Distributors remain as essential to the custom integration channel as they always have been, and perhaps even more so now with the emergence of new and trending product categories.
Speaking with several dealers, it's no surprise that a big theme is the growing importance of high-performance home networking and a variety of lighting solutions.
Here, Drew Fischer, vice president of home integration and specialty sales at DOW Technologies, Cody Crossland, vice president of sales and marketing at Blackwire Designs, Dennis Holzer, executive director of PowerHouse Alliance, and Bryan Stewart, chief sales officer at WAVE Electronics, talk to CE Pro about popular home tech categories, monthly recurring revenue opportunities, education, and more.
CE Pro: What are your most popular product categories?
Drew Fisher: Networking continues to be a key growth area for our company. As demand for home technology continues to grow, so does the need to ensure reliable, high-speed connections for every job. Additionally, innovation in outdoor living is driving the need for robust connectivity that extends beyond indoor spaces to cover entire properties.
CODY CROSSLAND: The evolving network requirements for advanced technologies have made it clear how important a properly designed and implemented network is to any project.
Dennis Holzer: PowerHouse Alliance's most popular product categories today include lighting and shading solutions, outdoor TVs, and product lines supporting small commercial projects. Our lighting and shading solutions have experienced significant growth due to their ability to provide energy efficiency and improved comfort.
Another reason for the category's growth is the ability to expand offerings to include products that can accommodate a variety of project budgets. Outdoor TVs are especially popular during the warmer months and are seeing increased use in commercial entertainment spaces and stadiums. Finally, as residential projects slow down, smaller commercial projects are on the rise, with projects for small offices, restaurants and retail spaces providing ample opportunities for dealers.
Brian Stewart: As a result of meticulous research and development efforts from our WAVE Electronics team, an entirely new category was launched for WAVE Electronics dealers in 2024: commercial 70-volt audio from Elura Audio. This comprehensive product line includes mixer/amplifier components, discrete amplifiers, in-ceiling full-range speakers, supporting equipment, and several pendant subwoofer and full-range options. The Green Label began shipping in February and has far exceeded both WAVE's and our customers' expectations.
There's always something new and interesting to talk about with Illumivue security: there's a new update to the Illumivue mobile app, a new 8MP camera will ship in July and there's already a line up for pre-orders.
CE Pro: What other trends do you see rising in 2025?
Fisher: We are seeing increased demand from end users for lighting solutions such as under-cabinet, low-voltage and outdoor lighting, and we expect the number of our customers serving this demand to grow. Not only does this segment create new revenue opportunities for our dealers, it also coincides with the expansion of outdoor living, driving the need for increasingly sophisticated lighting solutions.
CROSSLAND: With Wi-Fi 7 starting to emerge, 10 Gigabit networking becoming a necessity, and the rise of high-bandwidth networking products will continue, Ruckus and NETGEAR make some of the best networking products, so our dealers are set up for success and no service calls will occur.
HOLZER: Current trends point the way to where we expect to see things in 2025. We expect to see continued growth in advanced lighting and shading solutions. The mid-market's access to advanced lighting and shading solutions will drive demand beyond the luxury segment. We also have some plans in this space that we can announce going forward. We don't expect these small commercial projects to go away anytime soon, so we will continue to provide training and support to our dealers so they are prepared to take on these projects with confidence.
Stewart: It's been a few months since Elura Commercial Audio began shipping to dealerships, and the market response has been overwhelmingly positive. I'm confident that our commercial product line will continue to expand in the coming years.
Additionally, all WAVE dealers are actively embracing automation, lighting and shades. Not only are sales of brands sold by WAVE, such as Lutron, Savant and RTI, growing, but dealers are adding resources to their teams, including experts in interior design and lighting philosophy.
Finally, the residential and commercial security business continues to evolve around ease of use, connectivity and simplicity of decision making. While Illumivue has always been focused on innovation, future products will prioritize intuitive operation over technical understanding.
CE Pro: Have you implemented any programs, incentives, special offers, etc. in the past year?
Fisher: We are committed to value-added programs for retailers. Our Flash VIR specials have paid dealers over $150,000, our Smart Services program has significantly reduced dealer shipping costs, and our free marketing designs help dealers promote themselves and build their unique brand. Our dedicated account managers continue to provide design and troubleshooting support. We are committed to providing white glove service with industry-leading programs that benefit dealers of all sizes.
HOLZER: Each PowerHouse member is very sensitive to the needs of their respective markets, so they're agile in creating programs that add value to their dealer customers. The training programs offered to all members continue to be a huge benefit. Additionally, many dealers aren't aware of the design services available to them from their distributor partners. This is a huge benefit and helps dealers avoid turning down work because of the complexity of the project.
