A working strategy for home automation

Nest announced the next step in their product lineup yesterday. The Nest Protect, a smarter smoke detector which comes with all kinds of bells and whistles, and sports Tony Fadell’s trademark design chops, seems on first glance like a product that is undoubtedly going to sell well. The first conversations I had yesterday and today indicate that people were clearly waiting for this kind of product. Everyone seems annoyed with their smoke detectors, and to be honest, I myself have been thinking about hacking the smoke detectors we currently have to make them accessible programmatically.

What I’m really interested in, however, isn’t the Protect in and of itself, but how it showcases what I’ve been trying to convince clients of for a while now. That is, a product strategy for Home Automation that actually works.

Most companies in the Home Automation space (even though Nest likes to call it “Conscious Home”) tend to take the perspective that we see playing out in the wider IoT-Space as well: they focus on the integration, the middleware, the hubs, because they know how to do that, and because they’ve learned over the last couple of years that being a platform play is the most profitable one. So they’re trying to sell you their integrated solution, but mostly they just want to have the hub, and ideally a couple of API’s to then go out and beg developers and hardware companies to please build for their platform.

However, the incentives for customers to actually invest into a hub or integrated solution just aren’t there. Experience in the markets shows us that customers don’t upgrade their home all at once, but do it piecemeal, which flies in the face of the integrated players. And people certainly don’t buy abstract hubs for which they see no clear value.

And here, the beauty of Nest’s strategy really shines through: They are developing a platform, but it’s not at the core of their product strategy. Their products are individually useful, and obviously so. There’s no assumption here that, in best “build it and they will come” fashion, once they have a hub and documentation, companies will start building for it. Rather, it’s a collection of individually interesting products which work even better together.

And that’s at the core of the depressed home automation market. Every product that wants to play a role here needs to be individually useful. The assumption needs to be that any given product is going to be the only one of a product range that a customer buys.

If they get better with additional components, then you’re onto a winner, but you ultimately cannot require customers to completely invest into your – in most cases nonexistent – ecosystem.

Disclosure: Nest Labs is a client of mine. This post however is not informed by my work with them but purely reflects my personal opinion.