Current-State Assessment ● The Nest thermostat is currently holding a leader position in the crowded U.S. smart thermostat market, with approximately 35 percent market share.1 ● American consumers are increasingly purchasing smart thermostats; subsequently, market forecasts of consumer demand project a growth market.2 ● The smart thermostat market is a sub-market to a much larger smart home market, with billions of growth potential to Google/Nest in the coming years. Sales of smart thermostats offer a high-value opportunity to establish a beachhead in one of the most promising electronic device-related markets in the coming decades--possibly the most promising ● The biggest barrier capable of being addressed, directly, by Nest is the high purchase price ($250). 2017 U.S. Target Market ● Mid- and high-level income homeowners (with broadband internet access) ● Do-it-yourself (DIY) problem solvers 2017 Sales & Revenue Forecasts ● Total Achievable Market = $1.5B (6M units) ● Serviceable Available Market ○ Low Estimate = $480M total revenue (1.92M units) ■ Assumes 35 percent market share ○ High Estimate = $600M total revenue (2.4M units) ■ Assumes 40 percent market share 2017 Goals and Objectives ● Goals: Increase sales/profit and jump the chasm ● Objectives ○ Increase customer retention by providing high-quality customer services, solving issues quickly and effectively ○ Expand sales to existing customers who have a prior generation Nest thermostat. ○ Leverage utility relationships/programs to lower prices and gain access to midincome market. ○ Expand footprint in retail markets (do-it-yourselfers, home builders, service professionals).
Viratos, Brea; Binus, Joshua; Dabab, Maoloud; Beltaif, Nader; Laraichi, Oussama; and Hanayneh, Shihab, "NEST 3rd Generation Thermostat:
2017 United States Marketing
Plan" (2017). Engineering and Technology Management Student Projects. 150.