Key findings

New replacement cycle will drive growth through the medium term

Pandemic-era purchases are nearing end of life, with the replacement cycle set to drive growth. Growth in 2024 and the next few years will be largely driven by replacement purchases. Categories such as air fryers, coffee machines, vacuum cleaners, air purifiers and multi-cookers will benefit.

Smart appliances is now AI appliances

Companies are jumping on the AI bandwagon. The industry has fully embraced AI and smart appliances are now AI appliances. Smart technologies are now being relabelled as AI focusing on climate control, cooking, health, energy management and connectivity. We expect AI to drive growth in the premium segment.

Shark Ninja continues to gain market share

Using an “affordable premium” approach, SharkNinja has continued to gain share, at the expense of more established brands in Western markets. Its quick to market and minimalistic designs appeal to many consumer segments.

Shifting focus towards direct sales and a subscription model

Appliance companies want to own their customer relationships. Many are now focusing on selling directly to customers, through own retail stores and brand.com sites. This transition will also facilitate the move to servitisation. Subscription appliances have been very successful for LG, with growth rates over 20% for LG in South Korea and plans to expand to SEA.

Growth is coming from Western markets

Five out of the top six markets are from the Global South and growing at healthy rates of 4.8-11.2%. As consumers in these markets are becoming more affluent, many are turning to air conditioners as a means of increasing comfort in their homes.