Parks Associates

Anyone who has fallen victim to the dreaded “porch pirates” can understand why the current smart home trend of in-home delivery of packages continues to catch on. Nothing sucks more than having video footage — from a video doorbell or camera — of someone grabbing your goods off your stoop and having no power to do anything about it. 

It is this convergence of technology and convenience that is driving interest in, and spending on, security. In fact, nearly half of consumers who currently own or intend to buy a smart door lock, a smart garage door opener or video doorbell value the ability to remotely allow Amazon package deliveries, according to new research from Parks Associates, an internationally recognized market research and consulting company specializing in emerging consumer technology products and services.

“Battle for the Front Door: The Access Control Ecosystem” reports that one-third of owners or future buyers rate this capability as very valuable, with 37 percent of smart access control device owners or intenders willing to pay up to $1.98 per package for delivery inside their home or garage.

“The growth of online shopping from sites like Amazon and Walmart has led to an increasing problem of package theft but has also created a new use case for the smart home,” Chris O’Dell, research associate, Parks Associates, said in the announcement. “As consumers increasingly rely on home package delivery, and look for ways to make this process more secure, they have a greater awareness of access control devices like video doorbells, smart door locks and smart garage door openers.”

The prospect of package theft creates opportunity for smart home device manufacturers and service providers to boost consumer confidence by guaranteeing safe package delivery with in-home and in-garage delivery services. Amazon’s 2019 partnership with Chamberlain highlights this potential. Among consumers who own or plan to buy a smart door lock, a smart garage door opener or video doorbell, 43 percent find the ability for FedEx or UPS to perform in-garage delivery to be valuable.

“Enabling home services will ultimately drive adoption of access control devices by expanding their value to consumers,” O’Dell said. “Traditional garage door openers typically have a lifecycle of 10 or more years, so companies need a strong and unique value proposition with smart garage door openers in order to expedite growth in the market. The promise of safe package delivery, combined with partnerships that incent purchase and ease installation concerns, can be that driver.”

Found in the report is an assessment of the access control ecosystem, profiles of key players in each device category and evaluations of home services strategies. It also includes five-year forecasts of smart door lock, video doorbell and smart garage door opener adoption. For example, one-quarter of U.S. broadband households plan to purchase a video doorbell in the next year.

The battle for the smart home has raged on for quite some time now, with the big players like Amazon, Google and Apple making major plays to dominate the space. But, with the smart home market flooded with a ton of IoT devices — and many more to come — the new race is to see who will come up with the go-to platform to make all of these devices work in perfect harmony … I can dream, can’t I?

A new Parks Associates research report — Race to Control the Smart Home Ecosystem: Attracting Partners — looks at this dilemma, and finds that adoption of connected point solutions and the advent of smart speakers will drive demand for platforms to coordinate and centralize control of smart home products and capabilities in U.S. households. The report reviews the strategies of major smart home platforms in the consumer electronics and security industries and their approach to attracting manufacturers to their ecosystem.

"The percentage of U.S. broadband households highly familiar with smart home platforms increased across all platforms from the end of 2017 to the end of 2018," Chris O'Dell, research associate, Parks Associates, said in the announcement. "Amazon Alexa and Google Assistant saw the biggest jumps of all listed platforms, so voice control is a key factor in driving consumer interest in the smart home and the adoption of multiple devices per household."

The report states that as device adoption continues to increase each year, smart home platforms will help establish order out of the chaos that comes from the steady influx of connected devices in consumers' homes. According to Parks Associates research, 28 percent of US broadband households now own at least one smart home device, and device-owning households own an average of six devices in their home.

"Companies competing in the smart home ecosystem can leverage platforms to provide a reliable, interoperable ecosystem with a simplified user experience and deliver expanded value through enhanced features such as cloud intelligence and data privacy and security," O'Dell said.

When implementing a smart home ecosystem in their home, consumers care less about name brands of key devices and more about a seamless experience where all devices in the ecosystem work together smoothly, Parks found, noting: “Consumer preferences favor vertically aligned players, such as Comcast and Vivint Smart Home, which have introduced their own branded devices to optimize the experience on their platforms while also maximizing profits.”

Additional questions addressed in the report include:
•    Who are the major smart home ecosystem players by category?
•    How is the rise of voice-first control platforms affecting smart home ecosystems?
•    How can smart home ecosystems help the smart home industry overcome interoperability issues and concerns?
•    What are the smart home platform strategies of the leading CE and security industry players?
•    What approach are these companies taking to attract manufacturers to their ecosystem?

For the complete report, click here.

*/

The success of smart home assistants such as Amazon Alexa has spurred the growth of smart speakers within the home, as voice control in the home seems to be a trend that is not going away any time soon.

