According to data from a report published by market research firm Brandessence, the connected home market size was USD 47.52 billion in 2018 and is expected to reach USD 115.3 billion by 2025, growing at a CAGR of 13.5% during the forecast period.
The proliferation of internet and smartphone users, increasing number of IoT-enabled devices, and increasing demand for energy-efficient and low-carbon solutions to provide better and more comfortable lifestyles are some of the key factors driving the growth of the connected home market.
Global Connected Home Market Overview
Currently, globally connected home vendors include United Technologies, Johnson Controls, Rogeland, Ericsson, Schneider Electric, Panasonic, Siemens, ABB, Honeywell, General Electric, Samsung Electronics, and others.
The Connected Home is an automated luxury home that transforms each connected space with the help of a button or a single voice command. Connected homes can effortlessly improve security, enhance interior design and help promote the perfect ambiance throughout the house. The connected home is considered a smart home, with the only difference being that the connected home follows a single brand name, while in a smart home all other branded devices can also be connected to a single piece of software via a smartphone.
Connected Home is used for energy saving and provides smart living by implementing a connected ecosystem. Ecosystems can be designed with the help of IoT devices, artificial intelligence and gadgets with smart features to help them perform different tasks and make the necessary decisions. Connected houses can be operated through smartphone apps to perform specific tasks such as turning on/off the current switch, closing doors and windows, looking out for visitors at the door, etc. Apart from this, connected houses can also help in detecting the room temperature of the house and provide security to the home owner.
The global connected home market is segmented on the basis of product type into safety and security, health and monitoring, energy and utility management, smart appliances, smart entertainment, and others. On the basis of distribution channel, the connected home market is segmented into online sales and retail.
Global Connected Home Market Dynamics
The key factors for the growth of the global connected home market are the increase in the number of IoT-enabled devices with the proliferation of internet and smartphone users, along with the demand for energy-efficient and low carbon emission solutions that provide better and comfortable home care.
According to the Climate Group Organization, connected digital devices for smart building technologies have realized savings of about 1.68 GtCO2e emissions worth $340.8 billion by 2020. In addition to this, the growth in IoT spending for smart homes is driving the connected home market.
According to FICCI”s survey in 2019, global IoT spending on smart homes reached USD 44.1 billion due to increased adoption of IoT-connected devices and increased understanding of home automation.
However, high cost of automation and excessive automation leading to sedated lifestyles and adverse health effects are the major factors hindering the connected home market.
Moreover, technological advancements in leveraging IoT, artificial intelligence, automated sensors, and the advent of machine learning for connected devices along with a surge in collaborations, mergers, and acquisitions in connected home product development may create huge opportunities to drive the global connected home market on a global scale.
Regional Analysis of the Connected Home Market
North America is expected to dominate the growth of the connected home market at a potential price due to smart homes, increasing consumer spending. According to the Household Goods Organization, the smart home market is estimated to be worth $40 billion in 2020, due to the increasing adoption of IoT devices by consumers and rising automation in the U.S.
In addition to this, home automation also helps save on building emissions due to the implementation of proper automation and building design. According to the Climate Group, proper home automation can save up to 15 percent of energy. This is followed closely by Europe and Asia Pacific, where the demand for connected homes has increased dramatically.