The global smart home market was valued at USD 79.16 billion in 2022 and is projected to grow at a compound annual growth rate (CAGR) of 27.07% from 2023 to 2030. Smart home products come in various forms, such as cameras, smart lights, streaming devices, and dishwashers. The increasing integration of Artificial Intelligence (AI) into these products for enhanced smart features is expected to boost demand. Additionally, the widespread use of smartphones and internet access globally is driving demand for connected smart home devices. AI-powered digital assistants offer users hands-free, user-friendly control of smart devices, influencing buyer preferences.

The growing use of virtual assistants like Siri, Google Assistant, and Alexa allows users to automate tasks using voice commands. Features such as Bluetooth speakers and hands-free control of tasks are driving demand for smart home products. For example, in October 2022, Google enhanced its assistant to include voice-input message typing and emoji support, improving user convenience. The rapid adoption of modern technologies, including the Internet of Things (IoT), blockchain, smart voice recognition, and AI, is having a significant impact on the market.

Gather more insights about the market drivers, restrains and growth of the Global Smart Home Market

Smart voice recognition technology enables smart home products equipped with microphones to identify users' voices and deliver personalized responses. The increasing adoption of IoT in both developing and developed regions has also contributed to market growth. The ability of these technologies to connect devices is driving demand for smart home products. The COVID-19 pandemic, which led to industry shutdowns, affected the production of smart home devices. However, as people were forced to stay home due to lockdowns, there was a surge in demand for smart TVs and entertainment centers, leading to increased interest in smart home automation for tasks, especially in line with social distancing norms. Despite supply chain disruptions, the pandemic highlighted weaknesses in the digital device and internet infrastructure sectors. With production slowing and supplies decreasing, the semiconductor shortage impacted the manufacturing of smart home devices.

Product Insights

The security and access control segment led the market in 2022, accounting for over 30.40% of total revenue. This growth is driven by rising demand for smart security solutions that allow authorized access to safes or rooms with valuable items. Smart locks and security cameras help monitor and control access, utilizing features like live feed playback, custom PINs, and fingerprint scanners. For example, in September 2022, Amazon.com, Inc. launched the Ring Spotlight Cam Plus, Ring Spotlight Cam Pro, and the 2nd Gen Ring Alarm Panic Button for security and access control using radar and 3D motion detection.

The home healthcare segment is expected to experience the highest CAGR during the forecast period, fueled by the growing trend of consumers preferring smart home healthcare products for self-diagnosis, as healthcare and insurance costs rise. Increasing fitness and health awareness is also driving growth in this segment. Consumers now use smart healthcare products at home to monitor key health indicators like oxygen levels and blood pressure, which previously required hospital or clinic visits.

Protocol Insights

The wireless protocols segment is expected to grow at the highest CAGR of 27.75% over the forecast period and also captured the largest market share in 2022. This growth is due to the features offered by protocols like ZigBee, Wi-Fi, Bluetooth, and Z-Wave, which include mobile connectivity and communication regardless of location. Manufacturers favor these protocols for their ability to enable smooth communication with minimal impact on battery life and range.

For instance, the ZigBee protocol extends battery life by operating with lower latency and a low-duty cycle, facilitating instant device-to-device communication. The wired protocols segment is also expected to grow significantly from 2023 to 2030, driven by traditional products with built-in Ethernet or cable ports. Wired protocols are often used to operate a hub of smart devices from a central location, offering greater security and fewer connectivity issues. The demand for low-latency smart home products is expected to further support the growth of this segment.

Application Insights

The smart home market is divided into two main applications: new construction and retrofit. The new construction segment is expected to grow the fastest, with a CAGR of over 28.55% during the forecast period. This growth is attributed to the ease of installing smart devices in new construction projects. The rising number of residential construction projects worldwide is also driving demand for smart homes, especially for features like smart security and access control.

In new construction projects, multiple smart home devices are likely to be installed, thanks to the ease of logistics involved in the installation process. The retrofit segment dominated the market in 2022, accounting for the largest share of overall revenue. Many homeowners choose to retrofit their homes by installing one or more smart devices based on budget and logistics. The easy availability of smart home products is contributing to the growing trend of retrofitting, which is further fueling the market growth.

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