Looking Forward to 2021: How COVID-19 Will Reshape Home Security
With COVID-19 still affecting the way most Americans live, work, play and go to school, the security industry is faced with a variety of opportunities and challenges.
Editor’s Note: SSI has partnered with Parks Associates for the creation of DIY FYI, a column designed to help dealers keep track of important smart home market developments, what the competition is and whether they want to jump into something they see as a new opportunity.
As we look ahead into 2021, the security industry faces a mixed bag environment resulting from COVID-19. These are uncertain times and many factors can impact growth and attrition in the home security market, including unemployment and other negative economic impacts as a result of the pandemic.
Parks Associates research will continue to analyze the changes in the market throughout 2021. Here is what we expect.
Security/Alarm Dealers
2021 is up for grabs for the residential security industry as they must adapt to challenges brought by COVID-19. The pandemic inhibits in-home installation, places financial pressure on some customers and requires new precautions and procedures for company employees.
COVID-19 has increased online transactions for self-installable systems and devices due to social distancing practices, resulting in heightened demand for remote technical support.
No matter what, however, traditional residential dealers must gird for increased competition from DIY and review their firm’s strategy. Brands need to be polished and tools for self-installation and remote support improved.
To achieve profit on smart home installations, installers need training and practice on consultative selling and best installation practices. With products available online, prices to consumer will need to keep margins lower than they are on security panels.
Intenders for professionally monitored security systems most often select dealers as their preferred purchase channel, while self-monitored intenders select online most often.
Of interest is that nearly 1/3 of intenders for self-monitored systems also want a security dealer. These consumers may be in for a surprise as finding dealers who install but do not require monitoring is more difficult than going with pure DIY or installation with professional monitoring. Even more astonishing is that a total of 64% of intenders state a preference for retail, online or in store.
Monitored Services Providers
Pressure on RMR will arrive big time from DIY. Providers need to ramp up new segmented services over the next few years. As more aspects of daily life get connected, professional monitoring services will see new opportunities emerge beyond security to deliver a variety of new benefits to today’s connected consumers.
As adoption of smart products such as lights, locks, detectors and thermostats increases, they will create more use cases for monitoring and data-enabled services. The safety, security and peace-of-mind benefits that come with these services are powerful drivers among US households.
Technology
The biggest tech opportunity will continue to be in video solutions and services: attaching video devices and services to residential customer accounts; SaaS providers integrating video verification capabilities into platform interface with monitoring stations; applying more video analytics to reduce false alerts and provide intelligent alerts; applying video analytics to SMB use cases, such as customer analytics and occupancy tracking to comply with COVID-19 restrictions.
A challenge/opportunity will be in retaining and upgrading customers impacted by the 3G sunset. Consumer expectations for wider integration of device types, brands and models will continue as they seek a unified experience for the devices they love.
Smart access control in the hospitality and MDU segments will continue to accelerate. Touchless access control has generated increasing interest among consumers and property owners due to COVID-19.
Markets
Healthcare is on everyone’s mind as a result of COVID-19. A few security leaders have made plays in some aspects of independent living with limited success. The industry must rethink how it approaches the unique nuances of connected care compared to traditional security services. New players may well emerge that specialize in both B2C and B2B solutions for connected care and independent living.
When it comes to the overall security industry, consumer interest in self-installable devices and systems will expand the lower end of the market with more dealers including DIY options in their solution set and larger players selling DIY systems direct to consumer online.
As value creation requires more advanced technology, we may see more hardware consolidation among those who are getting left behind and more M&A activity of enabling technologies, such as video/audio analytics and machine learning assets.
This year has been unprecedented for everyone and with COVID-19 still affecting the way most Americans live, work, play and go to school, the security industry is faced with a variety of opportunities and challenges.
They must find innovative and fresh programs and messages as we enter the new year. We predict 2021 will be a year of further expansion for the industry, with consumers adopting and experimenting with innovative and useful solutions.
Brad Russell is research director at Parks Associates. For more information on Parks Associates consumer and industry research or the CONNECTIONS Community, visit www.parksassociates.com.
If you enjoyed this article and want to receive more valuable industry content like this, click here to sign up for our FREE digital newsletters!
Related Content
Security Is Our Business, Too
For professionals who recommend, buy and install all types of electronic security equipment, a free subscription to Commercial Integrator + Security Sales & Integration is like having a consultant on call. You’ll find an ideal balance of technology and business coverage, with installation tips and techniques for products and updates on how to add to your bottom line.
A FREE subscription to the top resource for security and integration industry will prove to be invaluable.
