Eliminate Sales and Marketing

Author: John Honovich, Published on Sep 30, 2008

10-20% of all spending on video surveillance goes to sales and marketing costs yet customers find great difficulty determining the best solution for their needs. The solution to this, just like in stocks and real estate, is to eliminate traditional sales and market, replacing it with online tools and information sharing. While a complete elimination will never be productive, significant elimination is a very valuable goal for consumers and society.

High Costs

Though not generally examined, sales and marketing costs in video surveillance are very high - far higher than in other business like real estate and stocks.  Take the costs of manufacturers for sales and marketing organizations (often 6 to 12% of the manufacturer), add in the integrator's (often 3 to 6% of the product cost) and often the manufacturer's rep (often 2 to 3%), and you easily have 10% - 20% of the total end user price going to sales and marketing.

For end user, that means they are essentially paying tens or hundreds of thousands of dollars for sales and marketing efforts.  The dinners and the demos and the on site visits are nice but I doubt hardly any security manager would view this as worth the cost.

Collectively, this results in $1 Billion in inefficiencies (assuming the video surveillance market is $10B according to industry estimates). Given the market is expected to triple or more in the next 5 years, the total 'waste' could rise to billions of dollars.

Poor Results

Despite this enormous spending, figuring out the best solutions is incredibly challenging. Does anyone really know, with confidence, what the best solution is for them, out of the dozens of products available?  And if you do, do you really know why its better than other alternatives?  The more I have researched and talked with dozens of vendors and analysts, the more I realize how difficult and crazy this whole process really is.

Basically, everyone is forced to make the best decision with very limited information.  The sales and marketing efforts of vendors is focused on their own products with minimal understanding of competitors.  Because of the difficutly in acquiring and vetting information, almost all integrators and analysts must focus on a small set of products. Indeed, big conglomerates actually take advantage of this problem using their channel power to drive revenue at the expense of their customers.

At the end of the day, you make your product choices and hope they are the best, despite the very limited information available.  Most end users get solutions that are sub-optimal and a small but significant minority have projects that blow up.  All as a consequence of the difficulties of getting good information.

Online Alternative

The Internet, industry by industry, is fundamentally blowing up traditional sales and marketing, replacing it with online tools that empower end users to learn and specify directly.  This transition is complete with stocks, where transaction fees have dropped $50 to $5 in the last ten years.  We are currently in the midst of similar transition in real estate where the traditional 6% commission fee structure is being attacked from multiple fronts.

Given the high costs and the poor results of sales and marketing in video surveillance, it is inevitable that the same transition will occur in our industry. The pain is there and it's certainly technologically feasible to enable such online tools. Indeed, the goal of this site is to help enable this future.

There is a lot to be discussed on this theme, but let's start with this question: Do you think the costs are high and results are poor from video surveillance sales and marketing?

2 reports cite this report:

How to Cut Costs Using the Internet on Jan 03, 2009
The recession is forcing broad reductions. Worse, the era of excess consumer spending is over. In response, most business around the world, whether...
Should Manufacturers Sell Direct to End Users? on Nov 09, 2008
An insane idea today will become reality over the next 10 years. Driven by the Internet and accelerated by the recession, the role of the...

Related Reports

Hikvision USA Starts Layoffs on Sep 18, 2018
Hikvision USA has started layoffs, just weeks after the US government ban was passed into law. Inside this note, we examine: The important...
Favorite Intercom Manufacturers 2018 on Sep 14, 2018
Intercoms are certainly increasing in popularity, driven by the integration of video and IP networking. But who is the favorite? On the one side,...
VMS Export Shootout - Avigilon, Dahua, Exacq, Genetec, Hikvision, Milestone on Sep 13, 2018
When crimes, accidents or problems occur, exporting video from one's video surveillance system is critical to proving incidents. But who does it...
Ambarella on Computer Vision and US Hikua Ban on Sep 10, 2018
Ambarella, a widely-used video surveillance component supplier, is betting on the rise of computer vision and is already seeing a sales impact from...
IP Camera Cable Termination Guide on Sep 06, 2018
Terminating cables properly is critical to network performance, but it can be a tricky task with multiple steps. Fortunately, this task is easy to...
Dell Launches IoT for Surveillance on Sep 05, 2018
Historically, Dell has been a PC and server provider (e.g., "Dude, you're getting a Dell") and widely used for surveillance storage. However, in...
IP Camera Cabling Installation Guide on Aug 29, 2018
IPVM is preparing the industry's first Video Surveillance Installation book and our upcoming Video Surveillance Installation Course. We have...
Hikvision FIPS 140-2 Cybersecurity Certification Examined on Aug 27, 2018
A week after the US government passed a law banning Hikvision, Hikvision announced it had obtained a FIPS 140-2 certification from the US...
Ligowave Wireless Profile - Ubiquiti Competitor on Aug 27, 2018
Ubiquiti has become the most common choice for wireless in video surveillance (see Favorite Wireless Manufacturers) but not without controversy and...
SNMP / Network Monitoring For Surveillance 2018 on Aug 21, 2018
Surveillance systems typically rely on the the VMS to report issues, but this most often just means knowing a camera is "down" with no warning or...

Most Recent Industry Reports

Alexa Guard Expands Amazon's Security Offerings, Boosts ADT's Stock on Sep 21, 2018
Amazon is expanding their security offerings yet again, this time with Alexa Guard that delivers security audio analytics and a virtual "Fake...
UTC, Owner of Lenel, Acquires S2 on Sep 20, 2018
UTC now owns two of the biggest access control providers, one of integrator's most hated access control platforms, Lenel, and one of their...
BluePoint Aims To Bring Life-Safety Mind-Set To Police Pull Stations on Sep 20, 2018
Fire alarm pull stations are commonplace but police ones are not. A self-funded startup, BluePoint Alert Solutions is aiming to make police pull...
SIA Plays Dumb On OEMs And Hikua Ban on Sep 20, 2018
OEMs widely pretend to be 'manufacturers', deceiving their customers and putting them at risk for cybersecurity attacks and, soon, violation of US...
Axis Vs. Hikvision IR PTZ Shootout on Sep 20, 2018
Hikvision has their high-end dual-sensor DarkfighterX. Axis has their high-end concealed IR Q6125-LE. Which is better? We bought both and tested...
Avigilon Announces AI-Powered H5 Camera Development on Sep 19, 2018
Avigilon will be showcasing "next-generation AI" at next week's ASIS GSX. In an atypical move, the company is not actually releasing these...
Favorite Request-to-Exit (RTE) Manufacturers 2018 on Sep 19, 2018
Request To Exit devices like motion sensors and lock releasing push-buttons are a part of almost every access install, but who makes the equipment...
25% China Tariffs Finalized For 2019, 10% Start Now, Includes Select Video Surveillance on Sep 18, 2018
A surprise move: In July, when the most recent tariff round was first announced, the tariffs were only scheduled for 10%. However, now, the US...
Central Stations Face Off Against NFPA On Fire Monitoring on Sep 18, 2018
Central stations are facing off against the NFPA over what they call anti-competitive language in NFPA 72, the standard that covers fire alarms....
Hikvision USA Starts Layoffs on Sep 18, 2018
Hikvision USA has started layoffs, just weeks after the US government ban was passed into law. Inside this note, we examine: The important...

The world's leading video surveillance information source, IPVM provides the best reporting, testing and training for 10,000+ members globally. Dedicated to independent and objective information, we uniquely refuse any and all advertisements, sponsorship and consulting from manufacturers.

About | FAQ | Contact