In 2008, nobody escaped the traumatic effect of the corn-bubble. The ill-conceived and panic-driven notion of putting food in our gas tanks caused not a ripple, but a disastrous avalanche of food inflation unseen in nearly thirty years. I’ll guide readers to my July 2008 post for the details around this. In the end, our country saw a 6.6% jump in food inflation during 2008 causing consumers to tighten their wallets and annihilating our restaurant industry.

There is a direct correlation to the 2008 panic and fuel prices. As oil futures and retail gas prices escalated, so did that of corn, thus resulting in a corn bubble. Farmers were planting plenty of ethanol-doomed corn and not much of anything else. I say “doomed” as much of the corn sat in silos against a refining bottleneck and ultimately became rancid.

Now that the oil bubble has burst, so has the corn bubble. We can expect to see the results of this in 2009 as farm fields are freed up to again plant some of the other commodity staples. We have already observed the following commodity price declines:

Corn: -33.6%

Soybeans: -39.3%

Wheat: -68%

While we’re still seeing major food manufactures hold the line on pricing, we should see some softening on the wholesale and retail front in the near future. This means lower costs and improved profits for our struggling restaurant industry AND lower prices at the grocery store and more discretionary money in every one’s pockets.

There are many components to success in business, one of them being in the right place at the right time. Over the years I’ve seen this occur both through careful planning and execution as well as sheer luck. Regardless, if you happen to get caught up in the buzz around the must-have service, product or technology, the media can be you best friend.

Over the past few months, Envysion has seen an abundance of validation from leading industry and mainstream publications who are trumpeting SaaS and other disruptive managed service technologies as one of the best ways to cut costs and do more with less in today’s economic climate. To no surprise, there appears to be a correlation to funnel growth in both direct and indirect sales efforts. Following are samples from these leading publications:

“The movement to web-accessed, centrally hosted back-office software and services has gained momentum…”
 – Nation’s Restaurant News

“…the hot technology for 2009 will be anything that can save money… businesses are saving by using web-based software instead of programs installed on their computer systems.”
 – Wall Street Journal

“Disruptive technologies are expected to emerge within the video surveillance market… e.g., Managed Video as a Service”
 – Severin Sorensen, Past Chairman Physical Security Council, ASIS

“Managed services the talk of TechSec”
 – Security Systems News

MVaaS named Top 3 Emerging Technologies in Video Surveillance
 – ipVideomarket.info

Early in 2008, our company was in the process of re-casting our marketing efforts.  New logo, new tag-line, updated website, etc.

While discussing our tag-line, I recall mentioning to a colleague that every company I could think of had a tag-line, except Starbucks.  In fact, I also noted that they rarely, if ever, advertise.  I certainly don’t recall ever seeing a Starbucks commercial, in print, on the radio, or elsewhere.  Yet still, look at the business that they have built.

Reflecting back on my comments, I would add that they also rarely engage in special promotions and/or discounting.  Sure they have an occasional event, but they have been limited.  Even during these events, I recall hearing of them word of mouth or through free news coverage.  Still, no commercials.

So I was surprised to read about the company’s announcement that they are going to offer “value pairings”.  To me this makes sense.  Move more product, target value conscience new customers, turn the perishable food inventory.  This makes sense to me.  But remember, I’m a finance guy.  As a Starbucks customer, I wonder if this move slightly tarnishes the brand – one that has been built on premium priced beverages.

When I hear talk about the virtues of “Software Only” video systems, I kinda think, huh?  Since when is a camera made of software?  I think what is really being talked about are the virtues of a multi-vendor solution as opposed to a single vendor solution.

Multivendor network video systems are a great direction and the wave of the future because they deliver more value to the customer.  They give customers more options to put together solutions which better fit their needs and better prices

Today’s IP video solutions which promote “software only” are really saying, buy your choice of cameras (mix and match for your needs) and your choice of recording hardware (PC’s made by Dell, HP, etc..), and buy your software from us.  That’s a huge leap forward from the analog video surveillance market which has really only had competition on the camera front and locked in customers to buying recording hardware from the same suppliers as the software.

What seems to be taking some time however is the increased cost of the IP cameras is worth the benefits of a multivendor recording solution. It would be great if there were some open standards DVR’s out there, but alas, they don’t seem to exist.  If and when this happens, I can see a lot of value being created for customers as very cost effective DVR’s can be sold as part of a multivendor solution.  Imagine being able to buy whatever DVR suits your needs and cost requirements and being able to link that DVR with the advanced software platforms out there today, such as Milestone, OnSSI and of course, Envysion Video.

Having worked in telecom and enterprise networks for 15 years I strongly believe multivendor networks are often the right thing for the customer.  There are so many things a network needs to deliver that to deliver the “best of breed”, multiple vendors often have to be used.  Of course, there’s the healthy pricing competition that comes along with having more than one vendor bid a solution, and continue to bid upgrades and growth of that system going forward.  As a customer and builder of network solutions, it’s no fun to be locked into a single vendor’s solution.  Price is a huge concern here when the vendor knows how much it will cost the customer to switch vendors.

