Essence Group, a veteran home protection company, has been expanding into the smart home and medical sectors. Essence, one of Israel's 50 largest exporters, has been in operation for 24 years. The company has 750 employees, and has sold 20 million systems to date, most of which were produced at the company plant near Ofakim.
Essence's success is based on sensor and warning systems for internal security (protective systems), the smart home, and medicine. In the coming years, Essence hopes to expand in the medical market, mainly in safe homes for senior citizens that enable them to continue living at home for many years and delay a move to sheltered housing.
"We currently have a quarter of the wireless warning systems market in Europe through a large customer in Spain, who markets mainly to Europe, and that is our main business as of now," says Essence strategy and business development director Yossi Graff. "We serve over two million households and stores in Europe. We provide the entire solution of sensors, analytics, and 24-hour support, but not the call center. Our customers are the call center companies: both security and medical call centers." The company is very active in Israel, but also in the US, Japan, Australia, Chile, Russian, and many other countries.
Essence expanded from the protection field to smart homes and health. "In smart homes, we manage the home from the point of view of energy and smart lighting," Graff says. "We began in smart homes in 2003 with a major cooperative effort with Nokia. Nokia went its own way, but we stayed in the business, and the product is now sold in Europe. It can be used for actions like opening the door remotely if a technician arrives and closing other parts of the home when a guest enters, turning lights on and off remotely, and remote viewing of children at home using a camera. We facilitate a connection with various devices through home management software systems, such as Alexa, Nest, and Apple Watch. It was important for us to accommodate connections to many devices and systems, although our system works on RF communications, which is specifically adapted to security, and is very well protected."
Emergency buttons in the drawer
Graff says that the company's pet project is in the medical sector. "This sector has featured isolated emergency buttons for the past 30 years, mostly in the form of a wristwatch, connected to an emergency call center. These products are usually left in the drawer."
Sharon Dayan, who is responsible for global marketing in the company, answers, "People forget, or find it unpleasant to have the button seen on their persons, or they forget where they put them. Only 10% of people over 65 in Israel use a device for signaling distress, although many of them live alone."
Essence began operating in the medical sector in 2009. Graff explains, "We knew that our relative advantage was in sensors, and we developed a system that could indicate stress on the basis of detecting a change in behavior, without the senior citizen having to press something or having to wear something on his or her person. While other systems require supervision by a family member who defines in which cases he or she wants to be alerted (for example, if Dad doesn't get out of bed by 8:00 AM or if Mom spends more than 15 minutes in the bathroom), with us, already in 2009, a family member didn't have to define anything. The system studies the senior citizen's behavior and deviations from it by itself." In addition, if the senior citizen shouts a key phrase set in advance, like 'help,' an alert is sent even if there is no sign of an emergency in the learning system, without pressing anything or wearing anything."
Graff notes that the company tries to understand thoroughly senior citizens' needs before it develops a product for them. "We work with a system of four generations in which each generation has a function. The first generation is the senior citizens whom we are monitoring. The second generation is the senior citizens' children, who are sometimes still working, and have their own children and grandchildren. The grandchildren are occasionally involved in the care system, but not regularly, and it is hard to get them involved. The great-grandchildren want to communicate with their great-grandfather or great-grandmother, but there is a yawning technological gap between them. We have to manage our system so that it interfaces with all of these parties, but without being a nuisance."
Dayan: "The existing products aren't used much, even though the need is urgent. Each year, one out of every three senior citizens has a fall. A fall is life-threatening, and leads to additional falls. Fear of falling generates great anxiety, which causes senior citizens to avoid activities that they previously enjoyed. At the same time, the faster the fall is detected, the less serious its effects are. In addition, 50% of the less serious falls are never reported to the family or the doctors, and it's important to report this, because it affects later treatment and how we act to protect senior citizens liable to suffer another fall."
Another indirect customer for the product, but one that often pays for it, is the health system. "From the system's perspective, every senior citizen growing old at home, rather than in a geriatric institution, saves thousands of euros a month. We regard our system as a 'sheltered housing at home' service. The senior citizens themselves want to grow old at home. 25% of them manage to do it, and almost 100% of them want to."
Graff and Dayan also cite two important characteristics of the system. One is that the sensors do not have a camera, and their presence is as conspicuous to the user as possible. "Senior citizens tend to turn off or cover cameras through which family members can see them. It's uncomfortable. A magnetic sensor for opening and closing the bathroom door or the refrigerator door, on the other hand, make no noise or light, and there is no 'big brother' feeling. The family gets no regular report about what you're doing unless there is some behavior liable to indicate a problem."
"Very conservative market - 95% buttons"
Is signaling an emergency the main thing that enable people to stay in their homes? We have met companies that said that loneliness and physical difficulty in managing the home were important factors.
"There are many startups in the margins of the senior citizens care market, but its core is very conservative. Emergency buttons are still 95% of it. The market is slightly open to mobile emergency buttons that communicate with a cellphone, and on which additional apps can be installed. This is a really relevant product for still active senior citizens, and there are quite a few of them.
"We also have a product like this designed like a chain, so that it doesn't have medical associations or make a person seem too old, and it also includes an emergency button and a GPS location finder. In addition, the device detects falls if the user doesn't press the button, and it also has a meter for measuring strides. As the years pass, there are more senior citizens using cellphones, and that makes it much easier to assimilate these apps. What is delaying the development of this market is battery life and the need for special charging of the product, beyond charging the telephone. Our product is constructed so that battery life is no less than two years."
The National Insurance Institute held a tender a year ago for supporting the connection of homes to the Internet in order to issue warnings of senior citizens in distress. Is that relevant to you?
"The National Insurance Institute tender shows us that our path is the right one. There is a need, and recognition that the future lies in this way. Our customers are participating in this tender, not us, and we don't know which of our customers will bid. The National Insurance Institute offers these systems at the expense of nursing care hours, and we wonder how successful it will be, because senior citizens are not necessarily eager to give up their nursing care hours.
"In Europe, a considerable proportion of the buyers consists of municipalities providing the service through their 'smart city' project. We also don't work directly with them, but through our customers. A third kind of entity offering the service is medical insurers. The products are installed not only in private homes, but also in protected housing, but they are less suitable for nursing homes and hospitals."
"Who are your competitors?
"We aren't afraid of startups, because our system is based on an internal home communications system on RF frequencies developed for the security sector, and it has the most stringent standards in the world. A startup will need millions of dollars in order to meet these standards, which are essential for a product designed for an emergency. Their electricity consumption is low, and they are not Internet-based and are not affected by false alarms."
Will you allow other apps for senior citizens to be interfaced with your system?
"We're open to offers. In the smart home sector, we allow customers to make their own connection. In this system, we won't allow it, because it's an emergency system, but we can cooperate. Meanwhile, those who are interested in us are not necessarily startups, but large medical information systems, because our products produce a great deal of information. Even IBM talked with us."
Published by Globes [online], Israel Business News - www.globes-online.com - on September 18, 2017
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