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Hey friends,
Today, let’s change it up around here with a new type of newsletter. ✨
Nexus Labs has just completed two vendor selection processes for Buyers. Now, we’re sharing the results—because the industry desperately needs more transparency in the marketplace.
If it were easier for Buyers to get the information you’re going to see below, faster decisions could be made, and fewer resources would be required to make them. That’s why Nexus Labs is building out a database of smart buildings technology vendors, including which categories exist, what each category means, which vendors are in each category, and more.
Here’s our vendor selection process:
Step 5 doesn’t exist anywhere else in the industry. It’s time for sharing.
Enjoy!
We were asked to help select occupancy counting vendors for two different Buyers. The first Buyer is an office REIT in Canada that owns 5 million square feet. The second Buyer is a corporate owner/occupier with 450 global facilities.
Each is concerned with counting people in offices, but for different reasons:
Both Buyers had similar requirements, such as:
Neither Buyer is currently concerned with or interested in other use cases that are enabled by occupancy counting. That said, the solution needs to be flexible and extensible for future use cases. And as we laid out in our Buyer’s Guide to IoT Sensors, additional use cases are plenty.
Crucially, both Buyers needed this information to move their smart buildings program forward, but didn’t have time to wade into and through the vendor swamp. If you’re a buyer with similar needs, reach out, and we’ll help you!
At this point in our industry, there are very few technology categories where we could make a one-size-fits-all sort of recommendation. Meaning we couldn’t just tell the Buyers: “here’s your shortlist, good luck.” That’s where we hope to get soon, but we’re not there yet.
Nexus Labs used our Marketplace tool (coming soon to the public) to select 40 vendors that might be interested and capable of executing these projects. We sent them two forms to fill out, plus asked them to submit a budgetary proposal for a sample floorplan.
From that outreach, only about ⅓ responded with complete information. The rest either didn’t respond, declined the opportunity, or submitted incomplete responses. From that list, we provided a simple comparison of their responses to the Buyers, who chose a shortlist to move forward with.
We’ll go into far more detail below, but here are the big picture takeaways for those short on time.
Takeaway 1: These Buyers made their selections based on business model and integration capabilities, not on sensor technology. Once you filter the responses for their requirements (Optional SaaS, local integration options), it leaves only a few left standing.
Takeaway 2: These Buyers also selected based on price, but not price alone. That said, the pricing exercise was eye-opening. There was a huge range in price, and differing business models made it difficult to compare apples to apples. We chose to normalize based on a 3-year total cost of ownership. The 3-year cost for one of the projects ranged from $290,000 to $1.3M.
Takeaway 3: Most occupancy counting vendors are too expensive to have a legitimate ROI with only one use case. They need multiple varied use cases to make the business case work. The challenge for them is that their high price rules them out when a buyer is just trying a pilot with one use case, as was the case with both of these Buyers.
Want to go deeper? Nexus Pro members can log in to read on about:
As we show below, comparing smart buildings vendors is a complicated, time-consuming, and potentially risky process. In order for the industry to really accelerate, going shopping needs to become a lot easier.
We believe Category-First Buying leads to better competition between vendors, making it more likely to select the best in the category. In this case, both buyers were looking for the same category: Occupancy Counting Sensor with Optional SaaS.
Our Marketplace database has 5 vendors in this category, but only one of them responded. We’ve heard that Irisys is pulling out of this category, but we haven’t had confirmation from them.
Since this category is halfway about business model of the vendor, we also included three other categories to see if those vendors’ pricing could compete or if they could be flexible in their pricing model:
Through this exercise, we’ve also created another category: Agnostic Integrators For Occupancy Counters. These vendors can pick and choose the sensor that makes the most sense for the application. Except, of course, if the sensor company brings them in on the opportunity, forcing them to respond with that vendor’s sensor as the basis of the response. Buyers might want to choose these vendors if they want more help on the design side, or they want to mix and match sensor types from different vendors.
Both Buyers Buyers are skeptical of wifi-based solutions, but we decided to include them to see what they would say about accuracy concerns. In this case, the price was still not competitive, so it didn’t get to that.
Both buyers were also a little concerned about using optical sensors due to the privacy concerns of putting cameras everywhere. We’re less concerned about this and decided to include them in the process because optical sensors allow a more expanded set of use cases for the future.
