According to a new report from NextMarket Insights, the research firm expects the U.S. smart home market to grow from the current size of $1.3 billion to $7.8 billion in 2019.
The report finds that more and more consumers are willing to become their own home technology managers. Product accessibility has also become a factor in the rising smart home market, with products like Nest and Dropcam becoming highly affordable and easy to use. As evident with Google’s $3.2 billion acquisition of Nest, the smart home market is certainly on the rise.
“Early generations of smart home products were expensive and often required a professional installer,” Michael Wolf, Chief Analyst at NextMarket Insights, suggests. “Over the past few years, new technologies have made the smart home more affordable and approachable for the average consumer.”
The adoption of products like Nest, and the backing of corporations like Apple and Google can only mean this market is ready to grow at a rapid pace. Michael Wolf agrees with this sentiment noting that these products will “create additional momentum for the consumer-managed smart home over time.”
Additionally, it is also worthwhile to note that many younger individuals are more prone to equipping their home with smart energy devices. Products — such as programmable thermostats, smart lighting and smart power outlets — are becoming the norm in the modern-day home. New studies from research firm Parks Associates reveal that 1 in 10 homeowners between the ages of 25-34 have at least one smart energy device, as compared to just 7% of the rest of the homeowner population.
“Younger consumers also own multiple devices at higher rates — 4% own five or more smart energy management devices, and they are the majority of those most willing to purchase a smart home system,” indicated Tom Kerber, Director of Research, Home Controls & Energy at Parks Associates.
Many new competitors are also seeking to capitalize on this growing market, as industry giants like ADT, Comcast, and Staples are all looking to begin marketing smart home products. Furthermore, home improvement stores, which have long sold hammers, nails and tools people need to DIY around the house, have now begun selling sensors, WiFi-enabled appliances and software to enable their customers to monitor and control their homes all from their mobile devices. With the emergence of the smart home, The Washington Post recently reported that established retailers Home Depot and Lowe’s have begun to bring the Internet of Things to do-it-yourselfers.
Though, Kerber believes that one single product in a home is not how the future of this market will unfold, he suggests the “successful solutions long-term will be able to work together as part of a smart home system.”
The smart home shift doesn’t stop with the United States; take the United Kingdom for instance. One in nine UK households will contain at least one smart system by the end of this year, rising to over one in four households after five years, according to new research from Strategy Analytics.
In fact, the total European smart home market is expected to reach $13.81 billion by 2020 at a double digit CAGR from 2013 to 2020. According to that RnRMarketResearch report, the key drivers for the European market are the regulatory initiatives and the mandatory measures taken by European Union, and the comfort and the security ensured by the smart homes systems. The foray of smart appliances, such as washing machine, refrigerators, air conditioner units, vacuum cleaners and televisions, into the smart home ecosystem are also expected to drive the market.
“All in all, my connected home system was the best purchase I made since switching to a self-driving car,” Flutter Wireless’ Taylor Alexander recently declared.