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What Next for Smart Home as a Service?
One-in-four Consumers Will Consider Buying a Smart Security Device this Year
When a consumer looks to buy their next smart device, they will be looking to purchase a product with a strong element of personalisation – one that aligns with their daily routine, eliminates manual tasks and improves safety, energy efficiency and even family connections. For this reason, at the heart of every B2C business are the burning questions: ‘Are we delivering enough relatable value to our customers?’, and ‘how are we motivating the consumer to make a purchase?’ When it comes to the consumer paying a monthly subscription fee, these questions become even more pertinent.
With Smart-Home-as-a-Service (SHaaS), the middle ground between providing a highly profitable product and delivering enough value to rapidly build a subscriber base can be difficult to find. So far, a key obstacle preventing the ascent of the SHaaS model has been the lack of a compelling use case to the consumer.
Security Opens the Door to SHaaS
Our latest research highlights the role of security as being the highest priority for consumers, with most consumers prioritising the safety of themselves and their relatives above all else. In addition, the study, conducted across the USA and leading European markets asked respondents who they would consider buying a smart home service from. The number one choice was a security company or provider, with their existing utilities and broadband providers ranking second and third, respectively.
In relation to businesses, the tech giants have long seen the rise of the smart home as an opportunity to further extend their engagement with users. While Google, Amazon, Samsung and even Facebook have rolled out a range of smart devices, providing everything from speakers to thermostats, it is the security and monitoring space that has presented the greatest opportunity to implement a SHaaS model for these firms. For established tech companies and smart tech start-ups alike, the benefits are clear – a consistent revenue stream, data capture and regular customer interaction leading to higher retention rates.
As SHaaS will play an increasingly important role in the future of the smart home sector, security is the sweet spot that can convert consumers to a SHaaS model. For the DIY-buying consumer, smart speakers and security devices remain the gateway products for attracting consumers into the smart home world. For the service model, security video cameras with recording capabilities is undoubtedly the gateway product.
Smart Security Devices a Key Consideration in 2020
Futuresource research carried out across the USA and Western Europe also shows that 26% of consumers who do not currently own a smart device will consider buying a smart security device in 2020. This presents a significant opportunity and re-emphasises the value that consumers place in security, whether that is through opting for a bolt-on subscription or a full-service model. As previously mentioned, people value the safety and security of themselves and their families above everything else, which emphasises the role that security plays in transitioning consumers to the SHaaS model. It is no surprise that a stream of tech companies, from Samsung, Google, and Amazon to Arlo and Wyze, have made significant investments in this space. Are you prioritising the SHaaS security opportunity?
Here at Futuresource Consulting we deliver specialist research and consulting services, providing market forecasts and intelligence reports. Since the 1980s we have supported a range of industry sectors, which has grown to include: CE, Broadcast, Entertainment Content, EdTech and many more.