New study, The Business of Consumer IoT, shares insights on business leaders’ outlook on market challenges and opportunities in 2025 

Parks Associates recently surveyed more than 100 executives across the connected home and consumer IoT landscape to better understand their view of the market, changes in their business strategies, key metrics for success, and top challenges facing the market. The research, found in The Business of Consumer IoT: Product Strategy in a Maturing Market, reveals consumer IoT products are priced 21-70% higher than similar non-connected products, with an average price differential of 44%.

“The smart home and security markets benefit from delivering solutions that address consumer needs that only get stronger in uncertain times – safety and security,” said Jennifer Kent, VP Research, Parks Associates. “This – along with growing demands on the grid due to electrification and data center development – gives stability to the smart home market and a positive outlook that may not hold in other economic sectors.” 

Connected home businesses are on the frontlines of AI use both internally and for product enhancement. Connected products and services generate a wealth of data that can inform organizational processes, including marketing methods and messages, support processes, and product development. Other data highlights:

• 90% of consumer IoT businesses are already using AI internally for business processes, and 79% are incorporating AI into the end-user product or service.
• 51% are focusing on expanding product reach through new channels in 2025, and builders and multifamily properties are top targets of consumer IoT businesses.
• Industry executives report 86% of connected product units are connected to the internet. 
• On average, 58% of smart product lines have a paid service attached. Both connectivity and paid service attach rates are highly dependent on the product type. 
• Executives find integration with other devices in the home is more impactful in driving engagement than gamification techniques. Solving interoperability challenges leads to more value for the user and the business.

“Great product development is at the core of many consumer IoT businesses, but marketing, merchandising, pricing models, logistics, and other operational factors will become ever more important to staking out a lead position in the market – and a profitable one,” Kent said.

The report is available for purchase, providing complete findings from this study detailed insights into smart technology adoption, service models, and revenue opportunities. This in-depth resource supports strategic decision-making for technology providers, property managers, and service partners in the connected multifamily ecosystem.

About Parks Associates

Parks Associates helps companies identify new opportunities, refine strategy, and accelerate growth in connected technology markets through data-driven insights and industry expertise. With more than 40 years of experience, the firm delivers proprietary consumer and industry research, market forecasts, and strategic analysis that guide business decisions across personal, connected home, small business, and commercial technology ecosystems. Parks Associates supports clients in navigating evolving markets including AI, security, smart home, broadband, entertainment, energy, multifamily, smart buildings, and connected health.

The firm also fosters industry growth and collaboration by convening thousands of leaders each year through its flagship executive conferences, including CONNECTIONS™, Connected Health Summit, Smart Energy Summit, Smart Spaces, and Future of Video.  Learn more at https://www.parksassociates.com.

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