Smart Appliances Market

Market Overview

The global smart appliances market size was valued at USD 29,871.12 million in 2022. It is estimated to reach USD 118,447.23 million by 2031, growing at a CAGR of 16.54% during the forecast period (2023–2031).

Smart appliances are operated through connected devices, such as smartphones, tablets, or computers, to provide more information and control are considered smart appliances. Communication with tablets or smartphones enables users to control these appliances remotely. Smart appliances also share and exchange data with the smart grid by providing consumers with reminders and alerts to use during off-peak periods. Moreover, advanced smart appliances send notifications and alert the user to switch off or on depending on their requirements.

Furthermore, smart appliances are developed and designed to be energy-efficient and allow users to operate the appliances conveniently with low power consumption. Smart appliances can be controlled with the help of commands from a central system or communicate with other appliances in a network and make certain decisions for the owner. The ongoing advancements in the IoT (Internet of Things) have played a massive role in the growing penetration of smart home appliances such as air conditioners, televisions, refrigerators, washing machines, etc.

Highlights

• Wi-Fi dominates the technology segment
• Smart home appliances dominate the product type segment
• Residential dominates the end-user segment
• Asia-Pacific is the highest shareholder in the global market

Market Dynamics

Market Drivers

Growing Adoption of Connected Devices and the Internet of Things (IoT)

Wireless connectivity is now being extended to many more devices, including those found in the home, allowing them to collect and share data in much the same way as mobile phones and tablets. The Internet of Things (IoT) helps to connect people and devices via the internet. Many smart appliances have transitioned due to the growing popularity of IoT, which integrates digital and wireless technology. In addition, IoT is influencing a lot of vendors associated with the field of technology.

According to a report from the USENIX association, there were around 83 million IoT devices in 16 million homes worldwide as of 2019. In several regions, most homes now have at least one networked IoT device. Moreover, according to Congressional Research Service, active IoT devices will grow from 9.9 billion in 2019 to 21.5 billion in 2025. While non-IoT device connections will continue to increase, IoT devices will be about two-thirds of those connections by 2025, up from about one-third in 2019. The rise in internet penetration is also expected to drive the market over the forecast period.

Rising Demand for Energy-Efficient Home Appliances

The growing concerns regarding higher electricity consumption and the lookout for energy-efficient alternatives will drive the growth of the smart appliances market. Smart appliances are designed and developed to use energy more efficiently by connecting them with smart grids and automatically scheduling the work cycles using time-based electricity programs to ensure the appliance operates during off-peak hours when energy prices are cheaper. Smart appliances come with future-oriented smart grid capabilities that could support a more reliable, less polluting electric grid.

Furthermore, smart appliances automatically adjust their work cycle time with incorporated sensors to help consumers reduce their energy usage. For instance, smart washing machines have a feature that automatically shuts off the appliance when the clothes inside it are washed. In addition, the prices of appliances are also decreasing as they become more energy efficient. The initiatives taken by several governments to curb carbon emissions by lowering energy consumption are driving the adoption of energy-efficient smart appliances.

Market Restraint

High Cost of Smart Appliances

The cost of appliances is one of the significant factors considered before buying. Both in developed and developing nations, a sizable portion of the population examines the price of products before making a purchase. The average price of smart appliances ranges from USD 300 to USD 2,000. On the other hand, conventional home appliances are available at a starting price of about USD 100. Owing to this high-cost factor, it becomes difficult for manufacturers to convince consumers to upgrade their regular washing machines with the smart connected variety. Moreover, the installation cost, coupled with the additional costs, discourages consumers from adopting smart appliances.

Market Opportunities

Rapid Technological Advancement in the Smart Home Appliances

The need for convenience is one of the most important factors that necessitate the development of products that can reduce manual labor. Several futuristic technologies help make home appliances more efficient and convenient. The Internet of Things (IoT) growth has aided the adoption of cutting-edge appliancesIoT helps connect appliances such as washing machines to other devices that can be controlled. For instance, the new QuickDrive™ washing machine from Samsung can be connected to the smartphone, enabling consumers to check the progress and schedule wash cycles.

Furthermore, many appliances use machine learning, computer vision, natural language processing, and other technologies capable of thinking, making decisions, and learning. Additionally, the development of the 5G network is expected to connect smart devices more easily and quickly than the current network. A 5G network allows appliances to work wirelessly while consuming minimal power. Such technological advancements are expected to boost the global smart appliances market.

Regional Analysis

Based on region, the global smart appliances market is bifurcated into North America, Europe, Asia-Pacific, and RoW.

Asia-Pacific Dominates the Global Market

Asia-Pacific is the most significant shareholder in the global smart appliances market and is anticipated to grow at a CAGR of 18.20% during the forecast period. Technological advancements and internet penetration rates primarily drive the Asia-Pacific market in developing economies like China and India. The presence of major market players such as Samsung Group, LG Electronics, Haier Group, and Panasonic has offered enormous opportunities for the smart appliances market in the Asia-Pacific region. In addition, the growing adoption of smart refrigerators, and smart ovens in the region, particularly in China, has boosted the market growth. One of the fastest-growing economies on the global market is that of the Asia-Pacific area, which includes nations like China and India. Moreover, the adoption of smart homes and growing urbanization with a significant rise in household luxury spending augment the revenues in the smart appliances industry in the Asia-Pacific region. Furthermore, the lowest manufacturing cost in developing countries such as China and India has resulted in a rise in the number of production facilities in the countries.

