From Quantity To Smart Change, 2019 Smart Home Jungle Law

- Jan 08, 2019-

The traditional industrial giant Bosch entered the smart lock at the end of the year and treated it as a strategic business. We also saw that IT companies such as Hikvision, Huawei, and Lenovo have started to occupy platform-level products. We have also seen that quasi-unicorns such as graffiti, BroadLink, and Oribo are making waves. Finally, the veteran electric giant Hongyan has also turned its business focus to smart homes, creating a whole-house smart system with smart panels as its core.


Capital is strong, and the board is helping

The smart home in 2018 is still essentially a quantitative change in traditional industries such as home, building materials and lighting. Although there is no shortage of capital, the promotion of the entire industry's trading volume is mainly based on traditional giants. We believe that in 2019, the smart home industry will have a large amount of capital to enter, the industry has undergone fission, the number of startups has soared, and the fields and models have been further subdivided. This is from the perspective of VC.

On the other hand, the quasi-unicorn company, which was born in 2017 and 2018, will usher in the first turning point in 2019. After a period of burning money, the moment to test their money and continued financing. For companies with a longer history, the PE market will heat up due to the hot market in the VC market. In the end, more smart home concept stocks will emerge.

With the reform of this year's science and technology board, smart homes will become one of the most popular investment targets as a combination of hardware, AI, big data, new retail and other commercial value areas. At the same time, the industry's bubble trend will also appear.

System concept enhancement, deep intelligence rise

It should be said that the smart home in 2018 is still the market for single products. Although the intelligent system is also very popular, the basic situation is "internal heat and cold outside." On the contrary, smart speakers, smart locks, smart cameras, smart sockets, smart sweepers, smart lighting and other items broke out.

Especially smart locks: According to authoritative research, by 2018, the number of smart locks has exceeded 3,000, and the number of factories has exceeded 1,000. The annual shipments will double that of 2017, surpassing 13 million sets. The total amount is not the focus, and the growth rate is the key. In 2019, it is immeasurable for smart locks.

However, we believe that such items as smart locks will increase in volume to a qualitative change in 2019 as the sales volume rises exponentially. To be precise, it is "smart change." To achieve "smart change," smart locks cannot reject system concepts. Only by integrating into the system, smart locks can be transformed from simple entry door automation to true smart home.

Smart locks are just a case. Most of the current smart products are still at the level of home automation. The so-called AI and big data have not yet been implanted or function. What we need is not a smart lock, but a system that sees the owner automatically opening the door without contact, while adjusting the indoor lighting, temperature and music to a personalized mode.

When there are enough smart devices in the user's home, the system will become a necessity. But the problem now is that there are many problems with the intelligent system made up of open-loop single product DIY. The most obvious of these is the "individual politics" of the control platform: Apple has Homekit, Samsung has Samsung Zhijia, Xiaomi has Mijia, Alibaba has Aliyun IoT, Huawei has HiLink, Haier has U+, Midea has M-Smart, Gree has Gree-Smart...

In fact, even if all the smart products in the user's home support a certain platform, it is still a kind of light intelligence. In 2019, we believe that true customized depth intelligence will be popularized. As soon as users' awareness of smart homes is more mature, light intelligence can no longer meet their needs. Second, the industry division of intelligent systems is more detailed and the solutions are more mature. Thirdly, software vendors, integrators and equipment vendors are deploying. The model house instills the concept of deep intelligence.

Offline channels strengthened, new retail outbreaks

Another trend is that the offline channels of the smart home industry will become even more important in 2019. From interviews with a number of smart home companies, we concluded that most smart home brands are accelerating the construction of offline channels. Another interpretation of this trend is that the B-end orientation begins to shift to the C-end orientation.

If smart homes really want to be upgraded to national consumption, going to the C side is the ultimate goal. The B-end is just a breakthrough in landing. It is essentially a cross-industry cooperation: you can install smart home for me, and I can better charge my customers. Only the C-end is widely popular, and smart homes can become mainstream consumption.

Therefore, we predict that in 2019, the C-end market must erupt to some extent. If the C-end does not break out, the billion-dollar smart home market and production capacity will not be bottomed out. Just relying on the B-side orders such as the growing real estate industry, smart homes can't carry such a large amount. Moreover, in the B-end oriented market, product differentiation is not obvious. Only by pushing to the C-end market can we quickly win the fittest, speed up the industry reshuffle, and truly enhance our technical strength and product strength.

In 2019, smart home enterprises will first increase the construction of offline channels, especially smart system suppliers. Secondly, the new retail concept will be more grounded, the smart living hall will bloom everywhere, and the number of stores in the store will further increase. Channel dealers engaged in traditional business in various places will further deepen their understanding of smart homes. It can even be said that the land battle for the smart home offline channel is a key event node in 2019. 2018 is the final stage of the evolution of smart home from 0 to 1, and 2019 will be an expansion period from 1 to 100.

At this stage, if a brand loses its online channel, it will directly face the disaster.

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