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Automation Unplugged

Automation Unplugged is a Facebook Live show recorded weekly with our host Ron Callis, Owner and CEO of the digital marketing agency, One Firefly. In each Automation Unplugged episode, Ron speaks with leading industry personalities and technology professionals to discuss all things business development, technology trends, and more. These interviews are designed to help our clients and members of the custom integration industry keep up-to-date with the latest news as well as learn from experts in the field.

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Home Automation Unplugged Episode #224: An Industry Q&A with Jeff Goldstein and Mark Hoffenberg

In this weeks home automation show of Automation Unplugged, Mark Hoffenberg, President at AUDIOVISIONS and Jeff Goldstein, Head of Sales at Sony share about the role marketing plays in positioning a company in growth markets and downturns.

Home Automation Unplugged Episode #224: An Industry Q&A with Jeff Goldstein and Mark Hoffenberg

This week's home automation podcast features our host Ron Callis interviewing Mark Bolduc. Recorded live on Friday,  September 9th, 2022, at 12:30 pm. EST.

About Jeff Goldstein

As head of sales, Jeff Goldstein oversees Sony’s relationships with leading audio and video integrators. With decades of Sony experience in numerous executive-level positions, including director of sales for the Consumer Integrated Systems division, as well as vice president of marketing for the company's Home Audio/Video and Television divisions. He most recently served as a strategic consultant to premium custom installation and optical companies, helping to expand their distribution channels, and refine customer engagement. Jeff brings deep experience in product development and planning and was instrumental in creating Sony's home theater projector line, as well as driving custom integration features for Sony ES, Home Video and TV products. 

About Mark Hoffenberg

Mark Hoffenberg founded AUDIOVISIONS in 1989, and led the company’s rapid growth to becoming one of the nation's largest and most respected home automation companies. In 2005, Mark directed the acquisition of AUDIOVISIONS to Best Buy, the world's largest consumer electronics retailer. For the subsequent 9 years following the acquisition, he served as Vice President of Services for Best Buy while remaining President of AUDIOVISIONS. In 2014, he successfully navigated the re-acquisition of AUDIOVISIONS from Best Buy. Today, Mark leads a talented team of nearly 100 employees in four geographic markets from Orange County to the San Francisco Bay Area in California. He is responsible for the company’s overall vision, business strategy, partnerships, ventures and key initiatives.

Interview Recap

  • Retail sales are the canary in the coal mine
  • The role marketing plays in positioning a company in growth markets and downturns
  • How to think about your brand when also driving a manufacturers marketing program
  • Builders, Architects and Designers as the source for local project forecasting

SEE ALSO: Home Automation Podcast Episode #221 An Industry Q&A with Mark Bolduc

Transcript

Ron:  Ron Callis here with a special episode of Automation Unplugged. We are here for show 224. It is Friday, September 9th. It's a little bit actually it's right at 04:00 here on the East Coast here in Florida. But you would not exactly know that because I'm actually not streaming this live. We are pre-recording this show. I've got two special guests joining us and it required some logistics to get everyone's schedules coordinating to make this happen. So what we're going to see when you do see this content on the social platforms or YouTube, you're going to see this a couple of days after we've recorded it. So I think we're going to get this uploaded on Monday or Tuesday. That's probably when you're seeing this for the first time. And then of course, it always takes us a few days after a recording to get this prepped for the audio podcast. So today we have two special guests because we have a special theme I want to talk about really the state of the market. There's talk of this dirty word called a recession. And maybe we're in a recession. Maybe we're going to have a light recession. Maybe we get lucky and we don't have a recession because there's all sorts of just frankly weirdness in the economy right now. Unemployment rates are still extremely low, purchasing is still extremely high. But at the same time, the stock market, the bond markets are odd. The FED is increasing their FED rates trying to fight against inflation, and there's just all sorts of strange things happening. But that said, there are some canaries in the coal mine. There are some indicators that are happening out there in the electronics market that are likely to impact the integration space. So my goal with this show is to bring in two industry veterans that have perspective both from the integration side and from the manufacturing side to weigh in on this. This is a special show in that it's very topical in nature and it was important to me and my guest to kind of have this conversation out there for all of you to listen and watch as soon as we could all coordinate schedules and make it happen. Which means it's on a Friday, late in the day, after a long, hard week for all of us, but we're going to do it. So who do I have? I have jeff Goldstein. He is the head of sales for the Sony CI Channel. And we have Mark Hoffenberg. He is the CEO and founder of AudioVisions. So let's go ahead and bring them both on. I'll have them introduce themselves and then we'll just dig right into the fun topic at hand here. Hello, gentlemen. How are you?

Jeff: Doing great! Hi, Ron.

Ron:  Awesome. Jeff, we'll start with you. And again, just keeping in mind maybe there's a rare chance someone listening or watching has lived under a rock and does not know who you are. If you could maybe just give a quick glimpse into yourself, maybe a light touch on your background and then your current role with Sony.

Jeff: Sure. So I've been involved with the custom installation, CEDIA oriented industry probably since around 1994. And actually Mark and I have worked together, me as a supplier and Mark as one of my customers going back to that time. I was with Sony for about 24 years, the first go round, and went off and did a few other things in the interim. Then about two years ago came back to kind of reprise a role that I had done quite some time ago. I always really love this part of the industry, the integration, how to deliver the best experiences with the gear that we make. So for me, it's kind of a homecoming and very happy to be involved in this segment of the business.

