New Home Insights Podcast Episode 42 Transcript | John Burns Real Estate Consulting


Episode 42: The Invisible Kitchen: Whirlpool’s Consumer Trends before and after COVID-19

Transcript

Dean Wehrli:

Hi, this is Dean. The episode you’re about to hear was recorded at our Design Summit event back in February of this year. That was before COVID-19 hit, so please keep it in mind as you listen to this podcast with Dan Clements and Jessica McConnell from Whirlpool. It’s a fascinating podcast, but since it was before COVID, we have Dan back for some follow-up questions just to see how things are been going since COVID has hit. That immediately follows the original podcast with Dan and Jessica. So stay tuned for that, and please enjoy this discussion with the invisible kitchen from Whirlpool.

Dean Wehrli:

So we’re going to talk today with Dan Clements and Jessica McConnell from Whirlpool. And let’s start with the story about me, because obviously. And so, I’ve recently… my wife introduced me to the Great British Bake Off. Anybody watched Great British Bake Off? Love that show. Still sad about Mel and Sue leaving. It’s fresh to me… And even though it happened five years ago. So, I’ve been more comfortable in the kitchen. Been little bit more of a kitchen person than I ever have been before. So we’re going to go into the kitchen now with Dan and Jess and talk about what they, a concept they call the Invisible Kitchen. So really, which is kind of about how appliance… not so much how much appliances are changing for the sake of appliances, but how appliances are changing to be sort of seamless with the kitchen, and how… hopefully that makes sense. They’ll make way more sense than I do. So actually, let’s start though, by having you two actually introduce yourselves.

Dan Clements:

Sure. Hi everyone. It’s great to be here with all of you today. My name’s Dan Clements. I am the Senior Director of the Advanced Design Studio and Global Brand Studio at Whirlpool. We work on developing the future roadmap for all of our brands globally, as well as all of the type of future experiences that we want to create within those brands. Within our brand team, we focus on the first one to five years out. Our advanced design team focuses more five to 15 years from now. So we’re really pushing towards what’s going to drive our future for each of our brands along the way.

Jessica McConnell:

Hi, hi everybody. I’m Jessica McConnell and Dan’s my boss and I’m the Director of Advanced Design, and I’m responsible for the Advanced Industrial Design team, Advanced Color Finished team and an Advanced Graphic Design group, all working together to create the future. I’ve been at Whirlpool for eight years now. I’ve started off career as a color finished material designer where I’ve worked on consumer electronics and appliances. But my passion is really the kitchen, not only cooking, but also the design of it. It’s something that I just live and breathe.

Dean Wehrli:

Before we get to the meat of what we’re going to talk about. Let’s just talk about, for lack of a better term, your methodology. It’s the, how you do what you do, and how you discover the things you discover.

Jessica McConnell:

So it’s a… If anybody’s ever done any trend forecasting, it’s a very similar process to what others do. You’re taking a lot of insights around you, taking in insights, but you’re also looking at high level social, cultural trends. So these are political things, environmental things that are impacting people’s lives every day. And from there you go into consumer trends. So how are consumers responding to these influencers and their lives? The things that they cannot control, what is going to cause them to do and so forth.

Jessica McConnell:

And then from there, you’ll look at technology trends. You have all of these little bubbles of information. And then from there, you do what’s called scenario planning. Where you take those things, put them together and say, “Okay, if X and Y happens, what will happen here?” And you start to try to predict the future by doing it that way. The same thing is done for color. You translate social, cultural trends into aesthetic themes, which sounds like maybe voodoo magic, which may be some of it is, but…

Dan Clements:

It kind of is.

Jessica McConnell:

Yeah, it is. But the funny thing is, when we do these processes of color forecasting, we’re usually right on. So it does really work. Oddly enough.

Dean Wehrli:

We can talk about voodoo if you want. I’m flexible, we can switch it up. So, let’s start with the concept. Just the bare bones of the concept. When you say again, “I’m more of a kitchen person now.” But I’d be lying if I said I’m a kitchen person. Can make pretzels, still can’t make anything else successfully, by the way. What do you mean by that concept of the Invisible Kitchen?

