Over the past 30 years, the square footage of American homes has increased by over 50 percent.
There’s a lot to unpack in that statistic, from urban migration to income to personal tastes, but when we consider the sheer amount of stuff we cram into our homes it’s hardly surprising.
In fact, we have greatly increased our household possessions, and according to a four-year study of middle-class households published in 2012, the effect of chaos and clutter is linked to expanded home size, as well as increases in stress levels, and reduced outdoor activity.
While the tyranny of stuff may be stifling the middle-class, the pendulum may be about to swing in the other direction, thanks to the Internet of Things (IoT). But if the problem is things; how can an internet of things solve the problem? The answer lies in “servitization”.
Servitization can be defined a couple of different ways. Narrowly, it can mean the introduction of new services and capabilities to an existing product, usually through software. As smart, connected products evolve, manufacturers are getting smarter about introducing services after products are in users’ hands. More broadly, however, servitization is replacing the sale of a physical product with a subscription model.
In short, we are moving to a leased lifestyle.
In the commercial and industrial sectors, servitization is already underway. Rolls-Royce has offered power by the hour for decades – bundling products and support so that a receipt represents not just a product, but a promise of minimized disruption.
As smart, connected products evolve notions of support to include preemptive failure sensing and predictive maintenance, manufacturers are changing what they offer. Instead of a turbine that is sold in tandem with a maintenance contract, manufacturers can offer uninterrupted use of that turbine.
A “servitized product” subscription offers both processes to prevent, repair and replace hardware, as well as the ability to upload new software-based features and functionality. Printers, servers and other office hardware are being similarly delivered, with customers leasing the usage of that equipment.
On the consumer side of the equation, the transition isn’t as fully developed, but we’re farther along than you might think. Many cell phone plans are now offering free annual upgrades, with a leasing cost for the phone (phones that are themselves being continually refreshed with OS updates). Cable boxes are almost exclusively leased to users. Car leasing is old hat, and in urban areas, car sharing models have gained traction. Even our media library has changed; we have given our movie and music collections a heave-ho, moving from physical media to digital to cloud streaming.
The companies that deliver these services are competing to bundle and consolidate, giving you a range of services on products they technically own. Fifteen years ago, many of us would have scoffed at the Zipcar business model, or cringed at tossing out our CD collections.
How does this tie back to household clutter and chaos? As manufacturers move to servitize products, they will be competing on ease of use and streamlining interconnected experiences. Smartphones will provide control over a multitude of physical household devices. If we look at home offices and entertainment centers, we see components being consolidated, and cords disappearing. It’s not unreasonable to think that we will soon lease a top of the line home entertainment experience.
These changes will, in turn, make things smarter and simpler. Even things like food and clothing will be monitored and trafficked more intelligently, so that walk-in closets and pantries will seem less of a necessity, and more of an indulgence.
The cultural drive to define status through amassing more “stuff” and large containers for that stuff will give way to less things that do more. Even for the products we choose to continue owning, an emphasis and value will be placed on efficiency and capability, rather than size and visible complexity.