Global Smart Thermostat Market - Segmented by Deployment (NFC, Wi-fi, Zigbee), Application (Industrial, Commercial, Residential), and Geography - Growth, Trends, and Forecast (2018 - 2023)
The global smart thermostat market was valued at USD 962.97 million in 2017, and is expected to reach a value of USD 10745.40 million by 2023, at a CAGR of 49.16%, during the forecast period (2018 - 2023). The scope of the market is limited to its applications across different end-users, such as industrial, commercial, and residential among others.
Energy saving has been the primary value proposition of smart thermostats among consumers, with statistics suggesting an average cost saving of around USD 100 to USD 150 per year. With the penetration of smart home technologies in common households, the capabilities of smart thermostats have also grown, allowing companies to incorporate more features with iteration of the device. These factors have been instrumental in driving the global smart thermostat market.
High Return on Investments and Energy Savings to Drive the Adoption of Smart Thermostats
The Smart thermostats have witnessed rapid growth in adoption in the developed nations, owing to increasing consumer interest in smart devices. While the industry initially focused on tech savvy consumers, growing adoption of smart homes and connected devices across consumer segments have propelled the adoption of smart thermostats. The market is experiencing boost with sales of smart home voice assistants, such as Amazon Echo, and Google smart home growing. Many companies are integrating compatibility with these systems enabling users to completely automate homes, while also building the abilities of smart thermostats, with consumers willing to take advantage of energy savings and automation. However, limited awareness in the developing nations is one of the major challenges, while slowdown in innovations is leading to a wide product category offering similar features.
Wi-Fi to Witness The Fastest Growth Over The Forecast Period
Wi-Fi has become one of the most widely used networks across the world, offering a range of Wi-Fi compatible devices. Also, the technology has the highest penetration rates in comparison with other deployment models with most of the residential, commercial, and industrial spaces enabled with Wi-Fi compatibility. Thus, Wi-Fi enabled smart thermostats gain huge consumer demand, with an extensive compatibility across multiple devices. The Global shipment of Wi-Fi enabled smart devices was estimated to USD 65 million, in 2017. With most of the smart devices in market being Wi-Fi compatible, the demand for devices working on similar networks is growing. While many companies are offering devices with cross network compatibility that can operate on multiple technologies, such as NFC, and Bluetooth, Wi-Fi is expected to remain the standard technology. Wi-Fi is expected to become the ‘go-to’ technology, with next generation smart thermostat devices focused on smart home assistants, allowing many smart home assistants to work on Wi-Fi.
North America to Hold the Largest Market Share
United States of America and Canada are the countries considered under the North American region, and are also the largest markets for smart devices across the globe. Companies offering the products, both start-ups and established giants, have been identified to be focussing on this region, with most of the products being launched initially in North America. USA is one of the largest markets for smart devices and IoT technologies, with high penetration in all the segments, including residential and commercial. The Smart Thermostats witnessed sales of 5.8 million units in 2017, compared to 4.9 million in 2016. Connected thermostat sales are expected to surge past USD 400 million in 2018, with users increasingly adopting new, and upgraded devices, offering more smart features and compatibility. Also, presence of strong sales and distribution networks, and higher budgets of the consumers is supporting the growth of the market further. With around 50% of the households in North America expected to turn smart by end of the decade, the consumption of smart thermostats is expected to continue to project strong growth rates in the coming years.
Key Developments in the Market