Home Automation Market Size, Share and Industry Analysis, By Component (Product and Services), By Network Technology (Wired, Wireless and Power Line-Based), and Regional Forecast, 2024-2032

The global home automation market size was USD 90.75 billion in 2023. The market is projected to grow from USD 101.79 billion in 2024 to USD 237.07 billion by 2032 at a CAGR of 11.1%. North America dominated the global market with a share of 39.12% in 2023.

The products considered in the scope includes Control4 Smart Home OS 3, Legrand Lighting Management, Honeywell Security System, Savant Pro Remote X2, Johnson Hx Thermostat and more. The global impact of COVID-19 has been unprecedented and staggering, with home automation witnessing a significant impact on demand across all regions amid the pandemic. Based on our analysis, the global market exhibited a significant growth of 11.9% in 2020 compared to the average year-on-year growth during 2017-2019. The rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.

Home automation systems control and monitor home operations with connected smart devices and appliances. These innovative smart devices offer safety, convenience, efficient energy saving, lower utility cost products and more to the users worldwide. The increasing adoption of internet of things technology is expected to boost home automation market growth. Similarly, growing home ownership by millennials and increasing disposable income among people in developed countries is estimated to drive automated home demand. Further, key market players are also focused on offering advanced solutions in order to improve the efficiency and convenient home management.

Temporary closure of manufacturing plants and later limited presence of staff impacted the production quantity across industries. During the initial months of the year 2020, the home automation devices and products witnessed a significant fall in their production along with an unstable supply chain. Also, the spending share on smart devices was reduced owing to the unpredictable economic crisis. This has negatively affected the growth and year-on-year growth witnessed a dip during the year 2020.

Home Automation Market Trends

Growing Innovative Property Security System to Propel Market Growth

The automation industry for its flexible and high precision management is being highly adopted for lodging management. Among these, the security system is a rapidly developing sector. The key home automation players are investing significantly to develop innovative and advanced smart security systems catering to property safety. For instance,

• In November 2022, Arlo Technologies, Inc., a global smart home security company, introduced its brand-new Arlo Home Security System. The system works with Arlo's latest 24/7 Professional Monitoring service, providing users with access to expert Security Specialists who oversee and address emergency incidents.

Thus, various such innovative security applications are now available. Similarly, the adoption of smart doorbells with audio and video, AI-based biometric, and face recognition capabilities is increasing. Honeywell Inc. also offers a face recognition integrated camera for self or kids activity monitoring. Thus, these increasingly advanced security solutions for homes is estimated to boost the market growth.

Home Automation Market Growth Factors

Customer’s Growing Interest in Smart Home Technology to Drive Market Growth

Smart technology is growing exponentially across industries. Smart property technology is significantly exploring and transforming the home automation system. Earlier, automation was signified as controlling devices and appliances through internet networks. However, with the introduction of smart technology such as self-diagnosing devices, smart security, smart entertainment, advanced self-health care, smart kitchen among others, automation is getting smarter.

The integration of advanced technologies such as the internet of things (IoT), artificial intelligence, machine learning, and more through smart devices to drive the automation capabilities. As per the Voicebot.ai survey, in January 2020, nearly 87.7 million U.S. customers were using smart speakers. This significant rise in the adoption of smart speakers indicates users' shifts towards automating the operation through voice commands. Similarly, the increasing implementation of smart lodging functionalities such as smart TV, light automation, face recognition doorbells, smart cookware, smart nursery, automated sprinklers, video monitoring, and more are expected to drive the property automation market growth.

RESTRAINING FACTORS

Expensive Products and Limited Clarity Regarding Technology to Hamper Market Growth

The automation products, tools, and appliances are expensive. Users with limited disposable income find it difficult to relate to the automation solution and to its necessity. Owing to this high cost, it is being adopted by certain groups in the market. Also, currently, the prices of smart devices are on a higher end in the market. Further, this cost barrier is expected to be witnessed in developing countries in comparison with the advanced ones. This is likely to barricade its mass adoption. Similarly, these users are unclear regarding its application, usage, and overall benefits. The maximum of users majorly using it for entertainment and voice commanding purposes. Thus, the complicated techniques and applications are expected to hamper the market growth.

Home Automation Market Segmentation Analysis

By Component Analysis

Increasing Innovative Smart Devices to Boost Product Share

On the basis of components, the market is bifurcated into products and services. The product is further classified into security & safety, HVAC, wellness monitoring, smart appliances, smart entertainment, smart lighting system, and others.

Similarly, services are categorized into consulting, installation or implementation, and support and maintenance.

Product is expected to dominate the market segmentation share and is also projected to grow at highest CAGR owing to the increasing development and production of smart home tools and devices. Key players are offering such innovative product portfolios to improve and enhance the  systems. Some of the key products considered in the report are ABB door entry system, Honeywell air cleaner, Legrand modular switches, Crestron flex care among others.

Amongst products, security and safety are expected to gain maximum segment share as it helps in remotely monitoring solutions. The increasing number of smart cameras, doorbells, smoke/gas detectors, theft alarms and more are likely to drive security and safety systems. Companies offer hardware that comes with benefits, such as small size, portability, battery-powered wireless operation, and wireless connectivity, making it convenient for users. For example, in November 2022, Signify N.V. introduced two portable smart lights in India. These lights had sensors and supported home automation applications.

Services are expected to grow steadily. The complexity and highly technical smart system are expected to drive installation or implementation demand. Similarly, support and maintenance are to gain demand to upkeep the smart devices and their connection.  

By Network Technology Analysis

Affordable Program Designing Solution to Boost Cloud-based Demand

Based on network technology, the market is categorized into wired, wireless, and power line-based.

