Can IKEA Deliver the Smart Home to the Mainstream?
By: Clark Boyd
Tags: Internet of Things, Consumer Electronics, Retail Technology, Technology News, Technology

Can IKEA Deliver the Smart Home to the Mainstream?

IKEA has created a new business division that will focus on the smart home, called Home Smart. I expected a cutesy Swedish name like Pipstark or Tekling, but you can’t have everything.

Home Smart will sit alongside other business units at IKEA like Lighting and Textiles. Indeed, they describe it as “the biggest new business we are establishing since Children’s IKEA.” That was back in 1997.

The Swedish furniture phenomenon will hope that its low price point, sleek aesthetic, and built-in customer base will attract a mainstream following.

Current products include smart lights and speakers, which can be controlled by voice or through the new IKEA app. It also works with Amazon, Google, and Apple digital assistants.

IKEA’s new division is charged with creating a more ambitious range of products, which could provide the boost the ‘Internet of Things’ needs.

So, could IKEA be the company that ushers in the era of the smart home?

This story will cover:

IKEA’s plans for the smart home.

Some ideas for new products. (IKEA, you are welcome.)

How IKEA can create a competitive advantage.

Are we sure we want to let technology companies into our homes?

TECHNOPHILES, ASSEMBLE

IKEA launched a range of smart lights in 2017. Many reviews at the time contained adjectives like “underwhelming” and “breakable”, but the approachable price appealed to a large audience.

Sales exceeded targets and IKEA wants to seize on the smart home market with a new, dedicated division of the business. Voice-activated blinds are first on the list, with a US launch date set for October 2019 at a price of $135.

To date, the reality of the “smart home” has failed to live up to its lofty billing.

The concept of a seamless, Internet-connected abode is at odds with the fragmented and frustrating experience of using these new gadgets.

The ‘Internet of Things’ has turned into a running joke, from that girl that used her smart fridge to Tweet when her mum took away her phone, to the smart fork that vibrates when you eat too fast.

Doesn’t the fork just make you drop food everywhere? I suppose you get the smart vacuum to clean that up.

The splendid Internet of Shit Twitter account collates these monstrosities for our bemusement. Their bio distills the mood of the times: “whatever, put a chip in it.”

Behind every good joke, there is a bit of truth, however.

The smart home market is said to be worth $36 billion this year in the US alone (Statista figures) and could grow to over $150 billion worldwide by 2024.

People have adopted some smart home technologies; Amazon and Google, in particular, have sold millions of AI-powered speakers.

Technology companies do not build homes, though. At times, they struggle just to keep the “smart” half of the “smart home” bargain.

There are convenient, time-saving use cases for Internet-connected devices in the home. The problem is that no-one has delivered these products in accessible forms that answer more questions than they raise.

And so, enter IKEA.

It is worth taking stock of IKEA’s current customer base before we assess their potential for smart home success:

There were 957 million visits to IKEA stores globally in 2018.

200 million IKEA catalogues are printed each year.

There are over 2 billion visits to IKEA.com every year.

IKEA stores raked in $43 billion in sales in 2018.

The company has 208,000 employees across 54 countries.

The Swedish furniture giant certainly has the clout to dictate homeware trends. In fact, IKEA has just launched its predicted trends for autumn/winter and guess what? Yes, the connected home is in a prominent position on the list.

IKEA also has the perfect, labyrinthian setting in which to convince us of their gadgets’ virtues. A digital assistant that helps people navigate IKEA stores without buying a load of that would be a best-seller.

With a rapidly expanding presence in markets like India and China (in China, IKEA customers are allowed to sleep on the beds, FYI), IKEA is best placed to capitalize on any interest in smart home devices.

First, IKEA will need to convince customers that these devices add value to their private spaces. Is it really worth giving up personal data just so we can tell our blinds to close?

Any victory may be Pyrrhic, as IKEA will enter a complex and unforgiving competitive arena.

Let’s explore.

HOME IS WHERE THE SMART IS

“Connected device purchase decisions are driven by solving simple problems, at least today. Whole platforms and ecosystems have yet to resonate with consumers.”

— McKinsey

The IKEA promise is simple and seductive: tasteful design, at a reasonable price, from a huge out-of-town showroom.

The “smart home” has some significant barriers to entry: inflated prices, complex products, and fragmented app ecosystems (McKinsey report).

Many brands struggle to occupy the nexus between a technology company and homeware provider. Most begin as the former and lurch clumsily towards the latter.

Philips creates some excellent smart lights, but customers have no reason to kit out the rest of their homes with Phillips products.

Amazon and Google create effective smart speakers and software development kits, but they are not in the business of designing furniture. Although, I would really like to see Google’s take on the mid-century armchair.

IKEA’s judicious entry into the smart home market is driven more by confidence than caution.

Those Amazon Echoes and Google Homes do not replace IKEA products. Often, they reside on top of them.

Tentative forays like smart lights and app-controlled dimmer switches have allowed IKEA to test the market before making any significant moves.

The new Home Smart business unit is charged with leading “digital transformation” across all other units within IKEA.

As such, we should expect to see an emboldened IKEA launch more ambitious products soon, beyond the remit of classic electronics.

Given IKEA’s strengths and the modern home’s weaknesses, this could mean television sets that add to the decor, rather than detract.

