A desire to keep a closer eye on what is happening around their homes as consumers shelter-in-place will help the smart home market weather the global COVID-19 pandemic in 2020, according to new research published in the latest versions of Strategy Analytics’ “Global Smart Home Device Forecast.”
Strategy Analytics forecasts global consumer spending in 2020 on smart home related devices will drop to $44 billion in 2020, from $52 billion in 2019, due to the economic downturn driven by widespread business slowdowns caused by COVID-19. However, the market will recover in 2021, and consumer spending will increase in 2021 to $62 billion. Strategy Analytics forecasts the global smart home device market will continue to grow at a 15% CAGR, reaching $88 billion in 2025.
Online shopping and contact-free delivery will keep purchases of do-it-yourself thermostats, cameras, video doorbells, and light bulbs moving. Adoption by consumers of more complex, professionally-installed smart home solutions will be lower, as some locales continue to prohibit in-home installation, or consumers are not yet comfortable with installers entering their homes for days or weeks at a time. As a result, installations of these premium whole-home systems will be delayed until 2023 or 2024, when they help return smart home market growth to near pre-COVID levels.
Bill Ablondi, Director of Strategy Analytics’ Smart Home Strategies advisory service, said, “Our consumer surveys during the pandemic, as well as our observations of device companies such as Ring, Nest, and Philips Hue, and interactive security companies such as ADT, Comcast, and Vivint indicate some smart home devices were acquired because of the pandemic. Surveillance cameras and video doorbells sold via retail or through an interactive security company, especially those purchased by young families, are good examples of this phenomenon.”
Jack Narcotta, Senior Industry Analyst in Strategy Analytics’ Smart Home Strategies advisory service, added, “Even with the onset of the pandemic the global smart home device market is very active. Since late 2019, every smart home device category has seen new entrants, and established brands are refreshing their portfolios on a regular basis. Globally, nearly 250 million households already have at least one smart home device, and as average selling prices for most devices decline, many of those are highly likely to buy additional devices. Online shopping will keep device purchases flowing in spite of any restrictions placed on brick-and-mortar retail stores”.
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