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JAGDEEP R.NO: 23
DIANA R.NO: 16
SANGHMITRA R.NO: 50
SHILPA R.NO: 53
CONSUMER DURABLES
LG AT A GLANCE
LG is the brand that is
Delightfully Smart.
 DETAILS
 LG
STANDS FOR “LUCKY - GOLDSTAR” . (LIFE’S
GOOD)
 ITS BASICALLY A PUBLIC SECTOR COMPANY
 IT WAS FOUNDED IN 1958.
 LG HAS ITS HEADQUATERS AT SEOUL, SOUTH
KOREA .
 THE CEO OF THE COMPANY IS YONG NAM
 NUMERIC DATA
REVENUE OF LG :3.7 %
MARKET SHARE OF LG :over 26%,
Turn over :Rs 9,500 cr
NUMBER OF OUTLETS :83 in india
NUMBER OF EMPLOYEES:82,000
Research lab :38
WHERE WE
?
COMPETITION RIVALRY
BARGAINING POWER Threat of new entrants
OF BUYERS

 HIGH  LOW
AS LOT OF
A LOT OF SUBSTITUTES INVESTMENT IS
ARE AVAILABLE . REQUIRED TO ENTER
 PRODUCT DIFFRENCE IS
LESS .  LG IS A BIG BRAND
NAME

Threat of SUBSTITUTES BARGAINING POWER OF

 HIGH SUPLIERS
 CUT THROAT  LOW
COMPETITION . A LOT OF SUPPLIERS
 SWITCHING COST IS ARE THERE IN MARKET
LESS . SO WE CAN SWITCH
EASILY.
SWOT ANALYSIS
STRENGTH
• Market leader on home appliances
WEAKNESSES
• Poor performance of some
• Strong research and development
product.
capabilities in global
•Not fully developed R&D in India
• Strong Financial position.
•Loyalty among customers
• Strong brand name Innovative
• Diversified operations

OPPORTUNITIES THREATS
•Customer needs • Higher distributer margins
•E-shopping • well established High
•Untapped rural market competition:
Competition from Indian brands
and other Foreign brands
 LG V/S SAMSUNG

FOCUS ON LOCAL CENTRALIZED R & D

R&D
More strong in this
Lack behind in the appliance
field of mobile phones
STEP 2
WHERE WE
WANT TO
BE?
TOWS Matrix
 STRENGTH WEAKNESSES
• Market leader on home appliances • Poor performance of
• Strong Financial position. some product
• Strong brand name Innovative
•No R & D in India
•Loyalty among
customers

SO-Strategies WO-Strategies
OPPORTUNITIES Investment in rural
•Customer needs areas We are in process to
•E-shopping develop R&D in
Availing the consumer India
•Untapped rural market financing option
potential for capture the
market share can be avail middle income
easily level
THREATS
• Higher distributer margins ST-Strategies WT-Strategies
• well established High
competition:
keep customers away from Good branding
switching to other
Competition from Indian strategies
local and foreign brands.
brands and other Foreign Effective price policy
brands Good relation with suppliers
 SEGMENTATION

TARGETING POSITIONING
SEGMENTATION

GEOGRAPHIC

DEMOGRAPHIC

LIFE STYLE

INCOME
GEOGRAPHIC IN GEOGRAPHIC BASIS WE CAN SEGMENT
OUR LG PRODUCTS..
SUCH AS IN COLD REGION WE NEED
HEATER N IN HOT REGION WE NEED
COOLERS..

DEMOGRAPHIC We have already segmented our products to

higher income people but now we
Have focused on middle as well as lower
middle class people

With our new technology and

LIFESTYLE
innovativeness
We have segmented our products
according to the life style of customers

We have segmented our products

INCOME
according to class and status of the people
• Mass market their product.
• Introducing innovative product in the THIRD
market at
• Premium price.
• Targeting those consumers who are more
SECOND
of safety and health issues.
• Shift more to mid class segment
• Targeted its market on basis of products
FIRST
• targeting to those consumer who are more
concern of life style product.
TARGETING
INDIA - ENVISION OF LG
 INDIA – The LG Vision

 Re-defining the position of Indian Rural Poor by extending the

boundaries for their activities (products and services) through
“Cutting Edge” initiatives.
RURAL INDIA: THE CHALLENGES
 Electricity Shortage – Sporadic Power Supply
 Acute Water Shortage.
 Poor Transportation availability.
 Consumer Finance Options.

 Can LG make energy saving products??

 Can LG give him a washing machine which
consumes less water??
 Can LG give him access to buying products
near by his location??
THE SOLUTION
 Set up of a Life style Research Team which
would analyze the needs & preferences of the
consumer , In-depth..

 Understand at length his comfort levels in

terms of what they wants and what they would
spend for what they wants..

 Make products and service available for him to

suit his needs & Preferences..

