Artificial intelligence is in your home, be it air conditioners (ACs), washing machines, refrigerators, microwave ovens or ceiling fans, with consumer brands seeing smart appliances as the next big thing.
As per Deloitte India, the penetration of smart appliances in India doubled from FY2020 to FY2023, with demand much higher in tier-1 cities at 40% in 2023, and is expected to grow to about 60% in the next five years.
Unsurprisingly, brands intend to achieve maximum sales from these products in the coming years as consumer interest increases, with premiumisation being the core growth strategy.
Brands that FE spoke with sing the same tune. LG claimed they have seen sales of their AI-powered and smart appliances double in the past year. Panasonic said they have one of the widest ranges of smart, connected ACs in India and nearly 45-50% of sales come from their MirAIe-enabled ACs.
MirAIe is an AI-enabled and IoT-powered app that allows users to control and monitor ACs and other smart appliances across brands. Since MirAIe’s launch in 2020, the app has been downloaded by over 5 lakh consumers and is rated above 4.2 on iOS and Google Play.
Samsung India targets to achieve 70% of its home appliance sales from AI-based products by 2025, having recently launched its new range of AI-powered large capacity washing machines for Indian consumers.
As Praveen Govindu, partner at Deloitte India, says, “Some of the largest brands expect AI-powered products to contribute more than 50% of their overall sales by 2025-2026. Overall home appliance industry in India is expected to grow at a rate of 6-8% driven by AI-powered smart appliance market, which will grow at approximately 14-18% over the next 4-5 years.”
And, while prices of these products are generally higher than other products, consumers are willing to shell out that extra money.
Samsung’s and Panasonic’s AI-powered ACs are priced from Rs 45,000 to Rs 65,000, while others are priced around Rs 35,000 to Rs 50,000. In the refrigerator category, Samsung’s AI-powered products range from Rs 90,000 to Rs 1,20,000, while high ended non-AI refrigerators from brands like LG and Panasonic with smart inverter technology and multi-door features are usually priced around Rs 45,000 to Rs 70,000.
Panasonic’s AI-enabled microwaves with features like 360° heat wrap and multiple auto-cook menus are priced around Rs 16,000 to Rs 22,000, while other high-end non-AI ovens from brands like IFB and LG which have features like convection cooking come at a price of Rs 10,000 to Rs 18,000.
“AI preference for appliances that consume more energy such as ACs, washing machines, refrigerators, and lighting is higher as AI helps optimise energy consumption and, in turn, total cost of ownership,” said Govindu of Deloitte India.
“With an increase in disposable incomes, rapid urbanisation, internet penetration and easy financing options, consumers are willing to spend on appliances that are energy-efficient, smart, and connected to enhance overall lifestyles,” said Manish Misra, chief innovation officer, India Innovation Centre, Panasonic Life Solutions India.
“From a value standpoint, we have seen 70% of our AC consumers using the AI platform that auto-controls temperature during sleep profile time,” claimed Misra.
LG said its ThinQ technology – behind many of its smart appliances – is particularly praised for its intuitive control and integration with smart home ecosystems.
The company claimed that its AI-powered home appliances have become one of the top sellers in their respective categories since launch. “LG Electronics commands 40%-50% market share in IOT-based products and in some categories, even higher,” Sanjay Chitkara, senior vice-president, home appliances and air conditioners, LG Electronics India, told FE, adding that these smart appliances have significantly boosted their overall sales and outperformed other high-end products in their portfolio.
Orient offers BLDC Pro series fans priced in the range of ₹8,000 to ₹14,000 that come with smart features combined with energy efficiency such as IoT connectivity, reverse rotation, and integrated lighting, besides water heaters and smart lighting. “Our IoT-enabled Aeroslim fan has seen growing demand since its launch in 2019,” said Gaurav Dhawan, business head of electronic consumer durable, Orient Electric Limited.
As per a recent Redseer report titled ‘Unlocking Convenience: The Indian Smart Home Revolution’, the smart home market stood at approximately ₹90,000 crore in 2023, with expectations for it to grow to ₹140,000 crore by 2028. The trend is expected to continue, with adoption rates estimated to reach 12%-15% by 2025 and 25%-28% by 2028.