The promise of smart home devices to make our homes more convenient, safe, comfortable and entertaining is at an all-time high. Consumer adoption of smart home products continues to grow. Research firm International Data Corporation (IDC) predicts an annual growth rate of 16.9% between 2019-2023 for smart home devices, and it anticipates that nearly 1.6 billion devices will be shipping by 2023.
Despite the high adoption rates, however, the actual use of smart home devices in the real world has been disappointing so far. So the question becomes, how do appliance manufacturers design smart home products that will meet consumers’ demands?
Creating Consumer Satisfaction with Smart Home Products
Speakers at the recent Consumer Electronics Show (CES) panel on “Key IoT Trends and Innovations” discussed the issues of consumer satisfaction and the overall design of smart home products. Stacey Higginbotham, journalist and publisher of the industry newsletter Stacey on IoT; Atle Larsen, vice president of product marketing at Hamilton Beach; and Reid Bernstein, innovation manager at Nestlé Waters, talked about IoT technology innovations for creating smart home products that consumers want to buy and use in their homes. Plus, they discussed some current problems with connected home devices and how to overcome them.
The speaker panel suggested that designing successful smart home products for consumers comes down to four IoT design guidelines:
Many smart home products have yet to meet these criteria, says Hamilton Beach’s Larsen, “because most brands have been concentrating on developing the tech.” In most cases, he says, consumers aren’t looking for technology for technology’s sake; they're looking for tangible benefits.
It’s important for brands to think about what comes next after people bring a smart product into their homes.
For example, Bernstein said that his company, Nestle Waters, is focused on customer retention. “We could be selling a very pretty-looking smart product, but at the end of the day, what is the return rate? What is that failure rate based on customers’ expectations? And how many customers are sticking around past that one-year mark?”
Higginbotham, who also has a weekly IoT podcast, points out that high-profile security and reliability problems with smart doorbells and connected thermostats have consumers thinking about whether “they're getting enough value for taking a risk” in purchasing IoT products, which are still relatively new to the market.
Using Voice Technology with Smart Home Products
Higginbotham says that “voice has been an incredible trend” driving swift adoption of smart speakers and other smart home devices that consumers can program easily with voice commands. Still, she points out, it was estimated that in 2019, 80 percent of Amazon Echo owners used Alexa just to set timers and listen to music. Only 30 percent used it to connect to smart home devices.
Voice assistants continue to evolve as more companies develop ways to take advantage of ubiquitous smart speakers in people’s homes. In a recent report, market research firm Parks Associates stated that voice-enabled technology continues to become the center of the smart home ecosystem.
“The growth of the voice control and smart speakers market is highlighting a new revenue stream,” said Ayla Networks’ CEO Jonathan Cobb. “The potential is huge as companies find ways to tap into ‘Hey Google,’ ‘Hey Siri’ and ‘Alexa’ voice commands.”
Personalizing the Consumer's Smart Home Experience
Nestlé Waters is looking to personalize the customer relationship by using technology to ensure that the taste and type preferences consumers choose for their home water dispensers can be replicated easily when they’re not at home.
“The future of IoT for manufacturers,” Bernstein says, “is to both better understand consumer behavior patterns and usage of your product, and also to improve the performance and operation of the product itself.”
Designing Smart Home Products to Meet a Basic Need: Less is More
Enhancing the smart home consumer experience also is an objective at Hamilton Beach. But, as in the example of the use of Alexa, just because customers think they want something doesn’t mean it will be useful in the long run.
“We ask consumers about what features and functions they're using in a smart home product,” Larsen says, “and compare that to the data we get on what functions they actually are using in the connected version of the product.”
Rather than providing too many IoT bells and whistles, Hamilton Beach creates a “minimum viable product” with upgradability.
“We start with a couple of features that are going to give us an ROI,” Larsen says. “That way we can invest not only in retrofitting units that are already out there but also at the manufacturing level to meet consumers’ changing needs.”
Connecting Your Smart Home Products to a Larger Ecosystem
Higginbotham advises that consumers will be more likely to buy smart home products that are part of an “ecosystem” rather than those products that are smart but unable to talk with other household appliances.
However, to create such an ecosystem will require standards—something, she says, that companies like Amazon, Apple and Google have failed to accomplish yet “within their walled gardens.” But hope might be on the horizon. The three companies recently introduced a proposed product communication standard dubbed CHiP (Connected Home over IP).
Higginbotham feels that standards may spur manufacturers to start using data in ways that will help consumers, while also building use cases that consumers will be excited about.
For Larsen at Hamilton Beach, standards would lower the cost and alleviate the complexity of smart home product development.
“IoT is hard and it’s costly. So anything that can be done for things to talk to each other, and be easier to get into consumers’ homes and connected, is going to be a benefit to the industry as a whole—and to consumers,” Larsen says. “I'm hoping that the new standard is going to be a huge success because it would be a real benefit to everyone in this space.”
Building Trust with Use of Consumer Data from Smart Home Products
As the industry enters what Higginbotham calls the 3.0 phase, consumers will be thinking more about trust and will be more likely to question the benefits of data collection from smart home product companies.
“I think the core issue of the year,” Higginbotham says, “is how do you build trust with consumers, and how do you make them understand this data will have an eventual benefit to them?”
To manufacturers and service providers, Higginbotham suggests: “You're going to have to figure out what role your product plays in consumers’ lives,” and then to create trustworthy systems of value to them.
Creating Connected Home Products Consumers will Love
So where does that leave an appliance manufacturer?
It’s impossible to predict where consumer whims will lead, so the best way to protect smart home product investments and plan for the future is to build smart home products on a flexible, adaptable IoT platform.
Companies ready to move forward with their connected home product design concepts need the expertise of experienced IoT engineers. Manufacturers that haven’t yet assembled a team of IoT experts might want to look for help from integrators such as Ayla Networks. Contact us today for a free consultation and to learn more about designing smart home products using Ayla’s IoT platform services.