[Soup] "Samsung and LG's washing machines are competitors in laundry subscription service"

Pioneering the daily laundry market through innovation in the laundry process

What will happen if we bring a new value strategy that innovates the process, not the output, into the laundry industry?

Compared to other industries, the laundry industry has been regarded as an area where innovation is less likely to occur.

This is because innovation in the laundry industry has been achieved mainly through the functional improvement of washing machines, which are the output of companies.

However, since the washing machine industry, which is based on the product of the output economy, the washing machine, has reached a certain level of growth, creating new value through product differentiation alone has reached its limit.

In addition, the laundry service sector has been slow in digitally-based innovation compared to other service sectors where digital transformation is taking place quickly.

The reason why it is difficult to innovate in the existing laundry service is because of the inherent nature of laundry.

Since the laundry is owned by the customer, the start and end of the service are connected to the customer's residential space.

For this reason, service providers are limited to laundry service companies near the customer's residence, which has served as a limitation in the structure in which economies of scale in laundry services are difficult to occur, and furthermore, the introduction of a digital conversion system is difficult.

In this situation, Laundrygo tried to improve the quality of people's lives by innovating the 'process' of laundry rather than washing machines through a change of thinking.

Of course, it wasn't that there weren't players in the field of laundry service before Laundrygo.

Most easily, the aforementioned neighborhood laundry is the first player to turn laundry into a laundry service and bring customers' laundry into the realm of service.

In addition, laundry delivery companies that sought to increase the convenience of laundry service by minimizing the inconvenience of moving the physical distance between the house and the laundromat can be said to be players who pursued innovation in the field of laundry service.

However, it is difficult to say that they have created value in the process of laundry 'experience'.

First, Laundrygo tried to solve the existing problems and improve the level of laundry service by introducing a new service called a mobile-based daily laundry service.

First, Laundrygo made it possible to request and receive laundry collection and delivery within 24 hours via mobile.

This shortening of laundry service opened the era of outsourcing laundry, which did not have to be done at home.

In other words, it provided a process that is irrelevant even if daily laundry is done in a space outside the house rather than inside the house.

This serves to reduce the value reduction part that was previously uncomfortable in terms of the customer's value chain.

In addition, elements that customers can feel in the washing result were added during the washing process.

For example, by using eco-friendly detergents or delivering laundry in a customized cover rather than disposable vinyl, when you receive the laundry result, you can feel the difference from the existing laundry service.

This laundry service was able to come out because the laundry service put innovation and differentiation points in the process.

This is in line with the discussion by Kazuhiro Obara, a famous Japanese consultant, that new value can be created by focusing on the process when innovation is no longer possible with products.

Specifically, process economy refers to the process of creating value and generating profits through the process itself, not the output.

The more value the customer experiences while using the service, the more the customer experience is improved.

How is Laundrygo's service different from similar non-face-to-face services?

Currently, there are other companies in the laundry service market that offer contactless laundry services similar to Laundrygo.

However, these companies are focusing on functional laundry services rather than enhancing customer experiential value.

Therefore, services for enhancing customer utility in terms of experience, such as using a separate laundry kit or using natural detergents to provide a pleasant laundry experience, are not provided.

Looking at the time required, it takes 24 hours for Laundrygo to request and receive laundry, while similar companies take 48 hours.

Overall, Laundrygo is focusing on providing premium services to improve customer experience.

These differences lead to differences in service costs.

Similar companies offer laundry services at a relatively lower cost than Laundrygo, suggesting that customer segments can be segmented in the laundry service market as well.

-won ▶ Why did Laundrigo find an opportunity in the innovation of the laundry process?...View full text of <Soup Interview>

Laundrygo's founding and the process of pioneering the laundry service market

Laundry is a part that requires a lot of time and effort as part of food, clothing and shelter from the customer's point of view.

It is true that laundry is often perceived as an inconvenient and cumbersome part of daily life, like 'homework', because it is a field that requires daily labor.

Laundrygo introduced a mobile-based subscription-type laundry service, a service that solves repetitive homework on a daily basis, and tried to return the time to customers' leisure time by saving troublesome washing and hanging and folding laundry.

The optimal washing course required for each laundry and the laundry service that delivers the laundry to the door in a neatly organized state after washing changes the perception of laundry, which previously resulted in a feeling of 'annoyance', to 'neat laundry'. could be converted into experience.

This is a departure from the perspective of viewing the business of laundry service as just 'washing dirty laundry'.

In addition to providing laundry service as a regular subscription type so that customers can feel that their lives have been improved through laundry, Laundrygo pays attention to details, including invisible parts, and focuses on the essence of the business of laundry service as an "experience." " was added.

Specifically, in order to provide value to customers in terms of experience, natural detergents are used, collection kits (customized service) are used depending on the type of laundry such as underwear nets, washing nets, duvet packs, and sneakers vinyl, and the use of hangers and laundry covers. Pick-up, and one-day delivery were introduced.