Dan Clements:

Right. So the idea of the Invisible Kitchen, we really made a statement about that as a provocation to get people’s interest in, to bucket all of the trends, insights, that Jessica was talking about, into a bundle. So we could help people to understand the way we want to shift the way consumers think about our products and the way we think about the way our products integrate with our consumers lives in a day to day basis, in the future. It’s also a great place for us to look to the past. I think today there’s been a lot of great conversations about the history of the kitchen. And if you think about it, over the past hundred years it’s evolved very slowly and methodically. Starting from kitchen appliances in the kitchen spaces in the early 1900’s, as purely functional space and separated off from the rest of the home. Moving on towards the development in the 20’s, 30’s, and 40’s. Around the work triangle and the efficiency of appliances to help allow people to do things, empower them in their day-to-day lives.

Dan Clements:

And then you had mid century, which was this, “Let’s bring the kitchen space into the rest of the home.” And the way in which food relates to every aspect of the things we do within the home day to day. But since then, honestly, it hasn’t changed a whole lot. So we’re using this invisible kitchen as a means for us to take the idea of the kitchen, which when you think about what the kitchen is, immediately we have an unconscious bias about it. So we throw that out and say, if we’re no longer thinking about that, then what role in the future do we play? Given all the technology that’s going to be available, as well as various ways to access food, that we’re going to be relevant, and valuable to the consumer in the future.

Dean Wehrli:

You guys didn’t know you’re going to have a brief kitchen history, did you? I don’t think… Well, now you have. So, you’re welcome.

Dean Wehrli:

So Let’s talk about then, the motivation. What is it that is motivating folks to want to have this kind of more seamless, integrated invisible kitchen?

Jessica McConnell:

So the first two big ones, first the open floor plan kitchen, which isn’t going anywhere. It does one thing that is kind of annoying, which it creates visual clutter. When you have one big open space, you have all your stuff staring at you. And then on top of that all, you have this desire for personalization and showing off your prized items with open shelving. Pair that with just your life, where you have your stuff and dishes laying on the counter, and it can be very overwhelming. So we play a part in some of that visual clutter, and we know that we can help to decrease that through some design features and also where we think things will go in the future, as if the appliance has really become more de-emphasized in that space. We’re helping to clean up that clutter and leave room for people to showcase their personal items and decor, not the appliance so much.

Jessica McConnell:

The other one is a sort of backlash to high-tech looks. I think we’re coming out of this phase of blue lights and shiny black glass, was really deemed high-tech. People are now looking to sort of de-tech and celebrate mindfulness and so forth. And the black screens and blue lights and flashing information is not desired anymore. It’s distracting. And so appliances are full of screens and black glass. So we do see that reducing some of that would be supporting the invisible kitchen.

Dean Wehrli:

So let’s talk about something a little more… Let’s get into the specifics, I suppose. What are some of the ways that appliances are changing or becoming more seamless? And you mentioned colors a second ago. Color is a big, big part of how appliances are changing.

Jessica McConnell:

Yep, it’s a huge part. Yeah. And it’s really the first step. And it’s the first thing that we can do, I want to say, easily. But it’s not that easy. But it’s the easiest of things to start with, is color. And going back in history, there were some great colors out there. And actually in the 70’s and the 60’s, appliance color was a big part of integrating with the rest of the home and the kitchen. It was almost like one big furniture piece. Avocado goes with so many different wood tones. It’s a very flexible color. And then you saw in the 80’s and 90’s, basically nothing. The appliance just became a neon sign in the kitchen. It’s either bright white or shiny black, and it’s just this imposing thing standing there. So really softening up the colors, brings it more harmony into that kitchen space between appliance and cabinets.

Jessica McConnell:

So in 2015 we launched Black Stainless, which is our KitchenAid color, which we’ve now expanded to Whirlpool. That color was designed to be not really black, it’s sort of a light black, and it’s a matte finish, and it has very warm undertones. So it pulls in those wood tones. So it can actually make a wood kitchen feel more cohesive. We did the same thing with Whirlpool, with our Sunset Bronze Collection. It is a warmed up stainless steel. It has a little bit of a champagne hue to it. It’s very subtle, but it is designed to pull in the wood tones and create a more harmonious look between cabinet and appliance.

