Savant Realigns Ops, Salesforce, & Pricing for Next Phase of Growth

There has been a flurry of activity in the Savant ecosphere lately, much of it causing a buzz in the industry. Over the last few weeks, I’ve had several integrators reaching out to let me know about some of these changes. Not all felt they were positive and many questioned the motivations behind the moves. Accordingly, I reached out to Savant to see if I could get some insight into just what is going on. The company responded by making President JC Murphy available to update me on a few of their recent moves.

See what Savant’s JC Murphy told me about recent changes

Several sources reached out to me over the last few weeks to tell me that things were changing at Savant. Some said the company had terminated all of their manufacturer sales representatives. Others said there seemed to be some kind of internal reorganization at the company, with roles changing for some key folks. While others complained about a new pricing scheme that looked like a price increase, especially on non-Savant products (See the comment by “Anonymous” by scrolling to the bottom of this Josh.ai story.)

Many asked me if I had any idea what was going on at Savant. I didn’t…so I reached out to the company and was able to schedule a Zoom conference with President JC Murphy to get some details on just what – if anything – was going on at one of the industry’s largest control brands. We spoke for nearly an hour and a half and covered a lot of ground.

Strata-gee Interviews Like This Can be Uncomfortable for Companies

It should be noted up front, that conversations like this are very uncomfortable for companies, as I am often asking specific questions about internal operations and strategies – things that many consider confidential. So I wasn’t surprised to hear Murphy choose his words carefully – recognizing that I would be publicly writing about this conversation.

As many of the sources I spoke with sent me scraps and tidbits of info on this issue or that action, I had strongly suspected that I – and perhaps they – did not have all of the information…or perhaps were reacting to secondhand news that was presented in an unflattering manner. In other words, there was no perspective on how all of these independent actions fit together in context.

Company Says Complaints Miss the Bigger Story of Realignment

As it turns out, many of the data points I received from my sources, which all seemed disconnected, are actually in fact part of a bigger story. Savant has grown rapidly over the last few years with many acquisitions, some of which like GE Lighting, were of large companies. In fact, the company had just recently announced another acquisition at the end of May. This time it was of POMCube, said to be a leader in ESS or energy storage systems.

With many acquisitions and partnerships, the company has steadily grown to include a multitude of new home automation-related product categories, such as smart networking, lighting, and now smart energy/power. In fact, it is likely this last category that has brought to the forefront the need to realign the approach the company was taking to maximizing its opportunity in the market.

Aligning Salesforce to New Company Goals

The most visible aspect of this realignment was to restructure the sales network. Savant historically has used a mix of internal field sales support folks and outside independent manufacturers sales representative firms. These independent rep firms carry a mix of brands to offer integrators in their territories. The number of lines they carry could be just a few for smaller operations to as many as twenty or more brands for larger groups, Murphy told me.

For a while, this sales structure worked fine for Savant who was predominantly in home automation from the home entertainment perspective. But as the company has grown over the years and added many new categories, the sales strategy began to be stressed. Murphy says Savant was asking a lot as they expected their reps to support the burgeoning assortment of products.

Asking Too Much of Them

We were forcing [independent reps] to learn a whole new networking category, a whole new power category, a lighting category…to be experts in audio & video, be experts in integration, and [be experts in] security – it was tough. We were asking them to do too much.

J.C. Murphy, President of Savant Systems

Murphy told me that while the company had been sensing a looming issue for a while, they began receiving feedback from many Savant integrators alerting them to support shortfalls from their existing rep network. It became obvious to them that it was becoming difficult for multi-brand independent reps to fully support the expanding Savant line-up. But what to do?

An Alternative Salesforce Structure – The Ambassador Rep Program

So the company began analyzing the various sales network strategies of other industries facing a similar conundrum. The alternative solution they came across that seemed to make the most sense was to partner with local sales organizations that would agree to focus on Savant’s entire line with its many categories. So the company has created what they call the Ambassador Rep program.

Similar to what is known in our industry as “factory direct representatives,” Ambassador Reps are geographically dispersed sales representative companies that have agreed to focus on the entire Savant line. Unlike some other factory direct scenarios, these reps are NOT directly employed by Savant but rather remain as independently owned and operated sales representative companies contracted to provide sales and support services for Savant.

That is the Theory

With this focus on Savant’s product line, the reps can more easily train and retain the knowledge to offer a higher level of sales and support for the brand, than other firms juggling many different brands as well. At least, that is the theory.

Augmenting this strategy, Savant is also parceling out their line to other more traditional rep firms, who will receive only certain categories of the line that they too can focus on. For example, Murphy suggested there may be a traditional multi-line rep firm that will be appointed to represent Savant Power in a region.

The Ambassador Rep program has begun rolling out across the country, mostly on the coasts, with a few in the middle where appropriate. Murphy tells me that Savant firmly agrees that for many companies the traditional rep model is the way to go. However, with the scale of the Savant line, along with the complexity of some of the new categories, the traditional model was stretched to its limit.