In fact, the adoption of these devices increased by 800 percent from 2016 to 2018, reaching nearly one-third of U.S. broadband households by the end of 2018, according to research by Parks Associates.

In the firm’s “Strategies for Integrating Voice in the Smart Home,” report, it estimates U.S. households will buy more than 64 million smart speakers with voice assistants in 2022. The research profiles key technology partners that can help companies integrate voice and evaluates different strategies for implementation.

“Voice is emerging as a key complement to smart home device adoption and ownership, as it provides a simple method of interaction and creates opportunities for a centralized user interface and interoperability among multiple devices,” Dina Abdelrazik, research analyst, Parks Associates, said in the announcement. “The next step will be integration of voice among multiple device categories, which will help to alleviate smart home fragmentation.”

Use of voice in conjunction with smart home devices is increasing. The report finds 21 percent of smart homeowners have used voice to turn their devices on/off, while 18 percent have used voice to check a device’s status. With voice popularity and use cases expanding, device makers and service providers are looking to capitalize on the current market opportunity by integrating a voice experience with their current offerings. The first decision a company must make before doing so is to decide whether to create its own proprietary solution or to integrate with a readily available  solution.

“Major tech giants have entered the voice-first market providing companies with the opportunity to leverage their voice-based solutions, with Amazon and Google leading the market,” Abdelrazik said. “They have made it easier for companies to enable voice-based solutions while creating competition for consumer mindshare, with Apple, Samsung and Harman Kardon promoting their own solutions in an increasingly crowded market. This diversity gives companies more choices when considering partnerships or whether to develop their own proprietary in-house solution.”

Parks Associates will host CONNECTIONS: The Premier Connected Home Conference on May 21-23, 2019, in San Francisco, where analysts and IoT executives will examine the impact of voice along with other solutions in shaping demand, adoption, and new business strategies within the smart home  ecosystem.

Further validating the growth of smart speakers, IHS Markit recently released its report on this growing trend.
 

An estimated 7.7 million standalone and all-in-one networked/IP cameras will be sold in the U.S. in 2018, with $889 million in revenues, according to research from Parks Associates entitled Smart Product Market Assessment: Networked Cameras.

“Networked cameras have experienced a positive growth rate over the last year—2018 is expected to witness a roughly 11 percent increase in unit sales from the year prior,” Dina Abdelrazik, research analyst, Parks Associates, told Security Systems News. “Overall, the broadband household penetration rate is estimated at 9 percent in 2017 and is expected to nearly triple by 2023. Furthermore, the CAGR rate for all-in-one camera purchases from 2018 to 2023 is about 19 percent.”

Abdelrazik noted that advances in image recognition and ease of self-installation, combined with a strong user experience, “are driving increased adoption, with retail channels (online and in-store) starting to dominate sales,” she said. “IP cameras are key security-related devices and provide peace of mind to consumers. As such, these devices are consistently among the most popular smart home devices.”

While retail channels dominate (approximately two-thirds) in terms of channel purchase locations for consumers, security dealers were the next option, followed closely by “broadband service provider” and “direct from manufacturer.”

According to Parks’ findings, DIY cameras represent the majority of sales as these products are improving consumer experiences for installation, setup and usage. The good news for security dealers is that consumers still value recommendations and setup assistance, as 7 out of 10 consumers planning to buy a networked/IP camera would consider recommendations from an insurance or security company to be “important or very important,” according to Parks.

“Standalone IP cameras, video doorbells, and all-in-one cameras all provide an added layer of security for the home alongside security systems,” said Abdelrazik. “Security dealers have an opportunity to offer these products during their sales or installation processes to educate the consumer on the value of the device, as well as enhance the overall utility of the security system.”

She continued, “The attachment rate of video cameras and home control products to new security systems continues to climb, as does the incremental RMR from video services. Video provides unique value to consumers. Once consumers have the ability to check in to see a live view of their home from anywhere in the world, it is hard to give up that experience.”

Parks’ market assessment notes that voice integration and the development of AI as it relates to image and sound recognition will drive the next generation of networked cameras. For example, more than 80 percent of consumers who own or plan to buy a networked camera consider image or sound recognition abilities to identify safety and security events (like glass breaking or a person falling) to be appealing or very appealing, Parks found.

Looking forward, Abdelrazik said AI and the integration of voice control “will help drive further engagement with consumers, which will continue to drive positive consumer experiences. While consumer privacy concerns do exist with networked/IP cameras, we project double-digit growth for the IP camera market, as consumer familiarity rises, price points continue to drop, and millennials buy homes, acquire pets, and begin having families.”