Smart Thermostat Market Size
|Study Period||2018 - 2028|
|Market Size (2023)||USD 4.45 Billion|
|Market Size (2028)||USD 11.12 Billion|
|CAGR (2023 - 2028)||20.10 %|
|Fastest Growing Market||Asia Pacific|
|Largest Market||North America|
*Disclaimer: Major Players sorted in no particular order
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Smart Thermostat Market Analysis
The Smart Thermostat Market size is expected to grow from USD 4.45 billion in 2023 to USD 11.12 billion by 2028, at a CAGR of 20.10% during the forecast period (2023-2028).
Lighting and other household appliances consume a considerable amount of energy, and presently, there is a dire need to use these energy resources efficiently. Therefore, governments are emphasizing the use of smart devices in homes.
- The increasing adoption of smart homes across the globe, the occurrence of the COVID-19 pandemic, the emergence of IoT-enabled HVAC systems, the surging adoption of smart home voice assistants, and government regulations pertaining to increasing the energy efficiency of buildings are some of the factors propelling the demand for Smart Thermostat Market over the next couple of years.
- Moreover, the critical factors driving the need for smart thermostats are convenience, energy conservation, energy tracking, and the need for an increase in potential savings. Also, the BYOT (Bring-your-own-Technology) trend is expected to stimulate the growth of the market over the forecast period. Consumers have independently begun purchasing smart Wi-Fi-enabled thermostats capable of receiving demand response control signals.
- Additionally, with a Wi-Fi connection and smart thermostats, virtual assistants, like Amazon Alexa, or Google Assistant, are increasingly being used to control and monitor the home temperature, program schedules, or manage the Air conditioning.
- A wireless network is the most widely used connectivity technology in smart thermostats as it helps the customers to bring down the maintenance and installation costs, along with providing higher scalability and flexibility, and enhanced connectivity.
- The installation of wireless connectivity makes smart thermostats more compatible with smart devices such as tablets, smartphones, and laptops for operation. Further, the increasing adoption of smart homes in the United States is expected to fuel the demand for smart thermostats based on wireless connectivity technology.
Smart Thermostat Market Trends
This section covers the major market trends shaping the Smart Thermostat Market according to our research experts:
Increasing Demand for Energy-saving Devices
- As smart thermostats aid in saving electricity, owing to such characteristics, the demand for smart thermostats is expected to grow over time and has been influenced by the augmented demand for energy-efficient solutions.
- According to a study conducted by Nest Labs (a part of Google LLC), the company compared the energy bills of real people in 41 states before and after the installation of Nest Learning Thermostats. The study was conducted via two independent studies - from real Learning thermostats and real homes with real families.
- As per the result, on average, the Nest Learning Thermostat saved approximately 10% to 12% on heating and approximately 15% on cooling. Further, based on typical energy costs, the company estimated an average savings of approximately USD 131 to approximately USD 145 per year. That means the Nest Learning Thermostat paid for itself in under two years. Such positive results are expected to promote the adoption of smart thermostats in the market globally during the study period.
- According to the US EIA, the global energy demand will grow at 2.1 % per year to 2040 with the current stated policies scenario. The demand surge will raise the electricity share in 2040 to 24%.
- The use of technologies, changes in government policies, developing economies, and market conditions are driving the growth of low-carbon sources to maintain the environmental levels. Electricity consumption has a direct effect on the carbon footprint as electricity generation requires the burning of non-renewable resources and leads to a carbon footprint.
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North America to Hold Significant Market Share
- North America has been the major contributor to the revenue generated by smart thermostat products and services globally, owing to the increasing adoption of the technology across the residential sector of the region.
- Owing to this rise in smart homes and smart home devices, connected thermostats are also expected to witness an increased adoption, particularly in North America, being the early adopter of new technological encroachments. The increasing dependency on smartphones and mobile apps is only set to drive the demand for smart home applications as smartphones offer an intuitive medium via different applications for controlling smart home technologies.
- Smart homes are accelerating, with nearly 30 million US households predicted to add smart home technology soon. The products consumers are looking to integrate into their homes include connected cameras (40%), video doorbells (26%), and connected light bulbs, thereby fueling the demand for the smart thermostat application among the smart solutions.
- The addition of advanced technologies, like AI and predictive analytics, gives a notion of the increased price of allied thermostats. Therefore, the market has been further boosted by active government/state-level association initiatives to make the products affordable to the end consumers across residential applications.
