Consumer adoption of a more Internet-connected lifestyle is taking an uneven, yet inevitable march forward. While manufacturers are improving the experience that smart products provide, consumers have articulated a number of challenges that accompany owning and utilizing connected products.
For retailers, understanding these challenges and, more importantly, providing options to mitigate them are critical to closing post-purchase engagement gaps, and creating unique opportunities to build stronger relationships with these customers.
As part of our ongoing consumer insights program, Assurant conducted a comprehensive survey of U.S. consumer’s attitudes toward connected products and issues. The study found that a majority of people feel connected technologies improve their lives, citing savings, enjoyment, and peace of mind as the top three benefits of Wi-Fi connected home products. Consumers who adopted connected technologies also had a greater sense of well-being than those who were less interested in that type of lifestyle.
While this is good news for retailers, the flipside is that as buyers learn about the risks of connected living – and see headlines about cyber-attacks enabled by Internet-connected refrigerators and DVRs– their interest in purchasing connected products declines. In fact, nearly half of the consumers in the survey said that hearing about these hacks and breaches makes them less likely to buy connected devices.
There are also other barriers to the adoption of connected products. The top three consumer frustrations with products they already own include the high expense of repair or replacement, performance issues, and insufficient self-help for troubleshooting problems.
For consumers to embrace the connected lifestyle in a significant way, the industry – including retailers – must address concerns about these vulnerabilities. Our collective goal must be to help buyers get the most out of their products with the least anxiety. This is especially important as a substantial number of those surveyed who remain unconnected say that 2017 is the year they are likely to buy their first connected device.
One area of opportunity includes offering companion services to consumers. Our survey showed that the availability of “help” mechanisms such as on-demand tech support and protection options for loss, theft and/or damage has an impact on helping overcome consumer reticence toward purchasing connected technologies. In fact, nearly 8 out of 10 respondents said that they would rather buy products that increase protection against risks versus not purchasing a connected device.
Across a broad range of 26 Internet-connected products, approximately 45 percent of consumers polled said they’re more likely to buy those that offer a 2-year extended warranty or an insurance policy covering theft, loss or damage. In particular, “technophiles,” the most connected consumer segment, were much more likely to protect themselves and their purchases with additional coverage. In turn, they experience half the level of fear and frustration associated with a connected lifestyle compared to the broader population.
For the connected lifestyle market to reach its full potential, we must work together to ensure that consumers are not only well informed about the potential risks, but also well prepared to protect against them.
Jeff Unterreiner is president of U.S. Connected Living at Assurant. He is focused on helping Connected Living’s clients deliver a better customer experience, increase revenue and build loyalty through premium support and protection offerings including lifecycle management, trade-in and upgrade solutions, extended service contracts and technical support.