LG Electronics unveils upgraded, customized rental system

LG Electronics will revamp its rental service by providing highly customized offerings for home appliances with different prices and rental period options. The electronics maker dubbed the direction "a subscription-based model" in contrast to the...

Lyu Jae-cheol, head of LG Electronic’s home appliance and air solutions division, speaks at a press conference held Tuesday in western Seoul where he introduced the revamped business portfolio of its rental service. [LG ELECTRONICS]

LG Electronics will revamp its rental service by providing highly customized offerings for home appliances with different prices and rental period options.

The electronics maker dubbed the direction "a subscription-based model" in contrast to the conventional rental service providing unilateral products and services with restrictions on changes halfway through.

“The rental business provided autonomous services to all of our customers, whereas the subscription business will provide diverse, personalized services based on each customer’s preferences and needs,” Lyu Jae-cheol, head of LG Electronic’s home appliance and air solutions division, said at a press conference held Tuesday in western Seoul where he introduced the new business portfolio. “The new business model also allows consumers to choose their subscription period from three to six years with flexibility.”

Offering personalized services means consumers can freely add or delete functions on their home appliances using the smart home ThinQ application. For example, when a consumer acquires a new furry companion to share the home with, they can update the settings on the app, and the washer and dryer functions will automatically adjust to add extra cleaning functions or filters to get rid of animal fur.

The change is made possible thanks to the company's operating system and self-designed chips.

The subscription-based lineup applies to two new home appliances — the washer and dryer — released on Tuesday. The lineup will expand to refrigerators and air purifiers sometime this year.

A warranty on the subscription home appliances will be provided at no additional cost during the designated period.

The prior rental business will be integrated into the subscription-based business from the third quarter of this year.

“New upgrades on home appliances are well-reflected on consumer price due to increased production costs, but that makes our products lose price competitiveness,” Lyu said. “For a long time, we’ve been looking for ways to individualize functions of home appliances and at the same time also to spread this new ecosystem throughout the entire consumer base without increasing the price, which is how we came up with the new OS.”

The electronics maker is also collaborating with six third-party apps to cater to the consumer's individual needs and decrease the time they spend on domestic chores. Two of the apps are LaundryGo, which delivers customers' fresh laundry, and house cleaning service Daerijubu. Users can freely subscribe to or cancel the services via the ThinQ app.

“Until now, the home appliance industry was solely based on the product hardware,” Lyu said. “LG Electronics will expand its business portfolio to become a smart home solutions company so that people can use their free time more valuably instead of being chained to domestic chores.”

BY LEE JAE-LIM [lee.jaelim@joongang.co.kr]