Ron:  When you rejoined Sony, you walked right headfirst into the COVID, the zombie apocalypse. But for those that want to learn more about that or hear your take on that, we did have you on the show. We'll drop into the show Notes, that show number, but some shows ago we had you go into some of that. So for those that are curious and want to hear what that was like for Jeff to rejoin Sony right when the world started to fall apart a little bit, which actually turned out pretty good, right?

Jeff: In retrospect, it was good for our industry, for sure.

Ron:  Yeah, it was. Mark, if you could tell the audience a little bit about yourself. And again, this is a special show and that we're going to be talking about this kind of the state of electronics in the economy and whatnot. We've already gained a commitment from you; we'll have you on in the future and we can go more into your full in depth background, which is, I think, nothing short of fascinating. But tell us a little bit about AudioVisions and your role there.

Mark: Sure. So I'm the CEO of AudioVisions. I founded the company in 1989, same year that CEDIA itself was founded. We're in the California market. We have four locations Orange County, Palm Desert, Los Angeles, and Northern California. And we focus on the luxury end of the smart home business.

Ron:  AudioVisions is one of the largest, if not the largest, integrators in California. Residential integrators in California, is that correct?

Mark: Yeah, definitely. By a large margin, the largest in California and one of the largest independent integrators in the US.

Ron:  Awesome. Which would make you one of the largest in the world. Kind of a neat way to think about it. So I'm certainly honored to have both of you gentlemen on here to talk about what's going on in the economy. I'm here at One Firefly, I'm talking to integrators every day of the week and I'm starting to have some conversations where there's no other way to say it, I'm starting to sense some fear and anxiety in some of the conversations, because what I'm seeing is integrators where their pipelines getting a little bit more thin, certainly thinner than they've experienced in the last 24 months. COVID was sad and scary and harmful to many businesses. That is not what happened, at least here in North America in residential CI, it was a boom for residential CI, a lot of people were the busiest they've ever been in their lives. But that's changing. So, Jeff, maybe start with you. What are you seeing out there in terms of and again, I know that you have the inside data on exactly what's happening at Sony. So not here to disclose anything you can't disclose, but trends and industry publications and the news are talking about electronic sales being down in a lot of retailers in different environments. So what are you seeing?

Jeff: Yeah, I think and there's plenty of public information and data that are available. If you kind of pulled it all together and looked at it the way I'm able to look at it because the data is provided to me. There's absolutely a slow down in the electronics market in terms of. You know, anybody that's looking at last year as sort of the point where what you're measuring your business against. They're more than likely seen business being definitely smaller than it was last year. To that point, I think we've had two years where there's been a very heavy focus on purchasing around, making a home environment more livable as people were spending much more time there. I think as the Pandemic has now kind of really become something more that we're going to be living with on into the future, people are now looking outside of their home for experiences and entertainment much more than they were even six or eight months ago. So if you track credit card spending, where the money is going, the things that are growing are things like gasoline purchases, clothing purchases, travel purchases. If you monitor how many people are going through an airport, all of that is on the rise, and we're recovering to 2019 levels and beyond in terms of number of travelers going through airports in a day. We're definitely seeing a shift in focus, compounded by some increased costs for basics like gasoline and food. So there's no question that where the money is going has shifted.

Ron:  In the spring of 2020, when you rejoined Sony, one of your first initiatives in leading CI sales was actually a marketing initiative. Was that to potentially combat COVID or maybe just talk at a high level; Why did you go there? And you went there pretty quickly. You went there a couple of years ago.

Jeff: Yes, I think at the very beginning of the Pandemic, when nobody knew what was going to happen. And I think we all expected to see an immediate sort of downturn in the potential for work and for throughput in terms of jobs and everything else. So immediately I said, okay, if the natural sort of flow of business is going to be interrupted in some way, we have to create ways to reach out to the people who are still going to be looking for this kind of work. Literally, I joined Sony, February 10 and we went into lockdown in middle of March. So literally within that first month, I started working on ways that we could help our dealers reach out to customers that they've had in the past. Reach out to new potential customers that are looking at this kind of thing anywhere. Where the dealer could kind of go back and kind of rework the relationships that they've had in the past with customers and re-reach out to them to see if there was interest in an upgrade; In something new, a new TV, a new projector. So we set about immediately creating assets and artwork and messaging to talk about, it's time for an upgrade, it's time for a new TV. So we prepared all that. We got it ready and we made it available. Then literally within 60 days, everything went the other way and everybody got super busy super fast. But all that being said, I don't think anybody knew when the downturn was going to come. Just being who I am and the way I like to approach things. For me that was the time to actually double down and get a marketing program together that our dealers could tap into so that they could actually weather the storm better by really doing outreach. Even while business was good, even while things were really busy. In preparation for when that downturn was going to come. Be ready and understand how to market so that you could capture what business was going to be out there. So here we are two years later, and that eventuality is now happening.

Ron:  Yeah, I want to dig more into that, but I want to bring in Mark. Mark, you've been running an integration business since 1989, so you would have just missed the 87 crash, right? There was a market crash, but you certainly have lived through a number of recessions. You run your business through a number of recessions and I guess we'll start do you even think we're in a recession? Do you think we're going to have a recession? Do you think there's a change happening? Or is this all hyperbole?

