Smart sensors are those devices that have the ability to take the inputs from the physical environment and consist of inbuilt resources that further perform the predefined functions only when it detects a specific input and then it processes the data.
The market for smart sensors is anticipated to witness rapid growth over the course of the next five years. The key factors supplementing the market growth include the rapid adoption of automation solutions across the numerous industry verticals as these sensors offer automated and accurate data with comparatively fewer errors. The wide applications of smart sensors include monitoring and control mechanisms primarily that detect and process data. This, further makes these sensors suitable for applications that include a wide variety of scientific processes. Additionally, the wide growing applications of these sensors across smart grids is also widening up the opportunities for the market to grow in the near future. The constant improvement and advancement of technology especially in the semiconductor industry is playing a crucial role in propelling the market growth during the next five years as this has further resulted in the reduction of the manufacturing costs of microprocessors, thereby positively impacting the smart sensors market growth. Increasing government focus, especially across the developing nations towards the development of smart cities and adoption of smart manufacturing are also some of the key factors that are anticipated to shape up the growth in the coming years.
Rapid IoT Adoption
The benefits offered by IoT has led to a rapid upsurge in the adoption of it across the various industries throughout the globe. Additionally, the number of IoT devices around the globe has also increased dramatically. Sensors are considered to be the most important factor that has enabled the easy deployment of IoT. The rising penetration of connected devices such as smart speakers, smart lightings is further providing an impetus for the market to grow in the near future. Internet of Things (IoT) is considered to be one of the most demanding technologies in almost every industry. The increased affordability of sensors is considered to be a key factor in driving the adoption of IoT in various industries. Booming adoption of IoT across connected cars, home automation, and others is propelling the opportunities for smart sensor manufacturers to invest in the market and tap the potential it holds.
Industry 4.0 Is Positively Impacting the Growth
The rapidly growing trend of Industry 4.0 has led to an upsurge in the demand for smart sensor technology. Various applications, such as control and monitoring of operations in fully-automatic industries along with the rapid increase in the adoption of automation solutions is significantly driving the smart sensor market growth throughout the forecast period. Rising inclination of the governments across numerous countries regarding the adoption of industry 4.0 has led to the implementation of several for its promotion as well. For instance, in April 2018, The Ministry of Industry Indonesia launched the ”Making Indonesia 4.0”, an initiative in order to accelerate the growth of the five major focus sectors mentioned in this initiative which are automotive, food and drinks, textile, electronics, and chemicals. This initiative was launched in order to boost the country’s global position and to measure and assess the progress, the index “INDI 4.0” was launched. Similarly, in March 2019, The Ministry of Science Technology, Innovation, and Communications (MCTIC) and the Ministry of Economy launched the “Brazilian Chamber of Industry 4.0”, which was an initiative that launched in order to facilitate increased production, employment, and economic activity. The basic purpose was to accelerate and expand the adoption of Industry 4.0, which very few industries were using. Therefore, these measures and initiatives by the government bodies of different countries are going to affect the adoption of Industry 4.0, providing numerous opportunities to the market players to boost their market share and augment the smart sensors market growth during the forecast period.
Rapid Product Innovation Is Boosting the Growth
The smart sensors market growth is also attributed to the constant participation of the key market players in the form of investments in R&D, acquisitions, mergers, and partnerships among others. There is a high volume of companies working in the smart sensors market, however, some have solidified their position as the leading providers in this industry. These players are involved in a plethora of investments that further shows the potential for the market to grow in the near future. For instance, in June 2020, Petasense, a leading industrial IoT company based out of Silicon Valley announced the launch of its latest smart sensors especially to address the major challenges in the adoption of Industry 4.0. Similarly, in February 2020, Autogrow, a leading agricultural technology expert announced the launch of its new wireless smart sensor, Folium, for specific applications in greenhouses. Also, in January 2020, Elliptic Labs announced the next era of smart sensors with presence detection capabilities.
Manufacturing to Witness a Healthy Growth
On the basis of industry vertical, the market smart sensors market is segmented as automotive, healthcare, manufacturing, communication and technology, security, and others. The healthcare segment is expected to witness a healthy growth as the wearable technology recently has waved itself into society due to increasing demand by consumers to monitor their health. Creased health spending in many countries is also considered to be a key factor positively impacting the growth during the next five years. For instance, the current healthcare expenditure (% of GDP) in Brazil reached 9.467% by 2017 from 7.735% in 2012. Similarly in China, it reached 5.151% by 2017 from 4.549% in 2012.
Current Healthcare Expenditure (% of GDP) – Brazil, China
Source: The World Bank Group
North America to Hold a Substantial Share
Geographically, the North American region is projected to hold a considerable market share throughout the forecast period. The early adoption of technology coupled with well-established infrastructure across the industries along with the presence of key market players in the region are some of the factors boosting the market growth in the region during the next five years. Furthermore, the adoption of automation solutions across the industries coupled with the growth of the manufacturing sector in many countries across the region is also supplementing the market growth in the North American region. For instance, the Manufacturing, value added (current US$) in the United States reached 2.173 trillion by 2017 from 1.789 trillion in 2010.
Manufacturing, Value Added (Current US$)-United States US$ Trillion
Source: The World Bank Group