Smart Home Market Report
Smart Home Market by Product Type (Security & Access Controls, Lighting Control, Entertainment Devices, HVAC, Smart Kitchen Appliances, Home Appliances, Smart Furniture, Home Healthcare, and Others), Protocol (Wireless and Wired), Application (New Construction and Retrofit), and Region (North America, Europe, Asia-Pacific, and LAMEA): Opportunity Analysis and Industry Forecast, 2023-2032
Smart Home Overview
The smart home market refers to the market for linked devices and systems that provide automation, control, and monitoring capabilities for different areas of a home. There are many different items available in this sector, including smart speakers, lighting controls, thermostats, security systems, and other equipment. Smart home gadgets require interoperability and connectivity to function properly. Devices from multiple manufacturers must be able to interact and communicate with one another without any issues. Wi-Fi, Bluetooth, Zigbee, and Z-Wave are a few examples of widely used communication standards and protocols that make it easier for users to create interoperable smart home ecosystems.
As a popular and practical interface for communicating with smart home devices, voice control has gained popularity. Many smart homes now feature voice-activated virtual assistants like Amazon Alexa, Google Assistant, and Apple Siri that let homeowners manage appliances, play music, check the weather, and even complete complicated tasks.
Global Smart Home Market Analysis
The global smart home market size was $81.4 billion in 2022 and is predicted to grow with a CAGR of 20.4%, by generating a revenue of $518.7 billion by 2032.
COVID-19 Impact on Global Smart Home Market
Because of lockdowns and other social distancing measures, individuals are spending more time at home, which has led to a rise in the market for smart home. The entertainment, home automation, security, and remote monitoring device markets have all seen a rise in demand for smart solutions. As consumers explored ways to improve their home life during the pandemic, demand for products such as smart speakers, streaming devices, and home office sets has grown significantly. The growth of smart home automation systems has been fueled by the need for contactless interactions and convenience. As individuals looked to reduce physical interaction and simplify their daily routines, features like voice control, remote access, and task automation have grown increasingly.
Smart home technology adoption has been driven by the pandemic, and this tendency is likely to continue in the post-COVID-19 period. During lockdowns, consumers have enjoyed the convenience, energy efficiency, and increased security that come with home automation. The demand for smart home systems and appliances is anticipated to stay high as people get back to their daily routines.
Increasing Consumer Awareness and Adoption to Drive the Market Growth
Consumer awareness of the advantages and potential of smart home technologies is rising. The demand for these items keeps growing as more people become aware of the ease, energy efficiency, security, and comfort that smart home gadgets provide. Market growth is mostly caused by rising adoption rates and a growing consumer base. Advanced networking technologies like Wi-Fi, Bluetooth, Zigbee, and Z-Wave have made it easier for smart home appliances to work together and communicate with one another.
The Internet of Things (IoT), which enables devices to connect, gather data, and communicate with one another to provide improved automation and control capabilities, has significantly contributed to the rise of the smart home market. The market is primarily driven by consumer demand for convenience and home automation. With the help of voice commands, mobile apps, or pre-programmed schedules, users of smart home devices may automate and control several features in their homes, including lighting, heating, cooling, security, entertainment, and appliance control. Consumers are more likely to adopt smart home technology because of the capacity to streamline and simplify daily operations and routines.
Cost and Affordability to Restrain Market Growth
Cost is frequently mentioned as a major barrier to the adoption of smart home technologies. Certain smart home appliances, particularly those with sophisticated features or integration possibilities, can be quite pricey. Price-conscious consumers may be discouraged from investing in smart home solutions due to the higher upfront expenses involved with buying and installing many devices. Potential purchasers may also think about the total cost of ownership, which includes repairs and recurring membership costs for services. The ecosystem of the smart home market is fragmented, with a large range of products and technology from many producers. There may be difficulties with compatibility and interoperability as a result of this fragmentation. Integrating gadgets from several manufacturers or operating them through a single interface may be challenging for consumers. The smooth operation of smart home systems can be hampered by a lack of standardization and the existence of competing communication protocols.
Adoption of Connected Devices to Drive Excellent Opportunities
In the upcoming years, it's anticipated that the number of linked gadgets in households will grow significantly. Opportunities to integrate and manage them through a centralized smart home system grow as more objects become "smart". Home automation, energy efficiency, and convenience can all be improved thanks to the growth of smart appliances, lighting, thermostats, and other linked devices. The experience of living in a smart house could be completely changed by artificial intelligence.
Virtual assistants with AI capabilities, like Amazon Alexa and Google Assistant, are now common in plenty of smart homes. Voice commands, customized automation, and predictive analytics are made possible by the integration of AI, making homes smarter and more user-friendly. The capabilities and functionality of smart home appliances will continue to improve as AI technology develops.