Mark: Well, everything I'm going to say is clearly speculation.

Ron:  We don't have a crystal. I do have a magic eight ball. I borrowed it from my son's room. But yeah, this is just how do you feel?

Mark: Yeah, well, if you just look at history, whenever there's a high point, it's generally followed at some point by a low. So how big that low is going to be and how soon it's going to come, that's the thing that's really fuzzy, but the fact that there's going to be one that parts not fuzzy. So it's really hard to say. But because these last few years. Because of COVID and because of the market taking a quick dive and then super rapid recovery to 2021 being. I think, for virtually every integrator a record year, certainly was for us and every one of my friends in the industry. There's going to be the analogy of that coming. I just can't say when. But there are some indicators.

Ron:  What are they?

Mark: I think we all try and do our best to predict the future. And as integrators we have the fortune of being able to look at our signed contracts and know what our work in progress is to a large extent for quite some time. So unlike retail where the bottom could fall out just any day and you wouldn't know, we at least as contractors with signed contracts have that opportunity to know that that's going to still be there unless it's a major catastrophe. But there are some indicators on the sales side that the market is softening for sure. If we talk to builders, they're still going crazy and that's because they're trying to finish projects that have been signed a year ago, six months ago, maybe two years ago. So for them, they're more short sighted. If you talk to them, there's no end of sight. If you talk to interior designers, it's a little bit softer. If you talk to architects, at least all the architects that we've talked to, the market has softened a lot. So they're not signing new projects at the rate that they were in 2021. So to me that's an indicator that at the high-end of the luxury end of the market, we're going to see a softening at some point.

Ron:  Philosophical question, I don't know that it has an exact answer, but the wealthy consumer, the luxury residential consumer, they still have money. Even when there's high inflation, they still have wealth. Often they have their wealth because they know how to manage their money, right? So they probably know how to make money when things go south. So why would those sales pull back? Is there any logic to it, at least to you guys?

Mark: Well, I think as you pointed out, the majority of our clients are all wealthy, some uber wealthy, and they got there somehow, right? So they know how to manage the money really well and they know how to always make more money than they're spending, at least in the long term. They can't necessarily predict the future any better than us. So they're smart. No matter how much money they have, they're still going to be conservative when it's time to be conservative. And they're going to be super active when the opportunity exists, maybe even more so than anyone else because they have the luxury of resources, but they don't want to squander their financial resources, that's for sure.

Ron:  That makes sense. So if they are pulling back when it seems like that's the right thing to do, it's not that they need to, but yet the data or your historical perspective would be that they do pull back in times of market slow downs.

Mark: Yeah, because our signed contracts slow down. So we know it from the fact that it's harder to sign new contracts than when the market is just storming. That's a certainty that we know over 33 years of being in business. That being said, our signed contracts, they're a leading indicator, of course, of revenue. But right now, if I were to just look at our new contract signings in 2022 compared to 2021, it's very similar, but it still feels different.

Ron:  So you guys are still nicely busy and you're still booking business at a good rate?

Mark: Yeah. So here's the thing. We're nicely busy. We're booking new sales at a good rate, but there is a slowing of revenue. That's not because any contracts have disappeared or stopped. It's just the pace of the construction on the projects that were on has definitely slowed. So in a market where there's way too limited resources and everyone's trying to get stuff done as soon as possible, and especially when the housing market is accelerating, people are trying to get their projects done as soon as possible. We saw that in 2019, but we really saw that in 2021. It was at a pace of fury that I've never seen before. That pace has slowed down. So the projects where our clients were pressing our contractors to get done as soon as possible, they're not pressing as hard. Even when they are pressing because they want to get into a home, the contractors can't finish the job as quickly as they could before, whether it's because of supply chain issues or labor issues or some other reason the projects are slowing down.

Ron:  So, Jeff, why is marketing, again since reentering Sony and reentering the channel, why is marketing a way for Integrators to fight back? What is it that tactically that that is doing to ultimately help them? And again, from your perspective? I certainly have my takes in my perspective, but I'm betting our audience cares more what you think than I think. What do you think? Why does that matter?

Jeff: Yeah, so I think for many Integrators, the main sort of source or the generation of new business comes from kind of a referral stream that they've had in place for a long time. And if those contacts or that pool of recommenders slows down, I think it becomes really important to diversify the way you reach out and find new business. I think that because of the pandemic and what's happened in the last two years, especially because people have not done as much face to face in general, I think that consumers are very open to being communicated to in new ways. And using digital marketing or email blast or whatever you want to call it as sort of the kind of a new way to get at it and find the right people. I think the business doesn't just stop altogether. There are still people out there that are going to be buying a home or they're going to be remodeling a home or they're ready for a refresh or they're looking for work to be done and may not even understand or know anything about the custom installation market. I think finding those people that are out there looking for the type of work that integrators provide needs to happen in new ways. So for me, yes, keep going with the referral screen, keep talking to the people that you always talk to, to find the business in your local area. But I think going back and calling your prior customer list or reaching out to consumers in your geographic market that are actually out there searching and looking for the types of things that you do becomes a very unique tool that helps you find people in a very surgical efficient way. I think consumers are much more open to being communicated to in those ways than they were even three years ago. That's why I think it's important.

