State of the smart home

Back in September, HiddenWires conducted some research to analyse the state of the smart home industry across EMEA. Amy Wallington walks us through the findings.

Every industry has been affected one way or another by the global pandemic over the last couple of years. This has led to much uncertainty across all walks of life and life has certainly changed forever.

The markets that were always very popular and doing well, such as the travel or entertainment industries, have suffered dramatically throughout this time. However, we have seen the residential markets experience some growth while people are spending more time at home.

While there has been a lot of talk about the growing residential markets, we do not know if this is just temporary while people cannot spend their money elsewhere or if home really is the new going out. Therefore, we decided to build a market research survey to analyse where the smart home industry is currently and how people feel about its future. We received 8,012 responses to the survey and have collated the results into this report.

Who took part?

Before we delve into the data about the smart home industry, it’s important to highlight who took part in the survey. Most of the partakers were integrators or installers, making up 69% of respondents. The rest of the respondents were made up of designers (4%), manufacturers (3%), distributors (3%), specifiers (3%), architects (2%), interior designers (1%), and 15% of respondents described themselves as ‘other’. I should note here that all participants had to be a professional in the smart home market to take part.

Of those professions, a huge 87% of respondents work mostly throughout Europe. The second most popular region worked in was the Middle East, taking up just 3% of participants. Similarly, the UK also took up 3% of people taking part in the survey. There was just 2% from the APAC region, 1% from Australia, 1% from Africa, 1% from Russia, 1% in South America and 1% in North America.

As part of the survey, respondents had to specify whether they worked mostly in the high-end, mid-range or low-end of the residential market. The parameters that defined each level were that the lower end was €250,000 and lower per project, mid-range is €250,000 to €450,000 per project, and the high-end is anything above €450,000 per project. Just 8% of participants work mostly in the high-end residential market, while 20% work in the mid-range. A huge 72% work in the lower end of the market, implying that more homeowners are looking for smart solutions in their home life.

The survey results also looked at the different types of dwellings smart home professionals work in the most. Mid-range houses came out as most popular, totalling 57%. Zero/low energy homes were the second most popular type of dwelling with 36% of participants choosing this option. This shows consumers are becoming increasingly concerned about their carbon footprint and are taking action to lower their energy used at home.

Luxury homes are the third most popular dwelling with 33% of respondents working mostly here. 26% said assisted living homes, 26% said luxury apartments, and 16% said hotels.

KNX comes out on top

At the heart of a smart home is usually the control platform and communication protocols or ecosystems that the home will run on. Working with homeowners, it’s the installer’s job to decide what would fit best into a particular home to cater to the customer’s needs and dictate how the rest of the home will work together.

Looking at various communication protocols and ecosystems, KNX was found to be the one most people were aware of and the ecosystem most specified. In fact, three out of four (75%) smart home professionals who took the survey are aware of KNX technology, while 62% said they regularly specify the technology into their projects.

Wi-Fi took second place with 71% aware of the protocol and 53% working with Wi-Fi as the main ecosystem in a smart home. The research also found that 64% of people are aware of Bluetooth, while just 31% use it regularly in their projects. Zigbee was the fourth most popular technology with 54% aware of it but just 21% working with it on a regular basis.

This equates to KNX being three times ahead of Zigbee, which is one of its main competitors present in the smart home market.

KNX is the most specified communication protocol in the smart home industry. Image: Mangpor2004 / Shutterstock

Apple was the next most popular protocol used in smart home projects, with 51% aware of it as a smart home technology and 22% regularly using it. Interestingly, a big competitor to Apple, Amazon didn’t do as well in the survey with 44% aware of the smart home technology from Amazon but just 14% specifying it into projects on a regular basis.

49% of respondents said that they are aware of Z-Wave technology with 13% saying they regularly specify it. The ecosystem, Loxone, scored 46% for awareness of the technology but just 10% of people specifying it regularly, while 45% are aware of EnOcean as an ecosystem with 13% using it in projects.

