Blog for Building Materials Manufacturers

We’re Not Ready for Smart Homes

  |  Posted in New Product

We’re Not Ready for Smart Homes

The capability developing in the world of technology has been dazzling. Soon, everything electronic in our lives will, in theory, be addressable by its own internet (IP) address. Our homes, cars, machinery, appliances will be able to receive communications from us via smart phones, mobile devices and computers from anywhere in the world. The part that has been exciting many planners and futurists is the idea of controlling the electronics around the home from anywhere and the idea of appliances and machinery in the home “talking” to each other, regulating each other, turning each other on and off without the need of human intervention.

Home automation in smart homes could create energy saving based on efficient management of energy resources. Smart homes can really make control of the basics of living much simpler. The smart home can revolutionize the lives of people living with disabilities or functional limitations. However, concerns remain about the association of smart home technology with the internet.

The ideal of the home of the future is the smart home with its perfect self-regulation and control using smart devices offering beautiful slider switches for lighting, HVAC, when the coffee pot turns on, locking doors and all the other management tasks of the home. Many are now thinking there are reasons why these smart homes will fail as we are not yet ready for them.

Security Concerns

As the reality of the internet of things (IoT) gets closer, we begin to hear dissenting and cautionary voices. There are some limitations to the promise of the IoT. A lot of the concern is about privacy and security issues. The information being transferred through the internet becomes prone to access by data collectors and hackers as well as big government. The potential for crime and abuse is high. The IoT and the interconnection of devices can make it much easier for malware, spyware, worms and other concoctions of IT evil to spread through our lives.

Smart Home Hacker

It’s easy to imagine how a hacker can gain the same control over our devices that we have. There is also the problem of once a security flaw is discovered and fixed how do you notify owners a get them to update their software?  Here’s an example of this issue from the Wall Street Journal.  These stories will continue and create fear and concern in the minds of homeowners that will be difficult to dispell.

Data transferred and managed through the Internet can easily be exposed and leaked. Smart home security software is not yet fully developed. Current smart home security systems devour huge amounts of information about the user. Great harm can follow if that identifying information gets out. Consumers know this and are concerned about yet another intrusion in their privacy.

Installing state-of-the-art features inside a home is still very expensive. The technology is still new and at a premium. Wireless cameras and light sensors, a central touch screen system and automated systems are potentially available even now but can require a big investment. The cost of elaborate installation, maintenance, and repair of this technology is very expensive as well.

The electronics industry is joyfully predicting the deployment of billions of low-cost Internet-enabled appliance and devices in the next five years. But the design and production cost of these devices often don’t make sense. Many of them would never make a profit because of a limited market and because the labor savings would really not be that great. Attaching devices to the internet, in most cases, require power handling and memory capacity that make the real production of the devices impractical. This is especially true when security and encryption of data are considered.

Device life cycle management is a feature of complex devices that has been largely ignored in our optimistic vision of smart homes. Each device in the home would have to be registered and the operation of the device would have to be authorized in the system. The devices would have to be configured and operational parameters and product options would have to be set. Systems for automatically report problems and failures would have to be set up. Firmware in the device would have to be updatable to address bugs and provide feature upgrades. Data for billing purposes would have to be made available for any features that require a subscription.

Still a Novelty

There are many affordable smart homes products that work well such as Nest thermostats, cameras, and smoke detectors.  Their are door locks you can control with your smart phone.  These appeal to early adopters and may even be considered a novelty.  We have Nest camera so my wife can check in our dog when we are out.  If we are out with someone, she always pulls out her phone and shows them and says, “Look what I can do, isn’t that cool.”  The camera costs $200, and I know that within two years there will be a new version that I will just have to have.

When I spend $2,000 on an appliance that I expect to last ten years, how will I feel three years later when the new model can do even more tricks?  And if I build a new house with thousands of dollars of smart features, how happy will I be when my system is an antique three years later?

There are two types of companies making smart home products and they each face different challenges.

The first type is the traditional manufacturer who is trying to make their existing products smart. Their problems are their knowledge of the existing product and distribution which limits their creativity.  The other problem they face is technology is not their strong suit.  They would be smart to hire the best team they can and keep them away from headquarters so the experts don’t screw it up.  The other option is to outsource the whole thing to someone like IDEO.

The second type is the technology company who has little or no experience with the product category so they can more easily see the weaknesses in the existing product and the sales process. The challenge they face is a lack of knowledge about how the industry works.  Nest decided to ignore the traditional sales channel and they have done it successfully. Nest is not the key to Smart Homes as many people hoped as you can read in this article.

I wrote this article in January 2016.  A year later only 26% of homeowners wants Smart Homes according to this article.

Gaining Widespread Acceptance Will Take Some Heavy Lifting by Manufacturers

I know the smart home is coming, it’s just not going to happen as fast as some people hope.  Security, systems that work together, obsolescence, and subscription fees are some of the hurdles the industry needs to overcome.

I have an eye to the future and the practical. If you’re interested in growing your product sales whether it is smart or not, contact me.

What is the biggest challenge to your sales growth?

Contact me for a free 30-minute mini consultation about your sales challenge. We'll review your specific situation and I'll provide you with 2 or 3 strategies to help you solve your challenge. This call is all about you helping you solve your problem. I will not be selling you on why you should hire me.  You decide whether you'd like to learn more about working with us. Calls are available on a first-come-first-served basis, to request your free call contact me at 720-775-1184 or mark@seethewhizard.com

About The Author

I am the leading sales growth consultant in the building materials industry, I identify the blind spots that enable building materials companies to grow their sales and retain more customers.  As I am not an ad agency, my recommendations are focused on your sales growth and not my future income.

My mission is to help building materials companies be the preferred supplier of their customers and to turn those customers into their best salespeople. Contact me to discuss your situation.