Smart Home Automation Market Size, Share & Trends Analysis Report By Component (Hardware, Software, Service), By Technology, By Application, By Region, And Segment Forecasts, 2018 - 2025

Report Overview

The global smart home automation market size to be valued at USD 130.0 billion by 2025 and is expected to grow at a compound annual growth rate (CAGR) of 14.3% during the forecast period, owing to its rapid adoption across residential applications. The increasing demand for features such as the convenience of remote operation and exceptional experience offered by smart home automation is likely to propel the global market growth over the forecast period. This industry is expected to witness an increase in share owing to the growing adoption of systems or devices in a number of applications such as security, lighting, entertainment, HVAC & energy management, and smart kitchen. This technology has evolved with increasing preference among consumers for convenience, connectivity, safety, and security which are expected to fuel growth in the demand for the smart home automation systems.

Increasing urban population and growing geriatric population have created the need to incorporate smart home automation concept in order to address the arising challenges.The opportunities for the advancements of smart home automation system using mobile, applications and other platforms over different time spans is expected to be enormous.

Moreover, the advancement of Internet accessibility and the growing penetration of Internet of Things (IoT) which helps in the move to direct digital controls for better machine to machine (M2M) communication have encouraged users to adopt the smart home automation technology, thereby driving market growth. However, factors such as less awareness and high installation cost associated with the devices may pose a challenge to the market demand over the forecast period.

Smart Home Automation Market Trends

The automation capabilities are driven by the emergence of technologies such as Artificial Intelligence (AI), the Internet of Things (IoT), machine learning, and more through smart electronic devices. Consumers shift toward automated operations through voice commands is reflected in the popularity of smart speakers. Moreover, smart city projects are growing up all over the world and fueling huge demand in the home automation business.

Furthermore, the global home automation market growth has accelerated due to the rising awareness of new home automation technology and desire for lavish lifestyle in developing countries. The increased demand for features such as remote control convenience and amazing experience provided by the smart home automation has accelerated the expansion.

In addition, the significant need to tackle security challenges is expected to fuel demand for smart and connected homes globally. Furthermore, the industry expansion is likely to be supported by advanced wireless technologies such as entertainment controls, security and access regulators, and HVAC controllers. However, the market is still in its early stages with a huge demand for innovative and linked solutions. High product costs and moderate levels of consumer satisfaction are two of the most significant factors deterrent to the market growth.

The COVID-19 pandemic had a negative impact on the smart device market. The production output was hampered across industries due to the temporary shutdown of industrial operations and limited presence of workers. Home automation gadgets and goods initially experienced a large drop in output, due to an unstable supply chain. In addition, due to the unpredictability of economic crisis the share of expenditure on smart gadgets decreased. However, the limits on staying at home to prevent the infection from spreading pushed up online demand consistently. As a result, smart set-top boxes, streaming sticks with voice commands, demand via e-commerce for smart TVs, and other devices have increased.

Smart Home Automation Market Share Insights

Based on component, the market has been segmented into hardware, software and service. The hardwaresegment is anticipated to dominate the component market by 2025. The service segment is expected to witness a significant growthowing to increasing adoption of the smart home automation technology.

Rapid advances in smart home automation system as well as using these technologies to add value to the provision of urban services require authorization for sustainable development of new methods. This may involve the integration of hardware, software, and service that would improve the competitiveness of the environment in which smart home automation system operates.

IT is becoming an essential part of the product itself. Processors, software, connectivity and embedded sensors in products, integrated with a product cloud in which some applications are run, and product data is analyzed and stored, are driving substantial improvements in product performance and functionality.

Application Insights

Based on application, the market has been segmented into security, lighting, entertainment, hvac & energy management, and smart kitchen. The entertainment segment is anticipated to dominate the market by 2025. The smart kitchen segment is expected to witness a significant growth rate owing to the high demand originating for smart appliances.

