SecurityWorldMarket

06/10/2021

Smart homes market to hit almost $139 billion by 2026

Northbrook, Il (USA)

A new report entitled "Smart Home Market with Covid-19 Impact Analysis" and including a global forecast to 2026 predicts that this sector is projected to grow from USD 84.5 billion in 2021 to reach USD 138.9 billion by 2026 at a CAGR of 10.4 % - according to research firm Marketsandmarkets.

The increasing number of internet users and growing adoption of smart devices along with growing need for energy-saving and low carbon emission-oriented solutions has been crucial for increased demand of smart home systems. In addition to this, analysts also believe that factors such as increasing importance of home monitoring in remote locations and growing concern with regards to safety, security and convenience among general population is driving the growth of the smart home market.

Wireless communication provides the boost

The entertainment and other controls segment is expected to account for the largest share of the smart home market during the forecast period. The growth of the audio, volume, and multimedia room control market is driven by the convenience offered by these controls for managing as well as controlling entertainment systems within a house. The advancements in wireless communication technologies are a major factor boosting the growth of the home theatre system control market, thereby driving the smart home market for entertainment control. The market growth of the other controls segment can be attributed to the high demand for smart metres and smoke detectors as well as the increasing popularity of smart plugs, smart hubs, and smart locks.

Analytical behaviour data improves efficiency

The smart home market for software and services segment, by type, has been sub-segmented into behavioural and proactive type solutions and services. The behavioural type software and services help analyse energy-related data and forward it to the end users. However, this category is restricted to transmitting and receiving data and does not perform intelligent actions, unlike the proactive type. Behavioural type solutions provide direct feedback to the end users, providing basic information regarding real-time energy consumption data, along with historical data reflecting energy usage. Behavioural type software and services are increasingly being leveraged in smart homes as they help enhance the energy efficiency of these homes and minimize energy bills based on behavioural type data analysis. Behavioural type software and services possess the ability to learn user behaviour and accordingly render a smarter control of appliances, leading to an increase in its demand. As this type of software and algorithm is the most widespread due to its initial adoption and low cost, this segment is expected to account for a larger share of the smart home market during the forecast period.

Indirect sales channel dominate 

The indirect sales channel segment is expected to account for the larger share of the smart home market and is expected to grow at a higher CAGR from 2021-2026. Indirect sales channels or third-party service providers hold a major share of the smart home market. Most players in the market have strong sales channels and distribution networks to provide services to their end users. Indirect sales channels involve the sale of smart home products through both online and offline modes. Offline sales channels comprise third-party cellular network carriers, wholesalers, retailers, and value-added resellers. Online sales channels involve sales through e-commerce platforms. The Covid-19 pandemic has also resulted in a further rise in the use of indirect sales channels in the smart home market. Due to lockdowns in various countries across the world, people have started using online mode frequently. The demand for online channels has increased during the pandemic. Companies offer product setup and installation services that help users to buy products online without any hesitation. Moreover, third-party delivery providers have started undertaking extra precautions in order to encourage consumer to buy without reservations of getting infected. Thus, the online sales channel segment is expected to grow during the forecast period.

North America to hold the biggest share

The researchers expect that North America will account for the largest share of the smart home market during the forecast period. The factors driving the smart home market in the US include the high per capita income, the increasing demand for reliable home energy management systems, enhanced home security levels, improved device standards, and the growing popularity of integration of smart devices such as tablets, smartphones, and standalone voice assistants in homes are driving the growth of the North American smart home market. Furthermore, this region has a strong presence of some of the key players in the global smart home ecosystem, such as Honeywell, ADT, Control4, Simplisafe, Comcast, Lutron, Vivint, Ooma and Crestron Electronics, which has led to availability of a wide range of smart home offerings at economical prices. Additionally, various grants from the US Government towards green energy projects are also driving the smart home market growth in this region.

Some of the other key and emerging players in the smart home market as named by the researchers and not already mentioned above include Siemens, Johnson Controls, Schneider Electric, Assa Abloy, Amazon, Apple, ABB, Robert Bosch, Sony, Samsung Electronics, Crestron Electronics, LG Electronics, Legrand, Delta Controls, Axis Communications, Smarthome, Armorax, and Canary.


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