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How to Drive Development of Digital Home Solutions
Vendors must first lower costs, then collaborate to deliver single-provider choice if they want people to buy.
Posted Jul 14, 2005
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The cost and complexity of technology products and solutions continue to hold back the development and adoption of digital home solutions, according to a survey released by Accenture this week. "Digital Home Solutions: Issues, Trends, and Consumer Insights," found that more than 80 percent of consumers cite cost as the number one barrier to purchasing a digital home solution. Additionally, 70 percent of consumers would prefer a single provider of the content, services, and digital devices that comprise what they envision as the digital home of tomorrow. "Despite strong consumer desire for a single aggregator for converged or complete digital home packages, many companies in this space provide only a portion of the content or services that comprise the complete digital home," says Al Delattre, a partner in Accenture's Communications and High Tech practice. "In order to meet consumer needs, stronger collaboration and partnerships among hardware, content, and service companies is necessary." The study was administered by Research International, an independent third-party survey firm, via a 30-minute Web-based survey to 2,600 consumers in five countries: 1,000 in the United States and 400 each in France, Germany, Japan, and, the United Kingdom. Respondents were queried about four specific examples of digital home solutions: integrated home entertainment, family health care, home management, and virtual offices. Home entertainment was the most popular of the four types of digital home formats, with 42 percent of respondents expressing strong interest in such offerings. Thirty-seven percent found family health care important, while 28 percent listed home management and virtual home office offerings as the most interesting. When asked what benefit would most encourage them to buy a converged digital home solution, 56 percent of respondents indicated "saving money," followed by "making life easier" at 46 percent. Only 4 percent of respondents said they could afford converged digital home solutions now, while 48 percent said such solutions would be affordable in one to five years. About one quarter (24 percent) believes they will never be able to afford such a service. Additionally, 70 percent of consumers desire a single company to deliver and support the entire solution, and stressed that the provider must be trustworthy, reliable, and experienced.
Consumers expressed a willingness to pay additional fees each month for services if they provide additional ease of use and convenience. Sixty-five percent noted a strong desire to pay for digital services and content through a subscription or leasing model. That same percentage of people also indicated they would be willing to pay an additional $20 to $50 per month for automated services that guarantee data backup and system support. "Consumers will increasingly become more of a development driver for digital home solutions," Delattre says. "But the survey made clear that technology itself is just one piece of the puzzle. Business models and customer support are just as important as the product itself. Without specific consumer preferences to drive adoption of the digital home concept, it will continue to be just a concept." Related articles: Ranking Poorly with Online Customers How to...assess customer satisfaction levels by going beyond the standard satisfaction survey. Technology CEOs Foresee Growth in 2005
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