New technologies like LEDs, solar panels and electric-vehicle charging stations are finding their way onto distributors' warehouse shelves in ever-increasing numbers, and the product managers engineering these launches are utilizing a blend of the electrical market's evergreen truths of new product R&D and fresh, new social media strategies.
After comparing the winners of the key new product awards competitions in the electrical market; tromping through miles of aisles of exhibitors' booths at industry trade shows; reviewing the hundreds of new product releases that flooded our e-mail boxes over the past year from P.R. folks pitching what they swear are the latest and greatest products from their clients; and talking with some of the industry's masters of new product marketing, Electrical Wholesaling's editors developed the following 10 Golden Rules of New Product Development and Marketing in the Electrical Industry to help both industry veterans who want to brush up on their product launch strategies and new marketers just learning the electrical business.
If a new product can help electrical contractors, facility maintenance personnel and other end users do their job faster, better, cheaper or safer, they will listen to your sales pitch. This is the most basic truth in the development and marketing of electrical products. It rang true when Edison first marketed his incandescent lamp in 1879, and it still powers the much of the new product development in this industry, whether it's the latest in solid-state lighting or a new tool invented by an electrical contractor that makes life easier on the job-site.
Many of the winners of the “Product of the Year” competition that Electrical Construction & Maintenance (EC&M) magazine, EW's sister publication, has sponsored for more than a decade didn't utilize some radically new technology developed in the research lab of a billion-dollar electrical manufacturer. The winners of the competition, as judged by the electrical contractors, facility maintenance personnel, architects and designers on the review panel, had some innovative features that made them, quite simply, either faster or easier to install for electrical contractors and other end users. Examples include a disposable conduit accessory developed by the Electrical Bypass Co., Pittsfield, Mass., that allows users to send a snake through a conduit box without getting stuck; Encore Wire Corp.'s color-coded building wire; and a “drillspotter” tool invented by First Edition Products, Valley View, Ohio, that helps installers drill holes in walls without hitting any hidden objects like power cable or metal pipes.
The best ideas often come from electrical contractors and other end users. Doug Chandler, EW's executive editor, covered this trend extensively in his Sept. 2012 EW cover story (“Launch and Learn,” page 22), and several electrical manufacturers have a long history of utilizing this simple concept to drive much of their R&D. Most recently, Madison Electrical Products, Bedford Heights, Ohio, has attracted a lot of well-deserved attention for its Sparks Product Innovation Center, an innovative effort to work with electrical-contractor inventors to bring products to the market.
However, it's not uncommon for electrical manufacturers to get ideas for new products from electrical contractors. For instance, at Greenlee, Rockford, Ill., Ken Hagemeyer and the product management team for many years worked with electrical contractors to develop marketing agreements for new products, particularly in the wire-pulling arena. And Arlington Industries Inc., Scranton, Pa., has for years integrated ideas from electrical contractors and other end users into its new product development process.
Prefabricated products or systems are always popular with installers. Again, it gets down the “faster-easier-safer-cheaper” mantra. The concept of prewiring, preassembling or prefabricating some components of an electrical system has been around forever, but it continues to re-emerge in different product areas. For instance, electrical contractors have for some time utilized prefabrication to cut down on repetitive job-site work processes that can be done faster and better in a controlled environment back at the shop. This has included attaching flexible wiring whips to lighting fixtures, preassembling some components of electrical boxes, or developing wire assemblies that cut down on installation time.
One example of the latter concept is the line of armored fiber-optic cable that AFC Cable's armored-cable cable guru, Jim Dollins, helped develop years ago. It cut down on installation time for electrical contractors because they no longer had to pull the fiber-optic cable through a plenum-rated innerduct — the cable was protected by an armored shield.
Electrical contractor Dennis Denier, CEO of Denier Electric, Harrison, Ohio, is well known in the electrical contracting industry for the prefabrication operation that he eventually developed into his Denier Manufacturing division. According to information at www.denier.com, Denier Manufacturing, “started as an in-house fabrication department, then morphed into a center of development and manufacturing of new electrical support products for our own projects, and now produces assemblies and products for national distribution.” The company also says on its website that it manufactures and prefabricates Hubbell's Rough-in Ready products to be sold to other contractors.
Also on this note, Snake Tray's Snake Bus, a prewired underfloor access system for under-access floors, is a 2012 Category Winner in EC&M's Product of the Year competition. The Bay Shore, N.Y.-based company also markets distribution boxes for access floors, overhead, surface and wall-mounted applications that come “pre-configured for plug-and-play installation.”
Independent reps that get a bigger commission to sell new products will give them more time. No big surprise here, but independent manufacturers' reps will spend more selling time with new products (or new companies) when they are compensated with higher commissions. It's a strategy that Arlington Industries has mastered and used to launch dozens of products over the years.
