Innovation is key to drive margin expansion

  • Product innovation, built on deep consumer insight in the specific consumer audiences for our three main brands, has resulted in products with enhanced consumer benefits. These products command a higher price and drive margin expansion – known as ‘mix improvement’.
  • Mix improvements have significantly contributed to operating income in recent years, demonstrating that Electrolux product innovations are in demand.
    • In recent years, mix improvements have contributed an average of SEK 1bn to operating income.
  • Our most resource-efficient products also drive profitability – enjoying higher margins than other products on average since the 1990s.
  • Streamlining of the product portfolio has resulted in fewer product variants – which has reduced cost and increased sales. This is a key focus also going forward.

Strong track record on
driving mix improvements


Three clear innovation areas – Taste, Care & Wellbeing

  • Targeted R&D gives us a competitive advantage – optimizing our offering and shortening the time to market.
  • We are increasing our focus to grow profitably in selected mid- and premium categories with our main brands, while driving even more targeted portfolio management.
    • In 2023, we announced that we are looking at divesting the water heater business in Egypt and South Africa as these assets do not have sufficiently strong synergies with our
      core strategy to warrant the required focus and investment from Electrolux Group.
  • R&D is focused on features that allow a price premium i.e. products that provide great consumer experiences such as:
    • great tasting food with the right taste and texture, healthy, fresh and nutritious. Inspired by new culinary techniques, while also reducing food waste.
    • care for clothes so they remain like new for longer, and ready to wear by holding their size and shape, while using minimal water and energy.
    • healthy wellbeing in the home by using appliances with a visual appeal, while creating a healthy environment.
  • The two product lines – Taste and Care – have the global, end-to-end responsibility to prioritize the growing and profitable product categories where we will focus our business and investments, leveraging global scale with speed and lower cost.
    • Wellbeing is also a global product line but as the products are sourced it does not require the same organizational setup as the Taste and Care products.
  • On average, 3% of sales have been invested in focused R&D efforts over the last five years. Product efficiency is embedded in our R&D processes through defined targets. Read about our food-waste
    saving and energy efficient fridges and freezers, highlighting the company’s food preservation and recyclability innovations at

Targeted R&D – a competitive advantage

Taste: Cookers, hobs, ovens, hoods, microwave ovens, refrigerators and freezers.
Care: Washing machines, tumble dryers and dishwashers.
Wellbeing: Vacuum cleaners, air-conditioning equipment, water heaters, heat pumps and small domestic appliances.

Deep consumer insight – a competitive advantage in an age of greater consumer awareness

  • Deep consumer insight increases our success rate and return on investment.
    • The average consumer star rating for the Group was 4.64 out of 5 in 2023.
  • Consumer needs are our starting point to define business opportunities.
  • Electrolux Group’s R&D process is based on a long history of consumer insight built on surveys, consumer data, home visits, user experience labs combined with daily monitoring of consumer reviews of both Electrolux and competitors’ offering.
  • In recent years, new digital tools for testing products have accelerated the development process and reduced costs.

Increasing return through consumer experience design

The development of the intuitive user interface of the Quick Select dishwasher is based on consumer insights. Instead of the user having to make difficult choices between programs, the environmental indicator effortlessly provides an optimal balance between a sustainable choice and washing time.

Digitalization creates opportunities and new routes to market

  • Consumers are increasingly using digital tools to find and buy appliances. Through the use of data analytics and digital marketing, Electrolux is well positioned to tailor offers that meet consumers’ needs.
  • Our strong focus on innovation for the consumer experience improves consumers’ star ratings of our products, which in turn makes our more innovative products more desirable.
  • B2B e-commerce allows us to a larger extent interact directly with the consumers and tell our story.
    • Targeted investment in marketing and brand building is driving sales.
    • Provides strong, differentiated information with clear consumer benefits to help consumers to find the right product.
  • D2C e-commerce targets our most loyal consumers with a differentiated offering.
    • A complement to existing B2B sales, business models mutually reinforcing each other.
    • Currently a small part of total sales, but with strong growth the last three years.
    • Differentiated value proposition to leverage bundling, including services as well as products.
    • Already active in approximately 40 countries and scaling up the business in many of those markets.
    • Largest presence in Latin America and Europe, with ongoing rollout in Asia-Pacific, Middle East and Africa, and North America.
  • We are continuing to expand our range of connected products to deliver great consumer experiences based on a scalable global IoT platform and with strong partnerships.

