SEOUL, June 27 (AJP) - Home appliance subscription services offered by Samsung Electronics and LG Electronics represent a win-win solution for both consumers and companies that will likely expand to European markets including Germany, according to the head of the Internationale Funkausstellung Berlin (IFA), a major consumer electronics show, on Thursday.
Leif Lindner, CEO of IFA, told reporters at a press briefing in Seoul's COEX that subscription models reduce upfront costs for consumers while generating higher lifetime revenue for manufacturers through extended customer relationships.
Home appliance subscription services allow customers access to the latest appliances for manageable monthly fees, making the services particularly popular among single-person households and younger demographics. LG Electronics pioneered the South Korean market with its subscription service, driven by trends such as the increasing number of single-person and dual-income households. The company's annual subscription revenue, excluding care services, reached 1.67 trillion won ($1.2 billion) in 2024, representing a 73.7 percent increase from 2023.
Currently, Europe's appliance subscription market remains in early development stages compared to South Korea's mature ecosystem. German-based Grover dominates the European market, offering home appliances starting from €24.90 ($29.1) per month across Germany, Austria, Spain, and the Netherlands, with monthly rental costs typically representing 3 to 4 percent of an item's total purchase price. However, Grover's model differs significantly from Samsung and LG's approaches, focusing primarily on electronics and tech products rather than comprehensive home appliance ecosystems.
While Grover emphasizes device circulation and environmental benefits through refurbishment, Samsung and LG's services integrate artificial intelligence, personalized maintenance, and seamless connectivity within broader smart home platforms. Industry observers expect South Korean companies to differentiate themselves in European markets through superior AI integration, predictive maintenance capabilities, and comprehensive after-sales service networks that leverage their manufacturing expertise and global service infrastructure.
Samsung Electronics joined the subscription market in late 2024 with its AI Subscription Club service, adding competitive pressure to the growing segment. Lindner noted that the subscription model benefits the industry's overall growth and expressed confidence that European markets would adopt similar services in the near future, citing the mutual advantages for both manufacturers and consumers throughout the appliance lifecycle.
The IFA executive also highlighted smart home technology as a promising sector where South Korean companies maintain technological leadership. He emphasized that smart home solutions were popular at last year's IFA exhibition and predicted continued strong interest, with this year's event focusing on home automation and connectivity solutions. The executive noted that South Korea's advanced position in smart home technology would likely feature prominently at the upcoming exhibition.
IFA 2025 will take place Sept. 5 to 9 in Berlin under the theme "Imagine Tomorrow," with participation from global semiconductor companies including Nvidia and Qualcomm. The exhibition, considered one of the world's three major electronics and IT trade shows alongside CES in Las Vegas and Mobile World Congress in Barcelona, will emphasize artificial intelligence, quantum computing, and sustainability as major trends. Lindner described the event as becoming more youth-oriented and future-focused, with particular emphasis on autonomous AI solutions.
reporter
Candice Kim
candicekim1121@ajupress.com
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