Smart Home Market Research Report: Forecast (2023-2028)

Market Definition

Smart Home comprise intelligent devices for a home operated remotely using a mobile or any internet-enabled device that allows consumers to control services like security access, temperature, lighting, & entertainment. These devices help enhance energy efficiency & appliance functionality, centralize operational control, supervise the security of Home, notify during leakage or flooding, and allow for real-time surveillance & motion detection.

Market Insights

The Global Smart Home Market is projected to grow at a CAGR of around 23.8% during the forecast period, i.e., 2023-28. Most of the market expansion would be driven by the growing penetration of the internet & smartphones worldwide, coupled with the ever-increased focus of several countries on reducing carbon emissions and promoting the use of energy-efficient appliances & devices. Besides, the rising adoption of security cameras, video door alarms, facial-recognition devices, ultra-modern burglar alarms, and remote-controlled locks by households is another prominent aspect projecting a significant boost for the market.

Smart home devices help enhance energy efficiency by effectively managing different utilities like televisions, lighting, & gaming systems, among others, as well as controlling their energy utilization by shutting them off automatically when not in use. The rising penetration of digital assistants like Siri, Google Assistant, Alexa, & Bixby has enabled smart devices to be controlled & managed through voice commands. Moreover, the quick & wide acceptance of advanced technologies like the IoT (Internet of Things), Blockchain, and AI (Artificial Intelligence), among others, alongside their integration into smart devices, is also stimulating the market expansion.

The most recent application of smart home technology has opened up a plethora of opportunities, like the combination of AI & automation that provides domestic assistance in an all-new & innovative manner, thereby ensuring sophisticated technical gadgets & security. it come equipped with video door alarms, facial recognition devices, ultra-modern burglar alarms, and remote-controlled locks as some of the most popular security options. Another prominent aspect projected to drive the smart home industry is the IoT emergence, which has facilitated significant energy savings for consumers. In the future, massive clusters of sensors & devices communicating through high-speed internet technology like 5G shall be observed in Home.

Recent Developments in the Smart Home Market

• In January 2022, Samsung Electronics Co., Ltd. joined forces with Home Connectivity Alliance (HCA) in line with its aim to enhance the smart home experience through interoperability in home appliances, HVAC systems, & TVs. This partnership shall be aimed mainly at providing consumers with more options to customize their ecosystems while improving data privacy & device safety.
• In September 2021, Amazon.com, Inc. launched its long-awaited home robot, Astro. Equipped with cameras and a screen, it can autonomously drive around your home, map the home's layout, recognize objects, and check on loved ones & pets remotely.
• The same year in August, Schneider Electric partnered with Livspace, a well-renowned leader in home interiors & renovation, to create smarter houses for the future, involving the use of Schneider's superior home automation technology and Livspace’s interior design experience to revolutionize the home interiors market in India.

Market Dynamics

Key Driver: Rising Need for Energy Efficiency to Reduce Running Costs

With alarming levels of carbon emissions as a result of rising warming, energy efficiency is a crucial aspect of any country's development. As smart Home account for a considerable portion of the world's total energy consumption, the mounting consumer need for enhanced energy savings & minimized living costs is the prime aspect projected to drive the market during 2023-28. Additionally, the rising number of smart buildings owing to rapid urbanization, the increasing penetration of smartphones & the internet, growing adoption of intelligent technologies in Home, such as video doorbells, voice-assistants (Alexa and Google Home), & surveillance systems, among others, are also projected to fuel the market growth through 2028.

Growth Restraint: Consumer Concerns Regarding Security & Privacy Breaches

Smart home devices are prone to hacking tools as all the data associated with a user's personal information, physical safety, & healthcare is stored virtually on the cloud, which increases the chances of data breaches that hackers can use to victimize homeowners. Moreover, data generated by smart wearables & appliances can provide cyber attackers with a massive amount of targeted personal information that can be manipulated potentially for fraudulent transactions or identity theft. Hence, these aspects are projected to act as major growth restraints for the market during 2023-28.

Market Segmentation

Based on Product Type:

• Entertainment Controls
• Security & Access Control
• HVAC Control
• Smart Home Appliances
• Smart Kitchen
• Smart Lighting Control
• Smart Furniture

Of them all, Entertainment Controls are anticipated to dominate the market with the largest share during 2023-28. This growth is driven primarily by the improving economic conditions of their people and their inclination toward the utilization of wireless communication & cellular technology advancements. As a result, the demand for device controls like Audio, Volume & Multimedia Room Controls, Home Theater System Control, and Touchscreen & Keypads, among others.

Here, the popularity of audio, volume, & multimedia room controls are substantial and are driven by the convenience of these devices in managing & controlling systems within a house. Since advancements in wireless communication technologies are boosting aspects of smart Home, the utilization of these products is escalating rapidly and curating the fundamentals underlying the market dynamics.

On the other hand, HVAC Controls are anticipated to make a significant contribution to the overall expansion of the Smart Home Market during the forecast period. The growth is driven by the active participation of the governments of different countries, encouraging people to adopt energy-efficient solutions, including HVAC systems. It, in turn, is augmenting the procurement of HVAC Controls for advanced heating & air conditioning units in buildings. Besides, a greater inclination toward the construction of smart cities is also triggering the development of smart buildings with energy-effective HVAC solutions. As a result, the demand for these controls is escalating rapidly & positively influencing the market growth.

Regional Projection

Geographically, the Smart Home Market expands across:

• North America
• South America
• Europe 
• Middle East & Africa
• Asia-Pacific

Of all regions globally, North America is anticipated to make significant contributions to the overall market expansion in the coming years. This growth is driven by the growing focus of the governments of different countries in the region toward modernization, showcasing a greater inclination toward the development of smart Home. As a result, the sales of smart home appliances & devices, including entertainment controls, Security & Access controls, among others.

According to the Energy Department of the US, buildings account for a majority of electrical utilization. Yet, with greater consciousness for energy conservation, the government is focusing more on the deployment of energy-efficient solutions, including smart Home, to mitigate greenhouse gas (GHG) emissions. The same aspect further hints toward the presence of lucrative opportunities for the leading players to widen their offerings and cater to the burgeoning demands through the forecast period.

Furthermore, with the strong presence of prominent players operating in the market, entwined with the growing adoption of core communication technologies like Bluetooth, WiFi, NFC, Zigbee, and 5G network, among others, the potential for the smart home market is expanding.

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