Cheaper data, higher disposable income, and reduced hardware costs have led to India as the second largest digital market in the world. With a quest to make life simple and secure, technology has gained central stage in all walks of life including the designing of homes. This drastic change has been accelerated on the fast internet connections available throughout the country.
A smart home is composed of networked devices and associated services that facilitate automation. As per forecasts, India ranked the third highest numbers of smart homes around the world in 2020.
Smart appliances’ current penetration is 5 percent in India, which is expected to reach 12 percent by FY24, according to Frost & Sullivan. Growth of the smart appliances market in India will be driven by the more than 500 million smartphone users in India, mobile connectivity and easy-to install applications. LG Electronics, Samsung, Whirlpool and Panasonic are some of the key players in the smart appliances space in India.
Urbanization and digitization are the key macro trends influencing the Indian smart appliances market. Technological advancement in smart appliances has emerged in the last few years. Instead of manually operated remote controls, smart appliances can communicate through voice assistants such as Google Home, Alexa (Amazon) and Siri (Apple). The smart appliances market in smart homes is estimated to witness a CAGR of 12%-15% in the next five years. Due to the COVID-19 crisis, the market might see a subdued demand in the short term with demand dropping by 20%-30%, but in five years the CAGR is likely to remain unaffected.
OEMs need to focus on various technical aspects. Companies should invest more in R&D to not only be a part of the growth story but to drive it. It is important to understand the demographics that look for smart devices and target the desired segment with the right technology features. Customers see significant value in postpurchase services offered by the companies. Hence, after-sale services will play an important role, and companies need a skilled workforce to address issues quickly
The introduction of smart technology across appliances has created an internet-enabled ecosystem. High-speed internet encourages end-consumers to purchase smart and connected products. Considering the large population size in India and concentration of technology-savvy users in urban centers, smart applications are likely to have high uptake in urban centers in the near future. The trend will soon spread to semi-urban and rural regions, thus broadening the available market for smart devices.
The market is currently limited to the top 10 tier-1 cities and some smaller cities. To attain the bigger market, companies are targeting tier-2 cities now for exponential growth. Certain areas have higher chances of growth as compared to others probably because of two factors – High Net-worth Individuals (HNIs) and IT hubs. Areas like Gujarat, Punjab, NCR have the most number of HNIs and cities like Hyderabad, Pune, Noida, Bangalore are the IT hubs.
The smart TV leading brands in India are Xiaomi, Samsung, LG, Sony and TCL, with Xiaomi far ahead of the others. In Q12021, the smart TV segment recorded a strong 55 percent annual growth with most of the TV OEMs focusing on increasing their product portfolios with smart TVs which brought down the entry-level price point to Rs 12000. OnePlus logged a growth of 66 percent on-quarter growth to secure a spot in the top five vendors list.
In contrast, the non-smart TV category declined in the Indian market and recorded a 46 percent yearly fall in Q1 2021. Most of the long-tail OEMs are pushing non-smart TVs in India at lower price points like sub-Rs 11000.
Interestingly, over 38 percent of the TVs sold during Q1 2021 were bought online, while 98 percent of the TVs sold during the quarter were made in India. “The open-cell or panel price in the global market is continuously rising along with other component prices, such as that of PCBs. Therefore, OEMs are trying to build some inventory as long as global component prices are lower than the future projections,” added Counterpoint.
During the COVID-19 lockdowns, the need for home entertainment became more evident, thus inflating the pent-up demand for TVs. Some new use cases also cropped up during these lockdowns, such as home office set-up and family video-calling, which pushed some consumers to buy a new smart TV. The pent-up demand from 2020 continued into the first quarter of 2021,” said a Counterpoint research report.
For the smart connected washing machine market, one of the key drivers is continuous innovation in the product. Some of the features that were recently introduced included remote access to the controls of the machine, Wi-Fi connectivity, and easy remote controlled wash. Therefore, by downloading the app on the smartphones or tablets and connecting the washing machines through the Wi-Fi, end users can easily operate the appliance from a remote location. The customers can keep a watch at the process on a remote location by getting notification and can select the type of wash cycle the customer wants the cloth to go through. Whereas increasing investment for producing these smart connected washing machine is the other factors which is fueling the growth of the market.
However, the high cost of these machines would hinder the demand and of the growth of the market. , is what will hinder the revenue generation for smart connected washing machine market.
The smart connected washing machine global market is valued at USD 10.63 billion in 2020 , poised to reach USD 26.38 billion by the end of 2026, growing at a CAGR of 13.7 percent during 2021-2026.
The key players in the global smart connected washing machine market are GE Appliances, Techtronic Industries, Whirlpool Corporation, Siemens AG, AB Electrolux, Robert Bosch GmbH, Samsung Group, LG Electronics Inc., Haier Group Corporation, Panasonic Corporation, and Candy Hoover Group.
In India, Samsung is banking on its innovation-powered, artificial intelligence-enabled washing machines range to become the number one player in the fully automatic segment in India this year. The Internet of Things (IoT) enabled range can be connected with Samsung smart devices such as Galaxy smartphones, Samsung Smart TVs and Family Hub refrigerators as well as voice devices such as Alexa and Google Home giving users a seamless connected living experience.
Smart refrigerators are in a nascent stage and will gain traction. Domestic refrigerators, with 35% penetration in India, are predominantly bought by customers based on their capacity and cooling requirements. Smart applications in refrigerators are “good to have” additional features, available only in high-end refrigerators, which are priced at a premium.
Smart refrigerators are offered with a touchscreen interface and can connect to the internet through Wi-Fi or Bluetooth. Also, there are new features available with internal cameras and remote-controlled cooling, operated with the help of a mobile phone or tablet, even outside the home. This helps consumers conserve energy. LG and Samsung are at the forefront, introducing smart refrigerators that allow users to compile shopping lists, keep schedules, and even watch video clips.
Looking into the growth of smart homes, the world market leaders of smart products have started to manufacture products which do not need hub and are easy to install and control. There has been incorporation of Wi-Fi technology in the smart products which has made it easier for any homeowner to install the easily and use them efficiently. With Wi-Fi technology, devices are now capable to communicate directly to the apps without the help of the hub.
Sentient home symbolises the future of smart homes where the house will be an entirely intuitive environment that manages external and internal necessities for residents. A sentiment home has smart devices and is totally connected to wireless control. The home will automatically adjust in real-time, a spectrum of facilities that support individuals, preferences inefficiency and weather patterns. On a whole, these smart houses are totally automatic that the house routines on their own. Automated applications controlled with artificial intelligence will cope with the day-by-day functions of the home efficiently and in a manner that accrues data so that machine learning can continue to optimise all processes.
The general threat that people envisage while using technology is the breach of privacy and data. When it comes to smart home appliances, people look for advanced technological devices. However, this drives us to a spot where consumers get the right to know how their data is being used and understand how to benefit from them. In 2021 and beyond, smart home manufacturers will concentrate more on how to collect minimum data and provide maximum service to consumers.