Unlocking Opportunities With Door Hardware for the Smart Home

SSI goes in-depth with Kwikset’s Matt Zimmer to explore residential door lock solutions and other smart home trends and challenges.

Bring up the term smart home and what immediately comes to mind may be smart thermostats, video door bells, lighting controls and the like. Of course, there is much more to this fast-expanding residential ecosystem to consider. Matt Zimmer, who serves as divisional vice president – security marketing, Spectrum Brands – hardware and home improvement division, joins the conversation to explore smart home trends, including residential door lock solutions and much more.

Standard(less)

The industry remains without any real smart home standard. Can you explain why this can negatively affect the market, and how a standard could benefit residential door lock solutions?

The lack of a single smart home standard can be confusing to both dealers and consumers. Highly engaged consumers have likely heard of and read about Z-Wave and Zigbee, which are inarguably the de facto home automation standards within the connected-device space. But then you include WiFi and Bluetooth, and even though the majority of consumers are familiar with these technologies, their application here can lead to choice overload.

Now throw in Apple HomeKit, Alexa, Google and the average consumer is not only more perplexed, they are not even sure what distinguishes a smart home platform from a hub or a standalone device. In the absence of a true smart home standard, there will likely continue to be some level of confusion, putting the onus on consumers to do their homework before they can make an informed purchase decision. The good news is that it also puts more value on the input of pro channel players — dealers, integrators, installers — to aid in that education process.

Could a single standard benefit Kwikset products? Possibly. But ultimately, we are prepared to go in any direction that the smart home market goes. We’ve had Z-Wave and Zigbee products for quite some time. And though Bluetooth and WiFi are not true smart home platforms per se, we offer Bluetooth products — several versions of our Kevo lock — as well as our Halo WiFi locks, including our new fingerprint-enabled Halo Touch. And of course, our products work with all the popular voice assistants. Ultimately, Kwikset is flexible and nimble enough to take advantage of whatever technology is poised to lead the pack.

Sell the Ecosystem

Most experts agree that a key to the security dealer’s success is the ability to sell the entire smart home ecosystem. Has the industry been able to make this transition, or do they too often fall back on what they know best, which is selling security systems?

Security dealers are not unlike professionals in any other industry: they are going to sell what they know best. Still, security dealers have a golden opportunity to create new revenue streams by selling entire smart home ecosystems — or at least additional smart devices — to their security system customers.

The timing couldn’t be better. According to Statista, revenue in the smart home market is projected to reach almost $25 billion in 2020, with an annual growth rate of 18.3% [CAGR, 2020-2023]; and household penetration, which will be 18.5% in 2020 is expected to hit a whopping 47.4% by 2023.

The good news for security dealers is that many surveys cite security as one of the main purchasing drivers to selling entire home automation ecosystems. This means that starting the smart home sales effort with a connected, electronic lock is a natural jumping-off point for sales of a complete package.

Of course, ongoing education about the smart home ecosystem will greatly benefit dealers. Many security dealers have really upped their game, not only in terms of their smart lock knowledge but of smart devices in general. But there is more work to do.

A study conducted by Kwikset revealed the areas in which dealers would like to improve their expertise. The top three answers were connectivity [how the various devices work together]; home automation standards [Z-Wave, Zigbee, etc.]; and purchasing drivers [why consumers buy these products].

The last item, purchasing drivers, carries extra significance. It’s not only important to know why consumers buy, but to understand the differences in generational purchasing patterns. While there may be some overlap, each generation — millennials, Gen Y, Boomers — has unique buying habits and motivations that are indigenous to their individual group.

That’s not news for anyone. Recognizing those purchase drivers and working them into your value proposition is critical to adapt with shifting macro trends in the market. We’ve seen businesses shore up their knowledge and capabilities by hiring professionals from emerging segments with growing purchasing power.

Coronavirus Impact

COVID-19 has obviously impacted all businesses, and security is no exception. Yet there are some experts who claim that security dealers can not only weather the storm but actually thrive during this time. What is your take?

Obviously, we wish COVID-19 had never reared its ugly head. It has taken a huge toll, not only on the economy, but on people’s mental and physical health. And although security has been designated as an essential business during the pandemic, many in this industry have taken a huge financial hit, one whose effects may take some time to overcome.

