Whirlpool, the global appliance behemoth, recently reported less-than-healthy results. To summarize Whirlpool’s performance, The Wall Street Journal titled its brief recap “Whirlpool Heading for Full-Year Loss as Costs Mount and Sales Fall.” Whirlpool’s sagging performance has resulted in a cost-cutting, price-raising strategy.
The Wall Street Journal describes the usual pressures behind Whirlpool’s downward spiral. Whirlpool faces rising raw material costs, fewer sales, higher interest rates that “suppress” home sales, and logistical issues. To protect the business, Whirlpool indicates it is making the following changes:
“Whirlpool has attempted to protect its profits with higher prices and cost-cutting, including trimming jobs at its Iowa refrigerator factory as a prelude to modernization, phasing out a plant in Mexico and reducing its distribution centers.”
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The Roots Of Whirlpool’s Trouble
However, to really understand Whirlpool’s dilemma, let’s go back to 2017.
Whirlpool’s troubles became starkly real in 2017 when Whirlpool “whined” to the US government that it could not compete with Samsung and LG appliances. Instead of spending resources to innovate and renovate its brands, Whirlpool asked the US government to step in and “punish” Samsung and LG. By doing this, Whirlpool hoped to limit customers’ brand choices.
Whirlpool, the owner of Maytag, Kitchen Aid, Amana, Jenn-Air, Hotpoint, Whirlpool appliances, made it clear that its brands could not compete. “Please, Uncle Sam, make it more expensive to buy Samsung and LG appliances.”
This example of Whirlpool’s whining is one of those really sad and distressing business stories of brand mismanagement. Whirlpool’s request shows how arrogance, complacency, losing relevance and not keeping up with its customers, caused new appliance shoppers to consider more relevant brands. Whirlpool’s 2017 request was an example of forcing out the competitors who make what customers want to buy, so Whirlpool could sell to customers what Whirlpool knows how to make.
Ten years before the Whirlpool request to stop appliance competitors, you could see how Whirpool’s competitors were focused on innovation designed to solve our laundry problems.
(Just an aside: in the early 2000’s, I managed a global problem detection study for Electrolux AB. After eliminating redundancies, there were at least 500 customer problems for each category of Electrolux AB appliances. Laundry appliances garnered the most problems.)
At the KBIS show in Las Vegas, 2007, Samsung and LG presented incredibly innovative washing machines and dryers. Compared to the US companies’ entries, the Samsung and LG brands unveiled designs that were years ahead in the ways in which they addressed laundry wants and problems. Samsung, LG, along with other international brands such as Fisher and Paykel, Siemens, and Bosch, were investing money into R&D, developing products and services aimed at innovatively addressing the most important, most frequently occurring laundry problems. In response, Whirlpool whined to the Federal government for protection from innovative competitors.
Currently, for example, if you search for the best laundry appliances to buy, LG comes up on top in most cases. This was not the case in the 1990s, nor was it the case in 2017 when Whirlpool asked for protection. In fact, Whirlpool was worried about LG even though LG had just completely rebranded from inexpensive Korean appliances called Lucky Goldstar to premium appliances LG. I was working with Electrolux AB in 1995 when this rebrand occurred. There was corporate, brand-wide admiration for what Lucky Goldstar had just achieved.
When Size And Scale Become The Strategy
While LG was designing and producing premium, exciting appliances, Whirlpool focused on size and scale, purchasing brands to become the largest appliance company in the world. In 2006, Whirlpool spent US $1.7 billion to acquire Maytag, its biggest competitor. Ironically, the regulators at the US DOJ were lukewarm about the Maytag acquisition fearing lack of competition for US customers. But, Whirlpool lawyers noted that there were all these new entries like Samsung and LG. Then, Whirlpool complained about its inability to compete with Samsung and LG.
Whirlpool saw size and scale as the path to enduring profitable growth. Whirlpool did not innovate its offerings relative to the competitors. With size and scale, complacency set in and bred arrogance. “We are the biggest. We are powerful. We will sell what we know how to make.” To make matters worse, at the time, Whirlpool had its largest showrooms in Sears, a store that was in its death throes. Whirlpool was also the OEM for Kenmore, Sears’ own brand.
