Residential Ready to Rally Around New Services
IP-based services and mobile apps that allow consumers to control and stay connected to their homes are expected to anchor a key market adrift in economic uncertainty. SSI‘s 2011 Residential Market Report provides research from Parks Associates to help security contractors take hold of these opportunities.
©iStockphtot.com/Iudovic Vangrootenbruel
Among all broadband households, comprising nearly 70 percent of U.S. households, 29 percent are interested in traditional security with IP-based features and 16 percent are enthusiasts with a high willingness to pay. Nearly half of these householders do not currently have traditional monitoring and report low intentions to adopt traditional monitored security.
A Bundle of Opportunity
Busy consumers want simplicity wherever it can occur. Because high concept rankers are also consumers who report concern about the ability to control the many moving parts of their lives, bundled services have high appeal. When respondents were asked about the appeal of having two or three of their top-ranked services in a bundle, appeal ratings jump a solid 7 percent to 10 percent above even the high rates offered for a particular service. In addition to increasing appeal scores on average, bundling brings households reporting only middle appeal ratings into the high appeal set.
The channel winners of this round of innovation will offer bundles with installation as an option or as a part of standard offerings. Security contractors have multiple possible roles in this embryonic marketplace that include the following:
- Partnering with heretofore nonsecurity channel companies in need of trained installation and sales assistance. Possibilities here include HVAC dealers, electricity providers and even broadband service providers
- Working with IP service developers to adopt an IP platform with multiple services for current or new customers
Still skeptical of the growth potential in this market? The chart “Households With Professionally Monitored Security: Traditional vs. IP-based” (right) provides Parks Associates’ forecast for the growth of IP-based monitoring services for home security. The research illustrates a strong upward trend. Currently, less than 2 percent of households with monitored security utilize IP connectivity. Parks Associates expects IP-based monitoring to eclipse traditional methodology by 2019.
With the national providers gearing up for prolonged advertising campaigns, the present offers perhaps the best opportunity for independent security contractors to enter the game, ride the coattails of some power marketing and grow with the IP services market.
Tricia Parks is CEO and founder of Dallas-based research firm Parks Associates.
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