Smart Thermostat Market Projected to Peak Here in 2021


As part of a story I wrote on IoT and smart, connected and communicating controls, I had the privilege of interviewing Stuart Lombard, the founder and CEO of smart thermostat pioneer ecobee. There are other brands that get a lot of hype, but Stuart Lombard created the smart thermostat when the first ecobee thermostat went on the market in 2014.

There appears to be a lot of room for growth. Lombard told me that smart speakers are the most popular product in homes with connected devices at about 25 to 30 percent and smart thermostats are in 15-16 percent of homes with connected and communicating devices. With that kind of potential, I was curious about the numbers in the graphic shown here that the ecobee team sent me, showing the market peaking in the United States in 2021 and in Europe in around 2024.

So I asked for their interpretation of the data, and here’s what they told me:

We can see that Bloomberg predicts rapid unit sales growth year over year in the Smart Thermostat category until 2022, where Europe continues to expand rapidly while the U.S. experiences a slight decline. Parks Associates has outlined that market penetration was 13 percent in 2017. Working off this assumption and factoring in the projected unit sales provided by Bloomberg, as we enter the year 2021 the assumption is that early adopters and early majority households in the U.S would have already switched to smart thermostats and now we would be targeting the late majority and laggards which typically on-board at a slower rate hence the slowing of the category’s U.S. growth. On the other hand, Europe, which currently has lower adoption begins to grow as smart thermostats gain traction with early adopters and early majorities.

Looking at the data, it also makes me wonder about adoption rates in Europe, where structures have tended to be better insulated for years now. Check out the conversation I had with Canadian engineer and hydronics/radiant guru Robert Bean, where Robert noted that a smart thermostat becomes dumb in a Passiv Haus because it has nothing to do. We’ll get a clearer picture once we get into the 2020s.