Still, there are strategies that security dealers can implement to help maintain their business until the economic situation returns to some degree of normalcy. We’ve observed a number of best practices that some dealers have adopted which can serve as the foundation to a quicker recovery and perhaps even create new revenue streams that dealers may not have considered. We’ve actually included these in a best practices document that we created for our own sales team to share with their dealer customer and prospects.

What are some examples of these best practices?

Perform contactless installs, that is to say, preprogram products and use Zoom or Skype to provide customer support.

Expedite new product launches. There’s a renewed focus on home improvement, and smart devices, including security systems and other security-related items, are in demand. If you have a new product scheduled to hit the market soon, try to make it sooner.

Consider channel expansion and targeting additional end-user markets. This can mean renters, multi-family housing, and more.

Have installers participate in online training sessions that they normally don’t have time for. By the time things are back to normal, they’ll have sharpened skills sets that will serve the business well.

Conduct more customer and prospect outreach via social media. Even if you can’t do certain jobs at the moment, you can get them lined up for later.

Sharpen Your Value Proposition

Besides COVID-19, is there another market disruptor in particular that you see playing out in the door hardware space that security dealers may not have a handle on, and how those might affect their ability to compete in the space?

Dealers will do themselves a great service if they are aware of — and improve their knowledge of — several market disruptors. As noted earlier, the ongoing introduction of new products into the smart home arena, along with new platforms and technologies, has made it challenging for consumers to understand what setup is optimally suited for their needs. Consequently, the dealers that can improve their smart home knowledge the quickest will enjoy a huge advantage.

However, it isn’t just knowledge of protocols and devices that dealers need to be familiar with. Their sales skills can have greater impact if they can become more proficient at explaining the real-life benefits of home automation technology. For years, we’ve seen commercials and other promotions touting smart home as a ‘luxury.’ Sure, it’s nice to be able to shut all the lights off in your home when you’re already in bed. But it’s even better to know when your child got home from school, or that your dog walker actually showed up, or that your elderly parent left the house for their doctor’s appointment.

The DIY trend is an obvious concern to the security dealer. Although manufacturers are increasingly touting the simplicity of their new-product offerings — including smart locks — pro channel players can still ensure that they are seen as an integral link in the smart home ecosystem chain. It requires dealers to sharpen their value proposition and clearly convey that message to their target audience.

DIY Disruption

How much of a threat do you view DIY becoming to professionally installed home control products and systems?

There’s no question that DIY has had an impact on the pro channel. But the rise in DIY should not be seen as bad news for security and home automation installers and dealers.

Overall, revenues are up for security dealers, and that can be attributed, at least in part, to the fact that DIY products can raise overall awareness of and spur interest in other home automation and security products, including those that require professional installation. With their lower cost and perceived ease of installation, DIY products have actually broken down barriers for the additional purchase — and installation — of complete, professionally installed systems.

Professional installers can and should bring an extra level of experience and guidance to the process. Their services often go beyond tech installation to include consultative interface design. With their years of experience, installers know the best way to automate a home – how to create a custom smart home experience that doesn’t make the user feel less than smart.

Perhaps the best way for dealers and installers to capitalize on the growing DIY trend is to tackle the problem head on and be creative. Offer a range of products that includes some DIY products, and some leave-it-to-a-pro products – consider the DIY product a great entry point for a more comprehensive system. Play up the peace of mind that comes with professional installations and support that pitch with flexible monitoring contracts and service plans. Relay your passion for producing complete and custom solutions and communicate how you add value to each and every sale.

Also, just because a product is called DIY doesn’t mean that it really is. Many homeowners planning on setting up a connected system may soon realize they don’t have the electrical skills or technological know-how to install and connect all devices, program a system correctly, and get everything up and running smoothly. Professional installers have learned from experience; there’s very little that they haven’t seen before.

Rental Market

Where do you see the market going in terms of smart locks for renters and property managers? Is it a growing market and, if so, is Kwikset looking to capitalize on it?

