions about why.  I also started to question some of the reasoning behind those conclusions.  Before I relate those thoughts though, I’d like to relay a couple of my experiences as an integrator and as a sales person for a manufacturer that I think may have some bearing here.

My first real job was at IBM direct.  IBM wanted to go head to head with Dell and Gateway (Moooo!)  in the Intel based PC arena and to do so needed to get into the Small to Medium Business (SMB) space.  These type of companies didn’t utilize Value Added Resellers (VARs) to buy product.  They had small in house IT departments and didn’t have huge RISC based servers like the AS400 or RS6000 running their networks.  IBM made the decision to go direct to these businesses instead of using their traditional VAR dealer channel.  I’ll tell you that the VARs did not like this one bit, and felt like they were being pushed aside by IBM in some respects.  IBM made it work only because the VARs were still the only way to buy the RISC based enterprise machines, and hence protected them from open competition in that forum.

As an AV integrator, I dealt several lines of higher end AV gear, and I’ll tell you that nothing lit up the CE Pro and AVS Forum discussion boards with more venom that an announcement from a previously “dealer only” manufacturer that they were going direct to consumer through retail outlets.  Many dealers argued that they were the ones who gave the manufacturers the success and name recognition necessary to make the retail play successful, and now they were being shrugged aside.

Finally, before I landed at Chief I worked for Horizon Display, a multitouch display manufacturer.  Shortly before I arrived, Horizon had decided that in many cases they could better support customers and make sure they received the proper technology by bypassing the dealer channel and selling direct to the end customer.  As such the sales team started having discussions with end users about projects and about purchasing hardware.  They still sold through distribution and through AV dealers as well at the time.  I remember calling a top executive I knew at a major commercial integrator on the west coast and asking him who they were using for touch screens.  The first question he asked me was, “Mark, you guys aren’t selling direct to end users are you?”  I replied honestly that we were but that we still needed the integrator channel for installation as well as the rest of the AV gadgetry but it fell on deaf ears.  I never sold them a piece of equipment in my time there before I was laid off.

Do you sense a common theme?

As a representative for a manufacturer I am very conscious of the impression my dealers may get when I am calling on their potential clients directly.  Now at Chief we don’t sell direct, so my interactions with end users never end in me supplanting one of my dealers with a direct sale, but I still walk the line as carefully as a soldier in the DMZ.  Technically no one is supposed to be fighting in those areas, but my best friend, a Marine, was almost killed in one.  I may not be engaged in improper behavior, but I still want to avoid any shots across my bow.

When speaking with Scott, I found that he actually buys product through a local dealer, but the manufacturer still calls on him to educate and inform.

Many manufacturers have done this for years with architects and consultants without any backlash, as those companies are not actually buying product , but rather designing it into projects.  There is a shift occurring though.  Many companies now have the in house IT and AV expertise to start designing their own systems and specifying their own equipment.

As AV systems have become somewhat simpler and as product information has proliferated on the web, the dealer channel is no longer the only gateway to product information and pricing.  It is not unlike the scenario I described above in IT, where the companies that started using Intel based server/client networks were able to design and setup the networks themselves, something they were unable to do in the previous mainframe and “dumb terminal” era.  The role of the VAR had changed slightly, and the PC manufacturers had to be talking to end users or risk losing projects to the competition.

Is the current shift something that AV manufacturers should be paying attention to and adjusting their methodologies to address?  I think so.

As manufacturers’ reps we need to be respectful of our companies historic path of revenue.  If we rely heavily on a dealer channel, like my company does, we need to assure our dealers that we are not trying to change that path to the product.

We also need to let our dealers know that in today’s world we also need to make sure that we are creating a path to the end user for information and support.  This is what Scott gets from his rep and then he uses that information and support to buy product through the dealer channel.

The great thing about this for manufacturers reps is that they get a better feel for what end users need and care about and can assure they get all the information available to cement their products into the design.  The great thing about this for AV dealers is that these direct conversations will result in something every one of my AV dealers asks me for. . . referrals to companies that need our products and their services.

Thanks to Scott Tiner for bringing up a great question and for making me reflect upon the reasons and possible solutions.  I feel like the exercise has given me a great base from which to operate that benefits both my company and my trustworthy dealer network.  As long as I articulate my strategy and activities effectively to my dealer base that keeps us in business, it seems unlikely that I will step on anyone’s toes.

Top