The CEDIA organization presented on May 14 the results of a survey in late April of 344 members spanning the U.S., Canada and the U.K., conducted well after the coronavirus worldwide pandemic bloomed. Unsurprisingly, the survey, done in conjunction with The Farnsworth Group, revealed an overall negative sentiment of the virus’s impact on business, with smaller firms feeling the repercussions most. But there were some bright spots – and hints that, although no one has a crystal ball, signs are that the worst may be over, at least for the short-term foreseeable future.
“Overall impact on business is negative,” opined Grant Farnsworth, director of business strategy for the Farnsworth Group, “but the severity of the negativity is lessening…. The residential contractor market bottomed out towards the end of April, with slight signs now of ‘reduced negativity.’”
Business declines were the result of a combination of factors overlaying the virus itself – including, namely, health concerns by clients about contractors entering their homes, as well as similar concerns on the part of the contractors themselves. Local governments’ stay-at-home policies also factored into the slowdown.
The survey also revealed homeowners’ concerns about their finances and budgets.
Conversely, some contractors have been doing more business in installation of certain categories, including health-and-wellness solutions, home entertainment products, and security and network systems. “It isn’t all doom and gloom,” offered Farnsworth. “There are certainly niche opportunities out there.”
The survey found that as of late April, a large number of companies opted for layoffs or furloughs in response to the pandemic; among the U.S. and Canadian respondents, one in three said that roughly three out of four of their staff had been furloughed in its wake.
Shifts in business focus have also been a behavioral byproduct of the virus, influencing integrators’ time and resource allocation. Further, 62 percent of the American/Canadian respondent group said they were spending more time in conducting or taking advantage of technical training, while half said they were developing new services and looking into new products to sell. Around one in three were taking advantage of changed business conditions to re-tool their marketing approaches, including their website presence. Another popular activity mentioned by three in 10 of these respondents was that they took advantage of the dramatic reduction in client visits or walk-ins, as an ideal opportunity to reconfigure or refresh their showrooms or look with fresh eyes at their warehouse layouts.
The survey, perhaps unsurprisingly, showed a bump in the number of home network servicing calls completed in March – up either somewhat more or much more than usual, commensurate with the rise in shelter-in-place client behavior.
CEDIA EMEA Brand and Communications Manager James Bliss, speaking from the European perspective, noted a decided uptick in “yearning for a better home entertainment experience” among clients.
More specifically, what is keeping integrators up at night in terms of the future? Of course, paying bills was a high-level worry, as was the health and safety of staff.
In response to an audience member’s question about what the next three months could hold for the integration discipline, Farnsworth offered this: “Economists we talk to say that no one really knows. The speed of the onset [of this] and its cause were very unique; things just fell off the table.”
Bliss added that what remains is a “huge demand for home networks, and the rise of the home office’s importance. That will be more commonplace on the other side of this – as well as a rise in home entertainment opportunities. Cabin fever is becoming ‘nesting’ – a switch in perception.”