eMarketer recently released a really interesting report on smart homes, entitled “The End of Interruptive Marketing as We Know It.” Our CEO Michael Caccavale isn’t new to the smart home game (here’s a throwback to a fun piece in AdAge) so we sat down to look at the report and talk shop about what’s coming next. In this three-part series, we’ll talk about the emergence of smart homes, the challenges and opportunities for marketers, and which industries stand to gain the most from this new frontier.
Explain to me the use of “Internet users vs. Smart Home Users” – why is this included?
It’s a good data set to consider when you’re making a point about adoption. While many households have internet – and many consumers are internet users – not everyone has taken the leap to smart technology at home. There’s a baseline of adopters but the data suggests this is just the beginning.
In the report, the #1 downside is hacking/controlling the devices and #3 is personal information. What gives?
It’s important to understand what people consider personal information. Is it things like your passwords and banking information, or do you consider video personal data?
The hacking has alarmed people and rightfully so, mostly due to the media exposure. There was a story just last week about a camera talking to the older sister of a newborn in a house… But really, it’s likely the people who are getting “hacked” have just installed cameras and left the default password as “mypassword” or whatever – then the kid next door gets bored and accesses the device. It’s creepy and easily avoidable but checking out your Ring video is different than stealing your credit card information or identity.
Basically, this data we’re looking at suggests that people want the convenience of relevant, real-time information and are willing to give up some security in order to have it here and now. They just don’t want to feel like they’re being watched all the time.
The cross-ownership piece is interesting. Is it really just a big mess?
It can be if you’re not thinking holistically about your home automation marketplace. That is, most systems have a hub, like an Amazon Echo, that can run all the systems in the house – different light switches, the garage door, your Nest… You still have to have all of these devices listed separately even though they are just components of a smart home. Think of it like PCs in the old days – you have a computer, a screen, a printer… Different devices that talk to each other. For your smart home, you may need different apps to install each device but they should still all anchor and be accessible through one hub.
This is really when you get into the meat of “smart home automation.” It’s more than just having a door lock and an app. That’s not a smart home. Having integrated functions throughout your home that all answer into a hub like the Echo Dot is where you can see how smart homes are built and how the features work together.
Is there a gimmick quality to smart homes?
Absolutely. Or at least it can start that way. You might start with a smart switch for the lights in your kid’s bedroom or on the front porch. Next thing you know, you’re buying the value pack to install smart switches in every room. But really, the gimmick period can wear off – as soon as you start building an integrated system, you start to see the benefits. For example, the efficiencies around features like thermostat controls are very visible. And then anything that isn’t integrated feels really inconvenient.
What are the challenges to building an integrated system?
It’s kind of the classic Betamax vs. VHS thing – there are several standards, so it’s not clear which one will win out. Some technologies for the devices talking to each other are somewhat standard but I was recently pushing a representative at an Amazon store about why some devices say, “works with Alexa” and some don’t. I know I can integrate them into the same system so perhaps the labeling is just a misnomer, but in reality, it’s Amazon just starting to put together a “certified list” of products for integration to help “ease the confusion.”
Stay tuned. Next, we’ll talk about what all this adoption means for marketers. Where to we fit in? And what do we need to know to do right by our customers?