Dan Clements:

And I think a really great example here with this new line of Whirlpool products is that, and it may not seem big to everyone in the audience, but it was for us in terms of thinking inside the company, around, how do we create that seamless integration from a physical design standpoint? And what you’ll notice with this design is, the hardware is lighter, more delicate and more responsive to the hardware of the kitchen. The design lines are cleaner, more architectural, less about us designing something that we’re proud of in terms of surfacing, like you would an automobile, and more about the way in which it fits in with the space and blends in beautifully and finds harmony between the environment and the physical product.

Dean Wehrli:

How far can that seamlessness go though, how much? At some point, does the kitchen become intrusive to the rest of the house or are today’s consumers really want that to be just extreme?

Dan Clements:

Well, I think that’s something we were starting to see in the house presentation. And I don’t know if you saw it as well, but it’s like consumers don’t know yet what they want. And they’re starting to find these blends between living space, entertainment space, cooking space. And really the only problem we have, and I guess we can talk about it a little bit later, is that, we’re not working together enough. There’s nothing I can do to change the way cabinets are installed or the way we design these spaces. I work on the appliances. So there’s a huge opportunity in terms of the way we can all work together to deliver to the consumer things that they didn’t know that they wanted.

Dean Wehrli:

Is avocado still a thing? I’m so bad. Avocado toast I know is… I understand. But is avocado still? What are the hottest colors for you?

Jessica McConnell:

So we actually… yes, green. And you can see right here. Green is really big and we’d seen in previous years, navy blue was a really big color for cabinets. And also I take care of a lot of the KitchenAid stand mixer colors too. So we’re always looking at these things. Green is really huge. We actually launched a stand mixer a couple of years ago, Avocado Cream. It actually did quite well for us. It was an updated avocado. But we’re actually seeing all shades of green really coming into play in the kitchen. And it’s a sign of vitality and re-energizing. It’s tied to health and wellness. So it makes sense that it’s a color that’s coming to the forefront.

Dean Wehrli:

Do you see big bold colors? We had a podcast recently with Nino Sitchinava, with Houzz and Lisa spoke from Houzz also earlier. But she was talking about how really bold colors are actually starting to become… they’re trending upward. The blues and hunter greens and things like that. Do you see that happening with you guys?

Jessica McConnell:

Yep, absolutely. So as much as you see sophisticated tones, you also see a lot of really bright hues. And I think that plays into people wanting less cookie cutter expressions. They want something that is uniquely theirs. And if they have a very gregarious personality, then they’re going to show that off in the colors that they use in their home. And there’s new ways, and the rules are broken around how you use those colors, where you can put it just on the island or just on the uppers or just on the lowers and create a focal point in the kitchen with color.

Dean Wehrli:

I was…

Dan Clements:

And I want to mention, this really warms my heart. This is not our photography. This is something we found on Instagram as a blog. And we spent six years of our life delivering this. And to see it in the wild and to see someone utilize it in a way that we intended it to be used, as a democratization of design. This is a low, high budget renovation kitchen. And to see them use our products in the way that we wanted them to be used is just really touching to us.

Dean Wehrli:

You’re a parent, you see. You set your children free.

Dan Clements:

That’s right.

Dean Wehrli:

To make terrible mistakes.

Dan Clements:

You don’t get to control it, but you hope they do the right thing, and they did.

Dean Wehrli:

But they usually have poor judgment. So, let’s finish up with the design part. Are things becoming more… It’s all about being streamlined, being seamless. Is that what’s happening here with the overall, the larger, bigger picture design?

Jessica McConnell:

Yeah. So as the exterior of the appliance becomes less of the brand aesthetic. I think in the past, when we used to do appliance design, it was very much like, “How can we make this look like Whirlpool?” And do a lot of extra whizz-bang things. Well that is no more the conversation. The conversation is the interior of the product. And that is where we see the future going. That is where your brand expression is. And that is where you can have a real wow factor. Because it’s closed door most of the time. So it’s not really obtrusive with anybody’s existing decor or cabinets. So it can really a de-lighter as you open up the doors. So a good example of this is something that we did and launched several years ago with JennAir, is the obsidian interior, it’s a matte black metallic interior.

