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What's Holding Back Smart Appliances?

Smart appliances are nothing new. Brands have had the ability to connect these devices for years but have struggled with finding a meaningful value proposition. They can make a washing machine talk to a dishwasher, but so what? Where's the ROI?  

The hype around the Internet of Things (IoT) has led many to purchase connected devices, only to become frustrated by the complexity of the technology. Seamlessly creating a connection over WiFi using an app has proven to be a struggle for users, resulting in a slow adoption rate.  

In a low-margin business, offsetting the costs of smart technology enhancements can also be challenging. Manufacturing appliances is expensive enough and most consumers just haven't been enticed to pay for the "smart" features. In fact, according to a 2016 report from the Atlantic Council, only 2% of U.S. consumers have a smart refrigerator – which may mean the current offering just isn't resonating with the buyers. 

Enhancing connectivity brings opportunities to provide additional services and realize new revenue streams in the process. According to IHS, there is more value in connecting consumer appliances to markets than in the appliances themselves.  

For example, new auto-fulfillment schemes enable refrigerators to create a shopping list and send it to a local grocery store for delivery. Opening up the ecosystem to include retail stores spreads some of the cost associated with adding intelligence to appliances. It also provides a level of sophistication that frees consumers up to focus on other activities. 

But the true opportunity lies within the insights gained from the consumer and behavioral data collected from these appliances. By learning about their preferences and loyalty, OEMs can customize features and content to an individual consumer's lifestyle.  

By partnering with brands, OEMs could deliver tailored coupons, recipes or other value-add content directly to consumers via their appliance. However, the trick to pleasing the user is striking the right balance between being non-invasive, offering rewards and utilizing artificial intelligence. This level of connectivity enables companies to develop and improve relationships with consumers, ultimately creating additional revenue. 

In a market that is expected to grow at a CAGR of 15.4% between 2015 and 2020, according to Markets and Markets, there is vast opportunity to make a mark. To help brands in this endeavor, Jabil partnered with, an enterprise platform for the IoT. This collaboration enables Jabil to help appliance brands fully leverage the entire ecosystem of connectivity, end-to-end. 

Blog Article Contributed By Brent Tompkins, Sr. Director of Business Development, Jabil

Brent Tompkins

Brent Tompkins has been in the EMS industry for more than 20 years and has spent the past 15 years focusing on the appliance industry. In those 15 years, he has led a global team that has driven a transformation into complex sub-assemblies and full assemblies with a focus on the Human Machine Interface (HMI).

Brent Tompkins
Sr. Director of Business Development, Jabil


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