Wireless network technology to gain maximum revenue share along with rapid growth during the forecast period. It’s open technology offers customization capabilities and can operate multiple devices at same time.  Today, wireless network connections are smarter options to manage smart property systems. Some of the products that work on wireless networks include Google Home Hub, Samsung Smart Things, Apple Homekit among others. In addition, manufacturers favor protocols that enable seamless communication without significantly affecting battery life and range. For example, the ZigBee protocol ensures longer battery life by operating with a low-duty cycle and lower latency, allowing for quick device-to-device communication.

Wired network technology ranks second in revenue share after wireless for home automation solutions. It offers strong security points against hackers as compared to wireless networks. Also, its high reliability is the major factor for its adoption for automation. Power line-based is likely to grow steadily during the forecast period owing to its low cost communication network.

REGIONAL INSIGHTS

North America to Dominate Market due to Higher Disposable Income

In terms of geography, the market is segregated into five prime regions namely- North America, Europe, Asia Pacific, the Middle East & Africa, and Latin America. They are further segmented into nations.

North America is projected to emerge as a dominant region during the forecast period. The region's inclination towards advanced technologies such as artificial intelligence and the internet of things along with higher disposable income drive the demand for smart technologies. Various startups such as Boca Raton, Sense, CUJO AI among others are emerging in the region and are contributing to the market growth. As per the Berg Insight report, the smart property system installation in North America increased by 28.5% in the year 2019.

Asia Pacific is expected to witness rapid growth during the forecast period owing to increasing investment in smart technologies. China to dominate the region's share owing to the dominant presence of key smart device manufacturers. India to gain rapid CAGR during the forecast period owing to increasing demand for automated solutions. For instance, considering the growing user interest and to offer ease of access to the home solutions, in April 2021, Schneider Electric collaborated with India-based home renovator, Livspace.

Europe ranks second in market dominance and has lower market penetration as compared to North America. The region has witnessed significant growth in strong market players over the years. Considering its sustainable environmental impact and energy-efficient solution various government policies are including the adoption of smart lodging technologies in European countries.

The Middle East and Africa is expected to witness steady demand for home automation with the growing 5G technology penetration. According to GSMA Intelligence, there will be nearly 50 million 5G connections worldwide by 2025, out of which approximately 20 million will be in the GCC Arab States. By 2025, the GCC countries are expected to be slightly ahead of the global average with a 16% adoption rate.

Similarly, Latin America is gaining steady growth and showcasing market opportunities with the growing smart home market.

List of Key Companies in Home Automation Market

Focus on Product Innovation to Boost Market Position of Key Players

Key players for home automation industry are strategically investing in enhancing the user experience with their advanced and innovative automation solutions. From smart lighting to other functionalities, these players are offering a wide scope of product portfolios to the customers. In order to gain expertise and expand customer reach, key players are acquiring small and local dominant solution providers. Similarly, expansion in product offering and geographical presence through partnership and collaboration is set to boost the market share of these players.

• March 2023 – Johnson Controls introduced the IQ4 NS Security and Smart Home System. This affordable system offers high quality and reliability, such as the IQ Panel 4. Users can access the system's features easily from their smart devices, saving time and money.

List of Key Companies Profiled:

• ABB Ltd. (Zürich, Switzerland)


• Johnson Controls International plc (Cork, Ireland)


• Crestron Electronics (New Jersey, U.S.)


• Siemens AG (Munich, Germany)


• Control4 Corporation (Utah, U.S.)


• Schneider Electric (Rueil-Malmaison, France)


• Koninklijke Philips N.V (Amsterdam, Netherlands)


• Legrand SA (Limoges, France)


• Honeywell International Inc. (North Carolina, U.S.)


• Savant Systems LLC (Massachusetts, U.S.)

KEY INDUSTRY DEVELOPMENTS:

• September 2023 – BT and Johnson Controls partnered to assist business clients in the U.K. and globally with smart building technology. This collaboration aims to digitally oversee, analyze, and enhance energy consumption in workplaces, such as offices and factories. By utilizing this technology, customers can achieve Net Zero goals quicker and lower their operational expenses.        


• August 2023 – Crestron Electronics, a leading company in home automation, introduced Crestron Home OS 4. With the advancement of smart homes, Crestron users are integrating a growing number of devices into their homes.


• February 2023 – Johnson Controls and Willow recently revealed a worldwide partnership to combine their smart building and digital twin solutions. This collaboration aims to assist customers in digitizing buildings and facilities on a large scale, ultimately promoting healthier, safer, and more sustainable environments.


• November 2022 – Schneider Electric partnered with Smartworld Developers Pvt. Ltd. to design complete home automation solutions. In this partnership, Smartworld Developers aims to construct homes that have a positive impact on the environment by reducing waste and promoting healthier interiors. To achieve this goal, the company will incorporate Schneider Electric's range of smart products, such as wiser smart homes and modular switches.


• October 2022 – Siemens partnered with ADMARES to build Smart Homes and Smart Factories. As per the agreement, Siemens software will be deployed to design ADMARES Smart Factories, which will manufacture the houses. Siemens NX and Teamcenter will be utilized to design, analyze, document, and manage ADMARES products.

REPORT COVERAGE

The market research report highlights leading regions across the world in order to offer a better understanding to the user with home automation industry analysis. Furthermore, the report provides insights into the latest industry as well as market trends and analyzes technologies deployed at a rapid pace at a global level. It further highlights some of the growth-stimulating factors and restraints, helping the reader gain in-depth knowledge about the market.

REPORT SCOPE & SEGMENTATION