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Smart Thermostat Industry Overview
The smart thermostat market is fragmented and competitive. Due to the government's support and promotion for the uptake of smart devices in residential buildings, many smart home vendors have entered the market. Some of the key players in the market include Alphabet Inc. (Nest Labs - Google), Honeywell International Inc., Ecobee, Schneider Electric SE, and Lennox International Inc., among others. Some recent developments in the market include:
In September 2022, Autogrid entered into a partnership with Mysa with an aim to launch utility-scale virtual power plants using smart thermostat technology for grid modernization. AutoGrid would be leveraging its VPP platform in collaboration with Mysa's smart thermostat technology for electric heating and cooling to provide a scalable and comprehensive dispatch solution for both technologies and other IoT solutions from various thermostat and Water Heater Controls platforms.
In May 2022, Ecobee launched its new Ecobee Smart Thermostat Premium, which would be replacing its existing flagship model, SmartThermostat with Voice Control, with new features.
Smart Thermostat Market Leaders
Nest Labs Inc.
Emerson Electric Co.
*Disclaimer: Major Players sorted in no particular order
Smart Thermostat Market News
- September 2022: Aqara, a leading provider of smart home products, announced the launch of its Radiator Thermostat E1 to automate hydronic radiators, making the heating systems smarter for improved energy efficiency and comfort. Based on the Zigbee 3.0 protocol, the Thermostat is anticipated to support the future-proofing Matter standard via an OTA update of the compatible, Zigbee 3.0-based Aqara hub.
- April 2022: Voltus, Inc., a distributed energy resource (DER) software technology platform, collaborated with Resideo, a global provider of home comfort and security solutions and a distributed energy resource management system (DERMS), and Google Nest, launched its first bring-your-own-thermostat program that would deliver both demand response capacity and ancillary services.
Smart Thermostat Market Report - Table of Contents
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS
4.1 Market Overview
4.2 Industry Value Chain Analysis
4.3 Industry Attractiveness - Porter's Five Forces Analysis
4.3.1 Bargaining Power of Suppliers
4.3.2 Bargaining Power of Buyers
4.3.3 Threat of New Entrants
4.3.4 Threat of Substitute Products
4.3.5 Intensity of Competitive Rivalry
4.4 MARKET DYNAMICS
4.4.1 Market Drivers
22.214.171.124 Increasing Demand for Energy-Saving Devices
126.96.36.199 Effectiveness & Convenience in Controlling HVAC Devices at Home
4.4.2 Market Restraints
188.8.131.52 High Product Price and Installation Costs of Smart Thermostats
4.4.3 Market Opportunities
184.108.40.206 Proliferation and Integration of Smart Home Devices
220.127.116.11 Internet Penetration and Demand for Smart Phones
5. MARKET SEGMENTATION
5.1 By Type
5.2 By End-User Vertical
5.3.1 North America
5.3.4 Rest of the World
6. COMPETITIVE LANDSCAPE
6.1 Company Profiles
6.1.1 Nest Labs Inc.
6.1.2 Resideo Technologies, Inc.
6.1.4 Emerson Electric Co.
6.1.5 Lennox International Inc.
6.1.6 Alarm.com Inc.
6.1.7 LUX Products Corporation
6.1.8 APX Group Inc.
6.1.9 Johnson Controls PLC
6.1.10 Netatmo SA
6.1.11 Tantalus Systems Corporation
6.1.12 tado GmbH
6.1.13 Centrica Hive Limited
6.1.14 Siemens AG
- *List Not Exhaustive
7. INVESTMENT ANALYSIS
8. MARKET OPPORTUNITIES AND FUTURE TRENDS
Smart Thermostat Market Research FAQs
How big is the Smart Thermostat Market?
The Smart Thermostat Market size is expected to reach USD 4.45 billion in 2023 and grow at a CAGR of 20.10% to reach USD 11.12 billion by 2028.
What is the current Smart Thermostat Market size?
In 2023, the Smart Thermostat Market size is expected to reach USD 4.45 billion.
Who are the key players in Smart Thermostat Market?
Nest Labs Inc., ecobee, Emerson Electric Co., Johnson Controls and Honeywell International are the major companies operating in the Smart Thermostat Market.
Which is the fastest growing region in Smart Thermostat Market?
Asia Pacific is estimated to grow at the highest CAGR over the forecast period (2023-2028).
Which region has the biggest share in Smart Thermostat Market?
In 2023, the North America accounts for the largest market share in the Smart Thermostat Market.
Smart Thermostat Industry Report
Statistics for the 2023 Smart Thermostat market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Smart Thermostat analysis includes a market forecast outlook to 2028 and historical overview. Get a sample of this industry analysis as a free report PDF download.