Internal Staff Realignments Required as Well

Murphy made it clear that changes are not only taking place out in the field but within the company as well. It was clear that responsibilities needed to be adjusted to realign the internal staff structure to optimize their future growth potential.

One of those internal changes is likely to be popular with many in the industry as Angela Larson, former VP of Customer Operations has been promoted to take over what Murphy called the company’s Pro business unit – which is their custom integration-focused business. Larson’s title now is General Manager, Custom Install.

“[Larson is in charge of] all of the [CI category] products like, all our audio video, professional lighting products, and networking products,” Murphy said, referring specifically to the custom integration space.

A Power Play; Connecting Support & QA Teams

In another change, Executive Vice President Craig Spinner has been promoted to run Savant’s Power business unit – a segment in which they expect to see strong growth in the near term. The company is continuing to invest heavily in the Power category, most recently with the acquisition of POMCube, as I mentioned above.

The company has also recently taken the unusual step of merging its Quality Assurance group with the company’s Support unit. Now the combined unit is under the direction of Danny Jones. Murphy specifically pointed to this decision as a “strategic” one designed to more closely tie “the customer experience directly into the quality programs that we run inside the company,” Murphy noted.

Reports Directly to Company CEO Madonna

This is an interesting move, as it puts the same people in charge of providing support – including dealing with integrator and client issues – as are in charge of assuring product quality. Talk about a direct feedback loop. But not only that, QA/Support unit head Danny Jones reports directly to Savant’s CEO Bob Madonna. This too is something that I’ve never heard of before and tends to suggest that the company is taking product quality very seriously.

Is it possible the company instituted this unusual internal arrangement because there were some nagging quality issues with certain Savant products, as some sources have suggested to me? It is possible, although the company wouldn’t comment on that point specifically.

Software-Centric Product and Pricing Strategy

Perhaps most interesting, Savant has implemented a two-tier, software-centric market strategy. In my conversation with Murphy, he suggested that the company really sees a software-centric future for the company. In many ways, it’s the software that controls the whole system and that defines the experience for the end user – more so than the hardware box endpoint.

Murphy said that in his opinion, the custom integration business as a whole is a service industry. While some integrators feel like they are in the box business – buying a box and selling it at a markup – the best integrators, he says, see themselves as a service provider bundling a range of services, including design services, installation services, and support services…on behalf of their client.

SaaS Licensing

Some time back, Savant announced it was moving to a software-as-a-service (SaaS) model, which is an operating model others have adopted as well. According to Wikipedia, SaaS is defined as follows:

Software as a service (SaaS /sæs/) is a software licensing and delivery model in which software is licensed on a subscription basis and is centrally hosted.

Now, the company has created two basic licenses for integrators – one based on the company’s Smart Audio WiSA Soundbar with Smart Host; and the other targeted for more sophisticated Apple M2 processor Mac-based solutions. See the description below for more details on the plan.

• Savant Ecosystem Software License– Designed for compatibility with IP Audio 1, the Smart Audio WiSA Soundbar and the Smart Host, provide the ultimate ease-of-deployment across Savant branded and Savant Recommended Partner products
• Savant EVO Software License – Designed for compatibility with M2 processor-based Mac products – allows you to customize the right combination of hardware and software tailored for each project; all with the stability and scalability of the Mac platform

Two Types of Licenses are Offered

The Savant Ecosystem license, Murphy said, incorporates Savant proprietary technology on a Linux-based platform. It will generally be targeted for smaller installations and will be “built around Savant products and 25 or so partner products – things like Ring and Sony – that we’ve fully vetted and sell to integrators on the Savant Store,” Murphy said.

In the case of the Savant EVO license, Murphy acknowledged that some of misinterpreted the company’s thinking. On a pragmatic basis, Murphy suggested that it is impossible to test the system on all the other systems and products that exist in the world. So “it’s going to be software licenses to add capacity, or to add other third party support – like lighting and music.”

While some integrators have suggested that this means if they don’t use Savant products, they’re getting hit with an “added tax,” Murphy feels they are looking at it the wrong way. He feels this system allows them an opportunity to support their customers and make money.

Savant Ambassador Integrators

Finally, the company is paying close attention to those integrators who are more professional, do an elevated-grade system design and installation, and rise above the rest in after-sale support. As Murphy told me, there are some integrators out there that offer a wide variety of brands and don’t particularly focus on any one brand. But there are others, who standardize on select brands and focus on delivering a better experience for their clients.

Savant, Murphy told me, is “really zeroed in on the quality versus the quantity of the companies” they do business with. As such, they are offering special programs for those better partners to help them be even more successful. That program is known as the Savant Ambassador Integrator program.

A Multi-Faceted Program with Key Advantages

This Ambassador program is multi-faceted and includes certain products that will only be available to them. Also, the company will be giving Ambassador Integrators priority on leads generated on the Savant website. I’ve seen something similar to that a few years ago with the Control4 Certified Showroom program, in which dealers told me the most beneficial part of the program is to get priority referrals from the company

While every Savant integrator will have a pathway to become a Savant Ambassador, the total number of Ambassadors will always be a subset of Savant’s entire dealer base.

Learn more about Savant by visiting savant.com.