The smart thermostat market is projected to witness a CAGR of 18.90% during the forecast period to grow from US$2.136 billion in 2020 to US$7.173 billion in 2027.
Smart thermostats are electronic devices that control the operation of air conditioners in homes and businesses. They are part of another generation of home automation gadgets that are becoming increasingly popular in smart homes. The advent of IoT-enabled HVAC systems, government requirements aimed at boosting building energy efficiency, and wide adoption of smart home voice assistants are all driving the smart thermostat market ahead.
According to recent research by the Consumer Technology Association (CTA), after the COVID-19 epidemic, 31% of US homeowners are anticipated to adopt tech devices by 2022. Despite the global pandemic's economic consequences, consumer spending on smart homes is expected to rise in 2021.
Small and medium-sized firms (SMEs) find it difficult to enter the smart thermostat industry. The HVAC industry is predicted to expand at a rapid rate. HVAC systems with smart thermostats require fine-tuning and specific manufacturing of parts during installation to ensure optimal functioning and failure prevention. As a result, skilled technicians are needed to properly install smart thermostats that are linked to HVAC systems. A qualified therapist is asked for installation, the end-user may have to spend more in the long run for repairs, or the HVAC systems may not work properly. As a result, the demand for professional people raises the cost of system deployment.
Market Trends for Smart Thermostats Industries are rapidly adopting smart-thermostat technology. They may easily manage and regulate the HVAC system by adjusting to this technology. With wireless communication, the smart thermostat may be installed quickly. The rise of IoT services is driving the market for smart thermostats. The number of people who keep an eye on appliances like air conditioners, heaters, and other gadgets is large. It is a critical market driver that accelerates the smart thermostat industry's growth pace. The need for automation devices is increasing as the rate of urbanization rises. AL capabilities are available in IoT devices, such as the smart thermostat. Users benefit from the thermostat devices' ease of use and energy-saving capabilities.
Furthermore, government attempts to reduce energy use are on the rise these days. Carbon emissions are reduced by using energy-efficient automation systems. In the coming years, it will raise awareness of smart-thermostat technology. As a result, many customers are aware that the thermostat device assists them in saving money on electricity. It is possible to operate the AC, tablets, cellphones, and other devices with single access control. The necessity for automation devices and the emission concept is the major market factor for the growth of this market.
Smart Thermostat Market Growth Factors
Society is becoming more urbanized, with a focus on smart cities, where linked technologies and Internet of Things (IoT) solutions are used to enhance critical infrastructure, public safety, city lighting, energy efficiency, traffic flow, and traffic congestion. The goal is to reduce cities' carbon footprint while also making them better areas to live, work, and play. To live up to its name, a smart city must use technology to support long-term growth. Technology must maximize resource efficiency while also encouraging governments and citizens to make sound decisions. Thermostats manage residential power use for heating and cooling, which account for 9% of total residential power use, according to Project Drawdown's February 2020 report.
Smart thermostats are being used in households to regulate humidity and temperature while also allowing for fresh air intake, thereby assisting in air quality preservation. Moreover, by combining IoT sensors and thermostats, smart HVAC systems can save families, businesses, and the government money on energy while increasing productivity. Thus, the government and businesses could improve the devices and applications to maintain adequate efficiency optimization in smart buildings and city projects. Intense emphasis and utilization of these devices may drive demand. According to IDC's August Smart Home Survey report, smart homes are now staunchly mainstream in the United States, with more than 75% of WiFi homes adopting them. According to Alarms.org survey results from February 2020, the number of Americans who do have technological devices in their homes is rapidly increasing, with 47 percent of millennials reporting owning a few smart devices, and 70 percent of customers who currently own one product are planning to purchase another furthermore, 63% of respondents wanted to buy smart thermostats and fans, 63% wanted security and alarm systems, and 58% wanted smart lighting. At home, IoT-enabled devices offer energy-saving features.
