How is the smart and connected products market evolving in Europe?

Every two years, USP marketing consultancy conducts a deep dive on smart and connected products in the European electrical installation monitor. In the lates version of this study, the Q2 2024 report on smart and connected products, more than 800 electrical installers in 7 key European countries voiced their opinion about the smart and connected products market.

Average % of companies involved in the installation of smart building products

Germany Leads the Growth, While the UK Faces Challenges

The market for smart products has shown remarkable stability across Europe, with Germany and Belgium leading the charge in growth. German electrical installation companies, in particular, have embraced smart technologies, reflecting a broader trend of digital transformation within the country.

However, the UK presents a contrasting scenario. Despite the overall steady market, the UK has experienced a decline in the adoption of smart products. This downturn is primarily attributed to the high failure rates associated with smart meters, including display issues, slow problem resolution, and compatibility problems with first-generation meters. These challenges underscore the importance of reliability and robust support mechanisms in fostering market growth.

Electrical and Lighting Industries at the Forefront

Smart products have found fertile ground in the electrical and lighting industries, with increasing demand driving innovation and adoption. Across most European countries, electrical installers view themselves as pioneers in the smart product domain. This perception is particularly strong in Germany and Belgium, where the integration of smart technologies is seen as a natural progression for the industry.

In contrast, France and Poland present a different picture. Here, home automation specialists are perceived as more adept at handling smart product installations. This highlights the varying dynamics within the European market, where expertise and industry leadership can differ significantly from one region to another.

The Complexity of Smart Product Installations

Despite the growing prevalence of smart products, many electricians find their installation more complex compared to traditional tasks. This complexity underscores the need for effective education and training. Manufacturers play a pivotal role in this regard, providing regular training sessions, comprehensive installation guides, and reliable technical support.

One electrician from Spain encapsulated the sentiment of many in the industry: “We need technical support to be immediate; we cannot wait for them to call us back because by the time they do, we are already off-site.” This highlights the critical need for real-time support to ensure seamless installations and minimize downtime.

Moving Forward: Strategies for Success

For manufacturers and industry stakeholders, addressing these challenges is crucial for sustained growth and market penetration.

Key strategies include:

• Enhanced Training Programs: Regular and comprehensive training sessions can equip installers with the necessary skills and knowledge to handle smart product installations efficiently.
• Detailed Installation Guides: Providing clear and detailed guides can simplify the installation process, reducing the perceived complexity.
• Robust Technical Support: Offering reliable and immediate technical support can significantly improve the installation experience, ensuring that issues are resolved promptly.

Conclusion

The smart and connected products market in Europe is poised for continued growth, driven by innovation in the electrical and lighting industries. However, regional disparities and installation complexities present challenges that need to be addressed. By focusing on education, support, and reliability, manufacturers and industry professionals can navigate these challenges, fostering a more robust and dynamic market for smart technologies.

Furthermore, a large part of the market is DIY focused. Solutions from companies like Amazon and Ikea centre around products that are easy to install by consumers themselves. This can be seen as both a positive and negative trend for the installers and manufacturers supplying them.

One the one hand, having more consumers exposed to the benefits of smart and connected products could lead to more interest in the more high end solutions typically installed by professionals.

On the other hand, a continued growth in the low end solutions market could also be a limiting factor for the professionals, as their involvement in this segment is minimal.

For the non-residential applications, the market outlook does look brighter, with an increased demand for solutions that can decrease energy consumption and can increase operating efficiency.

These are just some of they key findings of the report. The full report covers many more elements, like what products are installed, the evolution of the installation of smart and connected products overtime, the leaders in smart building solutions per county (manufacturers), future demands and remotely operated products.