As the smart home industry attempts to cross the chasm—moving from adoption among early adopters to the early majority—brands in the space fervently seek to understand the value propositions that drive product adoption and how to improve perceived product value.

Understanding the buyer journey is equally important for industry development. Knowledge of the products consumers are purchasing, what they intend to purchase, and what is driving these intentions can help guide product development efforts as well as partnership alignments and marketing strategies. A solid understanding of customer experience challenges along a customer’s journey with a product is also critical to industry success, helping brands eliminate the hiccups that inhibit future purchases.
Buyer journeys for smart home products are now more varied and complex than in the past, when most consumers started their smart home journey with security-focused solutions. Today, a greater variety of use cases drive consumers’ first smart home device purchases. In some cases, patterns can be identified, where a consumer is seeking greater convenience around access control use cases. In other instances, purchases seem guided by highly personal preferences or driven by the popularity of a given device. Patterns, often difficult to discern in this early market, will strengthen over time as adoption increases.
Today, householders most often acquire smart home devices incrementally rather than all at once. While security providers and Multi-System Operators (MSOs) offer a bundle of components, consumers typically tread carefully when adopting products, even through these channels. Given that the smart home industry is in its early stages, consumers are just becoming acquainted with the various smart home devices. Many consumers are not aware of the capabilities of these products, and more than half of consumers who do not own or intend to purchase a smart home device report that they do not think the products will be beneficial to their lifestyles. Consumers are also not completely comfortable with incorporating smart home devices into their lifestyles. Among consumers who do not own or intend to purchase a smart home device, more than 30% report security and privacy concerns and more than half do not see benefit or value in owning a smart home device.

Buyer Journey

Adoption of smart speakers with personal assistants, such as an Amazon Echo, Google Home, or Apple HomePod, is a precursor to smart home device purchases. Smart speakers with personal assistants capture consumers’ imagination and meet several mass-market criteria:

• They are relatively affordable
• Their most basic value proposition (playing music) is easily understood by the mass market
• They are fairly easy to set up and use
• They are innovative, with good design

If expanded to consider both first and second device purchases, smart door locks, smart thermostats and networked cameras are also popular entry devices into the smart home experience. Network security cameras’ high placement in device ranking can be partly attributed to the device being commonly offered as part of smart home packages in the security service channel.

Companies can use the knowledge of buying order to develop offers pertinent to a first-time device buyer, a second-time device buyer or even an old hand at device buying. For example, products targeted to first-time buyers may be offered with free technical support for a limited time, or a free home Wi-Fi inspection; whereas marketing for second- and third-time buyers may be centered on highly valuable use cases that involve interoperability among devices.

Purchase Channel and Challenges

Consumers purchase smart home devices from a variety of channels. The top five channels for smart home device purchases are national retailers, online-only retailers, security dealers, HVAC contractors, and broadband service providers. The decision to purchase a product typically involves gaining awareness of the product, identifying a personal need, assessing whether the price of the product is worth the benefits that it will bring, and determining the channel through which to purchase the device.

Purchases are made only after successful navigation of these steps.

Understanding consumer purchase intentions can guide product investment and partnership efforts. As smart home players attempt to drive market growth, an understanding of what drives these intentions and the motivation behind follow-on purchases will be a critical part of the equation. 

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