Congratulations are in order as electrical contractors (ECs) have taken the lead as custom installers for many key home technologies. According to 2007 findings by the Consumer Electronics Association (CEA), through research conducted by the National Association of Homebuilders (NAHB), electrical contractors represent 72 percent of all installers of home technologies, bettering security and other low-voltage specialty contractors by 10 percent or more.
CEA, based in Arlington, Va., shared the findings of its sixth annual State of the Builder Technology Study in a recent Webcast for journalists. The victory for ECs represents not only securing home technology work, but also securing it from builders both small (the greatest gain) and large, notably regional or national contractors.
The choices in which home technologies subcontractors offer and why are intriguing. For example, structured wiring and security systems seem to be required services needed to remain competitive. Meanwhile, intercom systems, multiroom audio and home theater installation are services driven to boost profit. Finally, offering energy-management systems, automated lighting controls and other home automation technologies set one apart in the marketplace. Providing central vacuum systems also is a differentiator.
Regardless of the technologies offered, the report revealed that home buyers preferred discussing cost and options with both the builder and installer together.
Of note, the top four consumer reasons in selecting a home technology installer were (in descending order): price, installer experience working with home builders, completeness of offerings and installer reputation. Approximately one-fourth of those interviewed shared a frustration in finding service providers for security systems and multiroom audio.
Even in a sluggish economy, builders remain keen regarding profits from home technologies. Fewer builders (31 percent) increased their profit through such services in 2007, but the drop was not precipitous. Better than half the builders surveyed considered the marketing value of offering these technologies as important, though few claimed to proactively market them. This “disconnect” continues to be a window of opportunity for subcontractors as builders revealed a high level of satisfaction and a better working relationship with this group.
CEA economist Shawn G. DuBravac had some added advice for ECs.
“You [the electrical contractor] need to help the builder make their customers, the home buyer, happy,” he said. “Recognize your job is more than just pulling wires. It is providing solutions and meeting lifestyle needs. Homeowners do not want unnecessary service or installation revisits. They want someone who can authoritatively provide the work and manage it from start to finish. Show a builder that you can accomplish this as a home technologies installer.”
DuBravac added that an EC should not try to do it all. Rather, offer expertise in select home technologies and build a reputation.
(Source: “State of the Home Technology Builder Market: Challenges and Opportunities” and Webcast response by Shawn G. DuBravac, economist, CEA)