The Evolution of Residential Security
Parks Associates
International market research firm studying connected home and entertainment trends, small business, and multifamily
Historically, the residential security market has struggled to exceed 25% of broadband households owning a system. Starting in 2018, product innovations, new entrants, and diversifying business models that give consumers more choice have resulted in definitive market growth. COVID-19 has been a net driver for the security industry, as the uncertainty of this time aided interest in products and services that provide consumers with peace of mind.?Improved DIY systems are another reason for growth.
Security and home systems have been established for decades in specific consumer segments, but now connectivity has created new opportunities. For the security market, market factors are creating new dynamics and a new structure for smart home and home security players:
1. Affordability
2. Commoditization vs. Differentiation
3. Consolidation / Partnerships
4. Disintermediation
5. Smart Home Integration
Security adoption continues solid growth with 90% of adopting households opting for professional monitoring. That is a higher rate of pro-monitoring than witnessed in many years.?Of even greater significance is the change in method of installation from majority professional installation to a majority of buyers going DIY as Parks Associates research reports that more than half of buyers in 2020 and 2021 self-installed systems. Additionally, the high percentage (41%) of subscribers intending to switch providers is startling and must be of concern to providers.
Broadening consumer adoption of smart home products through retail, traditional home security system providers, and ISPs creates an onboarding ramp to the development of new professional services—or added revenue to existing services.
Don’t miss Parks Associates’ last CONNECTIONS virtual session of the year on November 10. Bringing together industry leaders to address how technology providers and operators are expanding functionality to enable new services at home. Register here https://www.parksassociates.com/events/connections-us/register .