Market Dynamics
Market drivers: rising cases of burglary and crime
In today's scenario, security devices are necessary to keep oneself protected and alert to ensure house safety. The prevalence of home security equipment, such as doorbell cameras, has grown as crimes, such as theft and burglary, have increased. According to FBI crime statistics from 2017, about three burglaries occur in the United States every minute, making it the second-most common crime behind larceny-theft.
Furthermore, around 2.5 million burglaries are reported each year, with 66% being house break-ins. The violent crime rate was 382.9 offenses per 100,000 people. Non-negligent manslaughter, robbery, murder, rape, and aggravated assaults are examples of violent crimes. Additionally, the recorded rate of property crime was 2,362—Burglary, larceny-theft, motor vehicle theft, and arson account for two offenses per 100,000 people.
In the rest of the world, things aren't any better. In 2016, the European Union recorded approximately 5,200 occurrences of deliberate homicide. People's attention has been drawn to improving the security system in their homes due to the vast number of crimes committed. A doorbell camera has become an important security feature for managing and monitoring entry to one's home.
Market drivers: increased spending on smart home devices
An intelligent home employs internet-connected devices to enable the remote monitoring and management of appliances and systems, such as heating, lighting, and security devices. Homeowners can use/control these devices through apps on their smartphones and other network devices, including tablets and personal laptops. These residences use innovative home automation technology, offering security, comfort, convenience, and energy efficiency.
Over the past few years, smart homes have been gaining popularity globally. This, in turn, has boosted the adoption of security devices, such as doorbell cameras, in these residences as they offer efficiency and tight security. Moreover, the rising geriatric population improved M2M communication systems, and the development and launches of the Internet of Things (IoT) and artificial intelligence-based security systems worldwide contribute to the growing demand for these products in residential spaces. This leads to new home automation technologies providing adequate security solutions for households.
The ever-increasing popularity of smart homes is expected to play a vital role in widening the scope of doorbell camera products over the next few years. Rapid urbanization in developing economies, such as China and India, as a result of the implementation of new initiatives, including the Smart Cities Mission, 2015, introduced by the government of India, is expected to favor the product demand. Consumers are likely to boost their spending on intelligent houses with improved security measures in the near future.
The growth of middle-income households in countries such as China and India, as a result of the increasing job opportunities in private and government sectors, is expected to boost the purchasing power of consumers. Therefore, consumers are expected to pay a premium to buy smart homes with efficient, advanced security features. This, in turn, is likely to offer new growth avenues for doorbell cameras over the next eight years.
Market restraint: rising prevalence of counterfeit doorbell cameras
The rising prevalence of counterfeit doorbell cameras continues to impede the market growth. Counterfeit/fake doorbell cameras are those products that are falsely sold and marketed at a relatively lower price. These doorbell cameras may not be capable of providing appropriate image quality and recording to consumers, as these products are usually manufactured using low-quality materials. Counterfeit products also affect the consumer's perception of the brand. The circulation of fake doorbell cameras is more pronounced in Asian markets, particularly China and India.
Furthermore, the increasing demand for various doorbell cameras with advanced attributes has led to hundreds of thousands of counterfeit doorbell cameras flooding Asian markets. The easy availability of counterfeit products is likely to limit the growth of the doorbell camera market during the forecast period.
The complication around potentially dangerous counterfeit doorbell cameras has been worrying legitimate companies worldwide as such factors can lead to brand dilution. Counterfeit products are hard to differentiate as they carry the same brand name with minor changes, which can go unnoticed. Price is the primary factor driving the demand for counterfeit products among consumers, as these products are comparatively lower priced than the original.
What are future growth opportunities in global doorbell camera market?
Rapid infrastructural developments
Consumer preference has turned toward smart home technologies, such as smart electrical devices, kitchen appliances, and faucets, in recent years. Smart security devices, including smart doorbell cameras, are gradually gaining popularity in the smart home segment. Moreover, the advent of Voice over Internet Protocol (VoIP) is widening the scope and opening new avenues for smart security products.
Design innovation is another lucrative space that manufacturers can target to achieve a more substantial brand reputation. As far as function is concerned, doorbell cameras offer much scope for product differentiation in terms of design, size, and technological attributes to offer high definition and intelligent recording. Noticing a rising demand for doorbell cameras with innovative features, several manufacturers have recently started to focus on enhancing doorbell cameras' elements and aesthetic appeal. For instance, Arlo and Google’s Nest Hello brands offer cameras with minimum false alerts with intelligent systems to distinguish between people, animals, and cars.