Generally, every vendor said they didn’t collect personally identifiable information (PII). Once again, the pricing from these vendors was not competitive with the thermal / non-optical sensors that were shortlisted, so we didn’t dig deeper.
Once we pick vendors based on the Buyer’s preferred category, we then need to focus on capabilities. The main capability these buyers cared about was local integration options. They wanted to be able to access the data on the local network, not via cloud API.
Here were the 12 responses to this question:
This seems like a relatively simple way for more sensor vendors to compete, but it seems like their business models stand in the way. That said, many suggested that local integration options were “on their roadmap”. In the case of one of our Buyers, this functionality was vital to the project, since they planned to connect the sensor data to their BAS and control HVAC zones.
The power and connectivity options were very similar. Most vendors wanted a LAN connection via wifi with an outbound connection to their cloud. The Buyers had POE infrastructure already in place, so preferred that, plus the flexibility of multiple options in case something went wrong.
“If integration and connectivity options are flexible, it’s really valuable IMO as we test out different approaches. If one doesn't work out we can pivot without replacing good hardware…”
—Buyer
As we covered in the Buyer’s Guide to IoT Sensors, the full scope of an occupancy counting project like this is much more than just a sensor. When comparing pricing, we had to think about the total scope, even if we were just trying to select a sensor vendor.
Here are all the cost line items:
Once we got all these numbers from each vendor, it was still difficult due to the different pricing models. We decided to look at the pricing in a bunch of different ways:
The 3-year total cost felt like a good way to rank the vendors.
One other problem we ran into was the lack of consistency in the number of sensors. Some vendors specified 4x the number of sensors compared to others. The risk for a buyer is that a vendor could lowball the bid and then issue a change order later because they “misunderstood” something.
We decided that the floorplan we provided for pricing should have mitigated this risk and we assumed the differences in sensors were due to the technical specifications of each sensor. Generally, we didn’t have time to dig into details like this to confirm. We also made sure that the shortlisted vendors weren’t lowballing the sensor count.
As I said above, one one vendor responded with optional SaaS costs. This limitation, plus the total costs, makes it feel cost prohibitive to do these sorts of projects when you’re only getting benefits from one use case. For some price sensitive buyers, it could be cost prohibitive regardless of the benefits.
One idea that will help the ROI is if the Buyer can convert some of the rooms (e.g. private offices) into presence-only sensors. This will save some money, but it adds complexity, since only a few vendors have that capability.
Want to discuss this more with the community? Any questions? We’ll see you on Nexus Connect.
We believe Category-First Buying leads to better competition between vendors, making it more likely to select the best in the category. In this case, both buyers were looking for the same category: Occupancy Counting Sensor with Optional SaaS.
Our Marketplace database has 5 vendors in this category, but only one of them responded. We’ve heard that Irisys is pulling out of this category, but we haven’t had confirmation from them.
Since this category is halfway about business model of the vendor, we also included three other categories to see if those vendors’ pricing could compete or if they could be flexible in their pricing model:
Through this exercise, we’ve also created another category: Agnostic Integrators For Occupancy Counters. These vendors can pick and choose the sensor that makes the most sense for the application. Except, of course, if the sensor company brings them in on the opportunity, forcing them to respond with that vendor’s sensor as the basis of the response. Buyers might want to choose these vendors if they want more help on the design side, or they want to mix and match sensor types from different vendors.
Both Buyers Buyers are skeptical of wifi-based solutions, but we decided to include them to see what they would say about accuracy concerns. In this case, the price was still not competitive, so it didn’t get to that.
Both buyers were also a little concerned about using optical sensors due to the privacy concerns of putting cameras everywhere. We’re less concerned about this and decided to include them in the process because optical sensors allow a more expanded set of use cases for the future.
Generally, every vendor said they didn’t collect personally identifiable information (PII). Once again, the pricing from these vendors was not competitive with the thermal / non-optical sensors that were shortlisted, so we didn’t dig deeper.
Once we pick vendors based on the Buyer’s preferred category, we then need to focus on capabilities. The main capability these buyers cared about was local integration options. They wanted to be able to access the data on the local network, not via cloud API.
Here were the 12 responses to this question:
This seems like a relatively simple way for more sensor vendors to compete, but it seems like their business models stand in the way. That said, many suggested that local integration options were “on their roadmap”. In the case of one of our Buyers, this functionality was vital to the project, since they planned to connect the sensor data to their BAS and control HVAC zones.
