It was after a dinner conversation at a recent Internet of Things (IoT) consortium meeting that I started thinking more about the industry’s current business model and how IoT market innovators can commercialize emerging opportunities.
The smart lighting market is differentiated from other IoT markets by the strong relationship it creates between hardware and software. Consumers are accustomed to buying and determining value based on tangible things. Contrastingly, smart lighting is highly valuable, yet intangible because it is rooted in intricate software that makes a “dumb” bulb “smart”. The software offers automation and intelligence which is then displayed through corresponding hardware.
The app we developed at LumiFi is unique in that it corresponds with a software that controls smart lighting scenes through curated moods regardless of the combination of bulb brands they are using. That’s what I consider a huge value added, however it is common for consumers to expect these features to be free of cost. What consumers don’t always see is the value of an investment in smart lighting apps.
To break it down, IoT enabled smart lighting systems are composed of 3 key components that must come together in order for successful adoption, including: hardware, software and tailored lighting design experiences.
At this point, manufacturers largely focus on selling bulbs rather than all three components combined, because traditionally, this is what consumers desired. With the creation of wireless bulbs, manufacturers have been expected to sell bulbs “as is”, in addition to including wireless lighting control software, at around the same price point as dated halogen bulbs.
Lighting control software is necessary for wireless bulbs to function. Some of the larger manufacturers are able to bring software developers in-house. On the other hand, some technology companies, who have little experience in the field of lighting design and have little knowledge of lumens, color rendering index (CRI) and form factor requirements, enter the bulb manufacturing industry. In most cases, none of these players understand or focus on the design experience created by smart lighting bulbs because they lack the lighting design know-how necessary to do so.
The business model for smart lighting as it stands is incorrect because it doesn’t take into account the reason for which consumers are purchasing smart lighting to begin with. This is quite a problem because the smart lighting business model drives hardware sales and not the value of lighting design software.
Because of this business model, most software created to perform in conjunction with smart bulbs do not incorporate the design experience tailored in a simple and intuitive user format. Therefore, users struggle to use smart lighting systems because they are complex and time intensive to configure. For this reason, many consumers quickly lose interest.
This disconnect becomes obvious when recent numbers indicate that smart home lighting adoption has yet to gain mass market momentum. Is it because bulbs are too pricey, or could it have more to do with a frustrating user experience and the lack of value associated with the product?
I believe the best way to drive growth in the smart lighting market is by creating partnerships through which key players contribute their skills to combine the design experience, the user experience, as well and quality software and hardware. The the value of smart lighting is made most evident when the user and the space are held at utmost importance.
SEE BEATRICE WITZGALL AT LED SPECIFIER SUMMIT
Tuesday – November 17, 2015 | 10:00-11:00 am
Internet of Things: Mobile’s Role in Smart Lighting
Seminar Qualifies for: 1.0 AIA LU | HSW; 0.1 IDCEC CEU; 1.0 PDH, LA CES | HSW; 1 NCQLP LEU