There may be 13,000 alarm companies in the US, but among the larger companies it’s actually a pretty small network – so small that news travels fast. And the news currently making the rounds is about door knockers: specifically, that this spring and summer may well be the worst on record for door knockers soliciting customers from other alarm companies. It was pretty bad last summer, but rumor has it that we haven’t seen anything yet. We’ve also heard that they’ll be hitting the streets earlier than ever this year.
Why Worse This Summer?
Reasons as to why this summer is expected to hit new lows may vary, but the signs are there: fierce competition in recruiting door knocking sale personnel, huge hiring bonuses to hire sales managers away from other door knocking companies, and a shakeup among the top companies who sell this way. The absurdly high sales commissions being thrown at college students selling door-to-door result in some door knockers crossing the line into overly aggressive selling – or even shading the truth to make a sale. The most blatant cases involve trying to steal subscribers from other alarm companies. And while the door knockers claim such behavior is limited, or old news, the lawsuits, fines, and other statewide government actions refer to ongoing fraud and deception.
Bad Behavior Rewarded?
For instance, Pinnacle Security, the #2 door knocking alarm company, was fined $1 million in Illinois and $525,000 in California: fraudulent and deceptive practices were cited, as well as alarm licensing violations. Pinnacle recently sold most (if not all) their subscriber accounts, and their door knocking operation was acquired by another company. And then there’s the recent purchase of Vivint, the largest door knocker, by Blackstone Group, the huge US private equity firm, for $2 billion. The stakes are higher than ever for these companies to keep growing, and for these operators, that can mean growth by any means.
Harder to Sell Door-to Door
The challenge for door knockers is that the bad news is getting out: customer complaints and bad reviews are piling up in the thousands, along with warnings and low ratings from the BBB (Better Business Bureau). Even the FTC (Federal Trade Commission) has issued a warning on this business model. All this negative press is making it harder for these companies to sign up new customers – which makes them even more aggressive, and that results in more complaints. It’s a vicious cycle for the door knockers.
I’ve written numerous blogs on door knockers in recent years, and those posts have elicited quite a response: some comments defend the door knockers (and in many cases appear to be written by employees), while many others have shared sad stories of how they or an elderly relative or neighbor was pressured into buying a system that they did not really understand, or that did not work as promised, or came with inflated monthly fees, etc. The debate continues, and this summer’s activities may only serve to heighten the questionable profile of door knocking.
This One Says It All
In response to one impassioned defense of door knocking, I wrote the following response to a blog comment some time ago. I’ve shortened it a bit to share it here.
FrontPoint believes the best customers are the ones looking for a product or service in the first place: those customers are more likely to keep the system over the long term, and not just because they are “required” to do so by a monitoring contract. When you knock on someone’s door to sell them a product or service that they were not looking for to begin with, you might make the sale, but it may not stick long-term. For example, door knocking alarm companies have the highest levels of customer cancellation, especially at the time of contract renewal: as a result, they have extended the industry norm contract term (three years) to five years, just to hold on to a potentially unwilling customer longer. FrontPoint is different, in that we work with potential customers who are already looking online for home security: our approach therefore involves much less pressure and more much consultation – and we have a much lower rate of cancellation (and a far better reputation) to show for it.
It’s not that one approach is right and one is wrong: we just think this way is better for the customer. But another area where you see a stark contrast is in those customer reviews and complaints – and even government actions. It’s no secret that door knockers companies have been involved in lawsuits and have paid fines: the violations range from overly aggressive sales tactics to accusations of fraudulent and deceptive business practices, right through last year. The canned responses such as “It’s only a few bad apples” and “That’s old news – we are much better now” really don’t carry much weight in the face of so much ongoing negative press from consumers.
We just want all the players in this space to act with integrity and behave in a way that reflects well on the industry, instead of creating a bad reputation for alarm companies in general. It’s not that hard to do it right, but it takes strong leadership and hard work to build a good company culture that respects the wishes and rights of the consumer – all the time. Thanks again.
Door knockers approached millions of homeowners last summer, and the same will happen this summer, starting as early as April. Frankly, these door knockers do not want consumers to do the research: it’s too easy to find the complaints, the low ratings from the BBB, and even more attractive offers from other alarm companies with better reputations and service records – like FrontPoint. When you’re ready to learn why we are the nationwide leader in wireless home security, just check us out online. We make home security and home automation safer, smarter, simpler, more affordable, and virtually impossible to defeat. And best of all, you never have to answer that knock at your door.