Bundles: Pay-as-you go for responsible consumerism

Show_bundles_case_study__image New appliance-leasing system, Bundles, offers consumers access to high-quality white goods and increased energy awareness, helping them to use less energy, create less CO2, and contribute to a circular economy.

Results and impacts

The pilot was a great success, both in terms of cost of acquisition and customer satisfaction. ‘My first customers are amazed by the machine!’ says Peters, ‘Apart from the concept, the appliance itself is wonderful. You think a washing machine is a washing machine, but if you use this new Miele appliance the laundry comes out cleaner, drier and less wrinkled...’ The data gave a wake-up call to almost all customers, ‘People are amazed by how much the machine is used and how many cycles. Somehow they are motivated to improve and immediately start using less energy. Seeing the impact of an individual appliance really helps people to act as responsible consumers. My current customers are already using 15 % less than they were initially.’

This kickstart allowed Peters to start finetuning the product, preparing automation of processes and funding the business. ‘We are focussing on getting the funding for the next launch of the laundry bundle in December or January... I am currently in discussions with a crowdfunding platform through which I could offer bonds with a fixed period and payback per month from individuals. The idea is that while the business will be funded with equity, which is used for initial sales, product development and operations, the appliances are financed with bonds, initially bought by the crowd. Individuals can fund a machine and receive revenue over time.’

Aims and objectives of this sustainable energy action

Bundles does not only provides customers with a better opportunity to use energy smartly, but also cuts down the demand for cheap, short-life electrical appliances. Customers are in a position to use more effective and energy-efficient machines than they might be able to afford outright. By leasing them instead, they can save on energy costs without the initial investment involved in buying superior quality white goods. They are also given a high level of usage-information regarding the appliance, putting them in a much better position to avoid energy wastage and get better results. Customers can assess how many cycles they need and chose a monthly payment package accordingly. They are incentivised to keep within their bundle threshold by continuous access to usage data, user advice, and charges on excess energy use.

Technical and financial implementation

The creation of a Bundles appliance is only a matter of bringing together the right technology and enough capital, explains Peters; ‘I buy a high-quality, energy-efficient off-the-shelf appliance, as well as a smartplug.’ With the help of data-collection experts, UppEnergy, and algorithms built by data-analytics company, ONZO, Peters tailored a method for communicating energy usage and energy advice to Bundles customers based on their usage. ‘From the power signature all kinds of information is derived that not only tells people how often they use the appliance, but also how they can use it more efficiently, and what the total cost of use is. An increasing number of appliances will talk to the internet directly which makes it easier to derive the right information from an appliance.’ Peters’ expertise allows him to assess the customer’s energy use over the first month, and explain to them how they can alter their behavior to lower the bill. ‘By connecting the appliance to the internet, applying data-analytics and using the analytics in mobile customer engagement, not only is energy saved, but the performance is enhanced and the lifetime of the appliance extended,’ says Peters, ‘The bundle includes distribution and installation, warranty on the working appliance, everything… so the customer has that added security and we ensure that the appliance is properly maintained for our future use.’

Initial capital is needed to purchase the appliances, and because of the cost of high-quality goods, it will take 5 or 6 years for the business to start to make a profit, depending on the growth speed. With mentoring, office facilities, information support and a €20 000 investment from Amsterdam’s smart energy SME support, Rockstart Smart Energy Programme, Peters began a partnership with Miele, purchasing and retrofitting the Miele WKG 120 WCS  washer to create a laundry bundle, Wasbundles. With the help of marketing experts, he sought out his first customers.

Lessons learnt

Not only does the Bundles structure help to teach customers energy awareness on an appliance-by-appliance basis, but Peters hopes that by replacing a culture of ownership of household appliances with one of responsible usage, Bundles can contribute to a circular economy across Europe. ‘Through the new business model manufacturers will have more incentives to build appliances that are designed to last, saving a lot of resources, including energy.’

How this action could be replicated

Bundles has big plans both to expand its appliance range and its user profile. ‘There is an international market for what Bundles can offer,’ explains Peters, ‘It is a concept that has no real limitations. For Wasbundles alone we are already in touch with laundry market experts in Spain, Germany, France, UK, Sweden, Dubai, Eastern Europe, US, China.... and the response indicates that in every country it is beneficial to shift from ownership to use.’

Next, Bundles will target home coffee-production, helping customers to process coffee themselves by removing the initial investment hurdle, reducing appliance maintenance cost and increasing its lifespan, wasting less energy, less coffee, and less money.  

Contact details

Marcel Peters

Bundles

Herengracht 182

Amsterdam, The Netherlands

phone : +31 85 4011908

e-mail: marcel.peters@bundles.nl

Further information

www.bundles.nl