Global Smart Home Market Share, by Product Type, 2022
The security & access controls sub-segment accounted for the highest share in 2022. The popularity of smart home security systems is being driven by rising worries about home security and a desire for a safer living environment. Smart home security includes capabilities like remote monitoring, video surveillance, motion detection, and real-time warnings. Homeowners are searching for comprehensive solutions that go beyond conventional alarm systems. Smart home security includes access control technologies, such as electronic door locks, keyless entry, and biometric authentication. With the help of these systems, homeowners can easily and securely manage who has access to their houses. Users can also give or revoke access remotely, keep an eye on entrance activities, and get alerts when someone tries to get unapproved access.
A unified and interconnected home automation environment can be created by connecting smart devices to other smart appliances and systems, including smart lighting, thermostats, and security cameras. User experience is taken into consideration while designing smart home security and access control systems. They provide voice control features, intuitive mobile apps, and user-friendly interfaces, making it simple for homeowners to manage and adjust their security settings to suit their tastes.
Global Smart Home Market Share, by Protocol, 2022
The wired sub-segment accounted for the highest share in 2022. Systems for smart homes that are wired offer greater stability and reliability than their wireless counterparts. Wired solutions are not subject to wireless interference or signal disturbances because they rely on physical connections, which guarantees continuous and uninterrupted performance. In comparison to wireless technology, wired systems often provide greater capacity and faster data transfer speeds. This benefit is especially important for applications that require huge amounts of data to be transferred fast and reliably, such as streaming media, video surveillance, and smart home automation. Due to their closed and specialized architecture, wired smart home systems offer greater security features. Wired connections give an extra degree of security to systems and devices used in smart homes by making it harder for hackers to gain access or compromise systems. It is simpler to install and integrate wired solutions into the existing infrastructure since they may take advantage of the existing wiring infrastructure in homes, such as Ethernet cables or power lines. This compatibility makes deployment easier and can save money, particularly when retrofitting older properties.
Global Smart Home Market Share, by Application, 2022
The retrofit sub-segment accounted for the highest share in 2022. Building a new smart home from the ground up can be more expensive than retrofitting existing smart home technologies. Homeowners can choose to upgrade particular rooms or systems in their existing homes, lowering overall expenses while still reaping the benefits of a smart home. This is an alternative to investing in a brand-new construction or buying a pre-built smart home. Wireless communication is frequently used in retrofit solutions for the smart home market, which removes the need for costly wiring and infrastructure alterations. Wi-Fi, Bluetooth, Zigbee, and Z-Wave are a few wireless protocols that enable smooth communication between smart devices, making it simple to retrofit and integrate them into existing houses.
Global Smart Home Market Share, by Region, 2022
Asia Pacific smart home market accounted for the highest market share in 2022. Rapid urbanization and the emergence of a middle-class population with rising discretionary income have been observed in the Asia Pacific region. Because of this, there is a rising need for smart home solutions that provide comfort, convenience, security, and energy efficiency. The adoption of smart home technologies is fueled by the population's increasing wealth. Sustainable living and smart cities are actively being promoted by governments in the Asia Pacific region. They are putting into effect laws and programmes, like incentives and rules for energy conservation, that promote the adoption of smart home devices. The need for smart home solutions is fueled by these government initiatives, which also foster a favorable climate for industry expansion.
Competitive Scenario in the Global Smart Home Market
There are several major players functioning in the highly competitive global smart home market. To create smart energy solutions for its clients, for instance, Samsung Electronics Co., Ltd. teamed with Oracle Corp. in January 2022. The two companies combined Samsung's SmartThings devices and automation services with Oracle's contextual and behavioural energy insights. This collaboration aims to add innovative and useful features to their product offerings. In order to facilitate their use in both newly constructed homes and retrofitted homes, major players are also creating extra capabilities for smart home devices.
Some of the leading smart home market players are LG Electronics, Inc., Siemens AG, Amazon.com, Inc., Google Nest (Google LLC), Samsung Electronics Co., Ltd., Schneider Electric SE, Assa Abloy AB, Legrand S.A., Sony Group Corp., and Robert Bosch GmbH.
Historical Market Estimations
Base Year for Market Estimation
Forecast Timeline for Market Projection
North America, Europe, Asia-Pacific, and LAMEA
Segmentation by Product type
Segmentation by Protocol
Segmentation by Application
Key Companies Profiled
Q1. What is the size of the smart home market?
A. The size of the smart home market was over $81.4 billion in 2022 and is expected to expand at a compound annual growth rate (CAGR) of 20.4% during the forecast period.
Q2. Which are the major companies in the smart home market?
A. Samsung Electronics Co., Ltd. and Amazon.com, Inc. are some of the key players in the global smart home market.
Q3. Which region, among others, possesses greater investment opportunities in the near future?
A. Asia-Pacific region possesses great investment opportunities for investors to witness the most promising growth in the future.
Q4. What are the strategies opted by the leading players in this market?
A. Strategic acquisitions and partnerships and geographic expansion are the key strategies opted by the operating companies in this market.
Q5. Which companies are investing more on R&D practices?
A. Google Nest (Google LLC) and Amazon.com, Inc. are the companies investing more on R&D activities for developing new products and technologies.