Dishwasher Manufacturers Must Educate to Penetrate New Markets
Dishwashers remained the smallest category in major appliances in 2013, accounting for a mere 4.4% share of overall volume sales. It is also a category in which average unit price, at US$609, is significantly higher than in major appliances as a whole (US$444). Dishwashers are generally not perceived as an everyday necessity, but rather as a luxury item in the kitchen. So, why do appliances with similar washing and cleaning functionality but for different items enjoy such a contrasting degree of popularity? That said, over the forecast period Euromonitor International predicts a credible volume CAGR of 3.6% for dishwashers globally.
Expenditure Per Household on Dishwashers by Region and Growth, 2008-2018
Source: Euromonitor International
Kitchen Styles Tell Us Why
Although dishwashers do not seem overly popular globally, North America and Western Europe will buck this trend, with volume CAGRs over 2013-2018 set to be stronger than those of 2008-2013 despite a larger sales base. The two biggest dishwasher markets, the US and Germany, together accounted for 58% of total built-in dishwasher sales in 2013, with strong built-in sales being a result of a preference for fully integrated kitchens. Moreover, both countries enjoy strong dishwasher penetration, reflecting a preference for automation of the dishwashing process compared to hand dishwashing, and with consumers now also increasingly looking for more attractive designs. Their kitchens are usually designed with fitted cabinets and sinks to include built-in models, or the appliances come with the house itself.
While freestanding versions account for a higher share of dishwasher sales in Turkey and France which are the next biggest market in dishwashers, both countries are also following a similar growth path, with anticipated stronger growth of built-in dishwashers over the next five years. In France in particular, recent housing laws which favour the construction and acquisition of new houses will boost sales of built-in appliances.
Who and What to Wash Matter
In addition, how is dishwashing done in other regions? There are two crucial reasons behind the low sales of dishwashers, with the first being price. Unlike North America, Austrasia, and Europe, the unit price of dishwashers compared to annual disposable income is high and so remains an obstacle to purchase. Moreover, in emerging countries there is a strong preference for employing maids to do household chores, including the washing of dishes. For instance, average unit price in dishwashers in Asia Pacific is US$730, which is higher than the monthly cost of a maid in countries such as the Philippines, Indonesia, Thailand, etc. As purchasers are not necessarily the end users here, they will either choose to buy products that have fewer features and hence simpler instructions, or opt for hand dishwashing instead.
Other obstacles to growth include different types of tableware and food ingredients. There is a longstanding perception that dishwashers can clean flat plates, wine glasses, juice glasses and utensils but not rice bowls, au gratin dishes and mugs of various depths and sizes.
Dishwashers and Dishwashing – Global Retail Volume Sales and Value Sales 2013-2018
Source: Euromonitor International
What Manufacturers are Overlooking
Leading dishwasher manufacturers, including Bosch, Whirlpool, Electrolux and Arçelik, have consistently been announcing new features and functions to attract consumers. Their current focus is on the presence of steam functionality (which helps to sterilise dishes), a reduction in noise levels as well as energy efficiency to meet regulations across various countries. These are functions that existing users are familiar with and desire.
Meanwhile, there need to be other trigger points to penetrate markets so as to attract non-users. Other than offering various price points to increase purchasing power, technology and functionality to increase the credibility of these products will be necessary to build trust in their efficiency. The key point is proving that dishwasher cleaning is comparable to that of hand dishwashing but also offers convenience and cost savings. Let’s not forget that washing machines were themselves once not considered necessities, with manufacturers having to actively show how clothes could be washed and cared for without wear and tear on different fabrics.