Harman Makes Dealer Support Central To Growth Strategy In Custom Home Electronics Market

Coupling Innovative New Products, A Pricing Strategy Aimed To Broaden Access/Appeal And Unprecedented Marketing Support, Harman Plans To Grow Market Share For Lexicon, Mark Levinson, JBL Synthesis And Revel

ELKHART, Indiana — At a time when other high-performance AV manufacturers are retracting marketing activities, scaling back new product development and holding dealers to maintain sales performance in challenging economic times, Harman’s High Performance AV group is making dealer support central to its growth strategy for Lexicon, JBL Synthesis, Revel and Mark Levinson.  In the past six months, Harman actively encouraged brand dealers to become group dealers carrying all four lines, consolidating quotas and benefitting from an aggressive marketing program that includes web and print advertising and a soon-to-be-unveiled traveling demonstration road show.  According to Marc Kellom, Harman High Performance AV Vice President of Marketing, the new program is timed to support the launch of exciting new products in all four brands that are priced and positioned to reach broad new markets.

“We view this current economy as an opportunity for Harman and our dealers to grow our market share and bring a host of high quality, highly innovative new products to the custom home electronics market,” Kellom said today.  “Our first step, to have all our dealers share this same ambition and approach, has been achieved and now we’re actively supporting our dealers with strong marketing and compelling products.  We’re looking forward to the CEDIA Expo in Atlanta as a springboard for market growth and we expect Harman dealers to be among the most optimistic and well-equipped attendees at the show!”

Underscoring this approach, Kellom’s multi-tiered print advertising program includes national magazine properties that reach affluent communities where style and uncompromising performance are must-haves.  Publications like Architectural Digest, Cigar Aficionado, Lexus Magazine, The Robb Report and Guitar Aficionado are central to his plan.  In regional markets, Harman is supporting dealers with full-page product ads accompanied by 1/3 page facing strips listing the respective dealers in each region.  Regional publications include Modern Luxury properties in Atlanta, Los Angeles, New York City, San Francisco and Chicago.

“In the luxury market, we’re experiencing considerably less of a downturn than we’d initially expected and we attribute this to the fact that affluent customers understand the performance leap they’re making when they choose our products,” Kellom noted.  “The current market sentiment appears to be weighed against those who provide style-based advances and towards brands that offer performance improvements.  Whereas Mark Levinson, Revel and Lexicon make a strong aesthetic argument, they make an even stronger performance argument!”

Kellom is also determined to support dealers with local initiatives and central to his program is a new 53ft, 1000 square foot expandable, customized trailer housing two demonstration suites and featuring an array of new and exciting products from JBL Synthesis, Revel, Lexicon and Mark Levinson.  The trailer, painted to double as a highly effective traveling billboard, will visit dealer sites to provide dealer training and will host VIP customer demonstrations and open days.  Harman will also deploy the trailer for co-branding/cross promotions events at automotive dealers for its OEM partners.  The trailer is likely to debut at the CEDIA Expo, where Harman is planning a comprehensive high-profile presence.

“This is a program we’ve successfully deployed on the pro side of the business for many years now,” Kellom explains. “Dealers appreciate the one-on-one training and local market promotional support.  They also appreciate the fact that when one of our trucks roll into town, that gives customers another reason to come visit their stores!”

Hand in hand with the marketing program, Harman is pursuing an aggressive product development program that will see more that 15 new products debut at CEDIA in Atlanta: Lexicon will introduce a new BD30 BluRay player to accompany the MC12HD processor; Mark Levinson will introduce four new amplifiers starting at the $6,000.00 price point; JBL will introduce the new K2 S9900 which starts at $30,000.00 a pair but will also debut a new series of floor standing loudspeakers at $1,500.00 a pair; Revel will introduce the stunning new Rhythm 2 subwoofer and two brand new in-wall speaker models and Synthesis will introduce a new professional-grade room calibration technology.

All of these introductions support a product marketing strategy that seeks to empower dealers to comprehensively address customer needs:  Dealers can reach out to Lexicon MC12 customers with a new firmware upgrade and the new BD-30 Blu-Ray player and can similarly upgrade Revel Salon 2 customers with the Rhythm 2 subwoofer designed especially to match the sonic performance and aesthetic look of the winning Revel Salon 2 tower loudspeaker. In addition, Harman will make select product SKUs from its JBL and Crown professional lines available to CEDIA dealers.

“We’ve been very careful to respect and protect each dealer’s current business and potential opportunity,” Kellom explains. “We’re seeing residential applications of pro-grade product, particularly in outdoor applications and we’re confident that our pro-grade products can tick more boxes at better prices than what the market is currently getting.  This will not impact pro dealers but it’s a significant growth opportunity for residential dealers and a performance win for their customers.”
Protecting dealers is central to Harman’s mission and so the company is pursuing a strictly no-Internet dealer policy for the Revel, Lexicon, JBL Synthesis and Mark Levinson brands.  “We’ve made quite a few changes over the past 12 months,” Kellom acknowledges. “And whereas there is still a lot of work to do, we’re now confident that our high-performance AV dealers are best positioned, best promoted and best equipped to grow their businesses in 2009, 2010 and beyond!”