HTA Update - 03/31/2008 (Plain Text Version)

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In this issue:
Going Green with Home Automation
Builders and Remodelers Benefit from Multi-Room Audio and Video Trends
50+ Consumers Are Buying Into Green Technology
Quick Tip on Lighting
Industry Recognition
NAHB-Produced Programs on DIY, Fine Living and HGTV
NAHB Spring Board Meeting Set for April 29-May 3 in Washington

Builders and Remodelers Benefit from Multi-Room Audio and Video Trends

Today’s home buyers want increased accessibility to music. Even with a looming market, Apple reported 22,121,000 iPods sold during the 1st quarter of 2008, showing a 17 percent revenue growth over last year’s quarter.* High quality speakers are available in every price range from modest installations to showcase-quality professional designs. Multi-room audio is scalable to the home buyer’s budget. Another point to consider is the invisibility angle of technology products – it’s important to consumers who are opting for sleek looks. There are many available options for builders to satisfy this demand while preserving great sound.

What multi-room audio trends are driving home buyer demands?

1) Music anytime, anywhere. More consumers are able to enjoy music in a variety of areas in the home – this is due to extended connectivity, increased affordability of technologies and the growing consumer trend toward convenience.

• Outdoor Speakers. Home owners are spending more time outside - on the deck, pool or the patio. Nearly 100% of all multi-room audio systems (also called whole house systems) include weather resistant speakers with high quality sound reproduction outside. They can hang under an eve or mount on a deck.

• Shower Speakers. The rekindled passion for music has been revealed by the iPod revolution. Customers can now be awakened by sounds and water or connection to local and world events during their daily routine. Waterproof and stylish speakers are now available and capture the interest of the audio-loving and multi-tasking tendencies of home buyers.

2) Invisible or built-in sound. Big bulky speakers are out. Heard but not seen is in. This is growing in importance as home buyers want the equipment to be invisible or blended in with their design choices. Builders have many options to offer their customers.

• Subwoofer/Satellite Systems. This type of speaker has been growing in popularity for the last 10 years or so. Builders can offer have installers put tiny speakers on the wall and then locate the small subwoofer anywhere in the room.

• Built-in Ceiling or In-wall Speakers. The in-ceiling speaker category commands two thirds of all built-in speakers.* Folks can now listen to high quality performance and sound without having to give up space for large tower speakers.

• Bar Style Surround Sound Systems. Zero clutter, no rear speakers, and no rear wires. Complete surround sound is available from a single slender speaker that nestles right under a flat panel TV. Enhanced sound is seamlessly matched with movie-quality viewing. Builders can offer these with all the electronics and DVD player in a console.

• On-Wall Home Theater Speaker Solutions. These encased speakers are great for clearing up floor space. They offer high performance surround sound combined with a sleek and high visual appeal demanded by the market.

Why should builders offer multi-room audio and structured wiring in their sales packages?

1) Make money and maintain revenue on every opportunity.
• Nine in ten builders say adding home technologies increased (31 percent) or maintained (61 percent) their revenues.*
• Increase profit margins on all home technology sales and installation packages. You can’t make revenue on products not offered.

2) Differentiation from the competition.
• You have the edge over the builder down the street if your offerings are better. And if the remodeler who gave other estimates to your customer doesn’t have it – well, what will drive the customer towards you?
• Studies showed that almost 89 percent of builders stated that home technologies are important for marketing homes. *

3) Meet home buyer demand.
• Over 67% of home builders in 2007 offered multi-room audio to their customers, making it the 3rd most installed technology in homes. *
• Structured wiring (installation services for home technologies) is the top most offered technology offered by builders in 2007.*

4) Increased home buyer affordability.
• Multi-room audio products are available in a broad range of prices and options. There is a huge opportunity for production, single family small volume and multifamily builders and remodelers to capitalize the mainstream market.
• Home technologies considered as built-in amenities may be rolled into the mortgage.

5) Establish business partnerships with the 4th trade.
• Partnering with a qualified Electronic Systems Contractors (ESC) enables builders and remodelers to utilize professionals who have the expertise, education and experience in home technology products and installation. This is the same type of relationship modeled with other trades (e.g. HVAC, plumbing, etc.)
• Builders can arrange for ESCs to have separate agreements between the home buyer and ESC (to cover product warranties, service, additional training, etc.), and reduce callbacks.

6) Increase customer service through established builder arrangements with Electronic Systems Contractors (ESCs).
• Customers are provided training by the ESC on how to use their new multi-room audio and video technology.
• Customers can call ESCs directly for questions and service needs on products and installation.

7) Decrease builder worry to keep up with home technologies.
• Technologies upgrade and change quickly - it’s the specialty of the ESC trade to keep up with the changes and know the intricate details of audio and video products. Much like relying on other trades for their expertise, builders and remodelers can focus on the business of building.

About Al Baron: Al is Product Line Manager at Polk Audio, one of the leading manufacturers of premium loudspeakers and consumer electronics products for the custom installation and retail channels. He has held positions in marketing and international management over his 30 year career in the consumer electronics industry and is an active member of the Home Technology Alliance (HTA) and CEDIA (Custom Electronic Design & Installation Association). For more information please contact Al Baron at abaron@polkaudio.com or (410) 764-5202.

*Sources: Apple®, CEA State of the Builder Study (Supplement to the NAHB Annual Builder Practices Survey), Polk Audio.

*Photo courtesy of Polk Audio