Battlefield Video

Isaac Goren, owner of Sounds Good Stereo, Woodland Hills, CA, had been involved in the battles over mobile electronics for more than 23 years. So you know he's got plenty of war stories. And, unlike your grandfather's age-distorted accounts of his days overseas, you should pay attention to Isaac's.

He was already well established in the Los Angeles area market when the vehicle security business witnessed its boom in the early and mid-1980s. He can recall the heady days when a specialty mobile electronics retail shop could charge $500 to $600 for a good alarm system (installed, of course).

Then the fly-by-night and hack shops, mass merchants, and detail shops got involved and forced the price of alarm systems installed to an unreasonable $200 or less. What happened? Those of you who were in the wars back then remember that these shops performed shoddy installations and used short cuts in their installation process in order to cut down on installation time. Consumers thought they were getting a bargain and specialty shops began to educate the public with the notions that you "get what you pay for."

Well, Goren says that he is experiencing déjà vu, and he doesn't like it in the least. This time, however, it is the audio/video category that is being attacked. And he is once again advocating to the industry-no, actually screaming-the need to educate consumers that you "get what you pay for." In short, it is time once again to man the barricades against the hackers.

VIDEO REWIND

Goren claims that the audio/video category accounts for about 15 percent of his total sales. He said that is up from only five percent last year.

Since he has been in the field of mobile electronics for more than 20 years, he has seen the evolution of audio/video in the industry from the beginning. He noted that audio/video first started out when innovative custom shops were taking home video products like VCRs and televisions that run on 110 volts and putting them into vans. "Fifteen to 20 years ago, shops were building cabinets to hold home televisions for vans and they used the speakers on the TVS," he says. " Installers figured out how to put in inverters so that the home equipment could work."

The evolution of audio/video products was the result of a consumer-based demand, he continues. "Consumers demanded the products, specialty shop installers figured out a way to give it to them, then the manufacturers saw a need and offered products," says Goren.

HE notes that Audiovox was one of the first companies to offer 12-volt videocassette players. Then came LCD monitors that were easier to install than the home televisions, and the DVD and surround sound processors. "Now we are integrating navigation into audio/video," he continues. "There's DTS 5.1 surround and 5.1 Dolby digital surround sound. We are putting center channel speakers into the dash, adding more and more amplifiers and subs, and tying audio to video. Twenty years ago we were putting cumbersome antennas on the roofs of vans. Now we are hiding antennas inside the vehicle for TV tuners and putting satellite antennas that track the satellite as you drive on to vehicles. We have come very far very fast."

PROTECT YOUR IMPORTANT PARTS

Goren warns that today the market is saturated with products. "It is only the beginning," he says. "In the next two years we will see a tremendous distribution of monitors, DVD players and changers, VCRs, wired and wireless headphones, and switching devices. LCD monitors will come pre-fab'ed into headrests. All one will have to do is remove the factory headrest from a seat and then slide the new pre-fab'ed headrest, complete with monitor, into place. The whole installation process will plug in. As this happens, prices will drop tremendously and new fly-by-night hack shops and detail shops will get into it and take short cuts in installing products. These shops will sell directly to consumers and to car dealerships so that consumers can incorporate the costs into the financing or leasing of the car.

"Distributors are already selling to anyone who wants products," growls Goren. "They are selling DVD changers fro $329, hi-fi VCRs and tuners for $139. The distributors are bringing in very inexpensive components. Specialty shops will need to make the consumer aware why one shop is charging $1700 for a flip-down monitor with VCR, while another shop is selling supposedly the same thing for under $1000. Specialty shops need to educate consumers about the differences in quality between products and installations."

Goren counsels that the educations process for specialty shops needs to concentrate on the two key elements involved in the audio/video category-equipment and installation.

TUTORING ON PRODUCTS-THE BATTLE PLAN

Goren advises that the battle plan for specialty shops is to speak up about the differences in quality between products. They need to explain that these products must overcome a variety of potential problems that home entertainment components don't have to worry about. For example, a vehicle is subject to major changes in temperature. Parked in the sun on a hot day, the interior of a car can reach temperatures up to 100 degrees. Then, in just seconds when the car is driven with the air conditioner on, the interior temperature can drop to 70 degrees or lower. Moisture can be a result of these extremes, which can have an impact on the performance of video products unless these products have moisture resistant features.

Goren also points out that there are differences in the way components are hooked up. For example, there are products that have only mono connections and products that feature stereo connections. There are differences in the quality of the cables that are used, and there can be a problem of interference because installers are dealing with floating ground, a battery, and on-board computers. "All of this can cause interference in an audio/video product," says Goren.

Moreover, different technologies are being used on some products that cause the comparison apples to oranges. For example, there are infrared headphones and radio frequency headphones, wireless headphones and wired headphones, infrared remotes, and radio frequency remotes. Some products have on-screen menus and directions while other versions of the same product do not.

In addition, some products may lend themselves better to stock-looking cosmetics than other products. For example, some monitors flush mount better to roofs of vehicles, on to the back of headrests, or on to visors better than others. Moreover, the angle at which a monitor may have to be installed can cause problems in viewing the picture. So, it is more advantages to have monitors that allow the user to adjust the contrast, In addition, specialty shops should ballyhoo their ability to customize installations. They can give the consumer what he or she wants, while a fly-by-night hack shop, detail shop, or even mass merchant just gives their consumer a take-it-or-leave-it design.

Goren encourages shops to set up displays that show the differences in the quality of video products. "If you put a $200 monitor next to a $1000 monitor, you will definitely see a difference in the quality of the picture," he says. "The difference is even evident between a $200 monitor and a $400 monitor."

Have demonstration vehicles with audio/video products in them to show off both the quality of the product and the store's skill in installing the product so that it looks stock. Have an album of photographs taken during installation of video products to show the quality of the installation.

SHOWING OFF YOUR VIDEOS (WELL, NOT THOSE VIDEOS!)

Goren suggests that a specialty mobile entertainment shop adopt a "Good, Better, Best" merchandising philosophy. "Go ahead and offer the inexpensive products," says Goren, "but make sure you install them properly." He also notes that the inexpensive products on display next to the better products will help promote the issue of quality. You know, "in-your-face merchandising." "This will help to sell the better products because customers will see the quality differences between level one and level two," says Goren.

The middle level products can be equipment that's reasonably priced and integrates well with the vehicle. This level of product can also prove ideal to sell to the car dealerships. Goren suggests that products from Audiovox can fit this category.

Goren identified products from Alpine, Eclipse, and Clarios as the top-of-the-line. He cautions that you probably won't sell very many of the top products, but just having them sets you apart from the rest of the market (and add that certain coolness to your store.)

Goren predicts that most customers will select the middle-level array of products. "The driver isn't watching the video, so he doesn't care as much about it. However, he will be listening to the audio and will therefore spend extra money on products that enhance the audio-head units, processors, better speakers, and amplifiers," he says.

Finally, when you quote a price to a customer, Goren suggests that you break it up and quote a price for the products and a separate price for the labor. This way if the customer wants to price shop, he can see the difference in the labor costs and make a more intelligent decision.

Remember: an informed customer is a smart customer.