July 22nd, 2015

Target Open House Concept Highlights Need for Smart Home OS

Last week, Target debuted it’s Open House concept here in San Francisco. A masterfully crafted 3,500 sq. ft. retail space, Open House is an exploratory attempt by Target to introduce the value of connected home devices to a mass audience and plant a flag in the emerging category. I had a chance to visit the space last week and came away impressed.

This is a very cool, immersive retail & showroom experience

The design team at Target did a great job of humanizing the connected home concept by literally building four “rooms” in the house to show how various smart home devices can turn a room into a smart room. For instance, the nursery introduced me to the Mimo smart baby monitor, Sonos speaker, Philips Hue smart lights, Withings scale and Belkin smart plug. Then it showed me how all of these things (and maybe even a coffee pot) can be linked together to automate activity, send alerts and generally make things smarter. The most tangible solution: Mimo detects when a child might be fidgeting in her sleep and triggers the Sonos speaker to play white noise in an attempt to put her back to sleep. This, I could use! The house is built using acrylic and brings together large format projectors, smart sensors, tablet kiosks and great sound mixing to create a Disney-like experience. Large format touch tables anchor a product section where visitors can dive deep into any of the thirty-five smart home devices. A lot of money was spent on this space and it shows. The best comparison I can offer is the new Rebecca Minkoff boutique. Overall, Target Open House is one of the best examples of a guided retail experience that I’ve seen anywhere.

TargetOpenHouse2

The connected home will never reach its full potential until a consumer-friendly operating system makes it easier to connect, program and control devices

There is some really amazing and useful technology in the connected home space and there is also some superfluous stuff as well (e.g. I thought the beauty of a crockpot was that it could be left all day without oversight or worry about doneness?). Target had to script an elaborate retail experience in order to showcase how these devices can be linked to deliver real value to consumers. And, they did a great job of it. The problem, however, is that the average consumer can’t just buy a bunch of these devices, take them home, link them together and create a smart room. It’s hard enough to link one device to a Bluetooth speaker and make it work every time. Each smart home device is managed through its own mobile application, but consumers don’t want an entire folder full of individual apps to control their home. The IFTTT solutions are coming along, but they’re not nearly simple enough for the average consumer to use. For the connected home to become a reality, there needs to be a smart home Operating System that makes connecting, programming and controlling these devices amazingly simple and intuitive. It has to go beyond a great individual product to an aware and intelligent platform experience that a 10 year old can understand and requires very little setup. Until that point, I believe the vast majority of the connected home devices will largely remain novelty or point solutions.

Is the war for the connected home Operating System going to be won by Apple, Google, Microsoft, Amazon, Comcast, AT&T, Verizon, IFTTT or someone else? And, what role can Target play in it?

What’s Target’s strategy in the connected home space?

Target executives have said the Open House experience is an experiment to be learned from, but not something they plan to replicate at scale. Certainly, there are retail experience learnings that may be applied to various store formats, but what else might the future hold for Target in this space?

As the brand searches for new revenue streams and expanded relationships with its customers, perhaps a Geek Squad-like service focused on the connected home is in the offering? Clearly, this would help solve the connection and programming barrier that many consumers will face on their path to creating a smart home. And, the brand could bring its famous design and brand ethos to this service that would greatly separate it from others in the space. It would also create meaningful differentiation from its most direct competitors (Walmart, Amazon) and perhaps help it capture market share from Best Buy in the electronics space. Or, maybe Target has a grander vision to introduce its own connected home Operating System? Who knows.

In the meantime, enjoy the Target Open House concept for what it is – an immersive retail experience where one can fawn over a potential future where you never have to worry about the baby waking up in the middle of the night, feeding the dog, watering the plants, turning off the lights or overcooking your steak, again!

Are you looking to create an amazing retail experience for your customers? Check out our latest white paper on Harnessing Mobility in Retail or contact us for more information.

Jeremy Gilman, Strategy Director & Managing Director, San Francisco

 

Tags: innovation internet of things IoT retail

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