NuVo Terminates Two Dealers for Violating Its Internet Sales Policy

August 20, 2009

CE Pro’s Tom LeBlanc yesterday published an interesting, detailed piece about NuVo Technologies’ termination of two dealers for selling its products over the internet, a clear violation of NuVo’s policy. Residential Systems’ Jeremy Glowacki also covered the NuVo story in-depth in the context of another manufacturer’s similar initiative.

Some people would say, hey, what’s the big deal? They’re just electronics products. If someone wants to eliminate the middleman, what’s the harm?

Well, it’s a big deal on two fronts. For one, NuVo’s whole home audio products are by no means DIY or off-the-shelf retail; they are clearly and explicitly meant to be professionally installed by an authorized dealer. Only someone who is trained in installing this stuff can fully understand its capabilities, install it properly and make it sing. These systems aren’t just something you plug into a wall; they require wires to be run throughout a house, inside the walls (and in the case of NuVo’s upcoming Renovia system for retrofits, they require a knowledge of electrical systems).

Not everything is meant to be bought on the internet. Like one of my other clients, Universal Remote Control, says, “Sure, you could buy an artificial heart online, but you’d probably want a trained professional to install it.” Of course, electronics products aren’t a matter of life or death, but you get the picture.

The other aspect of this is NuVo’s effort to support dealers who play by the rules. By dumping products on the internet, rogue dealers are negatively impacting policy-abiding dealers. If NuVo were to let the rogue dealers run willy-nilly, what would that say to its ethical dealers?

And what are those rogue dealers saying to the world about their own industry: custom installation? By selling installation-only products on the internet, or selling them to third-parties who resell them online, these dealers are implicitly and wrongly communicating to the public that their custom installation services aren’t really necessary. Essentially, they’re destroying the foundation of their businesses and their industry just to make a few quick bucks.

It’s great for the CEDIA channel that manufacturers like NuVo are standing up to the bad guys and protecting the good guys.

Posted by Joe Paone