Jessica McConnell:

It is absolutely a wow factor when you open it up. When it doesn’t have any food in it, it is very sexy. But then when you put food in it, and this is how it was designed, it was inspired by jewelry boxes. We completely rethought refrigeration. It’s not a clinical hospital space. It is a precious space, like a jewelry box or a Dutch painting, if you will, where, what you put in there really pops. So we want to celebrate your things, your items, those things that you love. The food that you are excited to prepare. And that’s the goal of this color, was to make everybody’s food look amazing, but also look beautiful, for its time.

Dan Clements:

I also want to mention, I actually was just at Modernism Week in Palm Springs and there are a number of houses that our new JennAir product was made a part of the renovation. And so we’re at a party and I’m standing by the Obsidian Column refrigerators and a designer walked up and looked at it and said, “Who would’ve thought that appliances could be this sexy?” And I said, “Well, we did.”

Dean Wehrli:

That’s twice.

Dan Clements:

It was a beautiful moment.

Dean Wehrli:

You guys have used the word sexy twice now. Just by the way, I can’t identify most of the food in that refrigerator. But that’s my fault.

Jessica McConnell:

Well, the next one gets even more sexy.

Dean Wehrli:

Yeah, I want to see the next one. Is that the Burlesque?

Dan Clements:

More sexy.

Jessica McConnell:

There is more sexy. It’s this one. I don’t know if it’s showing up very well. This is what we call Burlesque. It’s a deep red interior.

Dean Wehrli:

Is redder than that on Google.

Jessica McConnell:

Yeah, it is incredibly sexy. And then we have a alligator inspired, glass patterned air tower in the back, in the same metallic, deep red color.

Dean Wehrli:

You can’t go much redder than that, can you? Because then it looks like it belongs at the hotel from the Shining and it’s more scary.

Jessica McConnell:

Yeah, no. Yeah. And this is one thing, we designed the colors to make food look good. So when we design the color, we have a set of fake steaks and fake lettuce that we put next to the colors to see how delicious it makes them look. And so we tweak our colors based on that. But this is a limited edition, by the way, there’s only 13 of these available for purchase.

Dan Clements:

And we wanted this vibe to be…

Jessica McConnell:

What now?

Dean Wehrli:

13, 13? Literally 13?

Jessica McConnell:

Why 13? Because, because we like unlucky numbers. We’re rebels like that.

Dean Wehrli:

Okay, sorry, go ahead.

Dan Clements:

And we wanted this to have a vibe, to have a destination. And the destination was basically a brothel.

Jessica McConnell:

Yeah, we had…

Dean Wehrli:

You guys have an interesting, way more interesting job than I realized.

Jessica McConnell:

It was red velvet. So we were kind of thinking of those sort of speakeasies with red velvet lined booths and so forth. And that was kind of an exclusive take on that. Yeah.

Dean Wehrli:

Okay. We should be in Vegas, or counties north of Vegas.

Dean Wehrli:

Now let’s talk about again, your crystal ball. We love to do crystal balls here at John Burns Real Estate Consulting. Tell us about what you think is going to be happening with appliance. What are some trends you see coming down the road?

Jessica McConnell:

So we believe that panel ready appliances will become mainstream. We see it. It’s been in the luxury space for many, many years. It’s actually quite common in Europe. We believe that that will start to come down to the mainstream. And by panel ready, this is essentially the refrigerator, the dishwasher, even cooking products are fully paneled and hidden. And that is probably a big statement to make. But we do believe that it is something that people will desire as part of open, and small space kitchens will drive some of that, because the small space kitchens need to serve multiple purposes beyond just a kitchen. And so that’ll be some of the things there. And then the tech-lash, the sort of backlash of technology, black shiny surfaces and screens, the desire for that will be gone.

Dean Wehrli:

So you’re talking about just that very techie looking interface, right? You’re not talking about technology and interfacing with your appliances, tech? That’s still huge and growing, am I right?

