Ryu Jae-chul, head of LG Electronics’ home appliance and air solutions division, talks at a press conference about its latest upgradable appliances at LG Science Park in western Seoul on July 25, 2023. (Yonhap)
SEOUL, July 25 (Korea Bizwire) — LG Electronics Inc. on Tuesday introduced the latest upgradable home appliances, powered by a new operating system and AI chipset, in a follow-up measure to realize its vision to turn itself into a “smart life solutions provider.”
The South Korean tech company said the new OS and chipset, which took it more than three years to develop, allow consumers to use their home gadgets in a smarter, more personalized manner and to add, upgrade or delete features as they see fit.
“The Upgradable Appliances 2.0 marks the starting point where LG extends its home appliance portfolio into a service-based business,” Ryu Jae-chul, head of LG Electronics’ home appliance and air solutions division, said during a news conference held at LG Science Park in western Seoul.
“We aim to shift the industry’s paradigm to HaaS, Home as a Service, and will come up with innovative solutions to redesign consumers’ lifestyles through home gadgets,” he said.
LG launched upgradable appliances in January last year to better serve consumers’ varying needs, in what it said could be a major shift from selling products to offering improved consumer experiences.
Consumers can update their home appliances through the smart home ThinQ application to install new features, without having to buy a whole new product.
LG has so far launched some 60 upgradeable products.
In the first lineup of the Upgradable Appliances 2.0, LG rolled out a new washing machine, a dryer, a refrigerator and an air purifier Tuesday and said it will gradually expand the product lineup.
Ryu Jae-chul, head of LG Electronics’ home appliance and air solutions division, explains about the Upgradable Appliances 2.0 during a press conference at LG Science Park in western Seoul on July 25, 2023. (Yonhap)
Another important pillar of the Upgradable Appliances 2.0 is its subscription-based model.
LG’s long-term vision to become a life solutions provider cannot be fulfilled with the one-off sale business model, Ryu said, adding LG hopes to sell more than half of its home electronics through the subscription model.
“I believe we can do it in a short time. We are currently doing many things to achieve that,” Ryu said.
As part of efforts to extend the boundary of traditional home electronics, LG introduced the concept of “servitization,” where it uses its products to sell “outcomes as a service” rather than one-off sales.
For the goal, LG struck partnerships with local home services providers, including the laundry delivery service LaundryGo, in hopes of liberating consumers from doing household chores and helping them save their precious time.
Asked about the economic outlook for the second half, he said, “While I don’t believe the climate will improve dramatically, we could fare well if we continue focusing on premium products that can give new value to customers.”
“We would like to use our know-how of making hardware in service areas, and by doing so we can revitalize growth momentum,” he said.
Earlier this month, LG unveiled a grand plan to turn itself into a total life solutions provider, by focusing on non-hardware products, business-to-business solutions and new growth areas.
Under the new vision, the company plans to increase annual revenue levels to 100 trillion won (US$77.3 billion) by 2030, from around 65 trillion won last year.
(Yonhap)