 Have a deep pocket network to make products

available for him at a close proximity from
where they can access product easily..
STRATEGY OF POSITIONING OF
LG PRODUCTS

PUSH STRATEGY

PULL STRATEGY

ASPIRE BRAND
MODES OF POSITIONING

PRINT MEDIA

ADVERTISEMENT

SERVICES
 E ?
ER
T H
E T
G
E
W
D O
O W
H

 STUDIED WITH THE HELP

OF 7PS
PRODUCT PROCESS

PHYSICAL
EVIDENCE PEOPLE
PRICE

PROMOTION PLACE
PRODUCT
Cont.d
 PRODUCT STRATEGY

rigorous
world class very quality
product to advanced standard.
upper class and features,
upper middle which are
class normally
demanded
durable
enough which
meet
customer's last quite
expectations many years
 LG MARKET SHARE

Microwave oven market share(top 3)

50
40
30
%age

Series1
20
10
0
LG Samsung Kenstar
 LG MARKET SHARE

CTV market share(top 3)

25
20
percentage

15
Series1
10
5
0
LG Samsung Onida
 LG MARKET SHARE

Refrigerator marketshare(top 3)

24
23
22
%age

21 Series1
20
19
18
LG Whirlpool Godrej
 LG MARKET SHARE

Washing Machine market share (top 3)

40
30
%age

20 Series1
10
0
LG Samsung Videocon
LG GLOBAL SALES RECORD

17%
Digital Appliance
33% mobile
Digital Display
Digital Media

33%

16%
DIGITAL APPLIANCE COMPANY

29% 22%

Washing Machines
Cooking & Cleaning
12% Others
Air Conditioners
Refrigerators
33% 4%
SALES RECORD BY BUSINESS
FAST GROWTH
18
16
14
12
10
Column2
8 16.01
14.3
6 12.6
10.6
8.5 9.4
4 7
5.8
2 3.7 4.7

0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
PRICING STRATEGY

• Since they cater • LG follows

• LG pricing pricing policy in
to upper middle
strategy is and upper class, which their
normal formula
cost + fixed therefore their is import cost +
mark up 90% dealers are reasonable
in big cities only. gross profit to
cover their
marketing
expenses and
also give them
reasonable
profit.
PROCESS
It include services like customer support
PROMPT RESPONSE AFTER SALES
SERVICE

2 1 1
hour

Call back to Service In a promised

customers engineer visit one hour slot
within 2 hours within one time
day
 LG DISTRIBUTION NETWORK

SUPPLIERS SUPPLIERS SUPPLIERS

FACTORY (OEM) FACTORY (OEM)

WAREHOUSE WAREHOUSE WAREHOUSE

CFA CFA CFA CFA CFA CFA

DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR

LG SHOPPE DEALER DEALER DEALER www.lgezbuy.com

INSTITUTIONS CONSUMERS CONSUMERS CONSUMERS CONSUMERS

PROMOTION’S
CONTD…….
CONT.D
PROMOTION STRATEGY
, divert their
funds from
strong market

their
spending on
advertising
. Their major
approach and
planned and emphasis on
promotion through
executed trade
 Consumer Goods companies must go the Rural Way
LG’s Rural Foray
 LG India- tripled the number of its retail & distributor
outlets in rural areas from 2004 to 2008.

 The avg. price of its Sampoorna range of CTVs came

down to about the price so competitive that, thereby
bridging the gap between CTVs and other local B/W TVs.

 It also tapped local forms of entertainment like annual

haats and fairs and made huge investments in
infrastructure for distribution and marketing.
 FINDINGS

The rural market accounts for 60% of new

CTV buyers for LG

The rural market for LG grew at 25% over the last year,
against a 15% growth in urban areas.

Sampoorna TVs sold in the Indian heartland and the

semi urban belts, enforced a strong connection with
India for LG.

It connected very well with down the pop

strata.
PLACE
 PLACE STRATEGY
THERE ARE
APPROXIMATELY 2500 LG relatively don't
DISTRIBUTORS maintain loose stock at
AVAILABLE TO LG their end.
COUNTRYWIDE

They have only 300 dealers

mostly in big cities and some in
small towns.
 PEOPLE
Believe in happy employees
As employees are backbone
for sucess of any company
Mr. YONG NAM

No of employees : 82000

Well trained Professionals

Empowered individual

All LG employees receive competitive

salaries and a comprehensive range of
benefits, ensuring that they remain
healthy and able to balance the demands
 PHYSICAL EvIDENCE

State-of-the art manufacturing facility at Greater Noida, near Delhi, in 1998

RECOMMENDATIONS
EXPANDING DISTRIBUTION IN A WIDER
MANNER SO THAT IT WILL BECOME
EASILY ACCESSIBLE.
LOOKING TOWARDS TO PROVIDE MORE
CREDIT FACILITIES SCHEME FOR RURAL
PEOPLE
INCREASING THE AFTER SALES
SERVICES IN A MANNER TO SATISFY THE
CUSTOMERS.
PROVIDING GREATER FLEXIBILITY BY
HAVING MORE OUTLETS ACROSS INDIA
THANK YOU