I saw this smart lamp a few years ago and it struck me as something IKEA might create. It looks unobtrusive, but it can use augmented reality to add “smart” elements to the surfaces around it.

Here it is, recognizing and explaining coffee:

The adjective “seamless” is often used in relation to the smart home, to denote constantly connected technology.

For IKEA, that term has a more nuanced application, as it relates to the integration of technology into the living environment. This smart lamp, and thousands of similar product ideas would fit the bill.

IKEA could also apply its aesthetic flair to notoriously hideous air-conditioning units, or any other home appliance where the function has trumped form for far too long.

For the moment, it seems likely that partnerships will form the fulcrum of IKEA’s technology strategy.

The range of Sonos/IKEA speakers launched earlier this year (at a very reasonable $99) provide a glimpse into the smart home future.

That interplay between form and function is critical. IKEA knows how to design furniture people want; Sonos makes popular speakers.

As such, each sticks to what they know best.

At present, IKEA’s position in the smart home market is that of ‘device designer’, rather than technology developer. But for how long will it remain in that position?

The IKEA app and the competition

The new IKEA smart home app works with Amazon, Apple, and Google digital assistants.

Customers have the option to control their IKEA products from the IKEA app, or from a smart speaker like the Amazon Echo.

However, some of IKEA’s upcoming products will put it in direct competition with Google-owned Nest, for example.

Products like Nest’s thermostat control are part of Google’s strategy to, well, monitor and control people’s daily routines. This data is very valuable when it comes to selling ads.

For their part, Amazon-owned smart doorbell company Ring has been working with the police. Amazon Echo recordings have even been used as evidence in murder cases.

Many suspect that Amazon is developing a for-profit surveillance network; these claims are reified by the recent news that Apple, Google, Amazon, Facebook, and Microsoft are all analyzing verbal interactions between customers and their products.

So, back to IKEA.

IKEA probably doesn’t want to spy on us from their smart blinds, although that would be a good place to be for a spy.

Most likely, they want to sell us furniture with some technology in it, that we can control from their app. That probably means mood lighting, temperature control, setting timers, and so on.

Indeed, IKEA has no plans to launch its own intelligent assistant. Some industry observers have claimed this is an inevitability, although the business case for doing so seems flimsy. A voice interface makes sense, but a digital assistant is more hassle than it’s worth.

High-margin technology products seem a surer route to profitability, powered by functional software. IKEA has dabbled with some audio content, such as the new version of the catalogue, signaling an awareness of changing preferences. It’s good for the environment and all.

However, by creating products for the home that can be activated by voice, IKEA opens the possibility of a data partnership with the likes of Amazon and Google.

If people use their Amazon Echo as the central device for controlling their IKEA products, Amazon can access that data directly.

If they use the IKEA app to set their lighting levels, that data will reside with IKEA. A company like Amazon (or Google, etc.) would find that data highly useful for understanding their customers.

The way we choose to customize our home environment reveals a lot about our current state; how we’re feeling, who we’re with, what we’re doing.

Combine that knowledge with browsing behavior and search queries, and you have a pretty potent targeting mix.

That may sound extreme and dystopian, but consider that Amazon has already worked on software for the Echo that would read a customer’s emotional state and change color in response.

They also, believe it or not, want to use that data to optimize the ads that an individual sees. IBM has worked on something similar, and so has Google. We shouldn’t be surprised and we may wonder why we invited them into our homes in the first place.

IKEA could prove to be the acceptable face of the smart home movement. As more scandals engulf the tech titans, IKEA’s position only strengthens.

If IKEA can, as they hope, create a unified smart home ecosystem, it will provide a boost to the entire ‘Internet of Things’ industry.

Its intentions may be straightforward, but those of its potential partners and/or competitors are murky at best.

The more successful IKEA Home Smart is, the more frequently it comes into contact with Google, Amazon, Apple, et al.

Before surrendering even more personal data, customers might want to consider why these products are so cheap — and whether minimal convenience is fair compensation for what they are giving up.

“Our shortsightedness is their business plan.” — Internet of Shit

Code/spaces

In his cheerfully-titled book New Dark Age, James Bridle defines code/spaces as follows:

“The interweaving of computation with the built environment and the daily experience to a very specific extent: rather than merely overlaying and augmenting them, computation becomes a crucial component of them.”

When we add voice-enabled technology to our homes, they become code/spaces.

We don’t notice it happening until it has happened, but our behaviors change. In the process, so too do our thoughts.

Our brains will always take the shortest cut — even if convenience is the only positive on offer.

Technology companies know this.

Amazon is happy to make a loss on each Echo device sold, just to get into our living rooms. Once they’re in, it’s hard to get them out — especially if they control the temperature of your fridge.

The smart home is not just a home with some doodads tacked on.

It is a new space, co-created by technology and people.

We already view the world through a networked lens; our thoughts are through, and of, technology.

If we do not realize this, technology can take the dominant role, with the end result that we depend on technology to carry out routine functions.

That process is already set in motion and can still be shaped if we assume an active role in co-creating our spaces.

Companies like IKEA should educate their customers about the potential benefits and risks of a connected home.

It is a bigger decision than many realize.

“Stories about the smart home tend to focus on the negative, and for good enough reason; how many other household items can be hacked by pranksters threatening nuclear war? — WIRED

Sign up to the hi, tech. newsletter here.