Retail Observer

RETAILOBSERVER.COM SEPTEMBER 2019 54 W hile "smart home" and "connected home" are often used interchangeably, they aren't the same. Smart homes feature products such as doorbells and thermostats. Connected homes link those features to unleash a heap of benefits. Smart homes are no longer a gimmick or passing fad – there are now millions of smart homes globally. However, consumer confusion is at an all-time high, thanks to fast-paced product introductions, short product lifecycles and the layering of multiple services and control networks. The upside is that there's a major growth opportunity for those who can provide first-class service. THE SIZE OF THE MARKET Smart home products have been the second-fastest-growing category in the CE segment at over 50%, just behind wearables such as smart watches and fitness trackers. And the pace of growth isn't expected to slow. The addressable market looks even more impressive when we consider the $490 billion in revenue these products are expected to generate by the end of 2019. It's anticipated that smart home products will draw an impressive 42% repeat shoppers, which means more footsteps to your door. Still, a whopping 52% of customers are either scared or intimidated by these products! And this puts your knowledgeable sales team in a prime position to help customers overcome their fears and win their loyalty. SMART APPLIANCES The negative effects of smartphone radiation have made the news in recent years, and the major home appliance manufacturers have recognized the challenge. Because the kitchen is the home's traditional center, connected kitchen appliances offer a fine way to overcome the dangers of these smart devices. It's why many manufacturers have begun to incorporate "HUB" features in their kitchen products that can link-up music, video, social and productivity content. Retailers who offer high-touch service and installation need to offer solutions that will promote the benefits and value of the connected kitchen. As consumers become aware of the positive impact that a connected kitchen can have, we should expect sales to start rising rapidly. SMART CONSUMER ELECTRONICS In the consumer electronics home space, several product categories can be defined as "smart," including security, entertainment, networking and energy. Collectively, the products available in these segments already number well into the thousands. But it doesn't have to be overwhelming. Retailers need to focus on offering turnkey features as quickly as possible, by limiting the number of brands and products. For the independent retailer, some excellent platform choices may already be in place. Google, for example, offers a great brand, backed by an open platform, top-selling products, and existing functionality in some of the products we sell today. Google has invested heavily in smart home products and the connected home ecosystem, making it an easy choice. REIMAGINING THE RETAIL CONNECTED HOME DISPLAY Because the connected home is in its early stages, it will require a high-touch consultation to reassure the 52% who are still intimidated. Unfortunately, "smart home" took a rather funky DIY approach in its early days. It's still rare to see a fully functioning connected home display at retail. The best "show-me" retailers will need to find ways to demonstrate how the entire home can be connected, from front door to kitchen and living room to deck. As smart homes continue to converge with our lives, independent retailers will need to show customers what a great connected home experience looks like. Smart home product offerings are just the first step. We need to seize the opportunities that the connected home offers for sales, service, installation and support. Expanding our smart home products and connected home services will help us open up new opportunities in this large and fast-growing category. Derek Mattila Appliance Trends Derek Mattila VP of Appliances Nationwide Marketing Group Doug Wrede VP of Consumer Electronics, Nationwide Marketing Group RO FROM SMART HOME TO CONNECTED HOME

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