Ron:  Mark, when you think about marketing and AudioVisions, I'm going to make an assumption. You've probably grown this business to being the amazing business that it is primarily through referral. Right? You wouldn't necessarily say that marketing, or at least the way people think classically marketing is defined, how you grew it was through referral. I'll first just pose that. Is that a fair statement?

Mark: Yes, that's definitely a fair statement.

Ron:  So why do things now? You're doing some things. You've participated in the corporate marketing program with Sony, so there are some things happening there. You're also doing some branding initiatives and activities across social channels and email and even Google. Help our audience understand why would you do those things?

Mark: Yeah. So first let me preface by saying I'm not a marketing specialist, I'm an engineer.

Ron:  Sure.

Mark: But as the CEO of my company, I have to be paying attention to these things and things are changing, right. In particular in our company, as our company grows, it gets more and more difficult to do things the old school way. As Jeff pointed out, a lot of integrators like our company, we find our business not directly from the consumer, but through a referral channel. For us, it's architects, interior designers and builders as well as our current customers. When you've been in business a long time and you have a lot of customers, that really helps. But even super wealthy customers, they only build so many houses. So if you want to continue to grow to a certain extent, you do need to get new customers. The way we did it only by referral and only by directly reaching out to those referral sources is just insufficient now, I believe. I think the time to use the tools that are available to us today in digital marketing is when the business is good. You have to already have those connections made, not after business starts to turn down.

Ron:  I'm going to ask you maybe a controversial question, and I don't want to scare you. It's really not a scary question. Do you think those folks that are referred to you, do you think they go to Google?

Mark: Yes.

Ron:  Some of the time. I wouldn't take a position that they all the time do that. It's almost a softball. Do you think some of the time they go to Google and figure out who this company AudioVisions is that they were just sent to?

Mark: I would say it's a lot more than some of the time. Whoever you ask, whether it's an uber wealthy client or an 18 year old kid, if they're going to make a purchase, whether it's $5 or $5 million, they go to Google first. I really just think that's true, and that didn't used to be the case. My mom and dad are 94 and 92, and they use Google before they buy anything.

Ron:  Yeah, that's awesome. It's funny. I bought my car. I leased my car. But I went into the car shop a couple of years ago, and I had this very specific model in mind. And I had already done all my research prior to going there. I had already looked at whatever the car review. I'm not a big car guy, so I don't know, if I go into a shop, I'm going to easily be sold because I don't know what the hell I'm looking at. So I look at all the Consumer Reports and car and driver, and I just look in the categories that are appropriate for me. What's the best? And if it's the best, they probably know how to look at these things better than me. And so I walked into the dealership and I said, I want this car and this model and this color. And he goes, okay. He's like, all right, I'll get the keys. I was like, no, I don't need the keys. He's like, do you want to drive it? Do I need to drive it? I told you that's what I want. That's what they say meets my requirements. I was like, I'm good. I had already done all my research. I use this thing called the Internet. And I had taken the collective knowledge that I was able to consume out there and make my purchasing decision. And of course, it's a beautiful, amazing vehicle. Am I going to get in it and go, yeah. No, I think I don't like this. I'm an example of someone that does research, and I draw a lot of my decision making prior to that. Now, that said, that doesn't mean other details don't matter. But just as an extreme example, that was my purchasing decision. I think I totally weirded the sales guy out. He was like, Man, I don't know what yes. Let's go. Okay. By the way, I still was at the dealership for 7 hours. I was like, man, it's just such a horrible experience even when I know exactly what I want. But Mark, I just want to stay with you. One specific detail of doing marketing, and there's the idea, do you do marketing? I mean, you're a business. You're a sizable business. You could theoretically not even theoretically, you could build an army or a team of marketers inside your business. That's a way that you could do this and or you can staff your marketing engine in other ways with liaisons and you can work with others. Can you talk just about how you think about that? You acknowledge I want to do marketing. Well, then how do I tactically execute? How do I get it done and what's worked? And I'm going to give one of your former team members, Jackie, we worked with her. That concept of a liaison works so well with an agency. It could be any agency. That was just an example. That's where that question is coming from because I think different companies do it different ways and I'm just curious how you think about that.

Mark: Yeah, so we don't have a marketing person that's going to change soon, actually. But when things were accelerating in early 2021 and we knew we needed to refresh our website and start really pushing on marketing so that we have a head start, like whenever things are good, they're going to come down. So we started with our research and that's how we ended up landing on One Firefly. Obviously, we knew a lot about you already. I've known you for a long time and through HTSA and talking to other integrators, but we decided we're going to pick a company and we're going to go with it. This might not be the approach that everyone wants to take, but I think finding a vendor or consultant that you can trust that knows more than you do is a great way to start. So that's what we did and it's been really good for us.

Ron:  I appreciate that. And by the way, any relationship requires two people in that relationship for it to be a relationship. So our best opportunity and I'm going to wear my hat for any agency out there. Whether you're an independent or you've got an army behind you. In order for that team to execute on behalf of a business. We're purely BTB, obviously we need that business to actually have people that are involved both in a cerebral and a mental way ready to engage around strategy. The understanding of what is one trying to achieve. The only way you can help someone achieve outcomes is if you mutually agree and understand what those outcomes are. Then different methods and tactics can be put in place to help you achieve it. Then you can hold yourself accountable with Data and KPIs to say, well, are we in fact trending in those directions? I think that's what you and your team have done a really good job, and then that allows the mutual we and I put Sony in that group as well because we're running Sony programs in there, in that mix as well. It allows it to be possible for it to succeed.