The power and connectivity options were very similar. Most vendors wanted a LAN connection via wifi with an outbound connection to their cloud. The Buyers had POE infrastructure already in place, so preferred that, plus the flexibility of multiple options in case something went wrong.
“If integration and connectivity options are flexible, it’s really valuable IMO as we test out different approaches. If one doesn't work out we can pivot without replacing good hardware…”
—Buyer
As we covered in the Buyer’s Guide to IoT Sensors, the full scope of an occupancy counting project like this is much more than just a sensor. When comparing pricing, we had to think about the total scope, even if we were just trying to select a sensor vendor.
Here are all the cost line items:
Once we got all these numbers from each vendor, it was still difficult due to the different pricing models. We decided to look at the pricing in a bunch of different ways:
The 3-year total cost felt like a good way to rank the vendors.
One other problem we ran into was the lack of consistency in the number of sensors. Some vendors specified 4x the number of sensors compared to others. The risk for a buyer is that a vendor could lowball the bid and then issue a change order later because they “misunderstood” something.
We decided that the floorplan we provided for pricing should have mitigated this risk and we assumed the differences in sensors were due to the technical specifications of each sensor. Generally, we didn’t have time to dig into details like this to confirm. We also made sure that the shortlisted vendors weren’t lowballing the sensor count.
As I said above, one one vendor responded with optional SaaS costs. This limitation, plus the total costs, makes it feel cost prohibitive to do these sorts of projects when you’re only getting benefits from one use case. For some price sensitive buyers, it could be cost prohibitive regardless of the benefits.
One idea that will help the ROI is if the Buyer can convert some of the rooms (e.g. private offices) into presence-only sensors. This will save some money, but it adds complexity, since only a few vendors have that capability.
Want to discuss this more with the community? Any questions? We’ll see you on Nexus Connect.
We believe Category-First Buying leads to better competition between vendors, making it more likely to select the best in the category. In this case, both buyers were looking for the same category: Occupancy Counting Sensor with Optional SaaS.
Our Marketplace database has 5 vendors in this category, but only one of them responded. We’ve heard that Irisys is pulling out of this category, but we haven’t had confirmation from them.
Since this category is halfway about business model of the vendor, we also included three other categories to see if those vendors’ pricing could compete or if they could be flexible in their pricing model:
Through this exercise, we’ve also created another category: Agnostic Integrators For Occupancy Counters. These vendors can pick and choose the sensor that makes the most sense for the application. Except, of course, if the sensor company brings them in on the opportunity, forcing them to respond with that vendor’s sensor as the basis of the response. Buyers might want to choose these vendors if they want more help on the design side, or they want to mix and match sensor types from different vendors.
Both Buyers Buyers are skeptical of wifi-based solutions, but we decided to include them to see what they would say about accuracy concerns. In this case, the price was still not competitive, so it didn’t get to that.
Both buyers were also a little concerned about using optical sensors due to the privacy concerns of putting cameras everywhere. We’re less concerned about this and decided to include them in the process because optical sensors allow a more expanded set of use cases for the future.
Generally, every vendor said they didn’t collect personally identifiable information (PII). Once again, the pricing from these vendors was not competitive with the thermal / non-optical sensors that were shortlisted, so we didn’t dig deeper.
Once we pick vendors based on the Buyer’s preferred category, we then need to focus on capabilities. The main capability these buyers cared about was local integration options. They wanted to be able to access the data on the local network, not via cloud API.
Here were the 12 responses to this question:
This seems like a relatively simple way for more sensor vendors to compete, but it seems like their business models stand in the way. That said, many suggested that local integration options were “on their roadmap”. In the case of one of our Buyers, this functionality was vital to the project, since they planned to connect the sensor data to their BAS and control HVAC zones.
The power and connectivity options were very similar. Most vendors wanted a LAN connection via wifi with an outbound connection to their cloud. The Buyers had POE infrastructure already in place, so preferred that, plus the flexibility of multiple options in case something went wrong.
“If integration and connectivity options are flexible, it’s really valuable IMO as we test out different approaches. If one doesn't work out we can pivot without replacing good hardware…”
—Buyer
As we covered in the Buyer’s Guide to IoT Sensors, the full scope of an occupancy counting project like this is much more than just a sensor. When comparing pricing, we had to think about the total scope, even if we were just trying to select a sensor vendor.
