Connected Home: This Year More Connected Home Products Under the Christmas Tree (at Least in the US)

LONDON, October 6, 2015 /PRNewswire/ --

Consumers continue to buy single Connected Home devices, but are still confused by the "Smart Home" concept  

New research from CP Consulting, a consulting and business intelligence firm specializing in financial services, reveals the latest developments of the Connected Home and key implications for service providers.

Market Grows as Committment from Manufacturers Increases 

The market of the Connected Home [1] will reach inflexion point by the end of 2016 in the USA and Europe, with consumer spending hitting €90.90 billion globally by 2018 [2].

Manufacturers are getting ready for Christmas with a wider product range. Google, Amazon and Apple have all recently announced new products for the Connected Home.

In the US manufacturers have ramped up their investments in advertisement of Connected Home devices on national TV with an estimated monthly expenditure of $25 to $35 million in September 2015.

Retailers Working on a Compelling "Connected Home" Offering at Point of Sale 

BestBuy and Sears in North America and Euronics and Dixons in Europe are creating dedicated floor spaces for Connected Home products at point of sale.

In the USA, Target went one step further with Target Open House [3], the first "concept" store showcasing integrated Smart Home solutions [4].

"The new store layouts will help customers interact with, understand and compare Connected Home products. By seeing and testing these products in store, consumers will understand how they can fit into their home and in their day to day lives," comments Carlo Palmieri, MD of CP Consulting.

Millenials to Drive Adoption but Consumers still Confused by the Smart Home Concept 

Consumers' attitudes towards the Connected Home are positive and the level of adoption is increasing, especially among millennials who are prone to pay for the latest gadgets and opt for cost-effective DIY installations.

However, there are still fear factors hindering product adoption. These include complexity of use and set up, data security, concerns on privacy and high product prices.

"Consumers are confused by the vast number of products and perceive the Smart Home as a nebulous term. Nonetheless, they continue to purchase individual Connected Home devices - whether "Smart" or not - to meet specific needs in their homes," continues Mr Palmieri.

Key Implications for Service Providers 

Strategic partnerships between manufacturers and distributors are intensifying and new insurance propositions related to the Connected Home emerging.

Google's Nest has recently announced partnerships with Liberty Mutual and American Family Insurance. Insurers and other service providers will therefore need to plan their alliances soon to avoid being left behind.

"While Connected Home devices are purchased incrementally, when consumers perceive their benefits, the Hub that powers the Connected Home integrated solution is purchased upfront, on first installation. Hence, given the rapid expected take up of Connected Home - concludes Mr Palmieri - insurers and other service providers need to act now if they want to get a slice of the market in the future."

Notes to editors 

Connected Home: Implications for Insurers is a research published by CP Consulting in October 2015 combining an in-depth analysis of "Connected Home" and "Smart Home" with a review of Connected Home insurance products (or partnerships) related to Home Insurance. The study identifies over 15 products and partnerships already available on Connected Home Insurance with an analysis of key characteristics, opportunities and threats and an assessment of options available to general insurers. It also provides a short and medium-term estimate of the Connected Home Insurance market in the United States, United Kingdom, France, Germany, Italy and Spain.

CP Consulting (http://www.cpconsul.com) is a London-based consulting and market research company specializing in financial services and insurance in particular. It provides clients with information and strategic insights about major issues in financial services with focus on distribution, innovation and operating models.

[1] Connected Home refers to a home where appliances and devices are connected to each other through the Internet, Bluetooth, Wi-Fi or a local Ethernet and that can be operated by a smartphone, tablet or any other computer.

[2] 'How to Create Growth from the Connected Home', Deutsche Telekom, September 2015.

[3] Information on Target Open House is available at http://openhouse.target.com

[4] Smart Home is the next level in evolution with an integrated level of device interconnectedness. A Smart Home is a "Connected" Home - and not vice versa - encompassing three additional aspects:

• multiple devices can be controlled from a single app or control system
• devices interact with one another, exchanging relevant information with the Hub that acts as a 'coordinator'
• devices learn from users' behaviour (they are not just controlled by the users), storing and analysing behavioural and usage data.

Media contact: Roberto Napolitano,roberto.napolitano@cpconsul.com

SOURCE CP Consulting