Jeff: So Ron, the traditional method of having influencers helps us grow our business. And I mentioned architects, interior designers and builders. That still holds true today. Absolutely. But it's also important to have as many touch points, I think, as possible if you're buying a new car and then all of a sudden you keep hearing about the particular car that you want from random people, your next door neighbor or someone that you meet at the mall and they're talking about how great the car is, it just reinforces your opinion. So when we're looking to sign a contract, we know that if we get a referral from any of those three sources, we have a pretty good chance if two of those three sources refer us. We have a much better chance if all three of those the architect, interior designer, and the builder refer us. We call that the trifecta. It's like almost for sure we're getting that job. If we don't, we did something terribly wrong. Obviously if it came from a client, that adds to one more source. But the new part of this equation is digital marketing and the Internet. So even if they get a referral, even if we get referred to the job from one of our Trifecta partners, they're going to Google us, they're going to look at our website, they're going to ask around. The more times they hear our name or they see our name in social media, the better the chances it just reinforces their opinion of our company and the better chance we get the job.

Ron:  So I think there's dealers doing marketing brands where you are the brand. I'm a big advocate, Mark, and I know you and I are believers of this. Your brand you're promoting, no offense, Sony, and I'm going to flip it. That is not Sony, your brand is AudioVisions. That's what you lead with. That's the website they visit. That's what's on the proposal. And you're using various tools, ie. Products and pieces and parts to make up a system. You're not selling pieces and parts, you're selling solutions. You're selling systems. Someone goes and buys a BMW, they don't go and buy a BMW steering wheel. They buy BMW. They buy the full integrated system. That said, you do have an opinion on what it means to partner with a Sony on marketing. Can you just talk us about like that? Sounds like you're trying to have it both. Ways. So how do you think about that?

Mark: Yeah, so it's a good question. We absolutely subscribe to the fact that the brand in our case is AudioVisions. Our customers are getting an audio vision system. The important distinction here between AudioVision, and since you said, BMW, a car manufacturer, is the car is a system too, but all the pieces and parts are things that the consumer knows nothing about, has never heard of, except for maybe the tires. They might recognize the name of the tires, but they won't recognize any other parts and pieces in the car as independently branded. Our systems are different because our systems are a combination of subsystems and products that when combined together, are substantially better than the individual pieces. But the pieces still matter. Partnering in marketing with a company like Sony that has absolutely way more brand recognition than even a bigger Integrator like us is highly beneficial because the brands do matter. We're proud of the brands that become part of our systems. I mean, we show it prominently on our website. We explain why it's important. But the flip side of that is you can take a bunch of great brands and put them together and not have a good system. So that's why the AudioVisions brand is important. So they're both important.

Ron:  Jeff, when a piece of promotional tactic within the digital marketing strategy. Whether it be an email or a Facebook ad to give two examples; Go out and hit the consumer. Is it a fair statement that you're pretty confident they're going to recognize that name, Sony? And that's your goal, that was your whole reason for doing this? That's the magnet to get the click to help the Integrator?

Jeff: Absolutely. I think somebody that's in the market for a home entertainment system has likely heard of Sony before and may have had experience owning Sony products in the past. I think our goal when we created a marketing program that we work now was really to give the Integrator the opportunity to leverage their relationship with Sony in getting the click through or getting to contact me and getting that at that with the customer. So we utilize the combination of the Sony brand and whatever the bright shiny object of the moment is, whether it's a 100 inch TV or performance.

Ron:  While you're talking, Jeff, I'm going to show on the screen that our podcast listeners won't get the benefit here. You can check out the website, but I'm going to show on the screen some of the shiny objects some of that content looks like.

Jeff: Sure. So I think Ron, as we work together to kind of craft these things and over time kind of polish it to make them the most effective. I think we've realized that the combination of the Sony brand. The Integrator brand and the utilization of that object of desire. Whatever that might be. Really just increases the amount of interaction you get from the person who's seeing that ad or clicking through. That's really the goal. The goal was never to say, Mr. Integrator, now become a retailer and just sell a TV. The goal was, Mr. Integrator here is an opportunity to talk to a potential client that's interested in this technology or this product or this environment that we're showing in the ad, and that you're at that. If you sell the TV, great, but sort of shame on you for not taking that sale and wrapping all the other stuff you do around it. That's really the intent. It's not, Mark, please sell this TV. It's, Mark, please sell this job that the customer is interested in this TV.

Ron:  Jeff, what I'm showing on the screen is specifically an example of an email template. So if an Integrator is a diamond, again, for those that might be listening, go, I want to do this Sony thing that Mark's talking about and Jeff's talking about who's allowed to do this program? Because, unfortunately, funds are not unlimited as much as we wish they were. So it's finite. Who's allowed to participate?

Jeff: Yeah. So we have a large number of dealers at what we call our diamond level, and these are our top customers. It's a large number. I'm sure many of them are watching or listening to this now. Yeah, if you're a diamond dealer, you qualify for this program. And it's just very a simple matter of reaching out to your local rep or the regional manager and having a conversation. We're wide open for participation in this. The whole goal is to lift all boats. Right. And again, you don't need to be an expert in digital marketing to participate. You don't need to do actually very much to participate. We ask for very little involvement from the Integrator other than to provide us with a logo, provide us with if you've got an email list of contacts, you provide that to One Firefly, not Sony, by the way, so that they can manage the outreach with that list. Then if there's access to social media accounts and things like that, the whole onboarding process for this thing. What does it take, around a half an hour?

