Contributed Articles
Gavin Miller, CEO of Asurion Europe
Over the past decade or so, our reliance on digital devices has increased, with the average UK user spending nearly six hours per day online. (i) Additionally, more household items than ever before are equipped with connected capabilities. Home appliances such as TVs, speakers, thermometers and microwaves now often include “smart” elements that become part of a network of online devices in the home, helping to save money, improve quality of life and enhance security. These items are growing in popularity, with the global smart home appliance market predicted to exceed $143 billion by 2030, a significant increase from $59 billion in 2022. (ii)
Our increasing reliance on digital devices and online services has fundamentally changed our behavior, with many predicting a significant decline in traditional activities and channels. Ironically, however, book consumption is on the rise. (iii) And for certain products, people still prefer to go to the store. So, as a business, how can you truly understand the impact of digital reliance? And what trends should you be watching to capitalize on this rapidly growing market?
Analysis: Usage and Adoption Rates
First, our understanding of smart home technology is certainly increasing. Comparing attitudes in 2016 and 2023, we see a gradual increase in consumer knowledge about smart homes, with fewer people reporting they know nothing. (iv) What is interesting is the length of time it takes to go from awareness of a new product or technology to actual use.
A recent study by Asurion Europe looked at adoption and usage of smart devices in the home. Our adoption index represents access to devices and channels and is based on factors such as the number of internet users, adult social media users, mobile internet users, wearables owners and smart home device penetration, while our usage index represents the actual time spent on these digital devices and channels for activities such as streaming TV, browsing the internet and social media platforms, playing on games consoles and online shopping.
What is the relevance of these metrics?
Owning a smartwatch or having a social media account does not necessarily mean that the watch or account is used frequently. Because of this, usage generally lags behind penetration, and this gap has widened in recent years as people have become more familiar with various new devices and their features. Thus, the usage index indicates current dependency, while the penetration index represents future potential dependency. As smart technology becomes more familiar, the gap between usage and penetration will begin to close. And the more people use smart devices, the more they will depend on smart home devices.
Across all age groups, adoption of some form of smart connected device is around 80%.(v) However, analysing multiple device ownership reveals real differences across populations. Looking at “advanced adopters” who own three or more connected home devices, we see a skew towards younger adults, with 43% of 16-24 year olds and 45% of 25-34 year olds falling into this category.(vi) This compares to an overall UK average of 34%. As these younger generations gain more purchasing power and start moving into their own homes, we are likely to see a further surge in demand from these age groups.
Digital Addiction – The Positive Impact
Now, let us consider the impact of digital dependency on our daily lives. Of course, there is a lot to discuss here. But it is interesting to observe the positive impact that connected home products have on improving quality of life by addressing the rising cost of living, increasing leisure time, and improving home security. From this perspective, it may not be so surprising that consumers still enjoy going to the store and taking their time to choose a physical book.
Home Connectivity
More consumers are working from home, driven by improved internet access and advances in remote work tools that allow them to be just as (or even more) efficient when away from the office. This means that the home and its upkeep are receiving more attention than ever before. Smart devices are playing a key role in this transformation, allowing them to either completely eliminate repetitive tasks or reduce the time spent on them.
Home Entertainment
In many ways, connectivity has given us more time for leisure, whether it be by enabling remote working or simplifying home maintenance. And digital platforms for gaming and streaming have become an increasingly important component of that leisure time. Since Netflix launched its streaming service in 2007, the medium has only grown in popularity, with almost half of UK internet users using two or more streaming services as of October 2022. (viii) This is largely due to the development of smart TVs, which combine multiple entertainment options into one, allowing consumers to watch a show or resume a game in one place. The diversification of streaming services and the resulting competition has also made the price of these services more affordable for everyone.
Home Efficiency
Connected products not only save time, but can also generate economic benefits in the long term. For example, high energy costs make smart utility gadgets particularly attractive; one survey found that around two in five owners of energy-saving devices expect to recoup the initial cost of the device itself through energy savings within a year. (ix) Smart thermostats that can control hot water and radiators are becoming increasingly intelligent, learning when users are likely to be at home and therefore when they will need heating or hot water,(x), helping to create more energy-efficient and, as a result, cost-effective homes.