Jessica McConnell:

Yeah, that’ll be there, but it has to be something a little bit more silent and more predictive. So we believe… And currently where things stand is, people don’t necessarily trust the technology. They don’t believe that it’s working in the background in your favor. In the future, people will have that trust and we call it the Butler, the Invisible Butler. And this is all of your products, not just appliance, working in symphony in the background, aggregating information from various services and platforms, to better predict and provide solutions to whatever it might be that you need, before you know you need it.

Dean Wehrli:

And folks might be doing that through apps? Something like that, or will it be…?

Dan Clements:

Intelligence, automation…

Dean Wehrli:

It won’t be mind?

Dan Clements:

Sensor packages that we’re developing internally, that are going to drive that humanizing of technology, where it’s seamless, where it’s intelligent, intuitive.

Dean Wehrli:

How long before we can control our refrigerate with our mind? Is that…?

Jessica McConnell:

That would be amazing. I don’t know how long. But I’ve definitely thought about it.

Dean Wehrli:

That’s three ideas I’ve given you, but then again, you’ve talked about brothels, so…

Dan Clements:

Yeah, well, other than brothels, mindfulness. I think there’s been a lot of talk about things getting bigger. I think we’ve reached peak capacity, especially with appliances, almost to the point of going too far. And what we’re seeing, especially with the procurement of food changing, and the ability to have food delivered quickly. We’re going to see, I think, a retraction on the necessity to have high capacity refrigerators and all of these types of things that have driven the appliance industry for so long and in a lot of ways impacted our ability to create a kitchen that has appliances that fit in appropriately and blend in beautifully.

Dean Wehrli:

In 30 seconds, what do you want to see done differently, going forward in your industry?

Jessica McConnell:

Yes. Well, I’ll let Dan speak to that.

Dan Clements:

Oh yeah. So like I alluded to earlier, I think what needs to change is, we need to stop protecting all of our ideas and hiding them from each other. We are all partners in creating this space, which is the home. And we’re not going to get to the destination we need to get to, unless we find ways of reaching out to each other and developing what’s next, together. And you guys valuing appliances and wanting to work with us and vice versa, so we can help to get consumers ultimately what they want. If we’re selfish and protect what we have and not share more, then I think we’re all going to lose in the end.

Dean Wehrli:

All right. Thank you, Dan and Jess from Whirlpool. Appreciate it.

Dan Clements:

Thank you.

Dean Wehrli:

Hey, thanks for listening to that podcast with Dan Clements and Jessica McConnell from Whirlpool. That was done, as we mentioned upfront, prior to the impact from COVID-19. We have Dan here to follow up on some of those issues, as we are still in the midst of the impact of COVID-19. Dan, please say hi to the folks.

Dan Clements:

Hi, everyone. Good to be with you again.

Dean Wehrli:

We’re going to run through just a few of the key things and just see how those trends may have changed, or actually maybe not changed, now in this new world we have. Dan, let’s start with the first one, the biggest one, the invisible kitchen, this trend toward it’s less cluttered a kitchen, where appliances are less obtrusive maybe and more seamless. Is that still going strong with COVID or is it even going stronger?

Dan Clements:

Well, I think before I address that question, it might be good to take one step back really quick and talk about the way in which our trends were influenced and how COVID has changed that, because I think that’s going to help the conversation with some of these questions about what we shared at the summit. First of all, what was influencing our trends coming into this early this year was the generational shift of having Gen Y and Gen Z getting a seat at the table and entering the conversation and the way in which their thoughts and ideas around the way they expect their home to be actually influencing the conversation. I think for the first time, we’re really all taking it truly seriously.

Dan Clements:

From that side, from that angle, they were living lives that are influenced by technology, social media, always on, a lot of expectations and a lot of noise in their life, and I think they were already thinking about ideas like wellbeing and this notion that your home is a sanctuary and a place for you and your friends to have a safe place to interact, to represent your values and what you care about and to be a place that facilitates all of your needs.

Dan Clements:

The thing that’s happened since then is, I think, aside from the discussion being driven by them, now we have COVID, which has basically disrupted every aspect of everyday life, which is a really important point in the sense that it’s forced everyone to go back and ask themselves some fundamental questions, very basic things. What can I control in my life? How do I get what I need? Who and what can I trust along the way? Those are basic ideas. And now as we’ve been living in this space, it wasn’t two weeks that we were living at home, now it’s gone on, what, six, seven, eight months in some circumstances here.