Ron:  I was going to say maybe less. I was even going to ping Mark. I know Mark, you delegated this to your team, but do you have and the answer could be, you don't know. But do you know how long it took your team to get onboarded to do the Sony thing, the Sony program? Approximately how long it took.

Mark: Very simple to me, because I just asked Jacqueline to.

Ron:  You just delegated it, make it happen.

Jeff: Like a CEO.

Ron:  A true CEO right there. I can tell you, it typically takes less than 15 minutes. The hardest part, and it is just a necessary evil, and that is Facebook. It's easy to hate on Facebook for many reasons. And also you have to love it. Because of its access to the population of the world and North America for better and for worse. And so by having that access to those large demographics, ie. You and your mom and your brother and your sister and your wife and your kids and your neighbors, it allows for pretty neat strategic targeting, which is why we do it. But there is a process to get usually a little bit of back and forth to get One Firefly access to that channel. It's not as easy as we might wish, but yeah, I'm going to pull the assets off the screen. Let me find my button here. And Mark, I wanted to jump to you just at a super high level. We're going to be wrapping up here pretty soon. We're possibly and maybe probably going into some type of downturn. It's not crazy folks, even if you're super busy for us to say that because the past is often indicative of what happens in the future. It's not a guarantee. But what is happening is the US government has been printing money at an outrageous rate. It has caused inflation. What is happening is the FED is increasing the prime rate or the FED rate and they're about to do another one, I think eminently. And typically when that happens a number of times, at least in our entire recorded history in this country, that usually triggers a recession and so that it probably will happen, but it doesn't mean that it will happen. That said, Mark, what are the folks that are listening, what would you recommend they do to prepare their business for what might be uncertain times?

Mark: That is...

Ron:  A big loaded question that I did not prepare you for in advance.

Mark: Yes. I think it's important to pay close attention to your work in progress and you have to pay close attention to your financials to see am I healthy? Am I borderline healthy? Make sure that costs are aligned with not only your current revenue stream but your predicted future revenue stream. If that's the one thing, that's one thing that's hard to do. But it's a lot easier to do than it is for a retailer because a retailer can't predict. We actually have the ability to predict and we have to be paying attention to it. So we have to be looking at all the leading indicators and not only just measuring your new signed contracts, but measuring your new opportunities. Are the number of opportunities slowing down? Well, if the number of opportunities are slowing down and the ratio of your opportunities to sign contracts remains the same, that means you're going to have lower signed contracts which eventually is going to be lower revenue. And so you have to be prepared for what happens when that revenue stream starts to reduce to remain a healthy company. One of the things that I think you really want to have is you want to have a potential stream of new opportunities that's bigger than what you need. And because especially when there's a downturn, some of those are going to go away. So doing a good job marketing when business is good is the right time to do it, not after it starts to go south. So right now is a really good time.

Ron:  What I also heard in the subtext there is financial management and cash flow management and cash flow forecasting and the modeling of the way your business works financially. You do that at AudioVisions and you've done that for a long time. And I have to believe that's one of the many reasons you guys are who you are. I know many people watching or listening may not be there. What coaching or direction or advice, how can they get there? If you were pulled up at a bar at CEDIA here in a couple of weeks in Dallas, and you had someone that had heard you or heard about you and they asked you that question, how could they ramp that up? What would they do? What advice would you give them?

Mark: Yeah. So if you're an entrepreneur that doesn't have strong financial acumen, then you should have someone in your company that does. So whether it's a director of finance, a finance manager, a CFO, whatever you want to call that person, that's an important person to have, for sure. And if you can't afford that because you're a smaller company, you can hire a fractional CFO. And I would recommend that. The other thing I would do is there's all sorts of outside resources. In our company, we refer to a term called Starkey Metrics. Paul Starkey has spoken a lot and written a lot. He has a great little book that is of great value, and he started Vital Management, which still exists now and is run by Matt Burnatt. Highly recommend you check that out. They give some really good advice, but it's important to just pay attention.

Ron:  Brilliant! Jeff, I have an opinion. I think you and I have the shared opinion. I just would love you to riff on this, that dealers often are sitting on a gold mine and that is their client list or their referral list. That often, and I can say this fairly objectively, is true, goes untouched or unaddressed. Like it's out of sight, out of mind. They're on to the next projects. They're not busy trying to talk to maybe their past customers. How should dealers be thinking about their contact list, their client list, and in order to work that in some way to help them grow their business?

Jeff: Yeah. I think we have seen really in action since we started this program. Going back and reaching out to those customers that you've worked with in the past and you've got still have them on your list and maybe you haven't talked to them in two or three or four or five years. Whatever it is. You know, they may be lifestyle enthusiasts. They may not necessarily be audio video enthusiasts. And the reality is, they may not be looking at what's new or what new technologies out there or whatever it is, and simply putting an email blast out there. We have seen dealers that participated with us literally go back to their client list with that email about the new TV or the new projector or whatever it is, and get a phone call. We have some examples where, call the email list, put an email blast out, and within the first five minutes after the email went out, got a phone call saying, hey, I really want that 100 inch TV. Let's talk about it. We have other examples where dealers have cited that they've done 80 to $90,000 in new business just by reaching out to a customer they haven't touched in a long time. We placed entire houses full of televisions and upgrades and things that would never have happened if that email never went out. So we know for sure that is a goldmine. And not only does it pay off just by reaching out and making them aware of something new or something to consider or upgrade, but those customers talk to other people that are potential customers. So it's a great way, to me, it's the most low hanging fruit, the most easiest to access, the least expensive to access, and it bears fruit, it really does.

