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The smart speaker market is estimated to grow at a CAGR of 18.75% between 2022 and 2027. The size of the market is forecast to increase by USD 16,659.23 million. The growth of the market depends on several factors, including rapidly increasing unit sales of smart speakers, the growing need for smart speakers in households, and rising demand for smart speakers from non-English-speaking countries
This report extensively covers market segmentation by end-user (residential and commercial), distribution channel (offline and online), and geography (North America, Europe, APAC, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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An increase in unit sales of smart speakers is notably driving the market growth, although privacy and security issues associated with smart speakers may impede the market growth. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
A rapid increase in unit sales of smart speakers is notably driving the smart speaker market growth. The number of smart speakers is growing rapidly. Amazon, Alphabet (Google), and Apple were the top contenders for smart speaker units sold in 2022. Alibaba, Baidu, and Xiaomi were other prominent players in the market that played a central role during the same period. Sales of smart speakers are expected to increase during the forecast period. Vendors such as Amazon and Google have dominated the global smart speaker market since 2016. For example, Amazon, with its wide range of Alexa-enabled Echo products, led the overall global smart speaker market in Q1 2021 with a 28.2% share of global shipments.
This corresponds to year-on-year growth of 1.8%. Despite a 3.2% decline in smart speaker shipments in the first quarter of 2021, Google has established itself as its second-largest player in the global smart speaker market. China's Alibaba reported a 1.5% increase in smart speaker shipments in the first quarter of 2021. The variety of features offered by smart speakers is a major reason for the surge in sales. A smart speaker can also act as a personal digital assistant. Due to this, the adoption of smart speakers will continue during the forecast period. Therefore, the increase in smart speaker sales is expected to register strong growth over the forecast period.
The increasing popularity of voice commerce is a key trend influencing the smart speaker market growth. The concept of voice commerce is gaining popularity around the world. Voice Commerce is a technology that provides an alternative way to order and buy products online using a keyboard and mouse or smartphone. Consumers can give voice commands to smart speakers powered by virtual assistants such as Google Assistant and Amazon Alexa to search for and purchase products online. Completing purchases is quick and convenient with the help of voice commerce. Additionally, consumers prefer voice commerce over traditional input methods due to advantages such as hands-free operation, the ability to place orders while engaged in other tasks, and quick response and results. For Amazon, customers can use Alexa-enabled smart speakers to search, order, and purchase items from Amazon using voice commands.
For example, Alexa suggests products based on the user's historical data. Alexa helps customers with simple voice commands to purchase products in the user's purchase history. Innovative smart speaker options make online shopping easier. Therefore, the increasing popularity of voice trading will be the major trend driving the demand for smart speakers in the global market during the forecast period.
The privacy and security threats associated with smart speakers are challenging the smart speaker market growth. Consumers in the global smart speaker market are wary of potential privacy and security issues when using smart speakers. For example, in the United States, a majority of the population is concerned that smart speakers pose a significant threat to the privacy of their conversations and personal data. Manufacturers operating in the global smart speaker market employ thoUSAnds of people around the world listening to voice recordings made in the homes of smart speaker owners. This process is used to improve the smart speaker's understanding of human speech and improve its response to commands. Smart devices such as smart speakers can be the source of various cybersecurity attacks, including persistent threats (APTs) and ransomware attacks. These attacks discourage end users from using devices such as smart speakers. A smart speaker could serve as a means for attackers to hack into the end-user's IT infrastructure. Smart speakers are often mass-produced and identical, allowing attackers to hack. Compromised smart speakers can be used to jam end-user networks. Malware can be loaded onto an unsecured network via a compromised connected smart speaker.
Smart speaker manufacturers are also placing increasing importance on protecting customer data. Lack of strict guidelines and regulations to ensure the privacy of smart speaker users is making them more vulnerable to hackers. Therefore, the lack of privacy and security policies in the global smart speaker market may hinder adoption during the forecast period.
The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Smart Speaker Market Customer Landscape
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Alphabet Inc: The company offers different ranges of smart speakers such as Nest Mini, Nest Audio, etc. It also provides different Google services such as Google Ads, Android, Chrome, Google Maps, Google Play, Search, YouTube, and hardware.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market share growth by the residential segment will be significant during the forecast period. The home segment of the global smart speaker market is expected to witness significant growth during the forecast period. The need for smart speakers in the home is a key driver of consumer segment growth. The recent popularity of digital content and subscription services such as Amazon Prime, Netflix, YouTube, and other digital content platforms has underscored the need for smart speakers in homes around the world. Smart speakers have voice control capabilities and act as a hub to connect to various digital streaming platforms, TVs and other devices. Hence, the consumer segment of the global smart speaker market is expected to witness an accelerating year-on-year growth rate during the forecast period.