Last but not least, we are fortunate to continue to expand our vendor relationships, adding nearly 30 new product lines since 2020, giving dealers access to a wide range of products to meet their project needs. Each of these brands works in partnership with our members to provide competitive pricing, rebates and incentives, helping to increase dealer revenue.
Stewart: The WAVE Premier Program is a powerful loyalty program that gives dealers up to 7% back on eligible purchases every week. In fact, the Premier Program has won an award from CE Pro.
Plus, our technical support efforts continue to be at the forefront of the industry. We often hear stories of our technicians setting up in their offices or on test benches the same systems that dealers install in the field. This approach simplifies troubleshooting and programming, as our teams operate the same products in real time.
CE Pro: What are some ways you can help dealers improve their sales and capabilities?
Fisher: We help dealers leverage in-house resources to grow their business, including easy-to-post social media ads aligned with manufacturer promotions and free help redesigning logos, business cards and more to maintain a professional appearance with customers, eliminating the need for dealers to hire a full-time marketing team.
What’s more, we leverage our combined experience of over 200 years to provide free technical design and advice, plus we offer the broadest range of Monthly Recurring Revenue (RMR) opportunities in the CEDIA space, allowing dealers to generate ongoing profits from one-time sales.
HOLZER: Not a week goes by that a PowerHouse member doesn't host a training. From familiarizing dealers with new categories, like lighting and shading, to mastering areas they're already familiar with, like designing audio systems, PowerHouse members are there to help.
CE Pro: Do you expect your business to increase, decrease or remain steady this year? Why or why not?
Fisher: Although we expect a slight decline in traditional home control products, we are optimistic about new revenue streams for retailers. We are well positioned to offset any challenges in the controls market by focusing on RMR programs, smaller commercial projects and lighting solutions. We see these areas as promising opportunities for growth and diversification.
Holzer: We expect business to remain stable or grow slightly this year. This forecast is based on a general recovery in product demand. Growth in small commercial projects is expected to offset a slowdown in residential projects, resulting in a stable business outlook.
Stewart: We have experienced consistent hockey stick growth over the past few years and see continued success through the commercial side of our business offering.
CE Pro: What is your biggest challenge?
Fisher: As a family-owned dealership, we face similar challenges that dealerships face every day. We often find ourselves in a David vs. Goliath situation as we try to compete with large publicly traded companies that can incur significant losses every year.
However, we believe our competitive edge lies in our comprehensive programs, connections with local retailers, speed of decision-making, and the strength of our personal relationships. These factors allow us to compete effectively with larger companies in the market.
CROSSLAND: Inventory issues remain, but we attribute that to an inability to properly forecast demand for certain products. Blackwire is trying to understand demand as well as possible, which is why we've expanded our warehouse space and replaced our entire racking system so we can store more products.
We also updated our ERP system in January, allowing us to scale as much as possible and introduce entirely new ways of tracking and forecasting product demand.
HOLZER: Our biggest challenge is adapting to supply chain dynamics and keeping up with rapid technological advances. While supply chain issues have stabilized, effectively managing relationships and timelines remains critical. Additionally, ensuring our dealers are well trained and equipped to keep up with the latest product innovations and integrations is an ongoing challenge.
Stewart: Everyone has a limited attention span. Dealers don't have the time to attend shows on their own, read websites and keep up to date. WAVE is the distributor partner dealers need. We ensure our messaging and training programs are supported by in-branch communications, email connectivity and a website.
Education can seem like a real challenge. There are so many new products, services and apps, it's hard to keep track of it all. So in 2024 we introduced WAVE U, which aggregates all our podcasts, technical papers and product videos in one simple place to keep dealers up to date on all things WAVE.
CE Pro: What makes you most optimistic about the industry right now?
Fisher: Despite the challenges posed by the current housing market, demand for technology remains strong. New home purchase rates may be slower than they were four years ago, but demand for the technology that will transform today's traditional homes into the smart homes of the future remains strong. This continued demand is a positive sign for the industry as a whole.
HOLZER: I am optimistic that smart home adoption and expansion of small commercial projects will continue. Our members have already seen growth this year in both existing and new categories (shades, lighting, sound, etc.) and I am optimistic that growth will continue in the future.
“The growing number of households installing smart home devices represents a tremendous opportunity for our dealers. A recovery in commercial projects is also promising, especially in small office and retail spaces. Finally, innovations in integrated systems that increase energy efficiency and comfort are perfectly aligned with evolving consumer preferences, giving us confidence in the future of our industry.”
Stewart: For WAVE dealers, end-user interest in consumer electronics, professional audio/video products, and technology has never been greater. First, we have the right people who not only understand the products, but have been deeply involved in the industry for decades. Additionally, our innovative, industry-leading products and strategically located branches make it easy for dealers to dramatically grow their business.