Frost & Sullivan (hereinafter referred to as 'Frost & Sullivan') has officially released the '2024 China Smart Water Purification Service Industry White Paper' (hereinafter referred to as the 'Report'). The Report aims to conduct a comprehensive and in-depth analysis of China's smart water purification service industry, exploring the driving factors behind the industry's development from multiple aspects such as business models and drivers, tapping into the industry's tremendous potential, and tracking future development trends.
PART.01
Overview of China's Water Purifier Industry
A water purifier refers to a device that deeply purifies tap water through physical, chemical, or composite filtration techniques. It is used to remove harmful substances such as suspended solids, bacteria, heavy metals, and organic pollutants from water, thereby enhancing the safety and taste quality of drinking water. It includes product categories such as filters, water purifiers, softeners, and direct drinking water purifiers.
With the continuous improvement of industrialization and urbanization levels in our country, water quality fluctuations in some areas have become increasingly prominent. Coupled with the improvement in residents' living standards, the demand for healthy, safe, and high-quality drinking water is growing day by day, driving water purifiers to gradually popularize from high-end home scenarios to mass household, office, and public scenarios. At the same time, the rise of the young consumer group and changes in family structure are reshaping the usage scenarios and consumer habits of the water purifier industry, bringing new growth momentum to the industry. The functions of water purifier products have also evolved from single purification to intelligence, boosting the continuous expansion of the overall market. The Chinese water purifier industry benefited from early consumption upgrades and increased awareness of healthy drinking water, achieving steady growth. Although it was hit by a short-term impact from the pandemic in 2020, public attention to drinking water safety has further deepened, driving rapid recovery of user demand for water purifiers in 2023. In terms of revenue, the market scale of China's water purifier industry reached 143.18 billion yuan in 2024.
Data source: Analysis by Frost & Sullivan
PART.02
Overview of China's Intelligent Water Purification Service Industry
Intelligent water purification service refers to the free deployment of equipment and filters, with users paying based on water purification flow rates or duration. Intelligent water purification service is a typical product service-oriented operation model, which focuses on significantly reducing initial capital investment costs for users by providing free water purifiers and filters, and then charging them based on water purification flow rates or usage time. The intelligent water purification service model achieves real-time monitoring of the operating status of water purifiers, water quality changes, and filter lifespan. Through precise billing, intelligent maintenance, and proactive services, enterprises can build a high-frequency, long-cycle user operation system to improve operational efficiency and user experience.
The business model of China's water purifier industry is undergoing a transformation from product-oriented to intelligent-driven service-oriented models. According to business model classification, China's water purifier industry can be divided into the following models: complete machine sales model, rental model, and service model:
●Overall machine sales model
The complete machine sales model refers to a scenario where users pay the full cost of the water purifier in one go through online or offline channels, thereby acquiring full ownership of the product. Subsequent filter replacement and maintenance services are mostly borne by the users themselves or require additional payment.
●Lease model
The rental model refers to a system where users pay a fixed rent monthly, quarterly, or annually to obtain the right to use a water purifier. In the later stages, users are responsible for contacting the relevant manufacturer to replace the water purifier filter elements and receive after-sales service. This model effectively reduces the initial purchase cost for users.
●Service model
The service model typically refers to the practice where companies provide free water purifiers and filters to users, and through the integration of a built-in flow metering module with IoT technology, they implement billing based on water purification flow or usage duration.
Data source: Analysis by Frost & Sullivan
Intelligent water purification services have become a key fulcrum for driving the industry from 'selling products' to 'selling services' due to their high repurchase rate and strong user loyalty. This service model is expected to become an important force driving the high-quality development of the water purifier industry. In terms of revenue, the market scale of China's intelligent water purification service industry reached 880 million yuan in 2024. In recent years, users' comprehensive needs for the convenience, intelligence level, and service quality of water purifier products have been continuously increasing, providing a solid foundation for the development of intelligent water purification services. Looking ahead, with the widespread application of cutting-edge technologies such as 5G and artificial intelligence, this model is expected to achieve deep integration with multiple scenarios such as smart homes and health management, thereby becoming a new driving force for the growth of the water purifier industry. It is estimated that in the future, as users' understanding of intelligent water purification services continues to deepen, their overall penetration rate is expected to significantly increase. The following are the driving factors for China's intelligent water purification service industry:
● The improvement of residents' health awareness drives industry demand growth
With the acceleration of industrialization in our country and frequent fluctuations in water quality in some areas, residents' attention to drinking water safety and quality has significantly increased. According to the 'China Environment Status Bulletin', although the overall qualified rate of urban water supply in China is relatively high, problems such as secondary pollution, old pipelines, and building water tanks are still widespread, driving the demand for water purifiers as a rigid need for residents to ensure drinking water safety. At the same time, the rise of the young consumer group and changes in family structure have reshaped the usage scenarios and consumer preferences for water purifiers. New-generation users pay more attention to the quality of life, convenience of use, and product cost-effectiveness, and tend to choose intelligent water purification services that integrate products and services, laying a solid market foundation for the sustainable development of the industry.
● The integration of emerging technologies drives product intelligence and service upgrades
The deep integration of water purifiers with emerging technologies such as the Internet of Things (IoT), cloud computing, and big data has greatly enhanced the functionality of intelligent water purification services. It has achieved real-time and precise management of equipment operation status, water quality monitoring, filter element life management, and remote control. Based on the intelligent networking system, service providers can implement a closed-loop management of filter element replacement reminders, fault warnings, and user water usage behavior analysis. This not only optimizes the user experience but also enhances the user lifecycle value, promoting a strategic transformation of the water purifier industry from traditional whole-machine sales to service models.
● Policy support promotes the development of intelligent green home appliances and service models
The state has clearly emphasized the promotion of the popularization of smart green appliances and the establishment of service systems in its 14th Five-Year Plan and related green consumption policies. The government has issued several guiding documents such as the 'Comprehensive Work Plan for Energy Conservation and Emission Reduction' and 'Several Measures to Promote the Consumption of Green and Intelligent Appliances', actively encouraging enterprises to innovate product and service models, and cultivating a consumer ecosystem centered on intelligence and service. Policy support has provided a favorable development environment and strategic opportunities for the smart water purification service industry, effectively stimulating market vitality and empowering the industry to achieve high-quality sustainable development.
● Business model innovation drives the upgrade of industry value chains
Intelligent water purification services not only achieve precise monitoring and data collection of user behavior but also support personalized services and targeted marketing through big data analysis, further enhancing user loyalty and repurchase rates. In addition, relying on a continuous service operation system, enterprises can expand beyond core water purification services to include related health derivative services and products such as health management and nutritional advice. While enriching the user experience and deepening user relationships, they also enhance the overall user lifecycle value. With the continuous improvement of the service chain and technological iteration, intelligent water purification services are gradually building a user-centered health ecosystem, promoting the upgrade of the industry value chain and becoming a key driving force for the industry's large-scale, sustainable, and high-quality development.
