Covan targets new & existing homes
LIVERMORE, Calif.--To expand his business this year, Covan Security president David Coon is targeting specific homebuilders and initiated a marketing campaign aimed at existing homes.
At the year's halfway mark in June, Coon said he expected to see a 25- to 30-percent growth in revenue over 2005, putting the mostly residential security company "just under $2 million in revenue." He does some installations of small and mid-size commercial CCTV, access and security, which "accounts for about 20 percent of our annual revenue," he said.
A Honeywell First Alert Dealer who's been in business since 1989, Coon moved his 15-person business to the Central Valley from Fremont to take advantage of the boom in new home construction. Formerly farming land, development here is driven by the quest for affordable housing within commuting distance to the Bay Area, Silicon Valley and Pleasanton.
Even though it's a smaller company, Covan Security has a yearly awards ceremony where we "toot our employees' horns" and give away cash and vacation prizes. This work culture has translated into long-term employees.
"Our senior installer has been with us since '91, our operations manager for eight or nine years," Covan said.
Of the many area homebuilders, Coon targets "the builder who supports options, rather than the standard-options only."
"One of our big challenges is the cost of materials. The price of copper wiring has gone up 100 percent since November. It makes bidding for a job difficult," he said. While he understands some builders' desire to streamline their process by limiting options (some have reduced the number of options from 1,000 to 50, he said), the ability to sell options at the back end of the job can make the difference between a profitable and non-profitable job. It also, Coon points out, serves the customer better because it gives them more choices.
Covan offers structured wiring, a variety of security and residential fire systems, and home automation options. Structured wiring is the "the foot in the door with the builders," he said. Having pre-wired the home, he then has the option to sell additional home systems.
Ken Weinstein, senior vice president of program marketing for Honeywell First Alert, said that the number of options a builder offers differs from market to market, and agreed that when dealers have the opportunity "to get in front of the customer, then they can explain the benefit of investing in the technology." And today's homebuyers, the so-called Gen Xers, understand and want the latest security and home theater and automation products, he added.
For existing homes, Covan's new marketing initiative, launched within the past two months, includes direct mail, Internet marketing as well as direct sales. He'll be hiring new sales people and has a monthly target of putting on 40-80 retrofit residential jobs per month for the rest of the year.