Home automation companies need to understand the true requirements of the customers if they are to improve their bottom line, according to Gartner.
Home automation companies need to understand the true requirements of the customers if they are to improve their bottom line, according to Gartner.
In a report that is based on a survey of nearly 10,000 respondents in the U.S., the U.K. and Australia during the second half of 2016, the company said that adoption of newer connected home solutions are still at the early adopter stage. Only about 10 percent of the respondents have connected home solutions.
"Although households in the developed world are beginning to embrace connected home solutions, providers must push beyond early adopter use," said Amanda Sabia, principal research analyst at Gartner. "If they are to successfully widen the appeal of the connected home, providers will need to identify what will really motivates current users to inspire additional purchases."
The survey also found that home security alarm systems are doing much better in the market than other aspects of home automation. Alarm systems showed 18 percent adoption rate, close to double that of home monitoring which showed 11 percent, home automation or energy management which showed 9 percent adoption and health and wellness management which showed 11 percent adoption. The U.S. market showed higher adoption rates than the rest.
Moreover, the survey found that only the home alarm systems for which a monthly subscription fee is charged is financially beneficial to the solution providers. Others like home monitoring and automation solutions saw very few adopters.
“In the U.S., where the home monitoring industry is more developed, 59 percent of households with a home monitoring solution indicate they do pay a monthly fee, thus proving they see value for these solutions,” the report said. “However, charging for subscriptions for home automation/energy management and health and wellness solutions is more of a challenge since more than half of current households are already using these services free of charge. The challenge is even greater in the U.K., where few home automation services are subscription based and 58 percent of households with home automation get their services free of charge.”
On the other hand, the survey also found that customers are recognizing the importance of one app for integrating their connected home devices, appliances and services. They are also starting to see value in brand certification for their products or services.
“More than half of the respondents (55 percent) rated 51 or more toward the preference of one app integrating connected home devices and services, while 58 percent rated 51 or more toward the importance of hardware and services being certified by a specific brand,” the report said.