The rental segment is one that Kwikset is aggressively pursuing, based on the growing demand within the marketplace. More and more, renters are not only embracing smart home technology in their living spaces, they are demanding it — especially smart locks. Even though they are renting, they see their apartment as their home, and they have the same desire to protect themselves and their property as homeowners do.

This mindset is especially prevalent among younger renters. Consider: members of Gen Y want apartments with increased security; 61% are likely to rent an apartment specifically because of its electronic-access features, including keyless entry doors, and 55% are likely to pay more for an apartment that has high-tech door locks. It’s a veritable amenities arms race.

Getting smart locks into the rental picture does require signoff by landlords and property owners. They may have rules against changing locks, either for security or aesthetic reasons. However, there are now many smart locks on the market — including our Kwikset Convert — which will fit over the interior portion of a mechanical lock and turn it into a smart lock. It can still be opened by the traditional key, and it will do nothing to change the appearance of the door. But it gives the renter an added level of security, along with the convenience of keyless entry. Both renters and landlords are happy.

It’s not just new construction where this scenario is playing out: companies remodeling their rental properties are getting into the act, as they begin to include smart home technology — and smart locks in particular – into their remodeling plans.

For property managers or Airbnb owners, the benefits are obvious: when hooked up to a home automation hub, they can keep track of their renters. They can provide virtual keys, freeing them from the worry or lost keys and who might end up with them. They can furnish service providers with temporary passcodes to let them into apartments for repairs at specific times.

As a company, we are certainly investigating ways to penetrate further into this market. We have a number of products that are already appropriate for this niche. In the near future, it is likely we will be making a much more aggressive push into this area.

Aging in Place

The aging in place trend has really taken off in the last few years. How can dealers convey to their customers the benefits that smart home technology — and particularly smart locks — bring to this market?

The aging in place trend is seeing dramatic growth. Consider the growing number of candidates; according to AARP, adults 65 and older are expected to outnumber children by 2030. All boomers and one-fifth of the total population will have reached 65 by that year. What’s more, most seniors — nearly 90%, says AARP — want to stay in their homes as they age. Even if they begin to need day-to-day assistance, most [82%] would prefer the aging-in-place option.

Smart, connected locks play a huge role in this trend, helping caregivers, including adult children, keep an eye on elders without being intrusive. Using a smart lock, a caregiver could see, for example, if the elderly resident left the house to get to their scheduled doctor’s appointment. Individual, time-sensitive access codes can be provided to any authorized people who might need access to the home and its residents, such as service technicians.

These types of benefits — the ability to watch over the elderly parent — are frequently conveyed to the adult children, as they are often the ones who will primarily use the technology. Thus, dealers need to understand how to speak to this customer base, emphasizing the smart home technology as not simply a luxury but a necessary tool that allows their loved ones to live where they want for as long as possible — safely and independently.

While the scenario above is the most frequently marketed use case for the senior audience, it can be something of a trap. Consider the expression that 65 is the new 55, and so on up the continuum as we age. Many people  become extremely active after retirement; they want to travel, socialize, and enjoy their newly found discretionary time. Seniors enjoy and demand the same benefits from smart home technology that younger people are looking for: convenience, safety, and enhancing the quality of their lives.

Also consider that the group transitioning into this segment is vastly different from those before – they helped create the technical foundation that we’re building on today and readily adopt new products. Dealers should be aware of this fact and prepare themselves to sell the empowering aspect of smart home technology directly to older consumers.

As a company, Kwikset is always interacting with our dealer customers and helping them to better understand emerging trends like aging in place. We offer advice on how to question the customer and determine their security/smart home requirements, as well as showing them how our products will meet those needs.

About the Author

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Although Bosch’s name is quite familiar to those in the security industry, his previous experience has been in daily newspaper journalism. Prior to joining SECURITY SALES & INTEGRATION in 2006, he spent 15 years with the Los Angeles Times, where he performed a wide assortment of editorial responsibilities, including feature and metro department assignments as well as content producing for latimes.com. Bosch is a graduate of California State University, Fresno with a degree in Mass Communication & Journalism. In 2007, he successfully completed the National Burglar and Fire Alarm Association’s National Training School coursework to become a Certified Level I Alarm Technician.

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