Digitalization enables new opportunities for direct consumer engagement

Strong brands drive profitable growth

  • Strong brands grow faster, are more profitable and more resilient during crisis.
    • 75% of a brand’s value share performance can be explained by being one of the top 3 brands in the minds of the consumers1).
    • 1.3X higher growth rate of most relevant brands vs. S&P 500 average2).
    • 9X faster recovery for strong brands vs. global average during the 2008-09 financial crisis3).
  • Innovation has resulted in growth and higher profit for our premium brands Electrolux and AEG.

1) Value market share regressed against top 3 and Spontaneous Awareness (Brand Scorecard 2014-2016 & GFK sell-out data 2014-2017. Countries included Frigidaire (NA), AEG (BE, DE, ES, UK), Electrolux (FR, IT, PL, RU, SE).
2) Prophet Brand Relevance Index 2022 – 10 years CAGR of most relevant brands vs. S&P 500 average.
3) Kantar Research (2019).

Building stronger brands to accelerate profitable growth

Three well-established brands with strong and focused brand propositions

  • High brand awareness is built on 100-year track record of innovation.
  • The three main brands – Electrolux, AEG and Frigidaire – represent ~80% of  total Group sales and receive the vast majority of investments in consumer experience through marketing, design and innovation.
  • The main brands have clear target consumer positions where they can grow profitably and with potential to attract a larger audience.
  • Distinctive target consumers:
    • The typical Electrolux consumer is someone who actively drives change for the better and with a positive outlook on the future. They are open for new experiences and want progressive, sustainable premium brands that can help them evolve in their daily life.
    • For the AEG consumer, it is all about innovation, performance and premiumness, while acting responsibly. This consumer strives to improve and has very high expectations on brands to support their lifestyle.
    • The Frigidaire consumer represents middle American core families with family life and friends in focus. The consumer seeks practical solutions and wants to improve their local community.
  • In 2023, we announced that we are looking at divesting non-core brands including Zanussi as these do not have suffiently strong synergies with our core strategy to warrant the required focus and investment from Electrolux Group.

Three main brands with distinctive target consumers

Sales by main brand

*Includes Frigidaire Gallery and Frigidaire Professional.

Harnessing the growth opportunities in the high-margin aftermarket business

  • Through an expanded market scope that goes beyond the appliance purchase by focusing on the lifetime value, we broaden our business potential and can increase consumer loyalty to our brands.
  • The target is to increase the share of Group sales in the aftermarket segment to ~10% by 2025 with a long-term ambition to reach ~15% of Group sales. In 2022, aftermarket accounted for ~7% of the Group’s sales, compared to ~5% in 2018.
  • The aftermarket business is an important profit pool with a profit margin that is at least 4 times higher than appliance sales.
  • Increased consumer interactions via aftermarket sales create valuable insights that we feed into our innovation process to further improve the appliance offering. Recurring purchases is the ultimate proof of success, benefitting both us and our retail partners.
  • We are leveraging fundamental consumer trends of omnichannel presence, direct interaction with brands, and expected personalization to increase our direct consumer interactions. Through touchpoints such as product registration, direct-to-consumer sales, and connected appliances, we can establish an instant direct consumer relationship, benefitting aftermarket sales as well as brand loyalty.
  • To learn more about how we are harnessing the growth opportunities within aftermarket, please look at the on-demand recording from the 2023 Capital Markets Update:

Consumer direct interactions broaden business potential and deepen consumer loyalty

