Low Cost, Low-End Competitors Challenge SMB Surveillance Market

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Brian Karas
•Published Sep 01, 2017 12:31 PM

SMB video surveillance systems are a tough market.

From IPVM's new survey results of 135 integrator responses, we have identified the key challenges here.

Cost Is King

SMB customers are extremely price sensitive. There were 4 main challenges related to cost that integrators found when selling SMB systems:

  • Low price products
  • Low-end competitors
  • Low margins
  • Unrealistic customer expectations

Additional detail on these is found below.

Low ***** ********

**************, *********** ****** **** ****-**-***-****** ***** trends **** **** ***** ******** **** SMB ********* ***********. ********* **** ******* on ****** (***** *** *** ****** be *********, *.*.: ****** ***** ** ********* ***** *******) ** ******, *** ****** *********** to ******* **** ***** ******.

  • "****.... **** ****** ******* **** **** and ****** *** *** *** *** system ** ** **** ****."
  • "****. ** *** **** ****** ******* systems ****** ** **** ****** **** sets ***** *********** *** **** **** below **** * ************** ********* ****** would ****."
  • "*********** ******* ************, ************ ** *** labor ****."
  • "******* ***** ******, **** **** ** see ********** ** **** ******* *****"
  • "****** *** ******* ** ************."
  • "* ***** **** *** ******* ***** focused **** ** **** *** ****** clients *** **** **** ***** *** features *** **********."
  • *****. ***** *** ** ******* *** going ** *****/****** ********** ***** **** want *******, *** ****** ***** ** a ******** ******** *** **** *****'* match **** *** ***** ***."
  • "**** ******** *** * ****** **** size **** ****** ****** *******. ***** price *****"
  • "***** **'* *** ***** ***** *** they ***'* **** ** **'* ********* or * **** **."
  • "****. ******* ********* *** *** ***** over * *** *** ** ** your ****-*** ****."
  • "****, **** *** ****** ********* ******* and ******** ** **** ***** *****."
  • "**** ** ******."
  • "**** ** ********. ***** **** *** pricing ** ****** *** ****** *** believe **** ** **** **** ** high **** ************."
  • **** *** ******* **** *****"

Low-End ***********

***-**** ****, *** ********* ********** **********, make ** **** *** ***** *******, at ***** **** ** **** ******** experience, ** ****** "***********". **** ***********, with ****** ********, *** ********* ****** paid *****, **** ** *********** ** compete **** ***** ******* ** *** bids.

  • "*********** **** *** ***** ***** **** products"
  • "**** ** ********* ** ***** ************* key ****** (*****, ***, ********, *** ecc), ** **'* **** ** *** them ********** *** **** ******** ***** 2 ***** **** * ***********'* *****/********* 2series."
  • "*** ******** ********, ***** ** ** providers ****** ** *** *** ************."
  • "******* ********* ** ***** * **** integrator * *** ** ***** ** our ***** **** ** ****** ** well ** *** *******. **********'* **** a *** ** **** *** ******** your ******* ******** ****** **** ***."
  • "***** ****** ******* *** ** **********"
  • "***********. **** ** **** ***** ** smaller ******* **** ** **** *********** and ****** ****"
  • "*** **** *********** **** ****** ****** gear *** ****** ************"
  • "*********** **** ***** ******* ** *** market."
  • "***********. ***** *********** ** **-*** *** do **. ** *****, ****'* **** they *******."

Low ******* ***** ****** **** *** *****

***** *******, **** ***-**** **********, ***** integrators ****** **** *** ***** ** unforeseen ************* ** *** ************. ****** to **-***** *****, **** **** ******* networks, ** **** ****** ******* ****** quickly *** **** ********** *******.

  • "**** ** **** *****. *** **** put ****** *** ** * ***** estimate ** ***** **** **********. **** they **** **, ** **** ****/*****."
  • "******** ****** ** ******* **** * greater ****** ** *** ******* ** there ********* ****'* * *** ** hours ***** **** ***** ********.
  • *** ***** ********* ********"
  • "*** ******** - **** **** ** get *** ***** ** ****** ******* and ** ****. ***** ******* ** "homemade" *** ** *** ****** ***** ownership."
  • "*********, ** **** ** ******* *** network ************** ** ******* ** *** they ***'* **** * ** *****, so ** *** ** ****** ** configure ***** ******* *** ** ******."
  • "****´** ***** ****** ********, ** *** issue ******* ** *** ************ ******* could ** * *******. **** ************ must ** */* *** ** ** least * *** ** ****."

Uneducated / *********** *********

********* ********* ***** ****, ***** ********** increases ***** *****. *** ****** **** this ** **** ** * *******, but ** ***-****/***-****** **** **** *** make *** **********'* ******* ******** **** profitable.

