Smart home products are rolling out to the masses as consumers look for ways to simplify their daily lives.
Even though major commercial security companies like ADT are still leading the home security market, low-cost solutions are on the rise and retailers play a major role in their adoption. According to a recent survey from Parks Associates more than 40 percent of U.S. broadband households plan to purchase a smart home device in the next 12 months.
Below, we detail the lay of the land when it comes to what retailers could offer in smart home, what types of products are on the cutting edge and what’s piquing consumer interest.
DIY solutions on the rise. It’s a common fear that smart home products will be difficult to set up and use, but in reality these products are designed to make life easier. The DIY trend is on the rise as pointed out by a Google study that revealed 47 percent of home improvement projects were done because people take pleasure in wanting a hands-on experience with their products. Young, digitally savvy consumers that are often first-time home buyers are now looking to the internet for the latest and greatest DIY smart home products, so it's imperative that retailers don’t miss out on this opportunity to sell. DIY retailers are also concerned about the retail price points and often hesitate to invest in inventory, but the key to selling smart home products in a DIY environment is merchandising. The consumer needs to quickly be able to see and understand the product in order to make a purchasing decision, which means smart home product manufacturers and retailers should work together to develop creative merchandising vehicles.
Smartphones provide a more hands-on consumer experience. Consumers rely on their smartphones for more than checking email, making calls or texting. With the rise in smart home applications, consumers have the power to monitor the home (and loved ones) from the palm of their hand. You can control the temperature in specific rooms, keep an eye on the leftovers in your fridge, turn on/off the lights, potentially scare off an intruder or open your garage door, just to name a few. Retailers need to offer customers the solutions that continue to further connection.
Consumers are beginning to realize that smart home products are more than just gadgets. Smart home products have practical value and meaningful benefits outside of being cool and convenient. They can provide benefits to your life, like increased security, convenience from outside the home and a real-time pulse on what’s happening at your house. According to a new industry study release by Icontrol Networks, Inc., the number one reason why a consumer had a smart home system installed was for security and peace-of-mind during the decision-making process. More than ever, as the number of smart home products rapidly increase, customer reviews are a great source of intelligence for new consumers making their first smart home purchase.
Consumers are looking to better connect these smart home products. Smart home products are often scattered around the house (inside and out) – smart fridge, smart thermostat, smart lightbulbs, smart sprinkler systems, smart security systems and locks, etc. Consumers are looking for a central control point for all their smart home gadgets, que Amazon Echo and Alexa, which has now made talking to your house a norm. As Apple, Amazon and Google allow more and more devices to integrate with their control centers, retailers want to be the ones making those devices available to consumers. In the end, the consumer will decide what smart home products and platform are best for them. Retailers that stock the best assortment of smart home products will maximize this opportunity, and they will be the winners in this rapidly growing and expanding new product category
Smart home service models are maturing. Manufacturers are transitioning away from one-time hardware sales to recurring revenue models, yet some consumers shy away from smart home products because they don’t want another monthly subscription fee to pay every month. Reality is that most products have basic services that requires no monthly fee, or the monthly fee can be paid annually with a discount, and the amount is really very small. For example, many smart home security solutions offer cloud storage for low monthly fees (about $5 to $10 dollars per month), which is extremely low-priced when compared to monthly fees charged by commercial security companies that average $40 per month.
Understanding the landscape of the quickly evolving smart home will help retailers make clear decisions about the types of products to offer in this category. Home security smart home products are one of the easiest offerings and lowest risk offerings to start with. Good and bad, there is still yet to be a retailer that really owns providing consumers with access and education to this technology of the future.
Mark Honeycutt is CEO of Jiawei USA, makers of the Maximus Smart Security Light.