Feedback Heard from LightFair

LightFair, the annual gathering of the lighting industry and one of the few tradeshows in the electrical industry, had many traveling to Chicago last week. While other sources (trade publications) focus on the products that were exhibited, and we understand there were a number of “neat” niche products, we’ve asked a number of LightFair attendees (clients and non-clients) for their feedback on the show and general observations.

The feedback appears to be:

• A number of cool products albeit more architectural in nature or niche products with many not the types that are “bread and butter” for traditional electrical distributors.
  • Click here for the top 10 LightFair products according to Electrical Wholesaling.
• The sense was that attendance was down … or perhaps for specific days that our contacts attended. Some commented that a number of Tier 1 manufacturers seemingly had smaller booths (perhaps a sign of cost cutting and correlating to their sales performance) whereas “Tier 2” companies had larger booths (perhaps correlating to those who are growing and taking share?)
• A number of distributors and reps were in attendance. Graybar, Grainger, Sonepar, State Electric, Buckles Smith and WESCO were some names mentioned (and I know more attended. If you / your company attended, perhaps mention in the comments section below.)
• While the conference is called LightFair and was characterized as LEDFair the last couple of years, a few commented that the theme this year makes it ControlFair.  Lot’s of products / presentations on connected lighting, lighting controls and IoT.
  • David Shiller, president of Lighting Solution Development, commented “Nearly 100% of the innovation that I saw was on the controls  and IoT side.  One trend in controls was the increased presence of powerline communication control and dimming manufacturers.” (three companies were mentioned. Question … is this a niche application? Chris Brown, formerly of Weidenbach-Brown, also shared information on this technology and a company called Espen Technology.)
  • Shiller also mentioned that BlueTooth Mesh is gaining adoption in the controls area but that some still have concerns and improvements are needed.
• IoT adoption, according to the large companies, is undergoing painstakingly slow adoption.  There are technology challenges, app development challenges, sales process challenges, customer acceptance issues, channel indifference (caused by confusion) and pricing model issues. Some companies are conducting pilots but the pace of retrofit is nominal, pilots take long to sell and then broader deployment is measured in “years”.  While the concept makes sense and is technically feasible, it’s questionable if it will be the revenue driver, in the short-term, that some have professed.
  • This feedback included input from Acuity, Philips, Eaton and others
  • Selling the “upgrade” path seems to be hard.  If non-IoT is installed in new construction, delays future conversation as more difficult to sell energy savings benefits.  As benefits become more enterprise wide (i.e. worker productivity or marketing-oriented) the sale becomes more complicated (more people involved than solely facility decision-makers), decisions get delayed and lighting companies become dependent on someone writing software applications.
• Market feedback was:
  • Large market a little soft
  • Small to mid-sized market, especially renovations, still strong.
  • Architects / specifiers are still busy so overall lighting market is good. Could be transition in customer segments, which doesn’t favor larger lines and infers lighting agents need to do more “down market.”
• Edison Report had an interesting Day 1 article on James Trading as epitomizing “BigChinaLED”.  They had a large “booth” (grouping of tables) next to Acuity. He commented about their business model (sell direct, US warehouses, accept credit cards, “low price / sufficient quality (in most cases) and good design”. While electrical distributors may, or may, not be buying from them, companies similar to this, and contract manufacturers, are perceived as the reason for continued price declines and sales / margin erosion for the large companies (and for creating opportunities for others to enter / expand in the market.)  We’ve also had questions from some analysts about James Trading and their impact in the lighting space.
• Just prior to LightFair Acuity announced a 6% general price increase on “all legacy products and select LED product families and options.”  The question from many is “will this lead the market up? Will other manufacturers, including Chinese companies follow? Or will the market, and project pricing / negotiations, ignore this and it will have no impact on the market?”  Initial feedback we heard was a “yawn” and no expectations of it impacting the market.  Thoughts?
• Current by GE had a large presence at LightFair. Perhaps seeking to become more relevant again in the industry … just in time for being sold with Round 1 acquisition bids recently solicited by GE?  The GE name was prominently displayed on the booth, an indicator that GE wants to keep the brand alive to help the sale price … value in the name / goodwill.
• LEDVANCE seems to be making a comeback and seems to have made the transition to a fixture manufacturer.  They’ve launched over 100 new SYLVANIA LED lamp, luminaire and smart lighting products.  They showed a number of these lamp and fixture products at LightFair. The transition to MLS ownership is complete. With MLS also owning Forest Lighting, it’ll be interesting how the two position themselves in the electrical distribution space … why buy from both?
•  Acuity still playing catch up for “white goods” market in the areas of panels and small downlights.  Acuity also asking their lighting agents to talk to some of their other manufacturers about adopting Acuity IoT platform. Sounds like the beta vs VHS issue (and we know how that ended!).  Need to get others to connect with them, otherwise they may be on an island.
  • Acuity has launched its long awaited, long discussed Contractor Select line which has elements from Lithonia Lighting, Juno and Sensor Switch. Seems like more packaging and probably pricing … maybe a little product sourcing.  Question … will it help Acuity compete in this segment of the market? As a distributor, do you replace Tier 2 / 3 lines you’ve brought in and successfully sold for this Acuity line? Would incremental rebates or involvement in your marketing / buying group make you switch?
  • New panel products should be selling at Lowe’s by June and should help stock/flow. (and given the launch of Contractor Select, should distributors support Acuity for this renovation market product given their focus on Lowes?)
• Security concerns are slowing some IoT enabled adoption. The more companies hear about data breaches, the more they ask how to prevent / what they need to do and also want to  / need to vet the technology. Creates delays in sales process and also forces end-user decision-makers to get their IT departments involved which creates conversations back to rep, to distributor, to manufacturer.

What did you see that impressed you? What did you hear from manufacturers or fellow attendees? And if you attended any of the training sessions, what were your takeaways (we heard that these were more towards specifiers and more technical in nature … which could be an opportunity for distributor salespeople and reps to gain non-supplier training to position them in their marketplaces as “thought leaders”)/

With lighting representing 25-40% of a distributor’s business, independently keeping track of trends and gaining product / application knowledge can be key to driving growth in a product category that does not benefit from price appreciation.  Knowledge to support selling is key (as is transferring your learned knowledge from the show to others in your company and to your customers (and if you want some ideas, give us a call.)

Your thoughts / what have you heard regarding LightFair?