Targeting four areas

  • Consumables and accessories
    • The main growth potential lies in custom-made, captive consumables and accessories for our appliances where we can leverage our branded advantages, further enhance the consumer experience, increase personalization, and ensure
      optimal product performance and lifespan.
    • We focus on the full product lifetime and consumer journey already in the innovation process, using our deep understanding of consumer needs and unique consumer data insights as key input.
    • Subscription services for consumables provide recurring revenue streams and make it easier to order items such as filters and dust bags.
      • In business area North America, the water filter business has reached an average of 10% annual sales growth over the last five years (case provided at CMU 2023). Key success factors have been raised awareness of the need to change filters regularly to ensure water quality and optimal taste, built-in reminders of when to change filter, and ensuring a smooth ordering process. In addition, a campaign highlighting the importance of genuine filters lifted the conversion rate in our D2C channel by 10%.
  • Out-of-warranty repairs
    • Service and repairs provide opportunities to further enhance the consumer experience, build brand loyalty and facilitate further consumer direct interactions.
    • Closing the gap between consumer awareness of the manufacturer as a service provider and our market share provides an important growth opportunity. Key to driving increased conversion is a continuous focus on search engine optimization as well as solutions online and through call centers to guide consumers to entrust us with repairs.
    • The initial focus has been on Europe with initiatives such as fixed-price repair models, resulting in a sales CAGR of ~15% since 2018 (case provided at CMU 2023). Expanding learnings to other regions provides significant growth opportunities.
    • A flexible business model for access to service technicians, based on advanced analyses of our installed base of appliances, ensures cost-efficient and high-quality deliveries.
      • In strategic markets with high population density, in-house service personnel are used predominantly.
      • To ensure coverage in the more than 120 markets where Electrolux sells its products, a network of dedicated independent service providers and multi-brand independent service providers is used.
    • We have through recent acquisitions strengthened our position in service and repair in key European markets and Australia.
  • Spare parts
    • Opportunities to grow the spare parts business both on the DIY market and as part of out-of-warranty repairs.
    • Using branded spare parts and highlighting the importance of genuine parts to the consumers boost growth and profitability potential.
    • Understanding the consumers’ considerations in a repair situation is our base for optimal value-based pricing of spare parts to drive profitable growth.
    • Modularization is a key lever for agility and profitability while meeting rapidly evolving regulations.
  • Extended Warranty
    • More frequent consumer direct interaction opens possibilities to present our offerings to consumers and grow our penetration rate of extended warranty. Mainpoints of contact include D2C sales, product registration, and usage of our repair services.
    • Subscription solutions increase conversion rates by lowering barriers to purchase, illustrated by high growth in two subscription-based offerings available in Europe since 2021:
      • Care: an all-inclusive monthly subscription that consumers can cancel at any time. It protects from all faults and damages and the appliance is replaced if not repairable.
      • Repair & Care: an initial repair at a fixed price paid in 12 monthly installments, followed by the Care offering.

Growth levers to reach the 10% ambition by 2025

*Note: Figures show % of aftermarket net sales vs total Electrolux Group.
2022 is actual figure and 2025 is an ambition.
Information provided at the 2023 Capital Markets Update:

Consumables and accessories an integrated part of the appliance R&D process

Starting point for our innovation is understanding the consumers’ needs,
their pain points and how to remove friction. Already in the early R&D
phase we focus on product lifetime and the consumer journey to ensure
captive fit and patented solutions. Please press play and then click on the
tab ”Strengthen our position in the high-margin aftermarket business”.

Consumables and accessories an integrated part of the appliance R&D process

Chart shows the market split of appliance breakdowns during a year

Key strengths to leverage the aftermarket

  • An installed base of ~350 million major appliances offers a large potential for aftermarket sales.
  • Deep consumer insights and strong expertise in appliances to develop tailored offerings for consumables and accessories as well as for service, repairs and extended warranty solutions.
  • Focus on lifetime value and complete consumer journey already in the innovation phase.
  • Well-established brands with high brand recognition.