What is it? Gerrard Street produce modular headphones designed for easy reparability. The headphones are sold to the customer or can be leased under a monthly subscription model. Both sold and leased headphones are covered by a lifetime warranty for free repairs.
Why is this important? It is estimated that we throw away approximately 50 billion kilos of electronic appliances every year (Gerrard Street, 2022c). With increasing digitalization and more and more devices entering our lives, this number might rise to 120 billion kilos of electronic waste by 2050 (Gerrard Street, 2022c). A large amount of this waste is due to premature obsolescence, caused by, for instance, a lack of reparability and difficulty in accessing spare parts (Bakker et al., 2020).
Main resource strategy: Slowing the loop through offering a monthly subscription service that ensures continued use as well as offering free repairs for life.
Other resource strategies: Potentially closing the loop by processing the collected materials for recycling after many reuses.
Business model aspects:
- Value Proposition: Gerrard Street produce modular headphones that can be easily repaired through replaceable parts. They offer these headphones for sale as well as in a monthly subscription (Gerrard Street, 2022b). This offer enables them to promote high product use and long product lifetimes which means a lower environmental impact.
- Value Creation & Delivery: The headphones are designed and sold by Gerrard Street and include different models, some of which are wireless or offer Bluetooth connectivity (Gerrard Street, 2022d). They also offer free spare parts so that customers can order replacements for any faulty parts and undertake the replacement themselves. The package with the spare parts includes a return envelope for the broken items which will be sent back to Gerrard Street and repaired or recycled there (Gerrard Street, 2022b).
- Value Capture: Customers pay for the once-off purchase of the headphone or in monthly rental for the subscription. The subscription can be terminated monthly and the headphones can be returned or exchanged for a different model (Gerrard Street, 2022b). Spare parts and repair support are included in the pricing and are covered under the free repairs for life promise.
Strategies for degrowth/ sufficiency (based on sufficiency strategies from Niessen & Bocken, 2021):
- Design: Gerrard Street design their headphones to be easily reparable by customers, including not using any glue. This way, customers can repair the headphones themselves when they order spare parts.
- Green alternative: The headphones are made to last a long time and are built to be modular so that they can be repaired and parts replaced as needed, ensuring a long product lifetime.
- Long warranty: Through the promise of free repairs for life, the headphones are covered with a lifelong warranty that includes repairs and access to free parts.
- No ownership: Next to selling headphones, Gerrard Street offers a monthly rental subscription with prices differing across different models and the possibility to end the subscription monthly or change to a different headphone model.
- Support for repair: Customers can order replacement parts at Gerrard Street which will be sent to them via mail. They can receive additional help with the repair should they need it. In the delivery, a return envelope is included to send back the broken parts which will be fixed by the Gerrard Street team to be used in new headphones.
Business model experimentation practices: Piloting of the leasing concept and first prototypes with €15,000 funding through Climate Kick programme (Benner, 2016).
Sustainability outcomes: Founded in 2016, Gerrard Street has so far reused 1,648 parts, giving them a second life and preventing waste (Gerrard Street, 2022a).
Niessen, L., & Bocken, N. M. P. (2021). How can businesses drive sufficiency? The business for sufficiency framework. Sustainable Production and Consumption, 28, 1090-1103. doi:10.1016/j.spc.2021.07.030
About project Circular X
Project Circular X is about ‘Experimentation with Circular Service Business Models’. It is an ambitious research project funded by the European Research Council (ERC) which supports top researchers from anywhere in the world. Project CIRCULAR X runs from 2020-2025. The project is led by Principal Investigator (PI) Prof Dr Nancy Bocken, who is joined by a multidisciplinary team of researchers at Maastricht Sustainability Institute (MSI), Maastricht School of Business and Economics, Maastricht University. The project cooperates with businesses who want to innovate towards the circular economy.
Project Circular X addresses a new and urgent issue: experimentation with circular service business models (CSBMs). Examples of such new business models include companies shifting from selling products to selling services and introducing lifelong warrantees to extend product lifetimes. However, CSBMs are far from mainstream and research focused on experimentation is little understood. The research aims to conduct interdisciplinary research with 4 objectives:
- Advancing understanding of CSBMs; their emergence and impacts
- Advancing knowledge on CSBM experimentation
- Developing CSBM experimentation tools
- Designing and deploying CSBM experimentation labs
This project has received funding from the European Research Council (ERC) under the European Union’s Horizon 2020 research and innovation programme, grant agreement No. 850159.
Using this information
When you cite this publication, please use the following source:
Circular X. (2022) Case study: Gerrard Street - Headphones-as-a-service and lifetime guarantee. Accessed from www.circularx.eu