  • "******* *** *** **** ** ********** that ** *** ** ** * level **** ******, **** **** *****."
  • "*** ******* ******* *** *********** ************ of *** *********. **** ****** "*** type" ** ***** **********."
  • "**** ****** **** ****** ********, *** with ****** *******; **-******. ******* **** the ** '*******' *** *** **** minimal ******** *** **** * ****** of ****** ** ***** ******* ********."
  • "******** *** ********'* ************ ** *** camera's *******. *** ***'* *** *** at ***** ** *** ******* ****** of **** ******** **** * $*** mini ****."
  • "****** ********** ** **** *** ****** performance. **** *** *** ******* *** a ****** ***** $*,***, ***** ** not **********. *** **** ****** ** like ******** *** ************."

Cyber ********, *********** *** *********

**** ** *** ********* ********* ***** security ** * ******** ****** ** these *******. ** ****, ******* **** resolution, ***-***** ***********, ** ******** ****** basic ******* ** ****** *** **** back ***** **** *** ****** ** key ** ***** *********.

Driven ** ************ ***** ****

*** *** ****** *** **** ****** over *** **** * ***** ** significant ************ ***** ****. *** *******, back ** ****,** ********:

** **** $*** ****** *** (*) 720p ** ** ** ******* **** a * ** *** **** * built ** *** ******, ** ** anabsurdly ***********. [emphasis added]

***, ** ****, **** **** ***** the ******* *** ***** *** ********** are ********* *** **%+ **** (*.*., $399 (*) ***** ****** ****).

**********, *** *** ****** **** ******** **** trend as **** ** ********* *** ******* to **** *** ***** ******. *******, IPVM ** ****** ********** ************ *** suppliers (**** ******* ****** *** *** their ****) ** ******* **** **** and ********** *********** ** ******* ** exit *** ******, ***** ***** ******* this *****.

Comments (7)
UM
Undisclosed Manufacturer #1
•Sep 01, 2017

Not exactly news at this point as this seems to have been one of the top hot topics for several years now (subjectively).

The back to back comments:

"They expect "CSI type" of video recordings."

"They expect NCIS camera features, but with Costco pricing; go-figure"

.... have been the joke for how long now....?

Let's Enhance .... 2009

Only way to make some money and have a real business without being a trunk slammer is to make sure SMB is not your only market. Up your game, up your capabilities, up your service for those willing to pay for it, and just do it better or find something else to do.

 

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JH
John Honovich
•Sep 01, 2017
IPVM
In reply to Undisclosed Manufacturer #1

one of the top hot topics for several years now (subjectively).

Yes, certainly subjectively so. That's why we do surveys and run statistics to ensure that the actual trends reflect (or not) subjective statements.

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UM
Undisclosed Manufacturer #1
•Sep 01, 2017
In reply to John Honovich

Yes, and don't get me wrong. I wasn't trying to say the survey had no use. They are good for both informing the market, and sometimes reminding the market, of what the trends and realities are. I love the surveys, and not just because they save me a few dollars on my subscription. :)

Avatar
Brian Karas
•Sep 01, 2017
IPVM

Added a short section on things NOT mentioned as well:

Cyber Security, Performance Not Mentioned

None of the responses mentioned cyber security as a decision factor in these systems. As well, factors like resolution, low-light performance, or features beyond basic ability to record and play back video were not listed as key to these customers.

 

(2)
UI
Undisclosed Integrator #2
•Sep 01, 2017

One of the arguments I hear back from customers when challenged on the dangers of not paying attention to Cyber Security are " I don't care if the Chinese Government want to sit there watching my cameras!" 

I have to wonder if they are as blase with their IT systems as they seem to be with their Surveillance systems. I think the industry has a steep mountain to climb to educate SMB customers on the benefits of a system that addresses Cyber Security and whilst this type of mentality towards protecting yourself exists :

worlds-common-passwords-revealed amongst a frighteningly large proportion of the population , I wonder if the message will ever get through?

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UM
Undisclosed Manufacturer #1
•Sep 01, 2017
In reply to Undisclosed Integrator #2

I think the industry has a steep mountain to climb to educate SMB customers on the benefits of a system that addresses Cyber Security

This is the mountain. Good luck.

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Avatar
Daniel S-T
•Sep 03, 2017
In reply to Undisclosed Integrator #2

I think it's up to the industry. For the most part, in my own personal opinion, people care about cyber security with the IT stuff, because the IT people are trained to care about it.

Although I had no real formal training in this industry, there was never much of an emphasis on cyber security. I mean hell open just about any alarm panel in the areas I've worked in, and you will probably find the installers code written down. With some panels that gives you full access to everything, arm/disarm, change codes.

I think the industry as a whole kind of has to come together like IT and electrical, come out with standards, training, tickets, that would include such things.

But I do not think that will ever happen, maybe as more IT people enter our industry, some of the caring about cyber security and passwords and such, will come with them. I tried to make my clients aware, but after a few forget the passwords, or lose the document they had them written on, or you realize the document with all the passwords is a word document printed out and left taped to the monitor for the camera system, you stop wasting your time after awhile and just try to do a generic-to-you password that I the installer can remember, but not default.

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