Consumers Want Product Choice for a Smart and Secure Home

By Jennifer Kent, Ph.D. , VP of Research, Parks Associates

Wi-Fi is ubiquitous in US internet households, and consumers rely now more than ever on reliable, high-performing connectivity at home. However, consumers continue to experience problems with a range of issues and loss of connectivity. At the same time, security dealers are increasingly integrating Wi-Fi devices into security systems, responding to growing consumer demand for video doorbells, network cameras, and many other Wi-Fi smart home devices. Yet, dealers are not in full, end-to-end control of system performance, as they are with security and life safety sensors and Z-Wave devices.

Instead, they place the installed Wi-Fi devices on the customer’s Wi-Fi network. This introduces several challenges such as reliability, bandwidth, and speed issues with the home network, affecting the performance of the security devices on the network. Additionally, dealers are called to support faulty Wi-Fi devices and networks, driving up operating costs. Maintaining users’ home networks is difficult and expensive. Further, the demand for better home networking support is on the rise, given COVID-driven lifestyle changes and work-from-home trends

Parks Associates research reports that dealers need more sophisticated products and services that make installing Wi-Fi products and maintaining security solutions with Wi-Fi components easier and more cost-effective.

After a strong increase between 2018 and 2019, the home security market continued slow-but-steady growth through the pandemic. Parks Associates' research reveals that 35% of US broadband households had a security system at the end of 2021. Additionally, households have more smart home devices than ever: 37% of US broadband households own a smart home device, up from 24% in 2018. Consumers’ desire for peace-of-mind solutions drives security product and system sales, and the availability of affordable DIY installation and self-monitoring systems gives consumers more choices to meet their needs.

Meeting Expectations: Simplicity for Complex Actions

Security system owners are among the most enthusiastic technology adopters, and they want a smooth user experience. Seventy-six percent of security system owners have a connected home device, and security system apps are the most common tool for controlling multiple smart home products. The increasing demand for seamless integration has created an opportunity for dealers to drive the entire device setup and integration experience— by controlling the network. It creates a new role for security providers as the source for new integration solutions and the support for any problems associated with them. This means an increasing number of support calls and truck rolls to resolve matters.

Parks Associates research reports 59% of dealers to say they offer smart home devices because customers want the simple, unified experience resulting from combining smart home capabilities with security. This is the top reason dealers offer smart home devices, and like the proverbial duck working underwater, nothing is more difficult to accomplish than simplicity for complex actions. Dealers also offer smart home devices for additional RMR and increased customer stickiness. Creating stickiness is always top of mind for services, and security monitoring companies are plagued by high attrition, making growth a double-duty job: replace lost customers and then grow. Cutting attrition in half would add additional money (profit) to the bottom line, and a simple, reliable user experience with integrated smart home devices can help retain customers.

Video Products Drive Need for Wi-Fi Device Integration

Users want Wi-Fi products as part of a safe and secure home and expect to be able to integrate Wi-Fi products into their systems. IP cameras and smart video doorbells—typically Wi-Fi-based devices—are now the leading smart home device categories after experiencing strong growth over the past three years.

Security system owners are strong users of these products, adopting them at six times the average rate of all internet households. One-third of security system owners own a smart camera, and 30% own a video doorbell. Security dealers also report a surge in video product installations. Dealers rank video doorbells as the #1 smart home solution sold by their company, followed by external video cameras.

Due to the need for high bandwidth data transfer, video products require dealers to rely on consumers’ home networks for connectivity, rather than protocols like Z-Wave that support low-bandwidth sensors and devices.

Download Parks Associates whitepaper “Control the Network, Control the Costs: Solving the Wi-Fi Problem in Home Security,” in collaboration with Johnson Controls for more information on the rise in demand for Wi-Fi devices integrated with security and smart home solutions, the current impact of poor Wi-Fi network performance on the pro install channel, and the opportunity for dealers to own and manage the Wi-Fi network remotely, reducing their cost of ownership and improving user experience.

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