This is an interesting idea, but not sure if they examples quite hold up.

The reason why it makes sense for Rolls Royce from an economic perspective to sell the service of its engines rather than the engines themselves, is that its a highly specialised product that requires maintenance and care. Neglecting this will literally cost lives, while employing mechanics in-house to maintain the entire fleet will be expensive and more difficult to manage for the airline.

Markets reward efficiency and, in this case, selling the service is the more efficient model - and one that is quite common in B2B.

A similar model is much harder to replicate for consumer commodities such as a fridge or a smartphone that are relatively inexpensive to acquire. And the inconvenience of having to make do with a loan phone while yours is in repair plus the hassle of getting a broken item to repair and sending it back once done hardly seems worth it for either the company or the consumer.

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german expat in Australia | writes about climate change, marketing, books & big ideas | head of strategy at brandchemistry.com.au | editor at Climate Conscious

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Andrea Hoymann

Andrea Hoymann

german expat in Australia | writes about climate change, marketing, books & big ideas | head of strategy at brandchemistry.com.au | editor at Climate Conscious

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