Europe is estimated to grow at a CAGR of 17.37% over the forecast period. Europe holds the second-largest market share for the smart appliances market. The increased penetration and market concentration, purchasing power, and living standards have driven the European smart appliances market. Several Western European and Eastern European countries are involved in product manufacturing. The European region's major smart appliance manufacturers are Koninklijke Philips, AB Electrolux, and Robert Bosch GmbH. Moreover, companies focus on expanding their product line through product innovation, particularly in developing economies, to meet the rising demand. In addition, due to environmental guidelines highlighted by several governments, major growth factors, including technological advancement to increase energy efficiency and efficacy, tend to increase the market in the forecasted year. A booming real estate market that motivates fresh or replacement purchases, by innovating technology for smaller appliances, because of different housing arrangements across the region is also a significant factor boosting the adoption of smart appliances across Europe.

The North American region is growing substantially in the smart appliances market. A few major smart appliances manufacturers, such as Whirlpool Corporation and GE Appliances, are in the North American region. These companies constantly engage in research and development activities to gain competitive advantages over its peer. In addition, the global leaders in smart appliances focus on the U.S. as an important market owing to the significant market potential offered by the U.S. The growing adoption of smart homes in the region has increased the penetration of the smart appliances market. Furthermore, Canada is ramping up the demand for smart appliances in this region owing to the growing awareness of smart homes and the early adoption of technology. The increased spending power of the people and growing working women populace in countries such as the U.S. and Canada boosts the growth of the smart appliances market in the North American region.

The RoW comprises Latin America and the Middle East and Africa. The largest nation in Latin America is Brazil. In addition, the smart cities initiative will boost the smart home market in the country. On the other hand, Mexico has shown growth in disposable income and a rising trend for the IoT and cloud computing markets the smart home market is likely to perform well in the region, thereby increasing the adoption of smart appliances. The market is forecasted to grow in the Middle East and Africa mainly due to the rising population and high purchasing power. Rising urbanization and demand for home appliances and services will likely boost the smart appliance market in the RoW region.

Segmental Analysis

The global smart appliances market is segmented by technology, product type, and end-user.

Based on technology, the global market is divided into Bluetooth, Wi-Fi, and near field communication. 

The Wi-Fi segment is responsible for the largest market share and is anticipated to grow at a CAGR of 17.91% over the forecast period. The use of Wi-Fi technology to control home systems on smartphones will become a vital part of people's lives with the continuous maturity of Wi-Fi technology and the increasing progress of smart homes. Network users can move around without restriction when using Wi-Fi technology and access the network almost anywhere. Wi-Fi technology also provides a cost-effective network setup for hard-to-wire locations like old buildings. However, since Wi-Fi uses RF technology, the air is used as a medium to transmit and receive data. Further, signals transmitted through radio waves are easily disturbed by external environments, and the security could be higher, so they are unsuitable for smart home control systems requiring high protection.

The introduction of Bluetooth technology eliminated the requirement for wired connections. Bluetooth technology brings intelligence to home appliances through smartphones for 24/7 control of energy consumption, and it automatically switches off the power to provide electrical safety at home. The user needs to keep the Bluetooth on, and they can control the systems with their smartphone app. In addition, Bluetooth technology is perfect for home appliances with mechanical on/off switches, such as floor lamps, TV, fans, coffeemakers, slow cookers, and others.

Based on product type, the global market is segmented into smart kitchen appliances and smart home appliances. 

The smart home appliances segment owns the highest market share and is estimated to grow at a CAGR of 17.26% during the forecast period. Smart home appliances include smart washers, dryers, air conditioners, smart lighting devices, smart vacuum cleaners, smart security devices, and smart water heaters. The amount of time saved by using smart home appliances compared to manually operating them, and the reduced power and energy achieved. The advancements in IoT are the major factors leading to changes in smart home appliances. In addition, various appliances such as lighting, home appliances, computers, and security cameras will be interconnected owing to IoT incorporation. Significant developments in home automation will further propel the smart home appliances market.

Smart kitchen appliances include smart refrigerators, smart coffee makers, smart kettles, smart dishwashers, smart ovens, smart cookers, and others. The increasing adoption of smart kitchen appliances in residential and commercial sectors worldwide is driving the demand for smart kitchen appliances. In addition, the rising importance of kitchen renovation to build a modular kitchen is foremost to a fast-paced growth for smart kitchen appliances. The smart kitchen appliance market is heavily captured by numerous well-established and globally renowned manufacturers, tier 2 companies, and startups that offer various types of smart kitchen appliances. This factor is also catalyzing the growth of the smart kitchen appliance market.

Based on the end-user, the global market is segmented into commercial and residential. 

The residential segment is the highest contributor to the market and is projected to grow at a CAGR of 15.77% over the forecast period. Due to its Wi-Fi connectivity, smart appliances may be operated from any location at any time using a smartphone or tablet. Around 66% of customers agree that connected devices have the potential to make their life easier, resulting in higher demand for the market. In addition, increasing spending power and emerging smart home trends are the primary factors driving global demand for the smart appliances market.

The growing penetration of smartphones and wireless internet connections is surging the adoption of smart appliances. Moreover, the growing population in the Asian and Far East markets has increased the demand for commercial smart appliances. Likewise, sturdy economic growth and rising disposable incomes are expected to foster demand for laundry services in these regions. Manufacturers are now concentrating on offering high-end technology-enabled products such as water-saving technology, energy efficiency, time-saving features, and digital operational capability.

Recent Developments

• January 2023- Samsung Electronics introduced SmartThings Station, a user-friendly, cost-effective smart home hub and rapid charging pad. Samsung's SmartThings Station provides simple setup and interoperability with various smart home products, including Matter devices, with the ease of use that consumers have come to expect.

• February 2023- Allion Labs, a prominent consultant for Smart Home and IoT Ecosystem, announced the addition of Matter certification to its smart home integrated consulting services. Numerous manufacturers have been aided effectively in their certification and validation efforts for smart homes.