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The residential segment was valued at USD 670.31 million in 2017 and continued to grow until 2021. The Offline segment includes home appliance stores, hypermarkets, supermarkets, and specialty retailers selling smart home speakers. Globalization has spurred investment in traditional retail outlets, resulting in an increase in the number of offline retail outlets. Rapid advances in technology and product design have made smart speakers more affordable for US consumers in recent years, driving demand for high-end smart speakers. Several vendors such as Amazon, Google, Apple, and LG Electronics Inc. (LG) have adopted a one-way pricing policy where smart speaker prices are the same across all authorized retailers. Vendors in the smart speaker market offer smart speakers through several major retail outlets, such as supermarkets such as SPAR International, Walmart, Target, and ALDI. Such factors are anticipated to drive the growth of the offline segment of the global smart speaker market during the forecast period.
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North America is estimated to contribute 34% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
The United States and Canada are among the most important markets for smart speakers in North America. The growing demand for smart speakers in different households is one of the main factors driving the growth of the North American market. Smart speakers can be used for many purposes such as listening to music, finding recipes, cooking instructions, shopping, and making phone calls. US consumers spend a lot of money on home renovation projects. Upgrading regular homes to smart homes is one of the main reasons for the increase in consumer spending on home improvement projects. The average investment in living spaces such as living rooms and dining rooms has increased in recent years in the United States. In 2021, US smart speaker adoption will surpass 90 million users, making up 35% of the US adult population. Therefore, the demand for smart speakers in the home is expected to be driven by an increase in home improvement projects in the US.
During 2020-2021, the regional smart speaker market was hugely impacted by the COVID-19 pandemic. Governments in countries such as the United States and Canada have imposed nationwide lockdowns and restrictions related to COVID-19. As a result, consumers are forced to spend most of their time indoors. The pandemic has changed consumer tastes. With little to no entertainment and leisure activity options outside the home, consumers are spending more time on their smart devices. The increased use of smart speakers during the pandemic has prompted regional market providers to launch new products. However, after conducting a large-scale COVID-19 vaccination campaign across the region in 2021, many countries in the region will lift lockdown restrictions, allowing manufacturing plants to resume operations in 2021 and promote demand for Speakers In the vendor market, new smart speaker products have been launched to meet the growing demand from buyers.
The report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
Technavio classifies the global smart speaker market as part of the global consumer electronics market within the global consumer durables market. The global consumer electronics parent market includes products and companies engaged in manufacturing/marketing consumer electronics, home audio and video products, televisions, digital cameras, and related products. This market does not include mobile phones, personal computers and peripherals that are mapped to the hardware, storage and peripheral technology market.
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Smart Speaker Market Scope |
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Report Coverage |
Details |
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Page number |
166 |
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Base year |
2022 |
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Historic period |
2017-2021 |
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Forecast period |
2023-2027 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 18.75% |
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Market growth 2023-2027 |
USD 16659.23 million |
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Market structure |
Fragmented |
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YoY growth 2022-2023(%) |
23.27 |
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Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
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Performing market contribution |
North America at 34% |
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Key countries |
US, China, Japan, Germany, and UK |
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Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
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Key companies profiled |
Alphabet Inc., Amazon.com Inc., Apple Inc., Bang and Olufsen Group, Belkin International Inc., Bose Corp., Edifier International Ltd., Imagine Marketing Pvt. Ltd., Lenovo Group Ltd., LG Electronics Inc., NXP Semiconductors NV, Onkyo Corp., Portronics Digital Pvt. Ltd., Qualcomm Inc., Samsung Electronics Co. Ltd., Sonos Inc., Sony Group Corp., Xiaomi Communications Co. Ltd., Zebronics India Pvt. Ltd., and Zound Industries International AB |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by End-user
7 Market Segmentation by Distribution Channel
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
Research Framework
Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.
INFORMATION SOURCES
Primary sources
Secondary sources
DATA ANALYSIS
Data Synthesis
Data Validation
REPORT WRITING
Qualitative
Quantitative
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