In a deal expected to fetch $593 million, Resideo has announced that it will acquire First Alert, a brand best known among consumers for its smoke detectors and fire safety products. First Alert enjoys strong presence in retail stores and with homebuilders and contractors. Resideo, formed by a spinoff from Honeywell in 2018, is a provider of Honeywell-branded products to security dealers and builders, selling over $5 billion of products.
Resideo’s move is likely an opportunity to expand its footprint in the retail and builder channels, but also signals the firm’s expectation that consumers will continue to add on to their smart home ecosystems. Resideo currently has a presence in more than 150 million homes, with about 15 million systems installed in homes each year. The First Alert deal should enable the company to boost those numbers. Jay Geldmacher, Resideo CEO, remarked, “First Alert advances our strategy of expanding Resideo’s presence with contractors and broadening our suite of sensors for the home.”
Interpret’s Smart Home Matrix™ survey indicates that 55% of US consumers ages 18 to 55 own a smart home device and 42% expect to purchase one. 16% of consumers expect to purchase a smart smoke detector – up from 10% in 2020.
As consumer appetites for smart home products continue to increase, Resideo is in a position to show buyers of the familiar First Alert brand how they can move up into the broad Resideo product ecosystem. Interpret’s smart home segmentation calls first time stand-alone smart home product buyers “Converts.” The majority of smart home buyers are Converts and the opportunity for brands to guide this large buyer segment into a broader ecosystem is the prize to be won by large brands, operating in multiple channels, like Resideo.
“As smart home product ownership passes the 50% mark, the rewards from guiding consumers into lifetime customer relationships are getting significant – meaning big brands will be making more bold moves,” said Stuart Sikes, Interpret SVP.