We were so excited to be back in person for our 26th annual CONNECTIONS CONFERENCE last week at the Omni Frisco! Thank you to our event sponsors: Alarm.com, Calix, Cox Communities, F-Secure, Homebase, Plume, Airties, Bitdefender, Johnson Controls, Nice, Notion, Rapid Response Monitoring, Resideo, Schneider Electric, STRATIS®, AmTrust Specialty Risk, Gadgeon, Ivani, Midea, Cooktop Safety, Iris® Powered by Generali, and Assurant.
Last week, our discussions were all about "Moving the Smart Home Beyond Early Adoption” and the event features focused on:
While the use of smart home devices and appliances is mostly among early adopters, many markets will inch closer to the early majority in the next few years. The integration of new technologies in consumers' lives is forcing service providers and manufacturers to rethink technology solutions to meet the changing needs of the post-pandemic world. Convenience, comfort, and peace of mind remain the leading drivers of smart home device adoption.
But, other factors influencing growth include increased product familiarity; co-marketing partnerships with brands in different industries such as energy providers, builders, and insurance companies; and an increase in the production of DIY smart home device models.
Not only do more consumers own smart home devices, but also smart home device owners are buying more devices. Currently 37% of internet households have a smart home device and have an average of 16 connected devices total, with the majority coming from the CE category. Households that have a smart home home device have an average of 8 of those devices in their homes.
New Smart Products Entering the Home
Smart home buyers report 36% of recent device purchases were through a retailer, either an online or brick-and-mortar company, while 11% of units purchased were through an internet service provider, 7% through a utility/electricity provider, and 6% through an insurance provider.
As consumers grow increasingly aware of the smart devices on the market, new categories of smart products are emerging, offering added benefits that address different pain points. New categories include solutions that monitor indoor air quality and facilitate independent living, safe package delivery, and energy resilience in the home.
The market is ripe with the opportunity to continue providing value to consumers through the integration of devices, advancements in technology, and new partnerships.
Some key takeaways from last week's event:
Interoperability matters, more than ever, given the growing complexity of the smart home. The Matter initiative is a great one by Connectivity Standards Alliance. Whatever happens though, it is clear industry leaders are not sitting back and waiting for this to happen to continue innovating and releasing new products. ~ One-fifth of smart home device buyers say interoperability with other smart home products they own is a top purchase consideration according to Parks Associates research.
Privacy and security solutions are needed and are the responsibility of everyone. Clearly, the industry recognizes that privacy and security solutions cannot just be left to laws, mandates, or government entities to make happen. The device makers and service providers have a responsibility to help protect the consumer and work hard to roll out new solutions to help ensure data security and privacy are protected. Currently, 37% of consumers report they do not trust the companies that have access to their personal data, according to Parks Associates research.
We are in a new era of home services, driven by the advent of the 4th industrial revolution. Now US households have an average of 16 connected devices in their home. The Internet of things, cloud computing, data, and technology innovations driven by integration between products, artificial intelligence, machine learning, and predictive and proactive intelligence enable new applications and use cases. These services extend from all verticals in the home, including security and home automation, health and wellness, energy management and water solutions, entertainment, broadband, and support services.
The scale of the market is going to expand rapidly, through the building channels, especially the multi-dwelling environment, including apartments, student housing, and senior living. As consumers continue to expect more and more from their living environments, property owners and builders of single-family and multifamily homes are investing heavily in broadband, platforms, and services that provide new amenities for the resident and great operational benefits for the properties.
New business models are emerging to provide choice to consumers in the solution and installation process for home technology. Companies are introducing new ways to purchase and own technologies and services in the home. Practically all the hardware that is connected is getting a service attached to it or being connected to another service. Financing equipment, low hardware cost and low monthly service fees, partnerships between different ecosystems, and value-added services added to existing services are driving adoption, familiarity, and value for consumers.
It's all about the data and control. Clearly, the winner of today's connected home is the one who has control of the data and the overall experience. While the market continued to be very fragmented, industry players are looking for control of the smart home through curated systems, integrated platforms, works with programs, and high-end custom integrations.
There is a strong recognition that labor will be an ongoing challenge in the future for the smart home industries. Many different initiatives are underway and discussed to help educate, train, and drive new interest in working in these areas, especially for installation services.
Face-to-face meetings are invaluable. This year's event reinforced what many of us know already – face time in business is crucial, and business is about people. While we love our virtual offerings at Parks Associates and will continue those to help expand awareness and educate industry leaders, we also know the value of in-person events is different than virtual. It was truly an honor to host the industry last week in Texas at our 26th annual event.
It's a bright future for the connected home; obstacles and challenges will continue as they always do. The industry players of the smart home are resilient, passionate, and truly dedicated to driving new value for consumers at home. Parks Associates is dedicated to helping to best understand the growth of these products and services and helping diffuse knowledge through our research and events.
Please consider joining us at future events – virtual or in person. I'd love to talk to you about what you are working on in the smart home. Please reach out to Parks Associates team or me at any time.
We love feedback. Thank you for reading Parks Associates research. For more information visit www.parksassociates.com
If you enjoyed this article, be sure to subscribe to our newsletter on LinkedIn: https://www.linkedin.com/newsletters/the-connected-consumer-6876368780553990144/
