71% would consider purchasing a smart home product; smart thermostats garnered the most interest
Most consumers expect newly built homes in the next five years to include smart home technology
Consumer familiarity with smart home technology is still low; price, security and lack of standardization are key barriers
WASHINGTON, D.C. – November 5, 2015 – (RealEstateRama) — The “Internet of Things” is fast becoming a reality as more and more products and things contain sensors and/or microprocessors, and are connected to wireless networks. The near ubiquity of high speed internet access in homes, as well as smartphones, has set the stage for a new class of do-it-yourself smart home technology products, including smart thermostats, home security and monitoring systems, and smart lighting, to name just a few. The number of smart home product offerings has grown rapidly in the past few years, and will continue to do so as a diverse set of companies and industries vie for leadership in this space. But while consumers and business alike see greater technology in the home as inevitable, a new report from The Demand Institute finds that a truly “smart home” is still a ways off for the masses.
Smart Home Technology: Not Ready for Prime Time (Yet)is the latest publication from The Demand Institute, a non-advocacy, non-profit think tank jointly operated by The Conference Board and Nielsen. The report finds that more than 7 in 10 consumers would consider purchasing a smart home product, and that most consumers expect newly constructed homes in the next five years to include smart home technology. At the same time, consumers are in no rush to purchase smart home technology – just 36% of consumers say they are excited to incorporate smart home technology into their home.
“Smart home products need to demonstrate clear value and solve unmet consumer needs before most will make the investment,” said Louise Keely, president of The Demand Institute. “Some of these products do meet that bar, but many still feel these products are gimmicky, even though 64% concede that they really do not know much about smart home technology.”
The report found that smart thermostats, wireless speakers and home security and monitoring are currently the most popular and well-known smart home products, but that interest in other smart home products, like smart lighting, door locks and other categories is also strong.
“Consumers are starting small when it comes to smart home technology,” according to Jeremy Burbank who is a vice president at The Demand Institute and leads the American Communities Demand Shifts Program. “The typical smart home product user has just one or two products. Many of these products still cost several times what traditional models do, and a lack of industry standardization and interoperability means most consumers will add smart home technology slowly.”
While adoption will initially be slow, the report does posit that these technologies will eventually revolutionize how consumers interact with their homes, and that there is significant opportunity for the companies that build easy-to-use, affordable solutions that solve real consumer needs.
Smart Home Technology: Not Ready for Prime Time (Yet)is the latest report from The Demand Institute’s American Communities Demand Shifts Program, which provides insight on the future of American communities, including the ever-evolving housing sector. The program is an extension of more than four years of in-depth research conducted by The Demand Institute, and will help business leaders and policymakers better anticipate and address the needs of consumers and citizens.
A subscription program is available for an annual fee, and offers access to invaluable perspective on the drivers of consumer demand through research briefs, in-depth reports, online data visualization tools and engagement with the research team via webcasts, among other benefits. A collaborative effort, members also have an opportunity to help shape the research agenda. For more information about the program, please visit: http://demandinstitute.org/projects/american-communities/
About The Demand Institute
The Demand Institute illuminates how consumer demand is evolving around the world. We help government and business leaders align investments to where consumer demand is headed across industries, countries and markets. A non-advocacy, non-profit organization and a division of The Conference Board, The Demand Institute holds 501(c)(3) tax-exempt status in the United States and is jointly operated by The Conference Board and Nielsen. For more information, please visit demandinstitute.org.
About The Conference Board
The Conference Board is a global, independent business membership and research association working in the public interest. Our mission is unique: To provide the world’s leading organizations with the practical knowledge they need to improve their performance and better serve society. The Conference Board is a non-advocacy, not-for-profit entity holding 501 (c)(3) tax-exempt status in the United States. For more information, visit www.conference-board.org.
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