Home is where the smart is
The ‘Internet of Things’ is spearheading the evolution of the smart homes industry which is expected to be worth $150 billion by 2020, globally. Whilst the demand for connected home devices has not met initial expectations, the take up of home assistant devices such as Amazon Echo along with Apple’s recently announced, HomePod has been dramatic. Amazon Echo alone sold over 11 million units in the second half of 2015.
The proliferation of companies investing in the smart homes industry has led to an improvement in the quality and functionality of available products. However, without an agreed communication protocol, competitors are creating products which do not integrate. The Apple HomeKit has made significant steps in overcoming this. The app comes with compatible accessories such as lights, thermostats and sensors creating an ecosystem of interconnected devices.
The immediate opportunity for new products lies with media and entertainment, as Amazon has shown. However, longer term we see technologies enabling energy saving, convenience and greater security as being a bigger opportunity.
Hive is at the forefront of the advancement of smart technologies in the UK having repositioned their brand in the mainstream market by focusing less on technical qualities and more on the usability of their products. The company sold over 450,000 products in 2016, three times more than last year and hopes to reach one million by the end of 2017.
Despite this, only 3% of homes own a ‘smart’ thermostat while only 2% have installed smartphone controlled lighting systems. In order for the use of smart home devices to become more widespread, consumers will need reassurance on the following:
Connectivity: Consumers need to know that their smart devices can all work in cohesion as part of an integrated system. Wink Hub helps users build their connected home, with software that connects smart devices from a range of brands, including Nest and Amazon Echo.
Ease of use: There is a reluctance by many households to adopt new technologies because of their perceived complexities. In order to engage this audience providers need to place a greater emphasis on educating consumers on the benefits of their products, instead of simply building evermore complex devices.
Security: Consumers perceive increased security risks associated with greater smart technology adoption. For the market to reach the mainstream, companies need to prioritise both consumer privacy and security and effectively communicate that their data is safely stored and used.
The smart home market is currently stuck in the early-adopter phase and yet to move to the mass-market phase of adoption. However, the success of innovations through apps suggest that consumers are willing to adopt new technologies when the benefits to their lives are more apparent.
To learn about our work in the Home sector, please contact us.