Smart Home Solutions Market

Market Study on Smart Home Solutions: Proliferation of Smart City Projects Worldwide to Drive Market Growth

Smart Home Solutions Market Segmented By Villa/Bungalow, Apartment Home Type with Hardware, Software and Services Components for Security and Surveillance, HVAC, Lighting Solutions, Building Energy Management

Industry Snapshot

Revenue from the global smart home solutions market totaled nearly US$ 73.5 Bn in 2020, according to a revised study by Persistence Market Research. Smart home solution sales estimated to witness noteworthy growth at around 11.5% to 13.5% Y-o-Y from 2019 to 2021.

Market growth will continue to accelerate, increasing the high competition already prevalent in the industry. Increasing need for energy-saving smart infrastructure, development of smart cities, construction of smart buildings, integrated security and monitoring services, and others are fueling the growth of the market. Smart home solutions account for nearly 30% of the global smart cities market.

Smart Home Solutions Market Size (2020)

US$ 73.5 Bn

Projected Year (2031) Market Value

US$ 185.5 Bn

Market CAGR (2021-2031)

18.5%

Share of Top 5 Smart Home Solution Providers

30%

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Companies

  • Siemens AG
  • United Technologies Corporation
  • General Electric Company
  • Schneider Electric Se
  • Honeywell International, Inc.
  • Ingersoll-Rand PLC
  • Johnson Controls, Inc.
  • ABB Ltd.
  • Legrand S.A.
  • Samsung Electronics Co., Ltd.
  • Lutron Electronics Co., Inc.
  • Leviton Manufacturing Company, Inc.
  • Acuity Brands, Inc.
  • Vivint Smart Home
  • Switchmate Inc.

Smart Home Solution Demand Analysis from 2016-2020 Compared to Market Outlook for 2021-2031

Advanced automated systems (monitor lighting, temperature, multi-media, security shields, entertainment systems, window and door operations, and others, which can be easily run from smartphones and computers, are being developed and sold in the market.

Factors such as increasing use of smart cameras and monitors in homes and rising need for intelligent security systems and smart home gateways are contributing to the growth of the market. Need for smart home technologies is expected to rise, thereby driving the expansion of the global market for smart home solutions.

Smart home technology helps save the limited resources that the world has. As they use controllers that are integrated with home sub-systems to make their homes smart and green, people are becoming more aware of the capabilities of smart home solutions.

Smart home solution demand is estimated to surge at CAGR of around 18.5% from 2021 to 2031 in comparison to nearly 12.5% CAGR registered during 2016-2020.

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How is Increasing Internet Users Driving Smart Home Solution Sales?

Advantages gained connecting household items to the Internet or the Internet of Things (IoT) are numerous. Connected devices have become increasingly popular in the residential sector. IoT is able to connect goods, software algorithms, services, and end users, which thereby allows data to flow freely and facilitates the making of real-time decisions.

IoT improves the functionality of automation systems. Many large, mid-sized, and small businesses across the world are investing a lot in IoT and IoT-enabled devices. This is set to impact a variety of application areas, such as lighting, HVAC, defense, healthcare, and entertainment.

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Country-wise Insights

What is the Demand Outlook in the U.S. Market for Smart Home Solutions?

The U.S. is predicted to remain one of the most attractive markets over the forecast period. According to the Persistence Market Research study, the U.S. is expected to account for nearly 32% global market share through 2031.

The younger generation is believed to be the most technologically advanced. Smart products have a strong grip on the younger generation. The generation that is most interested in having smart technology in their homes is the millennial population.

This demography of consumers is also environmentally aware and supports the use of sustainable materials. Millennials are more likely to change their actions to reduce their carbon footprint or to patronize environmental-friendly companies.

Given that smart home technology can be used to conserve energy and lead a more environment-friendly lifestyle, it's understandable that this is a consideration of the younger generation and the need to buy smart devices and to live a luxurious life is driving demand for smart devices in the US.

Why is Demand for Smart Home Solutions Surging across the U.K.?

Smart home solution demand in the U.K. is expected to rise at an impressive CAGR of around 16.5% over the decade.

Digitization of household applications, energy management, and self-determination in the elderly, is advancing at a rapid pace. The Internet explosion and rising popularity of networkable household components and mobile communication devices have resulted in newer smart home applications. As a result of this, the smart living industry has rapidly grown in importance.

The COVID-19 pandemic led to a substantial increase in demand for smart home devices. It is expected that in the years ahead, there will be huge demand for smart home devices in the United Kingdom.

How Will the Sales Prospects of Smart Home Solutions Unfold in Japan?

Smart home solutions sales in Japan are estimated to increase at an impressive rate of around 10.5% CAGR from 2021 to 2031.

The smart home solutions industry has an attractive business opportunity in Japan. Natural calamities in the last few years such as the Great East Japan Earthquake of 2011 have fueled demand for smart connected devices that can send alerts to users or allow them to remotely control and monitor devices using a cellphone app.

In Japan, there is huge population living in cities. Smart home companies - consumer electronics manufacturers, smart home builders, smart housing equipment manufacturers, and smart communication manufacturers have a chance to increase the popularity of their smart home products and gain market share.

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Category-wise Insights

What’s the Market Share of the Service Segment in Smart Home Solutions?

The service segment in the component category is expected to showcase a higher market share over the coming years. This segment dominated the global market in the past and is predicted to account for an exponential share of nearly 56% by the end of 2031.

