Strategy Analytics has put out the numbers for the third quarter of this year, in regards to smart speakers, and the market grew 197-percent year-over-year. The big gainers were Alibaba and Xiaomi, with 1692 and 1800-percent respectively. Of course, that is because the two hadn’t really shipped a ton of smart speakers by Q3 2017, so growing from 0.1 million shipments to 1.9 million shipments isn’t as big as it sounds. Amazon, however, did grow around 45-percent. Jumping from 5 million units shipped last year to 7.2 million shipped in this quarter. Google also jumped rather significantly, about 174-percent year-over-year. Going from just 1.9 million units shipped to 5.2 million units shipped. Apple didn’t actually jump at all, and that is because the HomePod didn’t go on sale until Q4 2017, so there were no Q3 2017 numbers to relate too. But it did just barely make the list, above “others” at 1.1 million units shipped.
When it comes to market share, Amazon is still holding onto the number one spot here with around 31.6-percent of the market. That is actually a pretty significant drop from Q3 2017 when it had 64.8-percent of the market. Of course, the big reason for that is there were less competitors last year, with really only Google competing with Amazon. Speaking of Google, it also dropped market share to 22.7-percent, though it was a small drop from 24.5-percent. Alibaba went from 1.6-percent in Q3 2017 to around 9.5-percent in Q3 2018. Baidu and Xiaomi each have 8.4-percent and Apple has 4.8-percent of the market. While those listed in “other” have around 14.7-percent of the market. Despite growing rather impressively in the past year, Google and Amazon both lost market share. Google didn’t lose a ton of its market share, but Amazon did lose more than half, which is incredible. Perhaps unsurprising is the fact that Microsoft is not even on this list with Cortana. It’s worth noting that these numbers from Strategy Analytics are not just smart speakers, even though that’s the name of the table. It is also showing smart displays. Which include the Amazon Echo Show, and recently the Lenovo Smart Display, JBL Link View and Google Home Hub. So these are smart devices with smart assistants baked in here.
Background: Smart speakers are really starting to take off in the industry these days, and it’s not really because the smart home is taking off, but rather because people are going to be buying speakers anyways, so might as well get one with a smart assistant included. Amazon Alexa and Google Assistant are still the two most popular smart assistant speakers, and of course a big reason for that is the fact that both companies have been virtually giving away the Amazon Echo Dot and Google Home Mini, respectively, with different purchases. That helps get more people using the product, without forcing them to buy it. Amazon has also been bundling it’s other Echo smart speakers with different purchases too. That does definitely help both of those smart assistants gain market share, though the overall goal for them is to get everyone using either assistant. Amazon wants everyone using Alexa for every single thing, which is how Amazon is going to make more money. Right now, Alexa is mostly just a window into Amazon’s store, making it even easier for you to buy stuff. Of course, there are plenty of other things you can do with Alexa, but that is what Amazon wants you to use it for.
People are always buying speakers for their home anyways. Whether that’s a small Bluetooth speaker that they can take around the house and listen to their favorite music, or one that they sit on their desk to play music. That is a big reason why smart speakers are doing so well. These cost about the same as a regular Bluetooth speaker, and they sound just as great. Of course, having voice control included here really does help as well, as it allows users to use their voice to start playing music. Instead of needing to connect to their speaker with their phone and then open up some music to play. These companies have taken, essentially, everyday products and made them smarter, bringing their assistant along for the ride.
Impact: According to these statistics released by Strategy Analytics, the amount of smart speakers in the wild will surpass 100 million pretty soon, in fact, according to Strategy Analytics Vice President, David Mercer, it will surpass 100 million this month. Mercer stated that “the market has reached this key milestone faster than pretty much any other consumer technology device to have launched over the past decade. Our extensive consumer research shows that voice-first products have well and truly dropped any gimmick status they may have had and are becoming a permanent fixture in many homes.” Which is absolutely true. Other studies have found that most people that own a smart speaker, actually own two. And the majority of them own different smart speakers from different brands. Whether that’s an Amazon Alexa speaker and a Google Home speaker, or an Apple HomePod is in the mix as well. Showing that consumers are looking for variety in their home, which is nice. But it is likely because they were either given to them or priced pretty cheaply.
Right now, Smart Speakers is the catalyst that many companies are using to get consumers interested in and start using, smart home products. This is because smart speakers are used as a “hub” to control all of the smart home products in your home. Allowing you to control your smart lights, smart plugs, garage doors, door locks and so much more with your voice. And that is because it is a whole lot easier to control them with your voice than with an app – especially since each product has its own app these days. But with smart speakers growing, the overall smart home industry is also growing rather rapidly – just not at the same pace. It’s the catalyst that companies needed to get more consumers interested in smart home and the internet of things industry.