Smart home will be Amazon's next hit!
In the movie “Iron Man”, there was such a scene: the protagonist Iron Man gets up from the bed with a simple password, and the smart housekeeper “Jarvis” handles everything, including but not limited to controlling computers, curtains, air conditioners and TV etc.
With the development of a new round of technological revolution and industrial transformation, IoT devices are growing exponentially, and the era of Internet of Everything has kicked off, which also makes it possible for the smart home in the movie scene to become a reality.
As the basic application of the Internet of Things, the smart home industry is about to usher in a period of barbaric growth.
According to the Research and Markets report, the global smart home market will reach US$81.19 billion in 2021, and will grow at a compound annual growth rate of 24.11% from 2021 to 2027. It is expected that the market size will reach US$296.71 billion by 2027.
About subcategories
At present, the popular categories of smart home mainly include: smart lighting, smart security, energy management and smart devices. According to a public report by Research and Markets, the following sub-categories have considerable room for growth in the future:
Lighting controls are expected to grow at a CAGR of 13.7% to reach USD 55.8 billion during 2022-2026;
The compound annual growth rate of the security and access control category is 14.6%;
The HVAC controls category is growing at a CAGR of 14.2% and is expected to reach a size of USD 43.2 billion by the end of the analysis period. China will be one of the fastest growing countries in this regional market cluster.
About regional data
In 2020, the smart home market in the United States is about $21.5 billion. It is expected to grow by USD 18.18 billion during 2022-2026, at a CAGR of 17.90%.
The smart home market in Japan and Canada is expected to grow by 12.3% and 12%, respectively, between 2020 and 2027.
In the European smart home market, Germany is expected to grow at a CAGR of approximately 10.3% during the period 2022-2026.
It is estimated that by 2027, the size of China’s smart home market is expected to reach US$31.7 billion, with a compound annual growth rate of 13.5%. In addition, while the global smart home market is exuding growth vitality, it has also attracted the attention of many technology giants.
During this year’s Double Eleven, more than 280 companies, including technology giants such as Amazon, Apple, Google, Samsung SmartThings, and Signify, pooled their technology, experience, and innovation to jointly create Matter1.0, a smart A milestone in the home furnishing industry.
The Smart Home Has Great Potential
Amazon’s public selection trends
According to Amazon’s Business Opportunity Finder, smart home is becoming one of the fastest growing and most promising categories on Amazon.
According to Amazon’s global store opening forecast, the total value of global smart homes will reach 182.3 billion US dollars in 2025. Among them, the US site can reach US$46.8 billion, and the European site can reach US$44.9 billion, with a compound annual growth rate of over 2 digits. It is estimated that nearly half of American households will use smart home devices.
The following is the smart home selection trend of the four sites in the United States, the United Kingdom, Germany and Japan disclosed by Amazon’s global store opening:
US station
● As a new industry, smart home is highly accepted in the United States. In 2020, the penetration rate of smart home in the United States will rank first in the world, reaching 36.6%, about twice that of China;
● The penetration rate of control connection products in the United States and other English-speaking countries is high, and the United States is about 7 times that of Italy, with a bright future;
● The average spending of American households on smart homes is among the highest in the world, and the investment in smart devices is the highest, reaching US$665 per household per year.
UK station
● In 2020, the penetration rate of the Internet and smartphones in the United Kingdom both surpassed that of the United States, ranking first in the world, reaching 91.4% and 90.5% respectively. The mature Internet environment makes British consumers more willing to try smart homes;
● Smart devices are favored by British consumers, and the volume in the UK will reach 3.35 billion US dollars in 2025;
● The average UK household spends more than $663 on smart homes in 2020.
German station
In 2025, more than 20 million households in Germany will use smart lighting products; home entertainment products will be used by more than 15 million households, more than three times that of France; the volume of smart devices will reach 3.25 billion US dollars.
Japan station
Asia will use smart devices faster than Western Europe and North America. Usually, the first smart device purchased by consumers in Japan is a small item with a lower price. After using it, people will be more willing to try smart home products with a higher price.
Summarizing Amazon’s data, looking at the world, the first smart home that consumers usually buy is a small item with a lower price, and then they will try more smart home products with higher prices. And Amazon believes that in the long run, smart homes are likely to replace traditional homes.