Securing the Smart Home – Extending “Peace of Mind” and Future Proofing Offerings

By Frank S. , Research Analyst, Parks Associates

As smart home and security devices continue to grow in adoption and use, issues concerning warranty and data security will continue to arise.?

New competition from internet service providers, tech giants, and smart home device manufacturers is growing, with innovation and increasing choices for security solutions helping to advance the market. About one-third of US households have a security system in their home, and the vast majority have interactive services that include connected devices attached to the system. Some consumer segments are shifting demand to less expensive DIY alternatives that forgo some added safety yet still feature a baseline of alerts and other security features. DIY benefits can include lower costs of purchase, installation, and ease of purchasing. Still, many consumers are realizing that their households cannot be fully protected without a professional monitoring service that works in an integrated, complementary manner with DIY hardware.

Additional support offerings for these devices will be important, particularly as consumers add more and more devices to their network. These add-on services will entice customers to see new value in monitoring contracts, add stickiness and satisfaction through a bundle, and strengthen brand loyalty.

Security system users desire peace of mind and assurance that their devices will operate seamlessly and securely. Device warranty and privacy protection are valuable add-on services that will bolster confidence in both potential and existing users of smart security systems and devices. Consumers associate security providers with trust, and this trust is a critical advantage to have as consumers look for service providers. They trust security providers to keep their homes and families safe, and this sense of trust extends to the protection of their personal data. Parks Associates tested smart home device owners’ interest in using a single unified app to control all smart home devices. Trust is the top reason smart home device owners select a home security provider as their preferred provider of a unified smart home app.

The research firm reveals that 41% of those who select a security provider as their preferred unified app provider selected “I trust them with my data” versus just 25% of those who selected a smart home device manufacturer as their preferred unified app provider.

The level of trust that existing users have in their security provider is a strong indicator that add-on services will boost brand loyalty and overall adoption. Professional monitoring companies that offer warranty and privacy protections are broadening their offerings and growth opportunities, while still delivering peace-of-mind services consistent with security providers' core value proposition and extending the value of the professional services they already provide.

Smart device owners are demonstrating their interest in warranties in addition to support and protections for their connected devices as add-on services. The research firm reports that 67% of security system owners are interested in a warranty service that replaces or repairs damaged or otherwise inoperable devices, and almost half of the respondents have purchased an extended warranty/device protection service of some kind, up 15% from Q2 2019.

As consumers’ privacy concerns are a barrier to smart device adoption, home security providers can offer device protection and data privacy services, enabling them to leverage their skills, assets, and service relationships with customers. Home security firms are in a strong position to offer personal data privacy and security as an add-on service. Home security owners have assigned a significant level of trust to their security providers to ensure the protection and monitoring of their homes. Protecting the digital aspects of home life naturally aligns with the core security value proposition.

For more information, download the complimentary white paper “Protect the Connected Home: Home Security Meets Personal Privacy ,” developed in partnership with Assurant , which investigates the expansion of peace-of-mind offerings to device protection services. If interested in any of Parks Associates’ market reports, primary studies, consumer research, custom research, consultation, workshops, executive conferences, and annual service subscriptions please visit www.ParksAssociates.com .?