In Aldie, Virginia, about an hour's drive from downtown Washington, the biggest name in retail and the biggest name in homebuilding are test-driving a collaboration that could benefit both in a very smart way.
Amazon is opening "experience showrooms" in Lennar smart homes. It's a show-and-sell strategy for the home, the smart home products and the all-important services that go with both.
"Amazon, Google, Apple, most of the technology-centric companies are starting to think about the home as a centerpiece for the way they think about the future of how their products work and how they interact with them," said Stuart Miller, executive chairman of Lennar, who is fixated on connectivity. "Home automation is a point of attraction. It's a proxy for a lot of other things."
New Lennar homes are now Wi-Fi certified, meaning the internet is built into the walls and floors, so there are no dead spots.
"I think of that as a foundation underlying what is really important, that this new home automation is being enabled by us and enabling us to know how they work," Miller added.
And that makes the home the perfect showroom for Amazon, which owns smart home companies like Ring smart doorbells and sells hundreds of other smart home products … most of which can be enabled by Amazon's own Alexa.
"We wanted customers to experience a real home environment that showcases the convenience of the Alexa smart home experience, great entertainment available with Prime, and Home Services," Nish Lathia, general manager of Amazon Services, said in a press release. "Lennar offers the potential to enable this experience within easy driving distance of millions of customers."
So Amazon gets real home showrooms around the nation (now 14 but expanding quickl
y), and Lennar gets foot traffic from people who may come just to test the technology.
"There's cross-pollination that could happen, where somebody may walk in the door interested in an Alexa product, and they may say really, I'd love to have this home," said David Kaiserman, president of Lennar.
In addition to the home and the products, both companies are selling service. Amazon launched its home services division in 2015, offering not just smart home tech installation, but everything from house cleaning to home improvement. Lennar is offering the Amazon tech services for 90 days with the purchase of a Lennar smart home.
"When you come home, not only will the product arrive at your front door, it will be installed through that front door by an Amazon employee in your home," said Kaiserman.
And that is becoming more and more valuable as demand for smart home technology grows.
"Smart home is scary. When you put together all of these incredibly connected devices, a lot of people say I'm intrigued, but how's that going to work for me? They don't want to go to the store to learn how to use it," added Kaiserman.
Competition in the home services space is heating up, despite growing concerns about privacy in some quarters. Facebook just announced that consumers can now shop for home services professionals through Facebook Marketplace. It will connect them through existing home improvement portals like Handy, HomeAdvisor and Porch.
"Home services are already popular on Marketplace, with more people asking for recommendations related to home services on Facebook in the US than any other topic," according to the Facebook release.
With the aging of the U.S. housing stock, and new home construction still recovering at a slow pace from the recession, home improvement is expanding rapidly. Today's homeowners want easy access to professionals to upgrade their homes, and to teach them how to use those upgrades. Amazon and Lennar clearly want to be leaders in the smart home category and are feeding off each other to do that.