Dan Clements:

We know that when you do something for three months or longer, it shifts your behaviors. It just shifts your mentality. And so people have found in this time, the one thing that they can trust is their home. It’s become the sanctuary for everyone, and it’s also become kind of the Swiss Army Knife for life. And so although it starts as something that’s a necessity, after a while, and this probably has happened with you and the listeners, you start to think, how do I make this something sustainable, something that I can find enjoyment in, that I can be at home all the time and have it serve all my needs in a way that not only serves the functional needs and the necessities, but also my emotional needs and a sense of wellbeing and happiness?

Dan Clements:

As it pertains to the invisible kitchen, the whole notion there was this idea that we make appliances that serve an important function, and certainly COVID has reinforced the idea that our work matters in a major way. But we’ve always felt like it’s not our job to always be at the center of attention. We want our products to integrate seamlessly with life and fit in anywhere in the home where they’re relevant. So it was true then in the sense that millennials and Gen Z were concerned about their home and the space within it and its function and rethinking the way that worked, and that’s still going on now.

Dan Clements:

We’ve gone from open floor plans where we just got these big open spaces, and I think now that people are working from home and doing school and this becomes the hub for all of your activities, you realize you have to segment things down and you have to make spaces work in multiple ways. So even within the kitchen, the idea of making appliances take a back seat and be more integrated in a way that that space can flex beyond just the functional need of creating a meal for your family, but also serve other purposes, perhaps an office or otherwise. I think that’s why from that perspective the idea of the invisible kitchen is still relevant.

Dean Wehrli:

Yeah. It’s funny you mention that, because the kitchen is really the focus or the location of that hominess. Home is the place you’re safe and you’re trusted, and the kitchen is really the center of that within the home.

Dan Clements:

Yep. And we’ve always found too that food is just a catalyst for conversation and connection. That’s been true here in these times as well. It serves not only substance, but helping to provide emotional needs as well and connection to others. And I think that’s also a reason why the kitchen is and will remain, however, that place where people gravitate to and want to spend their time, so you want that to be as comfortable as possible, and we’d like our products to only stand out in ways that are relevant to their needs.

Dean Wehrli:

And maybe that’s the only reason meatloaf still exists. It’s that classic comfort food.

Dan Clements:

Yeah, I love it.

Dean Wehrli:

Because otherwise, not a good case for it. In the podcast folks just listened to, we talked about color trends and how brighter hues were designed to make food look better, so I’m assuming that’s still something that you’re concerned with.

Dan Clements:

Yeah. I think again, kind of going back to the last question, it’s this focused attention on the home and the variety of needs it has to serve makes attention to the color and material and aesthetics even more important. This is going down to two things. In terms of bold colors and, I guess, more polarizing aesthetic choices, we are actually are seeing people make investments in accent pieces, statement pieces, buying a refrigerator with a leather door panel on it, because they want to be unique. And this is their home and they’re spending a lot of time in it, especially now, so they’re willing to get away from that mentality of I’m buying this home as a resale value investment piece to something that actually is designed for things that make me happy.

Dan Clements:

Now, on the other side, we’re seeing a shift from boldness towards more muted colors. And again, this gets back to this idea of wellbeing and the notion that how do we use color as a means of helping to set a mood or a vibe within our home? And so we’re seeing more of a shift towards inky blues and muted tones, which help to soothe and create a space that’s comforting and inviting and relaxing.

Dean Wehrli:

So you’re saying avocado is still dead?

Dan Clements:

Yeah.

Dean Wehrli:

Thank God. Technology. We talked about sort of the end of the black screen and at least becoming more muted, more in the background. Are folks still looking for that?

Dan Clements:

Yeah. I mean, the technology is an inevitability. As humans, we’re hardwired to just remove complexity from life. That’s just what we do, and that’s why we’re obsessed with innovation. And so it’s just inevitable the way things are going that with the proliferation of smartphones and other devices, which are all connected and can allow you to control and have access to a multitude of devices within your home, to automation and artificial intelligence and the way in which in the coming years it’s going to take over more and more of the mundane tasks that previously you as a user would have to hold that knowledge in your head and be able to have that interaction.