BACnet is another communication protocol used in smart homes and 40% of contributors are aware of the technology while just 15% regularly specify it. 33% said they are aware of Samsung technology as a communication protocol or ecosystem with 8% using it regularly in projects. Surprisingly, Control4 was less well-known, equating to 32% of respondents aware of it and just 8% specifying it.

Finally, 26% said they are aware of proprietary ecosystems with just 9% regularly specifying them, and 25% know of Huawei as a smart home technology but only 2% are using it regularly.

Areas of automation

After finding out what systems are the most used in the smart home technology market across Europe, we wanted to learn about some of the most common areas of the home to have automated or some sort of smart home solution for.

The research showed that the most automated area of projects is lighting, with 71% of respondents giving this answer, followed closely by 65% saying that temperature control is the most popular area to automate. Also taking high priority is blind control, with 50% of smart home professionals saying this was top of the list in most of their projects.

Energy management is becoming more thought about by homeowners, with 46% of respondents saying this was the most important area to look at in an automation project. Likewise, security is also significant, with 38% regularly finding automated or smart security solutions a priority in their home projects.

Lower on the list than perhaps expected by some, home entertainment systems accounted for just 32% of partakers, while smart solutions for smoke and CO detectors equated to 26%. Of those that took the survey, 24% said that smart appliances were most important to have in their projects and just 4% chose ‘other’.

It seems that smart homes and home automation is being implemented more into new build residences rather than existing dwellings. Just 17% of people who took the survey said they are installing more in existing homes compared to 82% who said they are working mostly in new builds.

Lighting is the most popular application to automate in the home. Image: Chlorophylle Photography / Shutterstock

Future outlook

At the start of this article, I spoke about how the smart home has grown in recent years and even more so since the pandemic as more people are staying at home and have more money to spend on their homes rather than leisure activities such as entertainment and travelling.

Our research supports the growth of the smart home industry with 59% of respondents saying that interest in smart homes has increased in their region over the last five years, and 28% saying interest had significantly increased (more than doubled).

Of those who took part, 10% said that interest in their region had stayed the same. Just 1% said it had decreased, while 0.39% said it had decreased significantly (more than halved). This is all very positive news as it shows that more consumers are taking an interest in smart homes and, as a result, the industry is growing.

When asked about what is pushing this growth, 71% of partakers said that people having more awareness of smart home technology is the biggest contributing factor to this growth. Energy management is also clearly a key concern to homeowners with 52% of respondents naming that as the biggest contributor.

Just under half (42%) of those taking part in the survey found that customers wanting whole-home solutions was a priority pushing this growth. This highlights how many end users are looking at automation to ensure that everything in their home works together in an automated way to simplify the home life.

23% of respondents said that the effects from the pandemic and spending more time at home was the biggest contributing factor to the smart home growth. As I have already said, this is not surprising as many consumers have more money left over than usual as they couldn’t spend it on travelling or entertainment or other luxuries that were banned during the various lockdowns. As people were spending more time at home, they decided to invest more money in it.

Finally, 21% said that standalone/DIY products were a big growth factor. Consumers who are interested in smart homes but perhaps do not have the budget for a high-end automation system will look at off-the-shelf products such as smart speakers and cameras as a form of home automation.

Conclusion

The report told us many things about the smart home industry. We found that the market is continuing to grow, consumer interest in smart homes is increasing, lighting is the most common application to automate in a home, and KNX is the most used communication protocol.

In my experience, KNX is being used more and more in projects that I am seeing, as well as many products now integrating KNX technology. In fact, according to KNX, there are more than 8,000 devices from different manufacturers that use KNX technology and this also means they are all compatible with each other. This enables installers to build home systems using brands that will fit the homeowner’s needs the best, without having to worry about whether it will work together or not.

KNX prides itself on being a secure ecosystem, meeting high security requirements to avoid any risk of hacking. The technology also focuses on high levels of flexibility and simplicity for maximum comfort. There are some ecosystems around that are quite closed, limiting users as to what brands they can mix, what they can do with the system and how much control they can have. In some cases, this is a good thing. But KNX technology is an open ecosystem to allow users to add extra devices and routines whenever they like to allow more freedom and control at home.