Home Safety
Finally, smart devices that provide security to homeowners are rapidly growing in popularity. Around one in five households owns a smart doorbell and security system (xi), and almost two-thirds would like to incorporate some kind of security system into their smart home. (xii) A less established use for smart security devices is supporting the elderly, unwell and disabled. One company has designed sensors that connect to fridges, kettles and toilets to indicate healthy food and water intake, among other things, allowing important monitoring even for those who are less able to live independently. (xiii)
Supporting a digitally dependent society
The inevitable increase in the use and range of smart home devices is creating the efficiencies we have become accustomed to. This creates new opportunities and interest not only in technologies and innovative new applications that create further efficiencies, but also in related services and subscriptions to create premium experiences, enjoy the latest upgrades, and access rapid support when needed. Technology providers who monitor awareness, interest, and actual usage are in the best position to develop these services and constantly take smart experiences to new heights. However, our growing digital dependency means that the risk of device failure can bring our connected lives to a screeching halt. That’s why it’s essential today to have a comprehensive (and affordable) technology partner who can ensure all the devices in your connected home keep running.
As CEO of Asurion Europe, Gavin Miller is leading the global tech care company's expansion in the region. Gavin began his career at global customer experience company, Sitel (now Foundever), before moving into senior leadership roles supporting the rapid growth and acquisition of a range of businesses, including the UK's largest telephone fundraising specialist, a commercial contact centre business and a debt management services provider.
(i) Statista (2023). Average daily media use in the UK Q3 2022. https://www.statista.com/statistics/507378/average-daily-media-use-in-the-united-kingdom-uk/
(ii) Yahoo! Finance (2023). Smart services lead: services segment to exhibit highest CAGR of 11.98% during forecast period in global smart home appliances market. https://uk.finance.yahoo.com/news/smart-services-lead-services-segment-124900989.html
(iii) The Reading Agency (2022). A new survey to mark World Reading Night 2022 finds that a quarter of UK adults started reading more during lockdown and have continued to do so. https://readingagency.org.uk/news/media/a-quarter-of-uk-adults-started-reading-more-during-lockdowns-and-have-continued-to-finds-new-survey.html
(iv) Tech UK (2023) “State of the Connected Home 2023” https://www.techuk.org/resource/state-of-the-connected-home-2023.html
(v) Tech UK (2023) State of the Connected Home 2023 https://www.techuk.org/resource/state-of-the-connected-home-2023.html
(vi) Tech UK (2023) State of the Connected Home 2023 https://www.techuk.org/resource/state-of-the-connected-home-2023.html
(vii) https://www.forbes.com/sites/glebtsipursky/2022/11/03/workers-are-less-productive-working-remotely-at-least-thats-what-their-bosses-think/
(viii) https://www.statista.com/statistics/1356593/number-video-streaming-platforms-uk/
(ix) Tech UK (2023) State of the Connected Home 2023 https://www.techuk.org/resource/state-of-the-connected-home-2023.html
(x) The Independent. (2022) How to save money on your energy bills with smart home devices. https://www.independent.co.uk/extras/indybest/gadgets-tech/energy-prices-smart-home-devices-b2235191.html
(xi) This Is Money. (2023) Can your smart doorbell land you in court? How to stay on top of the law while keeping your home safe. https://www.thisismoney.co.uk/money/bills/article-12271963/Smart-doorbells-break-law-safe.html
(xii) Tech Report (2023). 37+ Smart Home Statistics and Facts (2023 Updated Data). https://techreport.com/statistics/smart-home-statistics/
(xiii) MedTech Innovation. (2022) Meet the Startup: Sensing Smarter Care. https://www.med-technews.com/medtech-insights/medtech-start-up-insights/meet-the-start-up-sensing-smarter-care/