Last week, we talked about rising home ownership among Asian Americans, and the cultural values behind this phenomenon. This phenomenon has also created chain reactions in many other industries, like connected home, home security, in-home technology, and many more. When 67% of Asian Americans agree they are fascinated by cutting edge technology (over indexing against non-Hispanic Whites by 19%,) it is no surprise Asian Americans are a driving force for early adoption of smart home and connected devices.
“Really” you say? Let’s look at the data.
According to a recent 2018 Asian American Report from Nielsen, 35% of Asian Americans agree that they are among the first of their friends and colleagues to try new technology products. When it comes to in-home technology, Asian American households over-index against non-Hispanic Whites by 105% for VoIP (Voice Over Internet Protocols) ownership, 66% for smart watches, 39% for streaming media players, 18% for game consoles, and 17% for smart TVs.
Owning the latest tech gadgets is a serious source of pride in Asian culture. We’ve seen similar trends with Asian Americans with the adoption of gaming consoles in the 90s, digital cameras in the 00s, as well as smartphone and mobile payment adoption over the last 5-10 years. Technology has always meant more than just convenience for Asian Americans. It is a social status barometer and has a very real ‘cool factor’ that they care about. In fact, 1 in 3 Asian Americans agree that they want others to say “wow” when they see their gadgets, according to Nielsen Scarborough. The “cool kids” in Asia are rarely your American style skateboarder or ball player. Asian “cool kids” are the geeks who own the latest iPhone, Canon 5D, Nintendo Switch, Google Home or all of the above.
Asian Americans’ propensity for in-home technology is also heavily influenced by innovations from Asia. Because 58% of Asian Americans are foreign born, they bring with them their way of life in Asia and expectations on what tech can do for them to the US. Asia has been leading the global growth of smart home technology, from smart TVs to connected appliances, and from home security to home-based AI devices. According to Markets and Markets’ smart home global report in 2017, the smart home industry in Asia will reach $120 billion, accounting for 25% of the global market in 2030. This incredible growth has been largely driven by Chinese consumers, and China will continue to dominate the industry.
Globally, Chinese consumers have leapfrogged many others and are now the most receptive to smart home technology and devices. China is one of the best informed markets on smart home technology. 75% Of Chinese consumers expect smart home devices to impact their lives in the next few years, which is 50% higher than global average. This estimated adoption rate is as high as mobile payment (74%), and has surpassed wearable technology (59%) and cloud computing (51%). Chinese consumers are also the most receptive to adopting home-based AI devices. 21% of them already own such a device and 52% plan to purchase one in the next few years. Chinese consumers are also leading the way in using voice assistants. 51% of them are regular voice users to avoid having the need to type. Voice recognition technology today is more developed in China than elsewhere because of such high demand, especially since Chinese is a character-based language.
This level of openness to smart technology in the home is significantly higher than the general U.S. consumer. Although interest is on the rise in the U.S., American consumers still have significant concerns over smart home devices and services. 88% of US consumers feel negatively about AI services that use their personal data to figure out when they are likely to be home. 72% of smart security system owners worry companies will invade their privacy by keeping their data without consent. Asians, especially Chinese consumers, are less concerned by these factors.
This contrast explains why Asian Americans will continue to drive the adoption of smart home. Not only are they more interested and open to the technology, their higher household income and education level will also allow them to accommodate the higher price point seen by early adopters. After all, 57% of consumers who are not buying a smart home device quoted price as their top reason, which is significant higher than the second reason of security concerns at 24%. Don’t be surprised if Asian Americans are the ones to drive this market over the next few years.