Three Brand-Damaging Tendencies
The recent 2026 news that Whirlpool is flailing should not be a surprise to its shareholders, the analysts, Wall Street and the business press. Whirlpool embraced corporate behaviors that are detrimental to brands. Whirlpool tumbled into the territory of tendencies for trouble that can traumatize brands. Specifically:
1. Loss of Relevance: Brands need customer-insight-driven innovation to stay relevant. Innovations, along with renovations, breathe life into brands: innovations and renovations keep a brand relevant and in sync with customer needs and problems. Think about Dyson vacuums. Dyson addressed a frustrating problem: vacuum bags. Appliance brands made money selling vacuum bags. Customers hated the process of buying and replacing vacuum bags. Not only were your specific bags never available, but vacuum bags were a hassle to empty with dust and detritus everywhere. Engineers at Electrolux AB believed that Dyson would fail because the engineers noted that bagless vacuums did not have powerful suction. Dyson prevailed and became a massively big, trusted brand. Dyson solved an extremely relevant and important vacuum-user problem. Dyson also recognized the role of sound. While engineers at Electrolux AB were focused on silent vacuums, Dyson gave its vacuums a powerful sound designed to make users “hear” and ‘”sense” Dyson’s suction competency.
2. Arrogance of Success: Size and power tend to generate feelings of success. When a brand owns a dominant share of the market, size covers up many sins. Success needs to be leveraged not lived off. Arrogance is an unfortunate and damaging corporate, cultural character flaw that leads the C-suite to make bad decisions. It is important to be big in customers’ minds, not just big in size. Size and strength are huge advantages. But, size and strength must be used to profitably market innovative products and services that satisfy real consumer needs. Innovation is the difference between creating superior value and competing on price alone. Size and strength can make a brand cautious.
Size and strength allow brands to make changes of magnitude. Size and strength provide brands with the opportunity to be better, to be greater. Size and strength allow brands to accept risk and offer the ability to resist adversity. Size and strength give brands a greater variety of talent upon which brands can draw. Size and strength make brands a stronghold of opportunities. Yet, size and strength are meaningless if brands do not leverage their benefits.
3. Comfort of Complacency: Complacency stops ideas from bubbling up. Complacency crushes curiosity and creativity, lulling people into laziness and inaction. Complacency gives a brand license to stop looking at the changes in the marketplace and the world. Warren Buffet said in his 2015 shareholder letter that complacency is a “corporate cancer.“ Mr. Buffet argued that complacency has its roots in the past. Warren Buffet said past success does not mean future success. CEOs who evince corporate complacency create an organizational culture of complacency.
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The Price Of Being Big, But Not Better
What analysts, shareholders, Wall Street and the business press now see as Whirlpool weaknesses started a decade ago. Analysts, shareholders, Wall Street and the business press enabled the focus on bigness alone. Whirlpool became big. But, did Whirlpool become better? Did Whirlpool become stronger?
Based on Whirlpool’s latest results, the answer seems to be, “No.”
Whirlpool bet on bigness at the expense of its balance sheet. Whirlpool’s balance sheet is not mentioned in The Wall Street Journals’ article but is top-of-mind in online business reports. Becoming big while not becoming better and stronger, Whirlpool is now in a deadpool with poor performance coupled with massive debt. This is what actually worries analysts: Whirlpool’s debt-to-equity ratio is almost triple the value of its equity. Whirlpool’s debt load is somewhere over US $7 billion.
With the acquisition of Maytag, Whirlpool became bigger, but so did its debt. Debt loads of Whirlpool’s size have destroyed brands. Toys R’Us comes to mind.
What A Turnaround Requires
Brands can be blinded by bigness. Size is only great when accompanied by being better and stronger. Whirlpool indicated a decade ago that it could not compete. Rather than address its relevant differentiation, Whirlpool opted for bigness. A Whirlpool turnaround will take patience. Investors and their counterparts tend to want financial gains now rather than a year or two from now.
Perhaps Whirlpool’s current strategies for quality revenue growth will take hold. However, cuts and price hikes will only go so far. At some point, there is nothing left to cut. At some point, the price is too high even for loyalists. The current economic environment indicates that price hikes in a category where prices are already high do not seem to make sense for a brand portfolio that, apparently, by its own admission in 2017, cannot compete with its competitors.
It is also clear from reading the business press observations that none of Whirlpool’s strategies for climbing out of its deadpool focus on Whirlpool’s brands becoming better competitive options, making Whirlpool stronger.
Contributed to Branding Strategy Insider by Joan Kiddon, Partner, The Blake Project, author of The Paradox Planet: Creating Brand Experiences For The Age Of I.
At The Blake Project, we help leaders turn brand into a disciplined driver of financial performance — strengthening pricing power, competitive position, and enterprise value. Email us to start a conversation about enduring profitable growth. For The EBITDA.
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