Research firm Statista has released its latest findings and forecasts relating to the smart home market, and notes the sector continues to enjoy substantial growth in Australia and worldwide.
Here’s an insight into what components are driving that growth and how Australia compares to the US.
Global growth for smart homes
This year the global smart home market is valued at US$71.629 billion but is expected to have an annual growth rate of 20.7 per cent until 2023.
That means within five years the market will be valued at an estimated US$151.955 billion globally.
Fuelling that growth is increased household penetration. Statista notes in 2019, 7.7 per cent of households worldwide feature smart home technology but that will rapidly increase to almost one fifth of all homes, or 18.1 per cent by 2023.
Statista breaks the smart home sector into six categories illustrating what it predicts will occur:
- Smart appliance revenue is currently valued at $10.3 billion globally, but is expected to equal $48.6 billion in 2023
- Security revenue is currently valued at $7.6 billion globally, but is expected to equal $28.198 billion in 2023
- Control and connectivity revenue is currently valued at $6.965 billion globally, but is expected to equal $30.796 billion in 2023
- Home entertainment revenue is currently valued at $7.534 billion globally, but is expected to equal $17.793 billion in 2023
- Comfort and lighting revenue is currently valued at $15.069 billion globally, but is expected to equal $48.6 billion in 2023
- Energy management revenue is currently valued at $2.968 billion globally, but is expected to equal $11.491 billion in 2023
US leading the charge
When it comes to the nation adopting smart home technology at the greatest speed, that title goes firmly to the US, where the market there is worth an estimated US$27.24 billion.
The US is followed by China (US$11.613 billion), Japan (US$4.193 billion) Germany (US$4.042 billion), and the UK (US$3.882 billion).
As the developer of all three major smart speakers and their voice assistants, it stands to reason the US is among the earliest and fastest adopters of the technology.
Statista notes 42.2 million US homes utilise smart home technology, with the average revenue per household currently valued at $112.76.
Smart home penetration there currently stands at 33 per cent, effectively meaning one in three homes employs some sort of smart home technology.
By 2023, over half the homes in America will feature some sort of smart home tech.
In terms of who is adopting this technology, 58.4 per cent of users are male and 41.6 per cent are female.
Meanwhile the age group most likely to embrace smart home technology is 25-34-year-olds (37.3 per cent) followed by 35-44-year-olds (26.6 per cent), 18-24-year-olds (18 per cent), 45-54-year-olds (12.2 per cent), and 55-64-year-olds (5.9 per cent).
The state of Australian smart home adoption
Experts have long noted Australia is roughly six to 12 months behind the US in terms of smart home adoption. Meanwhile, technology that is often released in the USA first arrives a little later to our door.
In 2018, this was evident in the long-awaited arrival of Amazon Echo and Apple HomePod smart speakers, which saw adoption of the technology spike throughout the year.
Now, Statista notes roughly a quarter (24.9 per cent) of Australian households feature some sort of smart home technology and that’s expected to increase to 41.9 per cent by 2023.
In real life figures, that means 2.3 million Australian homes have smart home technology, with the average revenue per installed household now at US$169.08.
Revenue-wise that means the smart home industry is currently valued at US$1.278 billion down under, but is tipped to increase to US$2.44 billion by 2023.
So, what are the major areas where Australians are set to invest?
Where Australians will spend their smart home dollar
When it comes to where Australians will spend their smart home dollar over the next five years, the sector likely to experience the greatest growth is smart home control and connectivity.
Currently this sub-category of smart home technology is valued at US$136.7 million in Australia, but is tipped to more than quadruple to $582.4 million by 2023.
Meanwhile, other sectors are predicted to grow at the following rate:
- Smart appliances will increase from a revenue value of US$167.7 million to US$594.8 million in 2023
- Security will grow from a revenue value of US$119.1 million in 2019 to US$450.5 million in 2023
- Home entertainment will increase from a revenue value of US$161.8 million in 2019 to US$314.4 million in 2023
- Comfort and lighting will grow from a revenue value of US$59.9 million in 2019 to US$257.2 million in 2023
- Energy management will increase from a revenue value of US$62.1 million this year to US$244.4 million in 2023
Which Australians invest in smart home tech?
Like the US, the majority of smart home technology buyers are men but here men far outrank women when it comes to the purchasing decision. Almost three quarters (72.6 per cent) of smart home products and technology in Australia is bought by men, while women comprise just 27.4 per cent of the buyers.
And, like America, it is people aged between 25 and 34 leading the charge, but unlike the US, it’s the younger generation who falls next in line.
In Australia:
- 8 per cent of smart home technology users in Australia are aged 25-34
- 2 per cent of users are aged 18-24
- 1 per cent of users are aged 35-44
- 8 per cent of users are aged 45-54
- 1 per cent of smart home tech users are aged 55-64
About Lera Smart Home Solutions
Lera Smart Home Solutions is a leading installer of smart home technology in the greater Sydney region. Our team boasts over 20 years’ experience in IT networking, programming and the electrical industry.
We have sourced the most reliable and cost efficient solutions from around the world to provide the very best in smart home solutions, and work with our clients to understand their needs.
You can learn more about transforming your house into a smart home here, or contact us directly for further advice.
