Simon Leggett, managing director of OCG Lighting argues that consumers need to understand the true value of LEDs before they accept the cost.
Several major brands have recently announced their intentions to cut LED bulb prices to encourage uptake in the consumer market. However, what impact might this cost cutting drive have on the quality of the technology and its role in an energy efficient future?
Consumer reluctance to pay higher prices is a minor obstacle to widespread LED adoption compared with the disappointment and ultimate rejection that would result from technology falling short of expectations. The LED industry has learnt this lesson the hard way and is still battling the memory of manufacturers that over promised, under delivered and left a legacy of considerable scepticism regarding LED performance.
Producing lower cost lamps inevitably means using less efficient, old generation chips, which seriously impact performance – this does not benefit the industry, the end user or the energy efficiency agenda. Consumers will never be convinced to switch to LED lamps unless they see the advantages that the best LED technology can deliver – high quality light output, long life and significant energy savings.
Rather than be tempted into producing sub-standard technology to answer demand for the lowest possible costs, we need to shift the consumer mindset away from consumables and towards solutions. This change can be effected by consistent, high quality technology that will trigger increased consumer demand and, as a result, drive competitive product cost.
In a sustainable future, consumer understanding of ROI cannot be limited to the initial cost of the light bulb but must incorporate total product life span, product consumption, waste and recycling costs. This is a shift in logic that must be reflected in the attitudes of industry before we can encourage it in our consumers.
The lighting industry is rooted in operations based on high volume production, retail presence and a commoditised market. It needs to look forward to long term relationships with clients and business models based on service and solutions provision. Most importantly, industry needs to take responsibility for empowering consumers through better information, in particular unified and lifetime-based product standards.
Ultimately, the answer to pricing pressure isn’t to artificially drive cost down with less efficient technology but to help consumers to understand exactly what it is they are buying. When the true value of LEDs becomes clear to them they will be considerably more prepared to accept the cost.