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Is the Smart Home Still an Open Field of Opportunity?
Is the Smart Home Still an Open Field of Opportunity?
Today’s digital consumer has graduated beyond exploring the latest iPhone specifications, browsing through streaming apps on their TVs and discovering new ways to avoid internet ads. Consumers are more informed today than they ever have been, with Gen Z leading the pack as the most research- and value-driven generation yet. They also have the highest expectations for customer experience and ease-of-use. To outperform the competition, modern-day service providers are adopting strategies that rise above the noise, building personalized relationships and addressing real customer needs.
From products to platforms, the smart home is consistently described as a fragmented market with numerous challenges. Providers are struggling to build an end-to-end holistic experience from these isolated platforms. However—with investment—evolving and educating both service providers and consumers offers a win-win solution.
Consumer spending on smart home products is expected to reach well over $157 billion by 2023. While new smart home adopters are addressing one-off use cases like security or home entertainment, high-fiber users often have more than 16 connected devices in the home spanning multiple use cases like energy management, home maintenance, security and more. It’s quite simple: smart home products simplify the home, but the customer chooses how much simplification they want and where. With a trusted broadband provider guiding their path and unifying the experience, pioneering the future of the home can be safe, easy and fun.
Where do the challenges lie for the Smart Home?
Users today already know what to expect from mobile phones, television and broadband connectivity providers, but they lack knowledge on the use and benefits of smart home solutions. The everyday homeowner is being forced to teach themselves about topics like internet security, speed, and privacy. With off-the-shelf products enabling homeowners to shape their own experiences, companies are also beginning to offer services to make that process easier. Areas that have seen an increase in demand are health and wellness, security, energy, family management and residential maintenance.
A common misconception is that a smart home proposition must be all or nothing – a complete end-to-end solution from the start. The simplicity of voice services, like Amazon’s Alexa and Google Assistant, continue to make the smart home digestible for the mainstream consumer. But they can also create interruptions for an innovator at an MSO, as seen in many cases where the experiences and off-the-shelf solutions they offer do not always complement the goals of the MSO. Consumers are beginning to form checklists for what to expect: a broad device ecosystem, automation and—above all else—ease of use. It can seem like clear leaders already exist and more than fill these specific needs. The business opportunities are not obvious. So, why must MSOs forge ahead with the smart home?
What Can MSOs Learn from the Smart Home?
Exposing customers to valuable use cases through channels owned by the MSO increases the number of branded interactions and device connections with that MSO. This not only increases adoption among customers, but strengthens the overall understanding and impression that consumers have with regard to the smart home.
The value of a smart home grows as more devices become connected not just to the home but to each other. Although a customer today may be using their smart home to help protect themselves from intruders, become more energy-efficient or to prevent household damage, customer needs are likely to expand beyond all three of these examples as they become more tech-savvy with the smart home. Automation will become increasingly important for service providers, and as usage grows, customers will continue to demand for ever-more seamless and frictionless experiences.
Telecom operators have a significant advantage over other competitors entering the smart home race when it comes to providing innovative IoT experiences. By combining these new smart home offerings with their pre-existing connectivity services and solutions, telecoms are in a winning position to unearth new revenue streams. However, the pressure will move to the trusted telecom providers, as they must begin to package smart home products to meet the consumer need for control and for their unique use cases – all the while building loyalty, reducing churn and creating an advocate out of the customer.
Unlocking the Full Potential of the Smart Home
Launching an all-encompassing smart home solution is challenging to say the least. MSOs are still learning what customers need from their offerings. They are launching solutions to learn, pivot and evolve. An end-to-end mass-market proposition requires significant time and investment, meaning that returns need to demonstrate substantial gains in a still-maturing market. However, this opens the door to constantly evolving solutions and offerings, which could introduce upgrade options for providers.
MSO customers continue to look at their providers as guides in their smart home journey, and this is the ultimate time for providers to invest in education both inside their business and for their customers. MSOs must build trust and confidence from their customers that these solutions are here to stay and that they are enriching—not complicating—their daily digital experiences.
Creating Revenue Opportunities in the Smart Home
Put simply, the connected home market opportunity is massive. Between evolving products and a burgeoning smart home market, several MSOs are already hedging their bets with the smart home. Furthermore, customers are purchasing smart home products at faster rates than predicted. Customers expect to connect those devices to their routers without any engagement with their internet service providers through a seamless digital service. What they find instead is the need for additional support to gauge new service requirements. Therefore, partnering with experts who can manage the complexity of the smart home ecosystem and address consumer needs significantly increases the business potential for MSOs. Getting started with lower up-front costs and a more flexible ongoing approach means MSOs can glean better insights from their consumers and address their core requirements with an evolved and tested solution down the line. Rather than wait for disastrous reviews and lost customers, MSOs have the opportunity today to leverage market experts in the smart home to quickly build revenue opportunities that will last decades.