Dan Clements:

So I guess long story short is, the way things are heading, I think the next 10 years, you’re going to see tremendous change in terms of the way in which you interact with any product within the home. But yeah, especially from an appliance standpoint, you’re going to see a lot more intelligence, automation, and the use of the various ways in which you can interact with the product, from voice to other devices doing the heavy lifting, again, to help remove any unnecessary clutter or unnecessary interactions.

Dean Wehrli:

And voice too.

Dan Clements:

Voice, yes.

Dean Wehrli:

My next question is the touchlessness, the touchless appliance. I mean, that’s just going to be into overdrive, and will we see more voice activated everything, or is it infrared, or where does that stop? What can’t be touchless? “Ali Baba” and the fridge door opens, and “Crisper” and the crisper door opens. I mean, why not?

Dan Clements:

Yeah. And I think often people think of it as it’s going to be this or that, and I would say you’re just going to see a lot of diversity in a lot of different contexts. There’s going to be places where you’re still going to want that analog connection. Sometimes psychologically you want to have some control over what you’re doing, or a feeling of control, so there’s still going to be ways to connect with the product and with the experience, for sure.

Dan Clements:

I think as it pertains to voice, there’s a lot of great benefits to that in terms of hands-free interaction in a more intuitive and natural conversation with objects within the home, but it has its limitations too. You don’t want to read your texts out loud often. There’s certain circumstances where voice is not a desired way to input information. So it’s all contextual, but you’re going to just see a proliferation of different ways in which people interact with products, and sometimes based on their specific needs are tailored to the way that they prefer to interact with it.

Dean Wehrli:

It’s funny you say that, because we were over at a friend’s house and she asked Alexa to tell her what packages she had coming. I’m thinking, you might maybe not want to do that out loud. Sorry.

Dan Clements:

Sometimes it’s not appropriate. Context matters.

Dean Wehrli:

Context does matter. What are you doing to make things more germ friendly? I mean, obviously that’s just a huge consideration. Is that a focus for you folks?

Dan Clements:

It is. As always, we’re looking into ways to make things easier to clean, products safer to use. We’ve got teams working on various ways we can use existing technologies that we have available to us, different types of finishes that we’ve developed over the years that maybe didn’t come to market because of cost reasons and a lack of consumer desire for it. Yeah, we’re obviously looking at ways in which we can address those types of needs from our customers.

Dan Clements:

I would say though, too, that I’m really appreciative of the fact that we’re not focusing our strategy moving forward solely on sort of fear-based tactics around COVID. We’re really focused more on understanding the motivations behind the changes we’re going to see in consumers’ behavior and then look to the future at the ways in which some of that might motivate their needs or desires coming out of this. Hopefully we come out of this. If we don’t, all bets are off, but we’re looking at its appropriate role as a part of the larger equation of how we address a consumer’s needs moving forward.

Dean Wehrli:

I’m glad to hear that you’re not going to do it fear-based, like buy this Whirlpool appliance or you might die. You don’t love your family if you don’t buy our product. That’s good.

Dan Clements:

Yeah. I think there’s a lot of companies who can fall into that easy trap of let’s use what’s happening right now to drive sales. I don’t think that’s the approach we’ve been taking as a company, which has been really nice to see.

Dean Wehrli:

I’m glad to hear that. We talked about refrigerators getting smaller. Might that be something that’s going to change now, or has already changed now, and like refrigerators and pantries getting bigger for stocking up?

Dan Clements:

Right. So yes and no. We’ve seen in the early months from lockdown consumers purchasing a lot of necessity items. These would be freezers and basic appliances, this type of thing. Obviously, the heavier use has caused appliances that were maybe close to breaking, they would break, and they’re replacing more on the functional needs. And certainly from refrigeration, there was an initial reaction to stock up and stockpile.

Dan Clements:

Some of that isn’t going to go away, and I don’t want to dispute, depending on family size in the context of your needs, you may need more space than you did before. But what we’re seeing is in the 10 years I’ve been at Whirlpool, we’ve passed peak capacity for refrigerators or any of our appliances in general, to the point where us and our competitors have gotten to where you can no longer fit it through the door anymore. We’re getting to where it’s limited by the physical constraints of the home.