Ron:  To prove your point, Jeff, and maybe this will be a punchline or not a punchline, but the finish line here for this chat, I'm actually going to share on the screen. Let's see if we can get technology to behave as I see it over here. There it is. I definitely didn't always put this on the screen, but I dug this up. This is an email, and we're good friends with Eric over at GHT out of Atlanta. So I'm pretty confident he doesn't have a problem with this getting shared. But this is an email from Eric to my team on August 26. This is a week or two ago. And this is Eric emailing his customers via the Sony program. And I'll read it for our listeners. Actually, I don't know what the first part says; yes, we did. We hit it. I'd like to do a replay of that one while 100 inches hot. I've copied Nick when we've done the 100 blast before. It made the phone ring more than any other campaign they've ever run. And actually, I'm a little sad because we've been doing his marketing a long time. It's not exactly what I'd want to hear, but it's a testament to the power of email and getting the right message out to your customer list, and that's saying a lot. This is one of the bigger shops on the East Coast, and for that campaign, hitting the email list, folks, do marketing, email your customers, be active on social media, update your website more than once every three years. Like, take your business seriously, because times are still good right now. And Mark, you started this off. You said, what goes up, goes down. The good news is, what goes down goes up. Right? Things run in cycles. So this isn't a doom and gloom podcast at all. It's just about the nature of things. There are business cycles and being active in marketing when times are good, it's just simply a good idea. So I'm going to close it there. Jeff, I'll throw it to you. Any closing words, sir?

Jeff: No, I think, Ron, what you just shared is really just the right recipe of brands coming together. The Integrator brand, the Sony brand, and that desirable product really causing the right reaction in the consumer that we're trying to reach. And this has been honed over the last two years to make sure we get those kind of results. Again, this is not about me chess pounding about how great the program is. This is about me saying to our industry, who I think needs to really up its game in terms of figuring out how to talk to the consumer in new ways. It's time to get active. It's time to do it. It's not an all to ran kind of situation. It's really central to success. And that's really my message.

Ron:  I was talking to a vendor contact just a couple of weeks ago, and she is newer to our industry. She's joined a big brand. Actually, I think you made that connection for us. And I was talking to her and she said she's entered this space and has been nothing but dumbfounded by the lack of marketing awareness in what she called this channel. She's like, it's weird for her that no one does marketing. Manufacturers don't do marketing, dealers don't do marketing. Everybody stuck with the referral. And she's like, if this industry is too advanced, that has to change. So I thought that was interesting. Just while I'm still with you, Jeff, how can people get in touch with you if they want to reach out after having watched or listened?

Jeff: Sure, if you want to contact me directly, This email address is being protected from spambots. You need JavaScript enabled to view it.. It's that simple. If you'd like to learn more about Sony's products and more information about what we sell and what we do, sonypremiumhome.com is a good place to go do some research.

Ron:  Awesome. And what if people want to come and see you at CEDIA? That's around the corner. What's the right protocol there just to hit your booth or do they call in advance?

Jeff: Definitely come to the Sony booth. Off the top of my head, I think it's 16001. How about that?

Ron:  Man! If you asked me to do that for One Firefly. I couldn't do it. I should be able to do it, but shame on me.

Jeff: The better news is we're just inside the main entrance, so I don't think you'll be able to miss us.

Ron:  Awesome. Mark, going back to you, sir. Any closing thoughts for our watchers or our listeners?

Mark: Yeah, I think two things. First is thanks to Sony for putting together this program, this marketing initiative. It does a lot more for, honestly, I think the Integrators than it does for Sony. And to Jeff's point is Sony might get a TV sale out of this, but the integrator guess it's very rare where you're just going to sell a TV. If you're selling a TV, you're selling a complete system and everything that goes along with it so can turn into a very substantial sale. And I think in the end run, Sony knows that by growing the integrator, they're growing their business in the long run. And I like that philosophy a lot. One closing thought on marketing and the importance of marketing when times are good so that you have lots of opportunities later. I've heard a lot of integrators say it's crazy to market now. I have more business than I can handle and that's probably true. But it's always nice to have more business than you can handle so that you can say no to much of it and it allows you to pick and choose the projects that you're going to do and the clients that you're going to work with. And that is a luxury to be able to do that. And it's good for your business, it's good for your employees. It's good for everybody.

Ron:  To jump on that point, Mark, it's fair to say, may be obvious to say every project is not equal. Every customer is not equal. Every dollar is not equal. I know the US dollar is fungible, so a dollar equals a dollar. But everyone listening here knows there are good dollars and there are really, really hard earned dollars. If you have an abundance of leads, it's really neat to be able to say yes to the best type of customer or the best type of business for your business. Mr. Mark, how can folks get in touch with you? They want to follow you. They want to follow AudioVisions. How do they do that?

Mark: Yeah. So our website is audiovisions.com and from there you can find us on various social media platforms as well. And if you want to reach me directly, my email is This email address is being protected from spambots. You need JavaScript enabled to view it..

