CEDIA, the global trade association for the home technology has today released its Integrated Home Market Analysis in partnership with the leading market research firm, Ancrage Consulting LLC. In it, the report highlights growth and direction of the estimated $20.1B integrated home market.
“As consumers focused on improving and connecting their lives at home, growth in the smart home sector was significant,” says CEDIA Global President and CEO Daryl Friedman. “The past two years have allowed us all to see the potential of our homes as the hub for entertainment, education, work and wellness. Our latest study confirms these top-line findings, as well as many important data points available to CEDIA members.”
Wellness, Lighting and Networking Grow as DIY Pressures on Industry Mount
Respondents were surveyed online from August to October 2021 and were asked to report on revenue figures from the last 12 months and provide projections for 2022. The main goals of the analysis were to ascertain the size of the integrated home industry, areas of expenditure, project size and frequency, specified brands by category and latest trends.
Key findings in the report included:
- Based on average annual revenue and project frequency, the integrated home market in the U.S. has an estimated value of $20.1B
- Approximately 11,000 integrator companies operate in the U.S. with an average annual revenue of $2.2M and an average project size of $26K
- Residential projects constitute 83% of revenue, on average
- The average integration company employs 11 people and completes 70 projects per year
- Most integration companies anticipate adding a technical staff member in the next 12 months
- Categories experiencing the most growth include lighting/shading, lighting control, and networking
- Homeowners are shifting toward streaming and “simpler” solutions
- The DIY trend continues to add pressure to this market, though not enough to thwart the bullish growth projected for the next 12 months
Respondents also noted a growing focus on wellness within custom home integration, commonly mentioning lighting and shading solutions as it pertains to the category. In addition, though less commonly mentioned, many integrators also see growth in energy management and new construction opportunities in the coming years.
Among the pressures facing integrators, consolidation among manufacturers and within the integrator community, as well as continued labor shortages are at the top of mind according to the report. Despite this, the overwhelming majority of respondents continue to see growth leading to a lack of technically trained applicants being the sole limiting factor. Responses to whether supply chain issues will improve over the next year are also split.
Opportunities for Integrators in 2022
As the topic of wellness continues to grow throughout the residential market, integrators not already tapped into this category are only gaining more and more avenues with which to access it. Recently, CEDIA themselves announced a partnership with Kohler, opening a variety of opportunities to engage in kitchen and bath projects (two of the biggest areas for technology and wellness in the home). Prominent control and lighting manufacturers have also expanded their product suites over the years to include circadian lighting options as out-of-the-box features in most cases.
In addition, the report painted an intriguing picture on the topic of voice-enabled devices, highlighting that 57% of respondents Rarely or Never include a voice-enabled speaker when installing new audio systems. Considering voice-control is often viewed as a gateway product and audio systems have been listed as the most frequent project by integrators in this past year, it would seem there are plenty of opportunities to build out revenue in this way.
This could also potentially play into another trend within the industry, that of the size of projects shrinking as the number of smaller projects increases. Overall, this contrasting shift has led to continued growth in revenue regardless, however, it does highlight the changing nature of projects (though what might be the cause of this shift is currently unknown).
To hear more about CEDIA, findings and predictions, as well as the expectations of many marketing leading integrators themselves, the 2021 CEDIA Home Market Analysis for the U.S. and U.K. is free to download for CEDIA members in the Research Library. Non-members may purchase a copy of the report for $1,000.