Dan Clements:

So we know we’re to that point and we’re moving past it. We’re seeing a lot more of a movement towards counter-depth refrigeration or French door refrigerators and products that have a more sort of sensible scale relative to the overall size of the kitchen and of relative importance, and distribution. So this idea that you may need the capacity, but does it come from one appliance instead of, hey, maybe I have a small beverage refrigerator in my office and I have a chest freezer in the basement and I have a French door bottom mount in my kitchen.

Dean Wehrli:

So you’re not going to do the Ikea way and have people get a refrigerator kit and put it together themselves in their kitchen? You’re not going to go there?

Dan Clements:

No. And we put it into their hands, we have problems usually, so we try to do that ourselves. So that’s one way, is sort of thinking about capacity in terms of distribution throughout the home, based on the need and location and so on. The other way to look at it is through disruptions to the food procurement ecosystem. This is all of the new companies that are coming in and radically changing the way that we get food, get it from the grocery store pre-made often, and of course changes in the restaurant industry as well.

Dan Clements:

So I think there’s a multitude of ways in which people can get access to the inventory that they need, and I think COVID has shown us and pressure tested some of the advantages and disadvantages towards more long-term thinking and stockpiling, versus which of these services and technologies hold up despite the challenges that are faced in terms of what the pandemic has put in place. And that’s not going away, and in fact, we see more and more of this. So yeah, from our perspective, when you tie those two pieces together, we think that trend toward smaller is going to continue.

Dean Wehrli:

Dan, let’s end with what we talked about actually at the end of the original podcast back in February, which was, you’re kind of a big advocate for teamwork in the industry. I’m assuming that’s true now more than ever.

Dan Clements:

Yeah, I think so. I mean, if you think back, the last big change that’s happened in the housing industry was post-World War II and this idea that people were coming home, the world had been disrupted in a big way, probably to some degree the same way we’re feeling today. And people were looking for homes and there was a lot of opportunity. A lot of things were in the air, which allowed some major changes and innovations in the way we live and the thinking about the role of the home and the way that companies work together to solve big problems and use technologies that are available to them to rethink the way people live and address the needs of a modern lifestyle.

Dan Clements:

And I would say now it’s true more than ever, because you couldn’t find a more opportunistic time than now, where everything’s up in the air for our companies to come together and solve some of the big problems that are difficult to solve individually or are difficult to solve just because of the infrastructure that’s in place and the consumer mindset and purchasing behaviors that have existed in the past. It’s kind of like the doors are open now to really rethink what’s possible, rethink what the modern home is, rethink what the modern community is, based on what people’s expectations are and what they’re looking for and what they’re looking to do in terms of integrating technology into their lives in a different way. So absolutely. It was important then, and it’s absolutely more important now than ever.

Dean Wehrli:

Yeah, that’s a good point. I hadn’t-

Dan Clements:

People love to work with us. We love to work with them.

Dean Wehrli:

I hadn’t thought about that, but you’re right. Crises are the best time to get change, to get real change, and that includes in the home.

Dan Clements:

Yeah. The mid-century modern period, which really the residue of it is everywhere, from open floor plans to indoor-outdoor spaces working in harmony, to that was the start of taking a freestanding range and deconstructing it so that you can cook and entertain guests at the same time. You can have your cooktop at the island, and you can have your oven against a wall and have the appliances appropriately placed so that you can afford yourself to a new type of lifestyle. So I think that’s kind of the place we’re in now, is like what can we do now that the restraints are off?

Dean Wehrli:

So built-in screens all over the kitchen, so you can have your Zoom meeting with family while you cook alone, quarantined in your house.

Dan Clements:

There you go.

Dean Wehrli:

Free from Dean. That’s all yours. Go with it.

Dan Clements:

That’s a great idea.

Dean Wehrli:

Well, Dan, thank you so much for following up. That was great. That was as good or better than the original one, I’m going to say, that we did back in February. Thank you so much.

Dan Clements:

You bet.

Dean Wehrli:

Hey, thanks for listening to New Home Insights. This is Dean Wehrli. I was with Dan Clements from Whirlpool. Thank you and see you next time.

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