Would bundled tech services spur the sales of smart home devices?
Cost, complexity, perceived value and interoperability may be among the reasons purchases of connected home products have been slower than expected, according to a study from insurance company Assurant. However, enhanced post-purchase service could lessen many of the barriers.
While consumers have become more tech-savvy over the past four years, intent to buy has continued to exceed ownership in a majority of connected product categories.
“The consumer experience before and after the sale has not matched expectations,” wrote Jeff Unterreiner, Assurant’s president of U.S. Connected Living, in the study published by Dealerscope.
The report found 85 percent of consumers saying they would buy if the purchase came with complementary services, such as technical support, extended warranties and identity protection. That figure was only 61 percent in 2016.
Thirty-six percent stated their connected devices develop issues that require third-party assistance to solve. The percent of consumers experiencing installation challenges also hasn’t changed over those four years, neither have the number of consumers saying they experience problems connecting their product to a mobile phone or Wi-Fi.
The report also finds that increasing awareness of 5G could be a tipping point for connected home purchases as the technology rolls out over the next decade.
Other recent studies have shown increasing intent to purchase smart home devices being driven by convenience and security. A recent study from Mordor Intelligence found connected cameras seeing the highest demand, followed by video doorbells, connected light bulbs, smart locks and smart speakers.
Yet a 2018 survey from cybersecurity firm CUJO AI found 87 percent of consumers concerned about the loss of personal data and contact information in using smart home devices, 77.5 percent worried about unauthorized remote access and 74.6 percent about the loss of financial data. Many agreed managing multiple devices was not user-friendly.
An extensive Gartner survey of consumers in the U.S., U.K. and Australia from 2016 found 75 percent indicating they are happy to manually set temperature and lighting controls versus only one-quarter who expressed an interest in having devices anticipate their needs in the home.
- Eye on the Consumer: Moving Customers from Consideration to Purchase – Dealerscope
- Majority of American Consumers Feel Comfortable With Smart Home – TraQline
- Smart Homes Market Expected to Grow at a CAGR of 25% – Mordor Intelligence
- The next generation of connected experience – Precision, protection and personalization – CUJO AI
- Survey reveals smart ovens and hobs as ‘least desirable’ appliances – Pinnacle Consulting
- Why Consumer Expectations for Smart Home Technology Are on the Rise – Security Sales & Integration
- Gartner Survey Shows Connected Home Solutions Adoption Remains Limited to Early Adopters – Gartner
DISCUSSION QUESTIONS: What do you think are the obvious and less obvious factors holding back purchases of smart home products? Can retailers do more to reduce those barriers or is there less opportunity than hyped?