The changing dynamics of the appliance manufacturing industry

If the idea of home appliances conjures boring old-school images of microwaves or refrigerators, that’s about to change soon. We’re entering a new era where appliances are becoming sexier and smarter, offering consumers a lot more than their traditional counterparts. From machine-to-machine to man-to-machine, the industry has come far in a short span of time, with humans now driving the next age of artificial and technological intelligence.

Machines and humans are connecting as never before

That the Internet of Things has permeated the appliances industry isn’t news anymore. Controlling one appliance from another has been made possible by the innovative leaders in the industry. We’ve two levels ahead now – It’s The Internet of Things, Services and People or IoTSP that’s creating waves today. Case in point: Futuristic appliances and applications like the Samsung’s Family Hub Refrigerator, Bosch’s HomeConnect, or LG’s SmartThinQ appliance sensors that are aiming to revolutionize consumer experience like never before.
Samsung Bosch LG existing IoT solutions Such innovations have now made the unthinkable possible: From refrigerators that can monitor items and alert you when something’s going stale to Apps that allow you to operate dishwashers while you’re out shopping to washing machines with Amazon Dash that enable you to order items online instantly with the press of a button, it’s a whole new world of experiences out there.

These innovations are just a handful of examples, but you get the drift: Machines are more personal, intuitive, and human today. Machines and humans are connecting like never before; and if you aren’t already in the race as an appliance manufacturer, you could soon be out of the game altogether. But how do you know you’re innovating right unless you can feel consumers’ pulse and have first-hand knowledge of users’ needs? How can you exploit and monetize trends future trends like IoTSP to your best advantage? You’d be surprised at the answer: It’s shifting focus to an area you might have overlooked all the while.

Redefining customer experience: The key to future success

By now, you already know how consumer-centric the appliance market is turning out to be. Gone are the days when consumers bought what’s available in the market. It’s the other way around today, with consumers influencing what’s available in the market. Put another way, customers enjoy greater bargaining and decision-making power than distributors now.

Thanks to the advent of the internet and social media, consumers are better informed and demand greater value for money throughout the lifecycle of a product. While the value of customer service can never be understated, the key to your success as an appliance manufacturer in today’s digital age lies largely in how well you anticipate a customer’s needs and how quickly you convert them into a valuable proposition.

Contrary to what many manufacturers believe, post-sales goes beyond customer support and technical assistance, and offers a chance to connect with customers and unleash opportunities to produce tangible business results. As an example, you could suggest your consumer to replace the water filter every other month while proposing to buy the original piece on the spot.

“Offered by the company, chosen by the customer”

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That way, you’d be promoting and selling parts even as you provide service, enabling you to retain and reinstate the customer’s faith in your brand. Even better if you could offer something extra to the users of the appliance, say DIY tools, handy tips, or even customized props as per their age group. That’s how you can build your brand image and reputation while tapping on a consumer’s evolving demands in a highly competitive market. Needless to say, that depends entirely on how service-driven your business strategies are; or more specifically, how intimately you’re connected to your end users.

Why you must connect with customers now

If you’re still relying entirely on your team of distributors or outsourced vendors and third parties to serve your customers, you could already be giving your competitors an edge over yourselves that could prove damaging in the long run. Given the rapid pace of life today, a user may not want to spend time and efforts to look for product documentation, search for the invoice, or to make multiple calls to support helplines or wait in queues to get help with their appliances. Consumers are seeking proactive solutions today - something that you can develop only if you observe the usage of a product through its lifecycle.

The only way to identify the weak link in your customer service and take it to the next level is to engage with your customers at every stage. Open dialogue is the need of the hour, where you connect with your customers on an emotional level and take every critical feedback constructively and turn it around into a business opportunity. You need first-hand knowledge about your customers, their needs, demands and expectations, usage patterns, and the experiences they expect out of a product to be able to build upon it and boost your brand image. There’s enough evidence to prove that a human-to-human touch between a manufacturer and consumer can go a long way in giving the business a leg up.

H2H is a success: Here’s proof

In the business world, everyone is paid in two coins: cash and experience. Take the experience first; the cash will come later.

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It’s only when you add a human touch to your customer service that you can understand this experience, which is far different from the one you get when you rely on machines to serve customers. Companies have, and are, successfully implementing H2H to their advantage.

Think about how Nespresso set foot on an uncharted service territory by setting up boutiques, flagship stores, and Nespresso Club to ride the digital wave and facilitate online purchases. It was a carefully calculated visionary step: Today, Nespresso is among Nestle’s most profitable product categories. Much of the success can be credited to the fact that almost 70% of Nespresso employees are directly connected to customers – a move that has hugely helped the brand’s image. The most important thing to understand here is that Nespresso didn’t do anything special. It simply recognized a basic need of being able to brew the perfect cup of espresso seamlessly and on-demand from the comforts of home without having to fear machine breakdowns or ingredient shortages.

Likewise, heavyweight manufacturers like Ingersoll Rand and Whirlpool are breaking boundaries and taking control over after-sales with their personalized service options to build long-lasting relationships and win customer loyalty. Why, even a fashion house like Burberry is sidelining retailers and betting on e-commerce and own stores to stay updated on customers’ evolving needs and preferences and personalizing their experiences!

You can take your business to the next level too if you’re connected directly to your customers. It isn’t half as arduous as it sounds.

How you can unlock the potential

A recent UPS research on industrial machinery revealed that while 35% of the manufacturers get more than 50% of annual revenue from after-sales, only about 12% consider service and aftermarket as differentiating aspects of business. Imagine the underlying revenue potential if manufacturers started taking customer service as seriously as R&D or marketing. That’s the kind of gap you need to plug today to exploit the massive business opportunities that after-sales can offer. Remember, after-sales can supplement your efforts to grow your business through innovation and open up new revenue streams.

As a manufacturer, you need to take control now, simply because you’re better positioned than traditional service providers to understand consumers enough to redefine their experiences, monetize after-sales, and tap new avenues to boost your top line.

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