Several major brands have recently announced their intentions to cut LED bulb prices to encourage uptake in the consumer market. The argument is that the high cost of LEDs is prohibitive for householders.
But the truth is that not enough is done to help consumers understand the long-term benefits of energy-efficient lighting. We also need to consider the impact that this cost-cutting drive may have on the quality of the technology we’re supplying.
Consumer reluctance to pay higher prices is a minor obstacle to widespread LED adoption compared with the disappointment and ultimate rejection that would result if the technology falls short of expectations.
As an industry that has learned this lesson the hard way, we should know better. After all, we’re still battling the memory of LED manufacturers that over-promised, under-delivered and left a legacy of considerable scepticism about LED performance.
Producing cheaper lamps inevitably means using less efficient, old generation chips, which seriously affect 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 substandard technology to answer demand for the lowest possible costs, we must shift the consumer mindset away from consumables and towards solutions. This change can be effected by consistent, high-quality technology that will help increase consumer demand and, as a result, drive competitive product cost.
In a sustainable future our understanding of return on investment cannot be limited to the initial cost of the lamp but must incorporate total product life, product consumption, waste and recycling costs. This is a shift in thinking that must be reflected in our own attitudes before we can encourage it in our consumers.
As an industry it is important that we evolve from operations based on high volume production, retail presence and a commoditised market and look forward to long-term relationships with clients and a business model based on service and solutions provision.
Most importantly, we must take responsibility for empowering the consumer through better information, in particular through standards that are unified and consider the entire lifetime of a product.
Ultimately, the answer to pricing pressure isn’t to artificially drive cost down with less efficient technology, but to help the consumer 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.
Simon Leggett, managing director, OCG Lighting