Smart Home Market Trends and Forecast

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In the past few years, smart home products have gone from niche items owned by early adopters, to being commonly found in American consumers’ homes. In order to better understand consumers’ thoughts about and usage of smart products, The Stevenson Company recently completed its inaugural Smarthome Products Study. Over 2,000 consumers were interviewed regarding their attitudes, adoption, and usage of 25+ smart home product categories.

Ownership of smart home products has become a commonplace part of consumer’s lives. Two-thirds of consumers interviewed indicated that they own at least one smart home product. In fact, on average consumers own five smart home products, suggesting an increase acceptance of smart home products overall.

Most Common Smart Products

Thermostats and voice assistants/smart speakers are commonly consumers’ entry point into building a smart home. Compared to other products in the smart category, thermostats and voices assistants/smart speakers are more likely to be owned by consumers and/or tend to be the first smart product consumers purchase in his space. Those consumers are next most likely to also likely to own smart light bulbs. This may suggest cross-category merchandising opportunities for retailers with respect to how they display or group smart products in their stores.

a chart displaying what percentage of respondents indicated that they owned a smart thermostat or voice assistant/speaker, and what percentage indicated that those products were the first smart products they purchased.

Factors Influencing Purchase and Customer Attitudes

Manufacturers’ “cost of entry” to join the smart product market is no different than that of most products. The two strongest factors influencing consumers’ future smart product purchases are price and ease of use. If a manufacturer’s products are not competitive in those key areas, their introduction will likely be less successful overall.

Despite the overall acceptance of smart products, challenges exist around widespread adoption. Consumers are divided on the importance of owning smart home products with slightly more favoring not very/not at all important at 37% versus the 31% who consider them extremely/very important.

While some consumers find smart home adoption less important, over half of consumers reported (60%) they are extremely/very interested in purchasing additional smart home products.  However, the key barriers preventing purchase include price, and , as these were the top reasons given for not owning any/more smart home products. Price will likely continue to be a concern but providing more education to consumers on the benefits smart home products provide (i.e. saving money on energy bills, added security to the home overall, etc.) could help change their mindset.

It is important to note that consumers’ comfort level with technology is not a major barrier for smart home product adoption. Fifty-five percent of consumers say they are extremely/very comfortable with technology compared to the 14% reporting they are not very/not at all comfortable. In addition, two-thirds of consumers felt comfortable setting up their smart products themselves or having someone in their household do so, rather than investing in professional installation.

 

Smart Products Will Continue To Grow

In summary, consumers are willing and able to embrace smart home products, with many doing so already. However, there is still a select group that believe they can live without them. Increased usage of smart features on smart home products will depend on further education. .  Manufacturers and retailers have an opportunity to provide communication to consumers and better educate them on how these products work, what roles they play, and the benefits they provide. Smart home products do fulfill a need in homes in addition to the many conveniences they provide.