The Smart Home World 2016 conference, held in London on June 21–22, served as a hub for networking and strategic thinking on how to monetize services and crack the mass market in the connected home sphere. The conference brought together hardware and software manufacturers, vendors, service providers, and market analysts. The general consensus among attendees was that growth in the smart home industry is still steady. However, some interesting initiatives were presented that could significantly drive the adoption of smart home technologies, providing the necessary boost the smart home needs to reach the mass market.
Developing a seamless and interoperable end-user experience will be essential for success
A good understanding of human behavior has proven to be a critical go-to-market strategy in the smart home industry. Market players are now focusing on the creation of “experiences” rather than solutions. Several companies at Smart Home World highlighted that they have adopted an experience-led approach to product development while promoting “use cases” that simplify and enhance the customer experience. One such company is Cozify, a Finnish start-up whose holistic approach to home automation not only provides a seamless experience, but also simplicity, with different standards and protocols consolidated into one single app. The company has developed an open future-proof wireless smart home hub that connects smart devices from different manufacturers such as Philips, Sonos, and Belkin through an intuitive application. This common interface provides unified access to different commands that allow users to set in motion several predefined settings for smart security, energy, lighting, and entertainment, among other things. Through this initiative, Cozify has demonstrated that it understands that consumers want solutions that are easy to set up, use, and expand and that they don’t really care about what happens at the back end in terms of interoperability. This represents an instrumental step towards the idea that smart home technologies are here to simplify our lives, not create new problems. Cozify is now trying to gain a global presence, looking for partners in the retail and service provider segments to further monetize the business opportunities around the smart home.
Opportunities lie in the “do it for me” approach
Many delegates agreed that current smart home DIY models are not as successful as they were expecting. Not all consumers are comfortable with the DIY approach to the smart home, and this forms a sizeable barrier to greater adoption. However, this issue presents a good opportunity for the support services industry. A company looking to take advantage of this opportunity is HomeServe in the UK. A provider of home emergency insurance cover and domestic repair services, HomeServe has started offering online smart thermostat installation services for £70 ($93) when customers purchase a Nest or Tado smart thermostat or for £99 ($132) when the services are purchased alone. HomeServe also offers the possibility to buy the smart thermostat and the installation service in installments through a monthly fee, bringing further affordability. It is easy to see how such a company could extend its services into other smart home areas with specific solutions and professional support. This example shows how important it is for companies to understand that each home has different needs. The development of a flexible business model that covers all the different stages of the customer experience will be crucial. Also, the delivery of support services will not only ensure that consumers adhere to the smart home concept, but will allow companies to maximize opportunities in every segment of the market.
“Why the smart home industry is not ready for the mass market,” TE0003-000924 (May 2016)
2016 Trends to Watch: Connected Home, TE0003-000893 (January 2016)
Mariana Zamoszczyk, Senior Analyst, Consumer Services