By Rob Love, President, CEO
In January of 2017, I visited the International Builders Show in Orlando and was impressed by how far smart home technology had progressed. As one presenter noted, Amazon’s Alexa had become “the gateway drug to smart home technology.” So, as I headed to the 2018 Builders Show this January, I was curious to see how far things had come in the past year. The answer was both exciting and nearly overwhelming: Nearly everything is now “smart.”
- In 2017, there was a model smart home you could tour that showcased examples of technology. In 2018, there was no smart home, as the technology was everywhere. There were scores of companies promoting smart lighting, appliances, home security systems, home comfort and more.
- In 2017, Nest was a thermostat maker. In 2018, Nest is a home security company offering a broad range of products.
- In 2017, Ring was a video doorbell maker. In 2018, Ring is also a full-service home security company.
Why such tremendous growth? Again, Alexa and other smart speakers paved the way.
- In 2016, there were approximately six million smart speakers sold, of which 90+% were Amazon Echoes (Alexa).
- In 2017, approximately 33 million smart speakers were sold, more than five-fold growth over 2016. While the Echo was still the dominant product, Google made major inroads, capturing about 25% of the market with its Google Home line of products.
- In 2018, sales are projected to increase to more than 56 million speakers, with Apple just releasing its new HomePod on February 9.
Smart home technology is also becoming a key differentiator in home sales, both for new and existing homes.
- Active adult community (55+) builders noted that they are integrating smart home technology into the basic design of their homes to differentiate their homes from “used homes” (as the presenters referred to them).
- Coldwell Banker is providing its agents with $900 smart home kits to turn their listings into smart homes, again providing a competitive advantage.
Is This Important?
With all this growth, a key question becomes: Is this important for senior living? My belief is that it is not only important, but critical that senior living—Life Plan Communities in particular—include smart home technology in our planning for the future.
Why? First, it was clear from their presentations and discussions that active adult community builders are eyeing the growing population of aging boomers and designing their homes to integrate technology so that homeowners can age in place. This will transform 55+ communities from sources of residents to more direct competition.
Second, the next generation of retirement community prospects want and expect smart home technology in their homes. In a recent series of research events with independent living prospects that Love & Company conducted for an organization planning a new community, we found:
- 83% own a smart phone, with 55% owning an iPhone
- 82% own a tablet, with Apple again dominating at 55%
- 60% said they would like to have a smart speaker to control home technology, with only 19% saying they would not like it. (The remainder were unsure.)
- 88% said that, if they were to move to a community, they would want an app for their smart device they could use to communicate with others, request services or make reservations.
Where Should We Start?
My key takeaway from the conference was that we should start with what is considered the “basics” of smart home technology today.
- Our communities need to have strong wireless Internet access throughout.
- Residences should be wired for direct access to the Internet, so that high-bandwidth services such as video and music streaming don’t overly tax the wireless network.
- Basic smart technology provided by the community should include home security (video doorbells), temperature and lighting control.
- Optional/upgrade offerings could include things such as smart blinds and shower controls.
As for which smart speaker to use as the control system for home technology–that’s a harder question.
- Amazon has by far the dominant share of the smart speaker market with its Echo line, and thus more smart devices are available that are Alexa compatible. Amazon speakers are also good choices for people who are Amazon Prime members, as they can directly access services and purchase products.
- Google Home: Google is widely recognized as having the best voice recognition of the three major competitors. It is also considered to be the best at search, for users that like to ask their smart speaker a lot of questions. Its market share is also increasing rapidly.
- Apple’s HomeKit is seen as the most capable smart home technology, as the user is able to make several things happen at once using a single command, or schedule multiple things to happen automatically at set times (though Amazon is catching up on this). And you don’t need an (expensive!) Apple HomePod to control smart home devices; that can be done through an iPhone or iPad, which many people already have, or even through an AppleTV. And based on our Michigan State survey findings—far more people own iPhones and iPads than smart speakers, so Apple potentially has far greater market share.
It is clear that smart home technology is here to stay, and is a very real factor in the marketability of homes today. As such, it will quickly become a basic expectation of boomers as they begin to consider Life Plan Communities more and more. To be ready, our communities need to be planning for this today.
In last year’s blog, I encouraged Life Plan Community CEOs, facility managers and marketing directors to make plans to attend the International Builders Show every few years to stay on top of building and consumer trends. After this year’s show, I believe it is critical that community leadership look outside the typical senior living field conferences and sources to stay on top of trends, and I recommend attending the Builders Show even more strongly.
The 2019 Builders Show will be held in Las Vegas from February 19 to 21. You can find more information at https://www.buildersshow.com/Home/. I look forward to seeing you there!
For more information on how Love & Company can help you reach your occupancy goals, give Tim Bracken at 410-207-0013, or Rick Hunsicker at 214-906-3801 today. Or, reach out to us online.