One of the early adopters of MVaaS technology has been the restaurant industry.  As such, the economic strength of the segment is of particular importance to vendors in the space. 

On Friday the National Restaurant Association released its forecast for 2009.  It is encouraging.  While concerns about the overall economy continue, the NRA forecasts only a slight decrease in sales versus 2008 (1%, when adjusted for inflation).

Not surprisingly, certain segments of the industry are expected to out-perform others.  For example, quick-service restaurants are expected to post gains well ahead of the full-service and eating-and drinking segments. 

The bottom line is that the industry is expected to display resiliency in the coming year.  This is good news to those of us who serve them.

I found a thought-provoking post on Brad Feld’s Feld Thoughts last week (sorry, not able to link at this time).  The post references another by Ted Rheingold, titled 10 Tips for Building a Profitable Business.

Brad highlights #4 as his favorite.  This is a timely point to reflect on this question.

A person I once worked with used to say that we are all in sales (meaning everyone in the company, no matter what your job description).  Her point was that everyone has a stake in the company’s success, and so we all have a responsibility to help drive revenue.  This doesn’t mean that we all need to start making cold calls to prospective buyers.  It does imply, however, that our efforts should be directed towards serving current customers or finding new ones.  If you can’t determine how your efforts contribute, talk it through with your manager.  If there is no connection, perhaps the company would be better served if you stopped doing it.

Doom and gloom.  There is certainly enough of it to go around.  My commute regularly finds me listening to NPR and lately I’m bombarded with company after company announcing lay offs and all kinds of market pundits saying how bad the economy is and how its going to get worse.  Hard to argue with their logic and with the data.

Having said that, I continue to believe that some markets are going to benefit from the downturn.  Discount retailers, fast-food, pawn shops and pay day loans – many of these companies are thriving in this market.

In our case, I can say that despite the challenges that many of our target markets are facing we are seeing more activity now than we have at any other time.  This week alone we met with companies that collectively had over 10,000 locations.  The majority of these companies had strong financials and were not seeing near term pressure on their financials given the market segments that they are in.  (In fairness, that was not true across the board as several had some significant leverage issues that they were concerned with)

I attribute our level of activity to a couple of different factors.  One, market awareness for us is definitely increasing and we are getting meetings with retailers that would not have heard of us in years past.  Two, despite the market conditions, there are still retailers out there actively evaluating video solutions so the opportunities are there.  Three, we have recently added some incredible sales talent to our team and they are paying immediate dividends with the activity that they are drumming up.  If there is one lesson that I’ve learned over the past several years running Envysion is that a good salesperson is worth their weight in gold.  There’s a corollary to that rule but I won’t get into that

I’m excited about our prospects for 1Q09 given how this month (a holiday month no less) is shaping up.

I came across an interesting read while viewing a related article at the networkworld.com website. It cites marketing departments as one of the big drivers behind the growth. This has actually been a strong value proposition as we gain more traction in the retail market vertical. For example, analyzing linger times and traffic patterns around promotional displays provides remarkable insight into the validity of the marketing effort and ultimatley, the best ROI of each marketing dollar.

While you’re visiting the site, be sure to check out the Top 10 IT Security Companies to Watch. Specifically, the third company listed.

The discussion around “Should You Use Software-Only Video Management Systems” at ipmarketvideo.info got me thinking about a feature we’ve been talking about over here at Envysion for a couple of years now, the “Downloadable NVR”.

A downloadable NVR appliance may offer a valuable mix of “software only” and appliance hardware.  Given the number of software appliances over at VMWare’s Appliance Marketplace, this is not a new idea, but perhaps one that just haven’t been done much with NVR’s/DVR’s.  Here’s one way this could be done:

- Go to a website

- Download the NVR software and burn onto a CD

- Put the CD into a PC and boot it up

- About five minutes later, the PC is now a dedicated NVR

- The NVR automatically appears in your Envysion Video Web application account

This has the value of reliability and easy of maintenance of embedded software, but without the specialized embedded hardware that locks you in to a hardware vendor.  Perhaps it’s also valuable due to the ease of obtaining the software.

What do you think?

Image by stevechasmar via Flickr

We have invested significantly in various trade shows the past couple of years.  Has the investment paid off?  Sometimes yes.  Other times, no.  We have spent considerable resources trying to decipher the elements that have contributed to both outcomes.  

On SandHill.com in two opinion pieces (Sales and Marketing), Elizabeth K. Cook documents some of the things she witnessed at the Oracle OpenWorld 2008, and provides commentary on the general do’s and don’ts of trade show sales and marketing.

Anyone who spends a considerable amount of time at trade shows should read these articles.