Furthermore, by setting the laundry space outside the residential space and returning the washer and dryer space to the customer, the goal is to provide a better experience and provide value to the customer in terms of awareness and utilization of the residential space.

Since launching the service in March 2019, Laundrygo has successfully grown the market with a monthly increase of more than 30%.

In the course of faster-than-expected growth, a lack of labor began to appear in the laundry process.

As soon as possible, even the manpower available for mobilization, including CEO Cho Sung-woo, began to be put into the washing process, but it was in a desperate situation to establish a fundamentally advanced washing process.

The difficulty in process automation and advancement was due to Laundrygo's inclusion of laundry services as the entire laundry.

Laundrygo has launched a laundry service that solves water washing and dry cleaning at the same time to innovate the existing dry cleaning-oriented laundry service.

However, at the time, there was no laundry system that could do both of these things at the same time.

For this service, Laundrygo had to be a pioneer in building the system itself.

While touring laundry factories in the U.S. right before the start-up, the idea of ​​automating the washing process and delivery was embodied, but trial and error were inevitable in the process of actual application.

There was no precedent for establishing an automated system optimized for all areas, such as water washing and dry cleaning, and items such as blankets, clothes, and underwear while maintaining constant laundry quality.

In addition, since the smart factoryization of the laundry process had to include not only the laundry service but also the delivery system, the final combination of laundry and logistics had to be achieved.

▶ How was Laundrygo's smart factory built?...View full text of <Suppinterview> In

fact, the smart factory system was a concept that CEO Cho Seong-wu had envisioned since founding Laundrygo.

To this end, at the same time as Laundrygo was founded, it acquired Aplus Machinery, a US laundry smart factory design, procurement, and construction EPC specialist.

CEO Cho Sung-woo wanted to build a laundry smart factory network targeting various cities from the perspective of laundry as laundry, delivery, and technology through redefinition of the laundry business.

The insight into the IT system for data accumulation and prediction for one-day delivery by combining the concept of delivery with laundry was possible because CEO Cho Seong-woo was in charge of early morning delivery service at Baemin Fresh before founding Laundry.

He saw that the property of a delivery service was included because laundry had the characteristic of being in and out of the house and then back into the house.

In order to innovate the laundry process, which had not previously been applied with advanced facility systems and IT technology, CEO Cho Seong-woo seeks help from experts with knowledge of the washing process and collaborates with other companies to innovate knowledge. was also obtained.

In addition to Machinery, we collaborated with a Japanese conveyor company to install additional hardware.

After a year and a half of journey towards the smart factory system, including the effort to eat, sleep, and stay in the laundry room, Laundrygo was able to complete the smart factory system, including the automatic shipping system for each customer.

Laundrygo has the world's largest B2C laundry factory by securing the founder's ability to see through the essence of laundry service, an automation system for the laundry process, and a delivery system that can be delivered 24 hours a day as core resources.

By building a smart factory system, Laundrygo has overcome the obstacles that hindered its growth and secured a competitive advantage to grow even bigger.

Furthermore, it has become a pioneer in accelerating innovation in the laundry process sector, where innovation has been relatively low compared to other sectors such as e-commerce.

Laundrygo, which pioneered the laundry service market based on daily laundry service, successfully combined laundry and logistics systems and expanded its category into various fields.

First of all, it showed that it was expanding its territory to the commerce field related to laundry service.

Laundry service requires a process of leaving and finding.

Clothing owned by customers must come out the door and then come back inside after being washed.

The meaning of the laundry kit entering and leaving the house means that it is possible to expand to a wider range of products and services related to the customer's lifestyle.

The scope of service provided has expanded from the first dry and wet laundry service to repair and after-sales service for luxury goods.

Subsequently, it entered the lifestyle commerce field by selling lifestyle products including luxury towels.

Second, Laundry 24 (unmanned smart laundry) is an unmanned smart laundry that started service based on an automation and innovative business model.

While generating sales quickly after launch, the number of affiliates is also showing a rapid increase (80 as of July 2022).

Third, by acquiring Cleannuri, a hotel laundry service, the company is advancing into the B2B area with a business model called Laundrygo Business (next-generation B2B laundry service).

It is a B2B service targeting hotels and small and medium-sized self-employed people.

In the existing B2B laundry industry, laundry that occurs at each business site, such as chefwear, uniforms, and customer laundry, had to be separated from lodging linen laundry and entrusted to different laundry factories, resulting in inefficiency in the process.

Laundrygo showed an effort to pursue efficiency and innovation in the B2B laundry process by handling all laundry processes in one-stop.

Likewise, in the industrial sector of the laundry industry, Laundrygo has expanded the possibility of category expansion.

It can be said that washing machines in the past were in the area of ​​products, and laundry services were in contrast to moisturizers, which could not get out of the simple service area and expand the category.

In this way, Laundrygo has opened up the possibility of expanding the category into various sectors through laundry services and automated processes in laundry factories.

**If the 'Go to View' button is not pressed, you can view the address by moving it to the address bar.