It is a well-known truism that nothing succeeds like success. This maxim certainly applies to the modern smart home, where the adoption of a new category of connected devices has been growing rapidly since 2014.
This phenomenon is not accidental. Data from Parks Associates shows that 88 percent of US households currently have broadband access. The ubiquity of broadband access in the typical household has created fertile ground for connected devices. Parks reports that 34% of broadband households have at least one connected device, with consumers having an average of 13 connected devices (of any type) in their home, up from 9.2 in 2016 – a dramatic increase of 41 percent in less than five years.
The overfeeding of the smart home is a growing desire of consumers to address and solve the problems of the home. As the technical smart home landscape has evolved (and continues to evolve), new and existing homes need to be “reinvented” with connected devices in mind.
Parks Associates recently engaged with GE Appliances to develop a white paper that identifies opportunities, headwinds, triggers and dynamics to address the smart home macro opportunity. Many of the key findings and insights from the white paper touch on a host of topics that smart home companies should consider in their mission to address this growing but difficult category of technology.
Smart home devices demographics
Parks Associates research has identified convenience, comfort and peace of mind as central factors for adoption. These overarching factors have been encouraged by traditional marketing attributes such as increased brand / product awareness and co-marketing partnerships (especially in traditional industries like energy providers, insurance companies and energy suppliers). The smart home space, from its inception, has always had a DIY (Do-It-Yourself) appearance, with the ensuing installation and setup consequences that early adopters and fast-paced consumers alike are willing to do. accept.
Nonetheless, the overall percentage of broadband households in the United States with three or more smart home devices has increased by more than 64% over the past two years, from 14% in 2018 to 23% at the end of 2020.
It’s hard to argue that COVID-19 has not has played a central role in the meteoric growth of video doorbells, as home consumers (increasingly working from home) have found a unique appeal in the ability to monitor deliveries online and observe visitors in their homes, often from a distance. Data from Parks indicates that video doorbells have experienced the highest level of growth – up 86% over the past six years – of the most popular smart home devices. Contributing to the appeal of video doorbells, particularly with the increase in crime in many urban and suburban areas in the United States, is the product’s ability to facilitate the overall safety of their neighborhoods by posting activity videos. harmful resolved.
Interestingly, while smart thermostats didn’t relinquish their leadership position for smart home devices until 2020, the growth in adoption of these devices is now comparable to that of video doorbells. Smart bulbs and smart cameras remain relatively popular (the latter due to growing concerns about home security). A growing number of mainstream consumers are recognizing the value proposition of remote monitoring and the ability to receive notifications when owners are away.
The main triggers for buying smart home devices
Awareness of traditional products continues to play a critical role fueling the buying behavior of smart home devices. The visibility of smart home devices in physical retail stores, as well as online brand awareness, is the primary buying catalyst. Like many other technology products, buyers of smart home devices often view the experiences of other consumers as an important purchase criterion.
Surprisingly, other traditional and customary marketing techniques such as holiday specials / promotions, packages and other price-based incentives are somewhat influential, although they are not among the main considerations such as awareness raising. fundamental and the experiences of others. This phenomenon could be explained by the desire of the average consumer to focus on solving real smart home problems rather than on the price or promotion “gimmicks” that are often effective with other types of products.
Smart home products permeate consumers’ lifestyles
Research by Parks Associates highlighted the epiphany that the smart home and connected devices are making deep assimilations into consumers’ lifestyles. It is quickly becoming clear that consumers understand smart home devices in their homes and lifestyles in such an integrated way that it has become difficult for them to imagine what life was like before the dawn of the era. the smart home. It’s not hyperbolic to claim that smart home consumers are starting to perceive video doorbells, smart thermostats, and smart light bulbs (a few examples) as being as critical as “can’t live without” things like air conditioning, cell phone service and indoor plumbing.
What are the main implications?
It is essential to point out that the smart home and connected home devices have mainly been a phenomenon of early adoption. This market situation is likely to change in the not-so-distant future as more and more mainstream consumers, often tech-savvy, will begin to understand and accept the benefits of the smart home value proposition. In addition, lower prices and product integration, creating and enabling new value, will help increase the adoption of connected products.
More compelling, impactful and pragmatic marketing messages can play a major role in accelerating the attractiveness of the smart home. Consumers and households with modest (and less available) income levels are likely to adopt smart home technology only when they fully appreciate the benefits of the usage model. Home builders need to understand the integration of these new technologies into their home design plans. Plus, with 30% of US broadband homes living in MDUs (multi-unit units), this is a clear call for multi-family managers to integrate smart home capabilities into their properties to improve their performance. operational efficiency thanks to remote energy management and access control. For building management companies, the good news is that MDU-based residents are willing to pay increased additional fees for smart home services and rentals that are ‘smart home friendly’, research shows. by Parks.
To learn more about new smart home products, the connected consumer lifestyle, and the future of modern living, download and view the Smart products: building the modern house white paper.
Mark N. Vena is the Senior Director of Smart Home & Strategy Practice at Parks Associates.