Internet of Things (IoT) is implemented by smart home services to bring together various intelligent devices and integrate critical data to process and proceed with innovative preferences. Every aspect of a perfect home can be addressed with high-end modernization techniques with the help of digitalization. Also, managed services are expected to highly contribute to the growth of the parent segment.

How is Adoption of Eco-Friendly Smart Devices Fueling Market Expansion?

The potential for environmental effect is one of the biggest opportunities for the rising smart home solutions industry. Smart devices and automated homes can help with home energy efficiency and cost savings, which can be a great value proposition for homeowners looking to maximize their technology. A simple sensor will ensure that lights and temperature control, for example, are only turned on when they are needed, reducing energy waste and saving money.

In light of growing demand, market players are providing eco- friendly devices such as Nest Thermostat, which includes security cameras and motion sensor alarms to help customers build an eco-friendly smart home. Thus, adoption of eco-friendly smart devices is fueling market expansion of smart home solutions.

How are Technological Advancements in Smart Home Devices Driving Market Demand?

Consumer preferences are evolving as a result of rapid technological advancements. As their standard of living rises, they expect more revolutionary smart devices. As a result, manufacturers are encouraged to invest in state-of-the-art and innovative technologies to expand their product portfolios and tailor them to meet the needs of customers.

Millennials, as a consumer demography, showcase great influence on prevailing market trends. This era has also given millennials a distinct set of expectations and priorities. They are more interested to know and adopt new things, which is why they are better connected to the digital world. Thus, technological advancements in smart home devices are fueling consumption growth of smart home solutions.

Impact of COVID-19 on Market Growth

The smart home solutions industry was affected by the emergence of the COVID-19 pandemic. The impact was both, positive and negative. Demand for products such as smart healthcare and speakers increased due to the pandemic, as government and private companies asked people to work from home.

Smart speaker manufacturing companies did not face many challenges in manufacturing as the process is not that much complex as compared to other products such as smart kitchens, HVAC controls, and smart furniture. This is one of the reason that the production capacity of companies was not majorly affected.

However, global sales of smart home solutions are expected to decline by nearly 10%-15% in 2021.

Competitive Landscape

A number of leading smart home solution providers are coming up with advanced and innovative solutions that meet the ever-changing demand for various applications.

  • In October 2020, Johnson Controls launched Tyco Illustra Insight, an intelligent frictionless access management solution for work environments.
  • In May 2018, The National Institution for Transforming India (NITI Aayog), the think tank of the Indian government, and ABB India, signed a Statement of Intent (SoI). NITI Aayog is set to work with ABB in the main key sectors of the economy, such as power and water utilities, food, as well as heavy industries.

Smart Home Solutions Industry Report Scope

Attribute

Details

Forecast Period

2021-2031

Historical Data Available for

2016-2020

Market Analysis

USD Million for Value

Key Regions Covered

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia & Pacific
  • The Middle East & Africa

Key Countries Covered

  • U.S.
  • Canada
  • Germany
  • U.K.
  • France
  • Italy
  • Spain
  • Russia
  • China
  • Japan
  • South Korea
  • India
  • Malaysia
  • Indonesia
  • Singapore
  • Australia & New Zealand
  • GCC Countries
  • Turkey
  • North Africa
  • South Africa

Key Market Segments Covered

  • Type of Home
  • Component
  • Application
  • Region

Key Companies Profiled

Report Coverage

  • Market Forecasts
  • Company Share Analysis
  • Competition Intelligence
  • DROT Analysis
  • Market Dynamics and Challenges
  • Strategic Growth Initiatives

Customization & Pricing

Available upon Request

Smart Home Solutions Industry Outlook by Category

By Type of Home:

  • Smart Home Solutions for Villas/Bungalows
  • Smart Home Solutions for Apartments
  • Others

By Component:

  • Hardware
    • Cameras
    • Storage Devices
    • Monitors
    • Others
  • Software
    • Intelligent Security Systems
    • Energy Management
    • Infrastructure Management
    • Network Management
    • Smart Home Gateways
  • Services
    • Professional Services and Consulting
    • Managed Services

By Application:

  • Security and Surveillance
  • HVAC
  • Lighting Solutions
  • Building Energy Management

Media Release

- FAQs -

East Asia is projected to register strong growth in the smart home solutions market, exhibiting a CAGR of nearly 19.5% through 2031.

Some of the leading companies in this landscape are Siemens AG, Schneider Electric Se, Honeywell Corporation, ABB Ltd., and Legrand. Nearly 40%-50% market share is held by the top 15 players.

The global market for smart home solutions was estimated at US$ 73.5 Bn in 2020, expanding at a CAGR of around 12.5% during the historic period of 2016-2020.

Sales of smart home solutions are currently valued at around US$ 85.5 Bn.

Key trends in the market include adoption of eco-friendly smart devices and technological advancements in smart home devices.

Increase in number of Internet users and technological advancements in smart home devices are key factors driving market growth.

Countries involved in providing smart home solutions include the United States, Japan, Germany, and China.

Top 5 countries driving most of the demand for smart home solutions include the United States, United Kingdom, Japan, and China.

Europe is predicted to remain one of the most attractive markets and offer a total incremental $ opportunity of US$ 5.1 Bn by 2031.

Smart home solution technology demand in Japan and South Korea was valued at around US$ 1.6 Bn and US$ 2 Bn, respectively, in 2020.

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