Several years ago, the National Electrical Manufacturers Representatives Association (NEMRA), Portsmouth, N.H., published a great primer on marketing new products through independent manufacturers' reps. Developed by the NEMRA Manufacturers Group, “Marketing Promotions and Product Launches,” is available for free to NEMRA members and for $45 to non-members (contact firstname.lastname@example.org).
Get samples in the hands of end users whenever possible. Selling with samples of new products has always been one of the best strategies to seal a deal. It's not always feasible for more expensive or cumbersome products, but you should try to get new products into the hands of customers whenever possible. Check out the sidebar on this page and page 21 about how RAB Lighting, Northvale, N.J., uses samples to sell its line of LED products.
Solar may struggle if the federal government slashes subsidies for photovoltaic (PV) installations, but many electrical distributors and their customers are still very interested in PV products. Now that the initial fascination with solar marketing opportunities has died down, electrical distributors and their customers are evaluating whether or not solar makes sense for them. As you can see in the charts on this page and on page 23, 33% of the 86 EW Top 200 survey early respondents said they already stock solar products, and 18% of 62 respondents to a question on customers' interest in new-tech products said solar was a hot area.
Several solar products attracted the attention of judges in EC&M's Product of the Year competition: the GE EverGold disconnect; Legrand's Delta Strut PV panel supports; and Cooper Interconnect's Sunnector family of wire connectivity products, including whips and jumper assemblies.
LED lighting systems might not yet pencil out as a real-world alternative for many general lighting applications, but they now have a ton of mindshare in the electrical market. If you are a regular reader of this publication, you know the magazine's editors have written many articles about the sales opportunities — and challenges — of selling LED products. LEDs are not quite ready for many mainstream lighting applications, but the current interest level among end users, lighting designers, lighting manufacturers and other lighting professionals is still amazing.
GE Lighting currently spends 50% of its R&D budget on LEDs, and LED lighting products of all sorts are mentioned prominently in the major industry new product competitions. In the Lighting Innovation Awards presented at last year's Lightfair conference in Philadelphia, LEDs completely dominated the major categories. And as you can see in some of the early data from EW's 2012 Top 200 survey on this page and on page 22, electrical distributors and their customers also have an insane amount of interest in LEDs. As Jim Newton, president and CEO, Horizon Solutions, Rochester, N.Y., said in his Top 200 survey response, “The speed at which LEDs are changing the whole lighting world is astonishing.”
Customers are looking for ways to remotely monitor energy usage in facilities. Products that utilize remote or wireless monitoring of energy consumption or wireless control of lighting systems are hot. These products include several category winners in the EC&M competition, including the software for the E-Mon family of submeters that track energy usage at a home or individual unit of a multi-family housing project; the Shark 100B submeter from Electro Industries/Gauge Tech; Schneider Electric's Wiser energy management system; and panelboards with integrated energy meters, such as Eaton's Pow-R-Line panelboard with the IQ35M meter.
Distributors, manufacturers and contractors are genuinely intrigued by supplying electric-vehicle charging equipment and are in the game early. EW's editors are surprised by the amount of early interest in electric-vehicle (EV) charging equipment. Twenty-five percent of the early responders to EW's Top 200 survey said they are already stocking equipment for EV charging stations, and 6% of them said their customers had more questions on EV equipment than any other new product area. That pales in comparison to the 81% of distributors who said customers have the most questions on LEDs, but it's still an early indicator that distributors' customers recognize the mammoth potential that EV equipment may have one day. The largest distribution equipment manufacturers — ABB, Eaton, GE, Schneider and Siemens — have all made major investments in electric vehicles, and one EV product, GE's WattStation, was a Category Winner in EC&M's 2012 Product of the Year competition.
Distributors too often don't learn about new products until the customers walk into the counter area and ask about them. One evergreen truth in this industry is that while electrical manufacturers will spend thousands of dollars promoting, advertising and otherwise marketing new products to electrical contractors and other end users, they sometimes neglect to tell electrical distributors about product launches. There's really no excuse for that these days. Even if an electrical manufacturer doesn't have the marketing budget to cover the cost of frequent advertising, trade shows and more traditional forms of electrical marketing, they can probably afford to target distributors with less-expensive but sharply focused digital marketing campaigns that could include e-mail newsletters, web-based marketing resources for new products such as installation videos, high-resolution and low-resolution images, spec sheets, PDF mailers and the like.
Those electrical manufacturers that don't neglect distributors in their product launch efforts definitely can grab distributor mind share. We saw this proved out once again in how many Top 200 survey respondents mentioned LED products manufactured by RAB Lighting, which has an integrated marketing program to promote these products that includes electrical distributors.
Electrical distributors, reps and manufacturers can't realistically aspire to create as much buzz in the product launches of electrical products as marketers of consumer products like new smartphones, tablet computers and other electronic gizmos. But new products in this industry can still create plenty of excitement — and profits — when you follow these 10 Golden Rules of developing and marketing new electrical products outlined in this article.