If it seems to you like there's strong momentum building for home automation in a broader range of new home construction, you're not alone. With new products coming on the market at a feverish pace and retailers like The Home Depot and Amazon jumping more deeply into the fray with DIY options, home automation packages are well poised to make substantial gains in new home construction for years to come.
According to a recent study, the market value was $40.8 billion in 2020. Predictions expect an increase to $63.2 billion by 2025, growing at a CAGR of 9.1%.
According to the latest Home Automation Ownership & Usage Report from NPD's Connected Intelligence, half of U.S. consumers own at least one smart home device, up from 35% in January of 2020. While security cameras remain the most commonly owned smart home device, NPD's Retail Tracking Service data reveals 2020's most significant sales gains occurred in security systems (+44%), smart garage door openers (+21%), and smart lighting (+19%).
This holiday season, Experian is also projecting "the growing trend in home automation, wearables and other connected devices to be an even bigger driver than last year in determining some of the season's hottest products."
Recent Internet searches related to home automation products have also escalated more than 14 times over the last three years. According to Experian, Samsung SmartThings, WeMo, Honeywell WiFi thermostat, and Phillips Hue LED lights lead the pack.
Home automation momentum will not slow down, so the big question for residential construction stakeholders is how you will get involved?
For product manufacturers, are you exploring ways your company can either offer a "smart" version of your product or are you looking for ways you can partner with symbiotic home automation solutions to create a companion offering?
Some partnership examples include folding door manufacturer NanaWall Systems' partnership with CubeSensors to create NanaWellness. According to recent headlines, the system allows NanaWall customers to use the sensors through a mobile app to understand air quality and know when to let fresh air into the home.
Another way for product manufacturers to get into the home automation game is, of course, through acquisition. Google's acquisition of Nest and Samsung's purchase of SmartThings was a bellwether moment in the home automation space. Lowe's has a smart home system called Iris, while Home Depot has backed Wink, a product that stems from the NYC design platform Quirky. And manufacturers like Schlage, Phillips, and Belkin have a big focus on the space.
If your product has practical automation applications, now is the time to get your R&D department to work before you're left behind. For example, the time to think about "smart insulation" is now.
Based on our conversations with technology suppliers and integrators, there seems to be a knowledge gap when it comes to an understanding of what builders want to know about home automation products and the opportunity they have to utilize the trend to leverage upgrade opportunities.
Homebuilders of every size are motivated to sell upgrades and additional options in the homes they construct. Since margins are slim on the "commodity" products that go into the project, builders look to upgrade opportunities as a source for making gains on the margin front.
Home automation product manufacturers, suppliers, and installers have an opportunity to reach builders and offer products and services that can be incorporated into the initial homeowner sales process.
Builders are becoming increasingly more sophisticated. They are becoming better marketers and are adopting new technologies quickly, both in operating their businesses and how they build.
Code changes also require continuous education, assessment, and changes to what products are being used and how they are applied. With that, builders have a genuine appreciation for any means of staying on top of market trends and offering the homeowner the latest technology.
Homeowners continue to look for ways in which artificial intelligence (AI) can transform their homes. The home automation space is on the rise with no end in sight. It's considered to be in the mid-stage of growth. With continued advances in technology and a burgeoning consumer appetite for the benefits of home automation, it's prime time for building materials manufacturers, builders, and remodelers to understand the opportunity and get more deeply into the game.
Are you looking for innovative partnerships or compelling strategies for reaching builders?
At Interrupt, we can help you understand these types of opportunities and the best approach to reaching your goals in the home automation space. Contact us for more information or to set up a capabilities presentation.
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