Upgraded control mechanisms and cutting-edge, connected thermostats necessitate large investments. As a result, small and medium-sized businesses (SMEs) may find it difficult to implement in the market. Furthermore, consumers with limited purchasing power may struggle to afford the cost. According to Brinks Homme, smart thermostats typically pay for themselves in less than two years, However, the initial investment can indeed be four times that of a standard thermostat. Furthermore, learning the application and operating the touch-sensitive- sensitive display panel may be difficult.
Due to the economic situation created by the COVID-19 pandemic in the market, Ecobee laid off 10% of its personnel and cancelled a new product line in March 2020. The device's production is primarily reliant on China. COVID-19 had a significant impact on Chinese exports, according to Business Standard, with shipments falling by 6.6 percent in April 2020. However, due to pandemics and lockdown restrictions, the home automation sector has exploded in prominence in recent years, forcing people to spend more time in their houses. As a result, there were more merchants on the market. As a result, despite the fact that the financial crisis has curtailed investment in smart buildings and cities, device vendors are attempting to implement crucial commercial strategies to crucial commercial tactics to mitigate the recession's effects.
Smart Thermostat Market Segmentation:
On the basis of technologies available through connected thermostat devices, the segment is divided into WiFi, ZigBee, NFC, Ethernet, Bluetooth, and others. Companies are investing in and launching new products in response to the increase in wirelessly connected devices. For example, in September 2021, VTech Communications, Inc., for example, will relaunch the E-smart W960 wireless thermostat based on WiFi and Zigbee 3.0 technologies. Learning thermostat devices are expected to increase substantially during the forecast period owing to their instinctive and sophisticated features that provide an enhanced customer experience. Learning products are in high demand due to their ability to save the most energy. Learning smart thermostats, according to Google Nest, save a significant amount of money on energy bills and are compatible with 95 percent of systems.
On the basis of the application of the smart thermostat, the market is divided into residential, commercial, and industrial. The increased awareness of energy conservation and efficiency, as well as environmental protection, has fueled the implementation of fuel HVAC control mechanisms, including smart thermostats. They contribute to the most efficient use of energy and the most pleasant indoor environment. Favourable government policies and tax access to credit for HVAC system installation, as well as end-users increasing focus on lowering electricity bills, have all contributed significantly to the growth of the residential smart thermostat market.
The Global Smart Thermostat Market is divided into four regions based on regional analysis: America; Europe; the Middle East and Africa; Asia Pacific; Since the residential industry, which is the key end-user of smart thermostats, is increasing at a healthy rate, the Asia Pacific has been a critical enabler of the smart thermostat market. The use of HVAC controls, such as smart thermostats, is aided by the population explosion in this continent's emerging countries, as well as a growing awareness of environmental issues. The rise in green building adoption and government initiatives to regulate energy-efficient practices across the commercial sector are assisting the deployment of smart thermostats in the region.
The smart thermostat industry is dynamic and not highly fragmented. Many smart home manufacturers have entered the market as a result of the government's backing and promotion of smart devices in housing developments, making it lucrative. To address the changing demands of residential, commercial, and industrial structures, market participants are investing in research and development and adaptation. They also collaborate and purchase new items from other companies. They are also collaborating and acquiring new products from other manufacturers. Some major market players are Google Nest, Ecobe, Honeywell International, and Schneider Electric; Emerson Climate Technologies partnered with Ameren Services in October 2020, an electric and gas service provider, to develop an energy-saving solution for Missouri consumers. The Sensi Smart Thermostat. Carrier Corporation, Allure Energy Inc., and Radio Thermostat Company of America.
|Market size value in 2020||US$2.136 billion|
|Market size value in 2027||US$7.173 billion|
|Growth Rate||CAGR of 18.90% from 2020 to 2027|
|Forecast Unit (Value)||USD Billion|
|Segments covered||Technology, Application, And Geography|
|Regions covered||North America, South America, Europe, Middle East and Africa, Asia Pacific|
|Companies covered||Google Nest, Ecobee, Honeywell International, Schneider Electric, Emerson Climate Technologies, Carrier Corporation, Allure Energy Inc., Radio Thermostat Company of America|
|Customization scope||Free report customization with purchase|
Emerson Climate Technologies
Radio Thermostat Company of America
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