Moreover, rapid infrastructural development in the commercial segment is fueling the need for high-end security in hotel rooms, lobbies, corporate offices, and other commercial spaces. For instance, according to the London Hotel Development Monitor Report 2018, the hotel industry in London is expected to add 11,600 rooms to its hotel market by the end of 2020. In addition, according to the Office of National Statistics, the hospitality industry in the UK grew from USD 110.37 billion in 2015 to USD 125.78 billion in 2017. Thus, significant expansion in the commercial space is likely to generate a high demand for the installation of security devices, thereby driving market growth.
It is anticipated that increased concerns for people's security, safety, and well-being will be a significant factor in expanding the use of doorbell cameras. The general public's increased understanding of the benefits of incorporating artificial intelligence (A.I.) into daily activities for comfort and luxury is another factor supporting the industry's expansion.
Regional Analysis
By region, the global doorbell camera market share is divided into North America, Europe, Asia-Pacific, Central and South America, and the Middle East and Africa.
Prevalence of north america and europe over others
North America is the most dominant region in the market. It is estimated to reach an expected value of USD 915 million by 2030 at a CAGR of 7.95%. Major home improvement projects in the region's consumers are boosting the adoption of doorbell cameras. The growing trend of smart homes, which comprise home automation solutions, and the growing concerns regarding house safety drive the demand for doorbell cameras in the region. For example, as per the US Department of Justice report, in 2017, burglaries accounted for 18.2% of the estimated number of property crimes in the US. Moreover, close to 57.5% of burglaries involved forcible entry, 36.2% were unlawful entries, and 6.3% were attempted forcible entry.
Europe is the second-largest region and holds a 27.8% share of the global doorbell camera market. It is estimated to reach an expected value of USD 770 million by 2030 at a CAGR of 8.12%. Increasing adoption of home security systems among people is driving the market in the region. According to Eurostat's statistics on crime and criminal justice systems, in 2018, the police recorded close to 528,000 police-recorded car thefts and assault cases of around 583,000 in the region. An increasing number of criminal cases has spurred the demand for home security systems, which is expected to favor market growth.
The UK emerged as the fastest-growing market for doorbell cameras in 2019 in Europe, with a market share of 21.1%. The growth of this market can be attributed to the increasing penetration of smart security devices, rising theft cases among the geriatric population, increasing crime rates, and growing interest of consumers in-home convenience and safety products. The rising trend of on-demand live audio and video features offered by various manufacturers also plays a significant driver in the video doorbell camera market in Europe.
Asia Pacific is anticipated to have the quickest growth with a CAGR of ~8.3% during the projection period. The doorbell camera's usefulness is anticipated to rise due to the rising crime rate in nations like Pakistan, Iran, Afghanistan, India, the Philippines, South Korea, Qatar, and China. People in these nations are vulnerable due to the high crime rates, forcing them to choose domestic security measures. Additionally, local Chinese producers have reduced the cost of these goods, making them accessible to the general public.
Impact of covid-19
The COVID-19 outbreak repressed the sales of doorbell cameras and other home security products. Retailers witnessed severe losses during the first two quarters of 2020 owing to lockdown measures imposed across the globe. Consumers became more conscious of their spending during the year and refrained from buying nonessential products. This trend holds for home security systems and doorbell cameras as well.
Moreover, many real estate projects, both residential and commercial, were abruptly halted due to the pandemic, which subsequently delayed or canceled myriad security system consignments. These factors have translated to dipping product demand. Most regions have categorized doorbell cameras as nonessential products, which led to a drastic fall in the sales of these products, majorly through brick-and-mortar stores and online platforms.
Additionally, the pandemic disrupted production and sales of these products worldwide due to primary factory closure mandates, social distancing norms, and stay-at-home policies. Many doorbell camera manufacturers have historically relied on the Chinese market for finished products and raw materials, including lenses, system-on-chip devices, and CMOS sensors.
Market Recovery Timeline
Nonetheless, with markets for nonessential goods slowly reopening, the popularity of online distribution channels is expected to create a healthy demand for security systems and solutions in the foreseeable future. According to a poll of 1,200 US consumers conducted by Retail Systems Research in late March 2020, about 55% of respondents predicted internet shopping to be a requirement for them during the crisis. This trend is expected to drive the sale of doorbell cameras via online channels.
Post-COVID-19, consumers are expected to find it uncomfortable to touch and feel products at physical retail stores. These places are incredibly crowded and offer products many people have seen or touched. Thus, many manufacturers are looking for ways to tie up with small and large online e-commerce retailers that can directly deliver products to consumers with minimum hand exchanges. This trend is expected to favor the growth of the online doorbell camera market to some extent.
