Sales of internet-connected smart devices are on the rise. What can retailers do to capitalise on this technology trend?

From smart appliances to smart home security and smart home entertainment, the range of internet-connected devices has grown exponentially over the last year.

Despite this growth, consumers are not planning to go to traditional retail outlets to buy or learn about connected home products.

According to a recent survey by Context, only 8% of UK consumers feel retailers are doing a good job explaining the smart home. Here are three ways they can better capitalise on the  opportunity.

Sell the lifestyle

Retailers tend to stock smart home devices alongside TVs, iPads and PCs. Stacked on shelves in boxes, it is hard for consumers to see how they work and get excited about using the technology in their everyday lives.

Companies like O2, and Lick! In France, have blazed the trail, creating concept stores where shoppers can play with devices and see them in action in a living room, bedroom or kitchen environment.

Educate customers

Lack of knowledge is a clear barrier for consumers. Our research saw 73% of Brits claim they worry about security when away from home. Yet only 11% thought a smart home could help improve security – despite the presence of numerous smart security devices on the market.

Amazon Dash button

Amazon Dash button

Connected electronic devices present a significant opportunity for retailers to grow sales

Nearly three-quarters of UK consumers would like to learn more about the smart home concept, while the fact that only 27% of people have heard about the smart home in store shows retailers are not delivering the required education process.

The retailers doing well in this area are investing in boosting the technical knowledge of their teams, positioning their staff as customer advisors and ‘gurus’ in a similar way to the Apple Store format.

Diverse marketing

As smart home technology is still evolving, it is tempting to see this as solely for early adopters – usually gadget-loving males.

Yet, our research shows that 65% of the UK consumers prepared to spend over £5,000 on the smart home are women.

In France this figure increases to 82% and reaches 100% in Italy, highlighting that retailers need to market to a wider audience, and show how smart systems can impact on family life.

“Consumers who start buying smart home technology quickly purchase more - with Europeans having an average of five connected devices”

Adam Simon, Context Retail

The opportunity for retailers is a substantial one. Consumers who start buying smart home technology quickly purchase more - with Europeans having an average of five connected devices.

The survey also revealed the maximum number was 19 products, showing the possibilities of connected products in the home.

There is also potential to offer additional services such as installation, technical support and insurance, creating new commercial opportunities.

This year at the Consumer Electronics Show (CES), US-based DIY retailer Lowe’s announced the launch of its emergency response service linked to smart home products. Before Christmas, Dixons unveiled the launch of a similar service in the UK.

To really capitalise on this new market, a major shift is required in the way products are displayed and marketed by leading retail brands.

  • Adam Simon is global managing director of retail at Context