Lexington, KY - The modest, little hi-fi stereo store opened in Lexington in 1976. Audio Authority planned to offer customers upscale, high-end audio and video components, along with installation services. But down in the store's basement, a couple of "mad scientists" were already at work, transforming the store and the future of the company into something entirely different. More on that later.
At the time, retail hi-fi stores didn't have a commercially available product that allowed them to effectively demonstrate speakers, amplifiers and turntables to customers in their stores. Customers tried to put together sound systems to buy but had no way to efficiently compare on the sales floor one speaker to another or one amplifier to another. It was obviously to the store's advantage to help customers do comparison shopping.
Audio Authority founder Jonathan Sisk and a buddy, Jonathan Gertz, put their heads and hands together to create a solution. They invented a simple but effective product called the Comparator.
"Within six months after opening the retail store, there was an entrepreneurial manufacturing operation going on in the basement," said Bob Sollee, president of Audio Authority. The two Jonathans had learned to manufacture audio switchers. From that humble beginning, they expanded their offerings to include car audio switching systems, production of video switching equipment and a series of commercial signal distribution and audio-video switching systems.
The retail store changed its name to Ovations and survived into the mid-'80s, but Audio Authority, with a new mission, exploded into the world marketplace. Today, its demonstration products form the backbone of many interactive retail showrooms worldwide.
Enlightening potential customers about everything Audio Authority does is one of the jobs of sales manager Tom Higgins.
"It's a matter of getting our name out there and educating the target market to the potential," Higgins explained. "It's making people aware that we're more than just 'the switching guys.'"
Over the years, Audio Authority carved out two more distinct business channels. One is customer-service intercom systems.
"We designed a superior intercom system for the banking and pharmacy industries," said Sollee. "We sell to other manufacturers who make pneumatic tube systems that carry money or pharmaceuticals back and forth between tellers or pharmacists and their customers."
Interestingly, the United States is one of the few nations that embraces drive-through banks and pharmacies. Higgins has seen the difference in Europe.
"People there like personal, face-to-face banking. It's all done inside. I'm getting some sales traction in Central and South America, but not much," he lamented.
The third company division is custom audio/video integration, which combines switching and distribution technologies for custom installers who combine products into user-friendly systems for their customers.
"When high definition came out in the 1990s, we were the first company to design an HD distribution amplifier that takes a signal from a satellite receiver and distributes it to all TVs in a retail showroom. Best Buy, Circuit City and Sears have used them," said Sollee. "Over time, we began making adapters, switchers and signal routing devices appropriate for home environments - a scaled-down version of what's in retail stores."
Audio Authority also developed a network of custom integrators who come to people's homes to install audio or video equipment for them. The company occupies a 44,000-square-foot facility on Mercer Road where about 40 employees engage in design, engineering, tech support, IT, purchasing and graphic design, as well as sales, marketing, customer service and accounting.
"We do it all," adds Sollee.
Audio Authority's forte is design. That involves sophisticated circuit board layout software. Engineers create products based on sales input and customer demand.
Then they take ultra miniature components and use robotic-like machines to place those components precisely on circuit boards.
Audio Authority uses electronic advertising in its marketing. "It's quick, and people have the ability to accept or reject it right away," said Higgins.
For presenting the A/V integration portion of the business, the Internet does the trick.
"We're doing e-mail blasts to our established dealer network and advertising in electronic trade magazines," Higgins stated. "Several key print magazines in our industry have electronic 'sisters,' and we run ads, or they send out electronic newsletters a couple of times a week and we'll have an ad in that."
Best Buy is Audio Authority's single biggest customer. "They come to us every time they need a solution," Higgins concluded.
Audio Authority considers itself a rare animal in that it proudly markets its products as "Made in America."
"We make a large variety of things in small batches and some things in really large batches," said Sollee. "It allows us to keep the technology here at home and still make a fair profit."
Pretty heady stuff for the long-ago dreamers inside that tiny hi-fi shop.