Ron:  Awesome! Mark, thanks to you. And Jeff, thanks to you for joining me here on a special episode, show 224 of Automation Unplugged, gentlemen, it was a pleasure having you on.

Jeff: Thank you so much.

Mark: Thanks!

Ron:  All right, folks, and there you have it, two industry veterans. Those are wise folks that have seen a lot. They've been through ups and downs in the economy. This is not their first rodeo because I run a marketing agency. I love that our thoughts and goals and vision to how to help integrators are very neatly aligned. That's just convenient. Wasn't certainly designed that way. But it's very convenient that the idea of making your brand your business. Your integration firm. Making your brand top of mind for the people in your marketplace that matter. Those influencers. That trifecta that Mark talks about. That architect, that designer, that builder. It's simply a good idea that you're the first name that comes to mind when they think about technology in the home. And Jeff didn't mention this exact fact. It could be maybe considered bragging, but Sony is considered one of the most recognized brand names in the world. And there's a survey and I'll in fact reach out to Jeff and I'll get that survey as a reference, but it is one of the most recognized names. It's right up there with Nike and Apple as the best and most recognized brand names in the world. So the idea is, how can you raise the awareness of your business? Because if things do get a little weird, get a little sideways, everybody's not going to go out of business. But I'm going to invert that some people are going to go out of business and those customers need to go somewhere. And wouldn't you want them to come to you? Or wouldn't you like to have an abundance of leads and opportunities and be that strong firm in your marketplace? Well, the way to do that is increasing your visibility. The way you do that is by either in house or through partnership, working on your marketing, working on your websites, working on your email programs, curating your email list and deciding what message gets sent to list A versus list B. For example, maybe you have clients in one list and maybe you have your trade friends in another list. Like, that's a simple and smart way to think about segmenting your marketing and then looking strategically at all of your channels. You have LinkedIn, you have Facebook, you have Instagram, you have, dare I say, Snapchat or Pinterest. You have the plethora of platforms out there. And my advice to all of you is to be really good at one platform. And only when you're really good on that platform do you go to platform number two. You're not helping yourself or really anybody by pretending you're active on six platforms. You're not faking it. In fact, I would challenge you're harmed if people go check you out and they see your last Twitter post was in 2015. Doesn't look good, right? So why pretend you're active on Twitter if you're not? It's been a pleasure working with Jeff. Jeff came on here. He and I were frankly brainstorming of how to help the industry because we know many people are harmed and going to be harmed in the coming period, or at least potentially. We don't know it definitively. I do have a magic eight ball and it didn't give me the right answer, but I did ask it. But I think it's possible that things get weird. So it's better to be prepared, the secret to success is in the planning and preparation, it's not in the action in the moment. So what are you planning and preparing your business to be successful should things get a little weird? And with that said, I'm going to sign off as I always do. I would love if you would go into your favorite podcast software and like or subscribe to the Automation Unplugged show. That way we can drop into your phone every week with the latest and greatest shows. And on that note, I'm going to sign off and I still have the gentleman down here on my screen. Don't leave guys, I'm going to come back to you in just a minute but to all of you out there, I'm going to say goodbye. I'll bid you at due and hopefully you join me next week for another show. And if you're going to go to CEDIA, make sure to stop by and see us. We are going to be there in force. In fact I'm bringing all of my fireflies to Dallas. So on Thursday morning you are going to see lots and lots of fireflies buzzing around the show. Until then, I will see you all later. Bye.

SHOW NOTES:

Mark Hoffenberg founded AUDIOVISIONS in 1989, and led the company’s rapid growth to becoming one of the nation's largest and most respected home automation companies. In 2005, Mark directed the acquisition of AUDIOVISIONS to Best Buy, the world's largest consumer electronics retailer. For the subsequent 9 years following the acquisition, he served as Vice President of Services for Best Buy while remaining President of AUDIOVISIONS. In 2014, he successfully navigated the re-acquisition of AUDIOVISIONS from Best Buy. Today, Mark leads a talented team of nearly 100 employees in four geographic markets from Orange County to the San Francisco Bay Area in California. He is responsible for the company’s overall vision, business strategy, partnerships, ventures and key initiatives.

As head of sales, Jeff Goldstein oversees Sony’s relationships with leading audio and video integrators. With decades of Sony experience in numerous executive-level positions, including director of sales for the Consumer Integrated Systems division, as well as vice president of marketing for the company's Home Audio/Video and Television divisions. He most recently served as a strategic consultant to premium custom installation and optical companies, helping to expand their distribution channels, and refine customer engagement. Jeff brings deep experience in product development and planning and was instrumental in creating Sony's home theater projector line, as well as driving custom integration features for Sony ES, Home Video and TV products.

Ron Callis is the CEO of One Firefly, LLC, a digital marketing agency based out of South Florida and creator of Automation Unplugged. Founded in 2007, One Firefly has quickly became the leading marketing firm specializing in the integrated technology and security space. The One Firefly team work hard to create innovative solutions to help Integrators boost their online presence, such as the elite website solution, Mercury Pro.

Resources and links from the interview:

Jeff can be reached directly by email at This email address is being protected from spambots. You need JavaScript enabled to view it. 

Mark can be reached directly by email at This email address is being protected from spambots. You need JavaScript enabled to view it. 

 

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