Connected Living Devices on the Rise: Consumer Expectations and Concerns
Recent reports show that in 2016 consumer adoption of connected home devices experienced a huge leap forward. IHS Markit estimates that 80 million smart home devices were purchased by consumers last year, a 64% increase over 2015. According to ‘2016: Year of the Smart Device’, a consumer survey commissioned by PlumChoice and the Z-Wave Alliance, 97% of consumers already know what a smart device is (versus 67% in 2015), while 79% report owning one or more. If we compare the numbers, it is clear that device adoption is on the rise, and that consumer expectation about connected living tech is growing and evolving.
Consumers are more aware now of the existence of connected living technologies and look for ways to incorporate them into their lives, eager to discover what they have to offer. There are many reasons why they would consider buying a smart home device, although their priorities seem to be evolving fast. As the PlumChoice survey highlights, there has been a shift in consumers’ top reasons to purchase connected devices. While in 2015 they mentioned cost reduction and energy management as their primary reasons for adoption, in 2016 they cited convenience, simplicity, security and control. The NPD Group’s Connected Intelligence service concluded that 4 out of every 10 consumers who are interested in smart home tech say their main reason to purchase would be making their home more secure and safe. Curiously, for those who already own smart devices, the most important benefits are convenience and simplicity.
Consumer expectation has also changed in other aspects. Whilst in 2015 they were interested in “total packages”, now they seem to look for more customizable options that suit their specific needs, growing with them and adapting over time. But if there is one thing that hasn’t changed, it is their need for support and services to help them use their devices. Many consumers seem to find them difficult to use and install, and struggle with solutions that are too confusing. According to PlumChoice’s research, “consumers expect more help and support from the brands they’re buying from”. This suggests that there is still ample room for improvement. In fact, consumers’ decision to buy from a brand again is overwhelmingly influenced by the brand’s ability to provide the help they need to use and enjoy their products. More specifically, installation support is cited as a top need by 68% of consumers. As the report states, “this data presents smart device manufacturers, distributors and brands with an opportunity to become a true partner for consumers who need more information and help.”
Regarding data security, it is interesting to note that in spite of recent events and media attention given to this issue, users seem to be a little less concerned about security and privacy challenges. Of course, they expect systems to be reliable and easy to use, while at the same time guaranteeing privacy, confidentiality, and secure data storage. But at present their main concern seems to be price. The principal reasons why consumers are still hesitant about purchasing smart devices are being perceived as too expensive (39%), not needing them (28%) and privacy concerns (18%). Perhaps because they now understand the value of connected living devices better than they did a year ago. It should be noted, though, that owners of connected products are less hesitant to purchase than non-owners.
Another interesting fact is that most consumers who already own at least one connected device are very satisfied with the purchase: 84% say they will buy another smart product in the next two years and 12% of them say they would like their next purchase to work with their existing ecosystem, although we believe this number is set to grow over time.
As adoption rates increase in a steady and unstoppable growth, there is still much work left to do in educating consumers about connected living technologies and how these can bring value into their lives. Likewise, brands should also educate themselves in offering better value propositions and more guidance to their customers, listening to their needs and addressing them, paying special attention to the three main factors essential to gain consumers’ loyalty: user experience, interconnectivity and support.
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