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For Smart Home Startups, It's No Longer About Platforms, But Simplicity

Mike Wolf Alexa Amazon Echo Google Home Skybell

Back in 2014, everyone in the smart home space wanted to be the platform. Companies from Lowes to Staples to SmartThings to Wink aimed to create the do-it-all smart home system that consumers would buy to control everything from lights to locks and just about anything else.

But a funny thing happened on the way to mass market adoption: Consumers don't actually go looking to buy platforms. What do they buy instead? Products that they can understand and solve a clear need.

The Holy Grail

Take the video doorbell. Back in 2014, it was a product category that many in the industry smirked at. Too simple, they thought. Even more importantly? It wasn't a platform.



"A couple years ago, people would dismiss our product," said Andrew Thomas, cofounder of Skybell, a maker of video doorbells. "It wasn't a solution that unified the completely connected smart home. It wasn't a platform and that was the industry holy grail."

But as it turns out, something as drop-dead simple as a video doorbell is a product consumers actually would buy. A lot. On Amazon, where many consumers buy smart home gear, Skybell has over 1200 ratings for its product, a sign Skybell is selling quite a few doorbells. Ring, another video doorbell maker, has sold even more with well over 8 thousand reviews, an indication they've sold anywhere from a few hundred thousand to up to million video doorbells on Amazon alone.

And it's not just video doorbells. Network cameras are selling at a brisk pace, as are smart locks from companies like August. The common theme between them? They're all products that consumers can easily understand and that solve a need.

Simple Sells

The success of simplicity in the smart home market holds an important lesson for product companies: Before you can make a home smart, first you need to get into it. To do that, you first need to sell a product the consumer understands.

This is something the makers of smart home systems that use a "smart home hub" have found out the hard way. Companies like Lowes and SmartThings created entire product lines that required consumers to invest in their system and, if the consumer wanted to grow a smart home and have everything work correctly, they were encouraged to come back and buy more products that are part of the platform.

But the problem was consumers don't buy like that. Products like smart home hubs languished at retail. When consumers did go shopping, they bought solutions to a problem, whether that was to help them see who is at the front door, monitor their pet while at work or a thermostat that they control with their phone. In other words, simple solutions for basic need.

Still, Everyone Wants To Own The Platform

So if consumers don't necessarily want to buy a complete platform, then why did so many companies make them? Part of the problem is the investor community. Venture capitalists love the idea of the platform, since they see it as a way to mint money if the companies they've invested in become some form of industry standard. Decades of watching companies like Microsoft, Google and Uber have trained investors to hunt for whatever company can be the "platform" in their respective spaces. Smart home was and is no different.

But investors looking for the next hot startup aren't the only ones with platform fever. Established tech giants like Google and Apple have spent the past couple years essentially trying to create their own platforms in the smart home with little to show for it. Apple launched HomeKit at their developer conference in 2014, but so far the effort has yet to meet the initial expectations. Google acquired Nest and has launched a number of efforts such as Weave, Brillo, Thread to name a few, but it's unclear if any of these will pay off in the same way their effort to create a mobile platform with Android did.

Still, sometimes companies get lucky, and seemingly simple products sometimes become something more. The Amazon Echo, launched last year by Amazon as a wireless speaker with embedded voice assistant technology, has been the hottest selling smart home product for the past 12 months. Dozens of companies proudly announced at CES in January that their product works with the Echo. Google, with its numerous other smart home efforts in tow, just announced their own Echo competitor last week called Google Home.

As a result of this success, Amazon has doubled down on the effort, launching an investment fund for companies to utilize their Alexa technology (the voice assistant used in the Echo) and they're hard at work facilitating a network of Alexa "Skills" developers to create simple tasks that Alexa - and by extension, the Echo - can perform.

If all of this sounds something like a "platform", that's because that's what the Echo and Alexa have become at this point, but only after a good idea proved itself to work in the market. One could argue that the reason Amazon has been able to invest in creating what is at this point the leading platform for voice and virtual assistant technology in the home is they first captured the consumer's imagination with a cool piece of technology that did something fairly straightforward, a wireless speaker with voice search and recognition capabilities.

Despite all the challenges companies have faced trying to create the next big platform in the smart home over the past few years, it's likely the success of the Echo will result in some investors and big tech companies going back to work on new "platform" strategies to connect everything in the home, only this time part of the pitch decks include some wording about the "next Amazon Echo."

But before they go off to develop their "platform story", I'd suggest they go back to basics and make a simple, focused product that does something really well first. Only then, after they find some consumer traction, will they have a platform story to tell.

This post was first published in Forbes

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