Big producers like Osram and Philips have indicated a shift in the traditional lighting business towards selling services. But what does servicizing actually mean? This could range from selling services associated with lighting products, to leasing the products, or even paying for only light.
Just visit any large lighting producers website and there is already a tab for “services”. Most are offering services related to their products such as extended warranties, maintenance, energy efficiency optimization and design services. Some are going beyond this with lifecycle and financial service options. But truly innovative business models are still limited it seems.
A few good examples of innovation include the “pay per lux” service Philips provided in a project with RAU architects and again with the National Union of Students in London. The projects were initiated at the request of the clients who wanted to pay for light services only. Leasing light products seems to be working in some cases and with particular clients, like solar lighting kits in developing communities in Africa or municipalities who need a way to finance the higher up front costs (but lower life-time costs) of LED street lighting, for example in Washington D.C.
While Philips have indicated such models of business are what they believe is the future of lighting, there haven’t been too many more examples that I can find. It seems selling only light still needs some of the details worked out to make it attractive to a wider range of customers. This is not uncommon as such challenges were also part of the process with other products (think Xerox) in their move towards servicizing, and there are several barriers in moving towards product service systems (PSS) in general. It will be interesting to follow the development in the next couple of years as new business models are tested and more empirical evidence can give insight into what works and what does not.