Why It's Smart to Make Connected Appliances Smart

IN THE ERA OF SMART HOMES AND INTERNET OF THINGS (IOT),connected appliances are not a new idea. In fact, the first announcement of an

"Internet refrigerator" dates as far back as 1999. Even today, many brands in this market havebeen having difficulty connecting with today's consumers.

SO THE QUESTION BRANDS MUST ANSWER IS:

How do you create added valuethrough smart appliances?

SMART

CONNECTED VS. SMARTAPPLIANCES APPLIANCES

Can alert the user to changes andinformation, but ultimately relies on the

decision-making of the owner

Utilize an internet connection

Remote access through devices

May include smart appliance functions

By learning about the users and their behavior,these appliances can react to certainsituations on their own

Enhanced features & functionality

Adapt to user habits

May be connected to the internet

APPLIANCES ARE

SMART WHEN...REFRIGERATORS

OVENS

Check for expiration dates Suggest recipes based on

what's available

Send shopping liststo grocery stores forauto-fulfillment

Sync with the fridgeon a recipe and

preheat in preparation

Cook the perfect mealusing image recognition Automatically schedule repairswhen issues are detected

MILKEGGSJUICE

DISHWASHERSAdjust the temperature based

on materials being washedShare information onhow much energy isbeing consumed

Stop operations whenissues are detected

CLOTHES WASHERS/DRYERSSet wash settings based on

the fabrics in the cycle

Recommend new detergentswith a coupon

Stop the drying processwhen clothes are dry

IOT IN THE HOMEPRESENTS HUGE OPPORTUNITIES

GENERATED

IN REVENUEIN 2014

$79.4B

WORTH

BY 2025

$200-350B OF U.S.

CONSUMERS HAVEAN INTEREST

65%

THE SMARTAPPLIANCE MARKET

IS EXPECTEDTO GROW ATA CAGR OF

BETWEEN 2015AND 2020

15.4%

ESTIMATED SHARE OF SMART APPLIANCES SHIPMENTS BY 2020

ASIA PACIFIC

68%AMERICAS

16%

EUROPE

12%

MIDDLE EAST& AFRICA

4%

CREATING VALUETHROUGH SMART APPLIANCES

WHAT BRANDSCAN DELIVER

Meaningful features & capabilitiesthat speak to consumer needs

An integratedecosystem ofappliances anddevices

Strategic partnershipson unique customer-focusedservices

Enhanced customerrelationships through

data and analytics

Centralizede-commerce

opportunities

Trustworthy products thatreliably deliver benefits

HOW CONSUMERS

CAN BENEFIT

Significant timesavings through

chore automation

Assistance indecision-makingthrough data and

analytics

Special offersand incentivesthrough usage

information

Immersive brandexperience that

solves needs

Trusted partnershipsand exposure to

new products andservices

THE GREATEST IMPACT TO CONSUMERS?

CHORE AUTOMATION.

1. Gather data on daily usage patterns

2. Determine household preferences

3. Begin scheduling own work routines

THE HOW

THE WHY

Reduced human workload17%

100

7-9%

Hours saved per yearin the typical household

Households in advancedeconomies that could adopt

smart appliances by 2025

SOURCES"AHAM's Industry Data & Research." AHAM. Association of Home Appliance Manufacturers,

<http://www.aham.org/>.

"2016 Global Mobile Consumer Survey: US Edition." Deloitte.<https://www2.deloitte.com/>.

"Smart Home Market." MarketsandMarkets.<http://www.marketsandmarkets.com/>.

"Mckinsey: IoT in the Home Worth $200 Billion to $350 Billion In 2025." SMAhome.<http://mysmahome.com/>.

"Smart Major Home Appliances Share by Region 2014-2020." Statista.<https://www.statista.com/statistics/424142/smart-appliances-market-segmentation-by-region/>

"Opportunities and Challenges in the Smart Appliances Market." Market Research. N.p., n.d. Web.<http://blog.marketresearch.com/opportunities-and-challenges-in-the-smart-appliances-market>.

"Smart Homes and the Internet of Things." Atlantic Council. <https://otalliance.org/>.

"Less than 5% of U.S. broadband households own a smart appliance." Parks Associates.<http://www.parksassociates.com/blog/article/pr-07202016>

TO GET CONSUMERS TO ADOPTSMART APPLIANCES...

BRANDS HAVESIGNIFICANT CHALLENGES

OPPORTUNITYIS KNOCKING...

BUT

CONSUMER AWARENESSMany still don't understand what smart

appliances are

PRICEIt doesn't make financial sense for

consumers – they don't see the value

SECURITY/PRIVACYRecorded daily data and worries of hacking

raise concerns

ECOSYSTEMThe lack of seamless app and device

integrations are a barrier

40%

<5%

18%

18-35

OF CUSTOMERS ARE WILLINGto share data in exchange for incentives

Of U.S. broadband householdsOWN A SMART APPLIANCE

OF CONSUMERS PLAN TO BUYa smart appliance in the next 12 months

AGE OF CONSUMERS MOST LIKELYto adopt smart appliances