With a strong desire to improve their life quality with high quality and customized home appliances, young families of China are taking an increased interest in an emerging product category, built-in appliances. Currently, new kitchen appliances expand and grow thanks to China’s rising trend of consumption upgrading. And built-in appliances have become a strong driver behind this trend.
A market surge
Compared to the penetration rate of more than 60% in Europe, China’s penetration rate of built-in appliances is rather low, which also means a market with an excitingly large potential. Years ago, built-in appliances were mainly sold as a package in China to mid-to-high income consumers who have a villa or a large-size apartment under the name. But in these two years, more and more young consumers-the ’80s generation and the ’90s generation-start to prefer integrated kitchen design and built-in appliances, according to Fotile, a leading kitchen appliance maker of China. With great market potential to deliver, this sector is rising.
Statistics from China Market Monitor suggest that retail sales of China’s built-in kitchen appliances registered 4.74 billion RMB in 2016, a year-on-year growth of 67.9%. Leading enterprises have a better profitability compared to the average performance of the industry. Upholding the principle of high quality, industry leaders refuse to undercut each other to stand out. And thanks their effort, China’s high-end kitchen appliance market is dominated by Chinese brands.
Fan Yingchao from Marketing Department of Haier’s Kitchen Appliance Division answers with the word “doubled” when asked about the market performance of Haier’s kitchen appliances in 2016. Haier’s built-in appliances have remained a high growth. After its purchase of a number of leading enterprises such as Fisher & Paykel and GE, Haier shares the platforms and technologies within its system to manufacture high-end kitchen appliances such as electric ovens and electric steamers. And thanks to this, Haier has come a long way in the development of its high-end products.
Rao Jian’an, Director of the Division of Sterilizers, Ovens and Steamers under Vatti, reveals that the sales performance of Vatti went beyond the industry average in 2016. Sales of its built-in steamers, built-in ovens, and built-in microwave ovens witnessed a year-on-year rise of 215.75%, 109.88% and 86.07% respectively.
Enterprises have a strong faith in the future of built-in kitchen appliances. China Market Monitor estimates that, China’s kitchen appliance sector would reach a market size of 97.3 billion RMB in 2017, a year-on-year rise of 12.2%, and built-in appliances would worth 7.63 billion RMB, a year-on-year rise of 61%, with a penetration rate of 42.1%.
A wide range of categories
As the ’80s and ’90s generations replace the ’60s and the ’70s as strong consumers, the mainstream aesthetics and the consumption philosophy change accordingly. Nowadays, built-in kitchen appliances have won the heart of new generation consumers with its simplicity style and become a must-have for many.
Currently, Midea’s built-in kitchen appliances span microwave ovens, steamers, ovens, dishwashers, sterilizers, gas hob cooktops, induction cooktops, etc. Mao Yonghong from Midea reveals that, “we’re thinking about rolling out built-in coffee makers and heat insulated drawers.”
Lu Yubin, President of Vanward, believes that built-in appliances are in line with the trend of future kitchen design, and Vanward plans to further expand in this category. Vanward’s built-in appliances span sterilizers, ovens and gas hob cooktops currently. In 2017, Vanward will roll out its new built-in small-size ovens, steamers, dishwashers and oven &steamer combos.
Zeng Chuantao, Director of Marketing of Glanz, tells China Appliance that to reflect this rising trend, Glanz diversifies its built-in appliances and has secured a surge in sales, among which sales of built-in steamers and microwave ovens stand out most.
According to Wang Weiqing, Vice President and Chief Sales Officer of BSH China, BSH has full lines of built-in kitchen appliances carrying the brands of BSH and Siemens, spanning ovens, steamers, dishwashers, range hoods, gas hob cooktops, etc., which offer an integrated built-in solution for consumers. Always staying in line with consumer needs, BSH is committed to providing a healthy and pleasant life style for consumers with its customized interconnected kitchen. Wang Weiqing says, “We are always updating and optimizing our built-in products to reflect Chinese cooking habits, and expanding our product lines to accommodate to market needs.”
A combination of western and Chinese elements
Influenced by foreign culinary philosophies of regions such as the Europe, the US, Japan and Korea, Chinese consumers have shown changes in their kitchen design and appliances. Combining western culinary philosophies and home appliance designs with Chinese tastes is what home appliance makers must address down the road.
“When the Europeans are looking for a house, they want a kitchen showered in the morning rays. I believe more and more Chinese consumers will love kitchen and culinary culture in the future. To get into this phase, Chinese consumers need some time to change.” Fan Yingchao from Haier says. Chinese enterprises have made great innovations after introducing built-in kitchen appliances into China.
Fotile’s in-sink dishwasher is a typical built-in appliance developed to meet Chinese needs. Gao Jianguo, Brand Director of Kinde, speaks highly of this product, saying “Built-in appliance is a rising trend. Both Fotile and Robam have attached great importance to it. Fotile contributes to the industry with a new product category, in-sink dishwasher. ” According to Fotile, it has rolled out its Q3 and Q6 in-sink dishwashers since 2016, and has received great response. This original product is capable of washing dishwashers and removing pesticide residues of fruits and vegetables. Taking a market share of more than 40%, this dishwasher has come into more than 100 thousands households to offer them a convenient life style.
Midea, through its mature quality-control system across the supply chain and manufacturing terminals, has ensured a consistent product look. According to Mao Yonghong from Midea, based on statistics from a wide range of researches, the home appliance giant has integrated a number of technologies to develop the best built-in products. For instance, it integrates temperature detecting technology, fuzzy control algorithm, steaming technology and air-heating technology to create a constant temperature inside its oven. And based on a large amount of experimental data, it develops a temperature curve, through which an accurate cooking procedure could be executed.
Consumers born in the ’80s and ’90s values style, creativity, engagement and personalized experience. To them, built-in appliances are not only about the best use of kitchen space, but also, a pleasant style.
With stylish designs and multiple functions, built-in kitchen appliances are gaining popularity. Wang Weiqing from BSH says, “With a great penetration in mid- and high-end market, built-in kitchen appliances are our star products.” Built-in kitchen appliances excel in space management. According to Wang Weiqing, BSH elevates the consumer experience through a scientific arrangement of appliances.
Built-in kitchen appliances are designed based on room structure, consumer habits, ergonomics, materials, etc. This is an integrated complex built upon in-depth market research and customized needs. Gao Jianguo from Kinde tells China Appliance that, built-in range, an integration of hood, cook top and sterilizer, has seen a rising market size year by year. Kinde uses the range as the main piece when designs its built-in appliances.
According to Fotile, consumers care not only about functions, but also industrial design, product look, smart experience and personalized features. To survive and thrive, high-end kitchen appliance makers must stay close to consumer needs.