The upsurge in need for push button control, energy-preservation, shifting demographic preferences and need to safeguard the global environment from polluting effluents such as greenhouse gasses and toxic wastes is expected to result in a significant market growth.

Smart home automation offers a number of advantages, such as system scalability and easy extension, aesthetical benefits, integration of mobile devices, maximizing home security, remote control of home functions, increased energy efficiency, improved appliance functionality, home management insights.

Technology Insights

Based on technology, the market has been segmented into cellular, wireless and others. The wireless segment is anticipated to dominate the wearable camera product market by 2025. Wireless technology is less invasive, have low set-up cost, and more convenient to use which has resulted in an increased adoption of it in the smart home automation system.

While there is enormous demand for technologically advanced solutions, the need for cost-effective solutions has also increased. Internet of Things (IoT) based solutions are trending in the home automation market and is the most preferred choice for most of the start-ups.

Smart home automation is all about a blend of comfort with more aesthetics. The advancements in the technology have not only provide the convenience but have also brought revolutionary change in its design aspects and practical use of the product.

Regional Insights

The North American region is estimated to be the key regional segment over the forecast period owing to well-established manufacturers and large consumer base. The region accounted for largest revenue share and is expected to grow at a CAGR of more than 8% from 2017 to 2025. The North American, European, and Asia Pacific regions are anticipated to remain the key revenue generating segments over the forecast period.

The Asia Pacific region is experiencing a healthy growth in disposable income owing to macroeconomic stimulus, which is anticipated to drive market growth. Innovative technologies, such as voice controlled smart home devices, and growing geriatric population base are the key factors driving the smart home automation market demand over the projected period.

The market in Europe is expected to be promising for global growth through the forecast period owing to increasing investments in infrastructure to improve standard of living. Increased demand for HVAC & energy management has significantly driven regional growth.

Key Companies & Market Share Insights

Key industry participants of the market are ABB Ltd. (Switzerland), Control4 Corporation (U.S.), Crestron Electronics, Inc. (U.S.), Honeywell International Inc. (U.S.), Ingersoll-Rand plc (Ireland), Johnson Controls (U.S.), Legrand SA (France), Leviton Manufacturing Company, Inc. (U.S.), Lutron Electronics Co., Inc. (U.S.), Schneider Electric (France), and Siemens AG (Germany). Key players are indulged in undertaking strategic initiatives such as new product developments, continuous upgrades of current product lines to offer avenues for increased profitability through better customer relationships.

Recent Developments

• In May 2022, IKEA, a Scandinavian chain selling ready-to-assemble furniture and houseware appliances launched DIRIGERA, a matter-ready hub for smart devices with a new IKEA home smart app

• In June 2022, Apple detailed how the company is ushering in the next generation of home automation during the launch of iOS 16. Moreover, Apple has joined Project Connected Home over IP, a collaborative effort with Amazon, Google, and the Zigbee Alliance to develop a unified standard that allows any smart home accessories to function together independent of the platform

• In February 2020, Control4, a provider of automation and networking systems for homes and businesses opened a new showroom for audio visual and home automation in West Hampstead. The company aims to target a new consumer base including the youth wishing for home automation     

Smart Home Automation Market Report Scope 

Global Smart Home Automation Market Segmentation

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest trends and opportunities in each of the sub-segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the global smart home automation market based on applications, products, types, and regions.

• Component Outlook (Revenue, USD Million; 2014 - 2025)

  • Hardware

  • Software

  • Service

• Technology Outlook (Revenue, USD Million; 2014 -2025)

  • Cellular

  • Wireless

  • Others

• Application Outlook (Revenue, USD Million; 2014 - 2025)

  • Security

  • Lighting

  • Entertainment

  • HVAC & Energy Management

  • Smart Kitchen

• Regional Outlook (Revenue, USD Million; 2014 - 2025)

  • North America

    • U.S.

    • Canada

    • Mexico

  • Europe

    • Germany

    • UK

    • France

  • Asia Pacific

    • China

    • India

    • Japan

  • South America

    • Brazil

  • MEA