The ADT dealer program has 2 major ways of handling customers. First, and most common, dealers sign customers into long term ever green (auto renewing) agreements and then sell these contracts to ADT for a 30+ multiple. The second, and far less common, are in-house accounts where the dealer keeps ownership of the contract and pays ADT a nominal monthly monitoring fee to monitor the account.
If a dealer is terminated from the program their in-house accounts need to be transferred to another monitoring center and the sold accounts remain the property of ADT (though ADT requires all sold contracts to be subject to a 12-15 month chargeback period, where if the account cancels the dealer must pay back a prorated portion of their proceeds).
That's what is funny about dealer programs. Not just ADT. This has been going on for years, not just with the Defenders program either. Without the dealers there is no way ADT and others could do the volume of new accounts that are brought in by dealers.
Although we currently generate accounts through hundreds of independent, third party authorized dealers, a significant portion of our accounts originate from a smaller number of such authorized dealers including one of our authorized dealers that signed a 5-year renewal agreement as a premier provider with us in 2014 and accounted for approximately 19% of all our new accounts.
a significant portion of our accounts originate from a smaller number of such third parties, including an authorized premier provider that signed a nine-year renewal agreement with us in December 2017 and accounted for approximately 25% of all our new accounts in 2017.
It's worth noting that according to this 2016 article in SDM, three of ADT’s largest authorized dealers, SafeStreetsUSA, Gaylord Security, and ASC Security USA, merged their businesses and began operating under the name SafeStreetsUSA. I'd bet these mega dealers have some mega pull with ADT.
This has been going on for years. Not just this particular dealer either. Not sure anymore but I assume it is the same as it always been. There is big time money in selling an alarm contract to a company like ADT or whichever company you are a dealer for. I used to play in this market years ago. I have seen some shady stuff go on when I have worked for a company that was a dealer. The sales people at this level are typically the scum of the earth. They make used cars sales look like angels. I remember hearing about a salesmen at a house and he waived a bible in the air and over the head of a customer while dancing around claiming he found religion and of course did this as this was what the customer wanted to hear. Actually if he would have not done the bible waiving and dancing around the customer probably wouldn't have complained so much about him.
Dealers like the "Defenders" go through sales people in droves. Everyone they hire is always good for a few sales. There is an enormous amount of pressure put on them to "Sell, Sell, Sell, Sell"!!! Forging signatures with some dealers is standard practice especially if they have small offices around the country. I know some that even somehow forged credit scores for customers so they would still get the sale to go through.
Companies like ADT will never scrap their dealer programs as it makes way too much money for them. It's all about the numbers.
What dealers have done in the past is sell the contract to monitoring company "A" then after the three year contract is up them go back and switch them to company "B". With this method they would get their 30+ multiple every 3 years.
I could go on for days with some of the shady things that I have seen.
One thing is for sure is that the ADT brand and their advertising still works. They are like Kleenex for tissues. If a person needs a security system and they don't no any different they will automatically call ADT because they have been bombarded with the ADT advertising, whether corporate or dealers.
Hey when Ving Rhames stands outside your house and says you are protected why wouldn't you get an ADT security system.
When I bought my house, I got NINE direct-mail letters from ADT begging me to buy a system from them, aside from coupons in the mover packet the post office sent me. Barnes said at ESX a couple of years that ADT's customer acquisition cost is scary high, and I believe it.
I haven't gotten robodials in a while but I still do get the occasional door knocker. If the "kid" appears to be honest, you can always tell by how they present themselves and how nervous they are, I tell them how long I have been in the industry and that I already have a system and can do it myself. When you come across a shady door knocker they will still try and convince you to switch the monitoring to their company no matter what you say. Seriously punk!
I still do get the occasional door knocker. If the "kid" appears to be honest, you can always tell by how they present themselves and how nervous they are...
Mr Davis: [Answering the door] Can I help you?
Ron from ADT: Hi, Mr. Dahvis, my name is Ron and I’m from ADT. How you doin' this morning?
Mr Davis: It's Davis, and I'm not interested.
Ron: Okay, I'm sorry to have bothered you. Have a nice day.
Mr Davis: Wait a minute. Wait, that's your pitch? You consider that a sales call?
Mr Davis: You know, I get a visit from you guys every other month and it's always the same half-a**ed attempt. If you guys wanna close me, you should sell me. Start again.
Ron: Okay. Hi, my name is Ron and I’m from ADT. How you doin' this morning?
Mr Davis: Crappy. What do you want?
Ron: It's not what I want, sir. It's what you want.
Mr Davis: Ron, now we're talkin'. All right. What are you selling me?
Ron: I'm offering you a subscription to ADT at a substantially reduced price. We're trying to reach out to people that have never had a home security system before.
Mr Davis: Right, so, basically, everybody who already has a system is getting screwed on this one? ...All right, well, I can handle that. So, tell me, why should I buy your system? I mean, why shouldn't I get Brinks or that SimpliSomething, you know?
Ron: Well, ADT offers you something no other system can: authentic ADT signs. We have the most recognizable signs, only available to subscribers, on lawns everywhere, more than any other security company in the country. Plus the hardware’s free. Now what do you think?
Mr Davis: You know what I think, Ron? I think that was a sales call. Good job, buddy.
I just got off the phone with a employee candidate and one of his first questions was there any upselling. I said no, we do commercial projects and these deals are negotiated long before the project goes in. He said good, he didn't like that, he just wanted to install. He also told me he was fired since his sales numbers were low.
He was an INSTALLER and he got fired due to low sales #'s?
I looked down and guess who he worked for? lol
The more I read stuff like this, it confirms my decision to abandon our residential alarm efforts. Cant compete with 5 camera/alarm/doorbell/door lock bait and switch packages for $40/month
About two years ago I had an ADT salesperson come to my house who promised a security and camera system for $48/month. But there were too many negative reviews and I was able to cancel my installation appointment with ADT after a couple of days.
Having done much further research, I decided to buy a Simplisafe system which I installed. Now, Simplisafe has upgraded their products, which have no backward compatibility with my system. So, I cannot add or update, but only replace. Thanks Simplisafe. Is that how you treat your early customers who made you successful?
Thankfully, my system still works so I do not need to replace it, yet!
Personally I thought "The Defenders" was the perfect culmination of the Daredevil, Iron Fist, Jessica Jones and Luke Cage series. Sorry Netflix cancelled them all as I really wanted to see "The Defenders Season 2"!
The question is are they locking the customer into a lease with that contract and a payout at the end or they threaten to take out the equipment if they quit paying? Is ADT still operating that way. When I used to work in residential years ago when and we were taking over a system and the customer informed ADT they were cancelling ADT would then a service call was placed saying they needed to turn off the system. What actually happened was ADT would come out and pull the door contacts out and stretch the wire as tight as they could and then cut it off. Same with the rest of the devices and panel as well.
I got into a confrontation with a tech once and he threatened to call the cops on me and the customer. I then said call the police and promptly informed him that he had no right to remove anything from the customer's property that was affixed to the structure under Kansas law at the time. After a call to his idiot boss he the then packed up his gear at got the heck out of there. Of course my work was then much harder than it was supposed to originally as now I had to reinstall the system.
Back then some of the leases were never ending similar to how a customer with a Ma Bell rotary phone paid thousands over the life of the phone. Now if we could only build stuff like that anymore.