Here are all the cost line items:
Once we got all these numbers from each vendor, it was still difficult due to the different pricing models. We decided to look at the pricing in a bunch of different ways:
The 3-year total cost felt like a good way to rank the vendors.
One other problem we ran into was the lack of consistency in the number of sensors. Some vendors specified 4x the number of sensors compared to others. The risk for a buyer is that a vendor could lowball the bid and then issue a change order later because they “misunderstood” something.
We decided that the floorplan we provided for pricing should have mitigated this risk and we assumed the differences in sensors were due to the technical specifications of each sensor. Generally, we didn’t have time to dig into details like this to confirm. We also made sure that the shortlisted vendors weren’t lowballing the sensor count.
As I said above, one one vendor responded with optional SaaS costs. This limitation, plus the total costs, makes it feel cost prohibitive to do these sorts of projects when you’re only getting benefits from one use case. For some price sensitive buyers, it could be cost prohibitive regardless of the benefits.
One idea that will help the ROI is if the Buyer can convert some of the rooms (e.g. private offices) into presence-only sensors. This will save some money, but it adds complexity, since only a few vendors have that capability.
Want to discuss this more with the community? Any questions? We’ll see you on Nexus Connect.
Hey friends,
Today, let’s change it up around here with a new type of newsletter. ✨
Nexus Labs has just completed two vendor selection processes for Buyers. Now, we’re sharing the results—because the industry desperately needs more transparency in the marketplace.
If it were easier for Buyers to get the information you’re going to see below, faster decisions could be made, and fewer resources would be required to make them. That’s why Nexus Labs is building out a database of smart buildings technology vendors, including which categories exist, what each category means, which vendors are in each category, and more.
Here’s our vendor selection process:
Step 5 doesn’t exist anywhere else in the industry. It’s time for sharing.
Enjoy!
We were asked to help select occupancy counting vendors for two different Buyers. The first Buyer is an office REIT in Canada that owns 5 million square feet. The second Buyer is a corporate owner/occupier with 450 global facilities.
Each is concerned with counting people in offices, but for different reasons:
Both Buyers had similar requirements, such as:
Neither Buyer is currently concerned with or interested in other use cases that are enabled by occupancy counting. That said, the solution needs to be flexible and extensible for future use cases. And as we laid out in our Buyer’s Guide to IoT Sensors, additional use cases are plenty.
Crucially, both Buyers needed this information to move their smart buildings program forward, but didn’t have time to wade into and through the vendor swamp. If you’re a buyer with similar needs, reach out, and we’ll help you!
At this point in our industry, there are very few technology categories where we could make a one-size-fits-all sort of recommendation. Meaning we couldn’t just tell the Buyers: “here’s your shortlist, good luck.” That’s where we hope to get soon, but we’re not there yet.
Nexus Labs used our Marketplace tool (coming soon to the public) to select 40 vendors that might be interested and capable of executing these projects. We sent them two forms to fill out, plus asked them to submit a budgetary proposal for a sample floorplan.
From that outreach, only about ⅓ responded with complete information. The rest either didn’t respond, declined the opportunity, or submitted incomplete responses. From that list, we provided a simple comparison of their responses to the Buyers, who chose a shortlist to move forward with.
We’ll go into far more detail below, but here are the big picture takeaways for those short on time.
Takeaway 1: These Buyers made their selections based on business model and integration capabilities, not on sensor technology. Once you filter the responses for their requirements (Optional SaaS, local integration options), it leaves only a few left standing.
Takeaway 2: These Buyers also selected based on price, but not price alone. That said, the pricing exercise was eye-opening. There was a huge range in price, and differing business models made it difficult to compare apples to apples. We chose to normalize based on a 3-year total cost of ownership. The 3-year cost for one of the projects ranged from $290,000 to $1.3M.
Takeaway 3: Most occupancy counting vendors are too expensive to have a legitimate ROI with only one use case. They need multiple varied use cases to make the business case work. The challenge for them is that their high price rules them out when a buyer is just trying a pilot with one use case, as was the case with both of these Buyers.
Want to go deeper? Nexus Pro members can log in to read on about:
As we show below, comparing smart buildings vendors is a complicated, time-consuming, and potentially risky process. In order for the industry to really accelerate, going shopping needs to become a lot easier.
Head over to Nexus Connect and see what’s new in the community. Don’t forget to check out the latest member-only events.
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