LG ELECTRONICS GLOBAL STRATEGY IN EMERGING MARKET

LUCKY+GOLDSTAR= LG

INTRODUCTION LG Electronics, is a global leader and technology

innovator in consumer The company was originally established in 1958 as

Goldstar producing radios ,TVs , refrigerators ,washing machines & air conditioners.

The L.G group was a merger of two Korean companies, Lucky & Goldstar, form which the abbreviation of L.G was derived.

L.G is the second largest producer in electronics , chemicals & third largest producers pf mobile phones.

Company has 75 subsidiaries worldwide that design & manufacture televisions home appliances & telecommunication devises.

HISTORY LG Electronics is one of the world’s largest

manufacture of electronic product. The company started in 1947 under the trading name

Lak Hui. Then by 1958, Goldstar was established by In-Hwoi

Koo, who was the founder of Lak Hui. The Goldstar made the first radio in Korea. The letter

G in LG Electronics today traces its roots from Goldstar its original brand name.

1962, Goldstar radios were exported to countries like the United States of America.

LG IN INDIA LG electronic India pvt. Ltd , a wholly owned

subsidiary of LG electronics , south Korea was established in January ,1997 after clearance of the foreign investment promotion board (FIPB).

LG set up a state-of-the art manufacturing facility at greater Noida, Near Delhi, in 1998 , with an investment of Rs 500 crores.

In 2004 LGEIL also up its second Greenfield manufacturing unit in Pune , Maharashtra.

LG plans to set up Rs 500 crores unit in south.

PRODUCT STRATEGY LG's objective is to provide world class product to

upper class and upper middle class to enjoy real luxury in their life .

LG is a Korean brand and being imported from Korea, it has very advanced features, which are normally demanded by in developed countries.

LG also insures that whatever product they market should be durable enough which last quite many years and give trouble free service to their customers

It provides its refrigerators, five years compressor guarantee and one year free service in spare parts under normal use.

LG MARKET SHARE

CTV market share(top 3)

0

5

10

15

20

25

LG Samsung Onida

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LG MARKET SHARE

Refrigerator marketshare(top 3)

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LG Whirlpool Godrej

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LG MARKET SHARE

Washing Machine market share (top 3)

0

10

20

30

40

LG Samsung Videocon

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MARKETING STRATEGY

PRODUCT STRATEGY

PRICING STRATEGY

PROMOTION STRATEGY

LG MARKET SHARE

Microwave oven market share(top 3)

0

10

20

30

40

50

LG Samsung Kenstar

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PRICING STRATEGY LG pricing strategy is cost + fixed mark up to cover

their GP. Since they cater to upper middle and upper class .

LG follows pricing policy in which their normal formula is import cost + reasonable gross profit to cover their marketing expenses and also give them reasonable profit.

PROMOTION STRATEGY Sales Promotion strategy is concerned, it is being

designed and implemented by their respective agent of each product .

They offer very handsome incentives to their dealers, who in return push their product among the customer and thus they get their desired volumes

Due to being a multi-national company and as a part of their global Strategy they, most of the time, divert their funds from strong market and spend more on weak or under developed markets.

PROBLEM To established into developed country

market . To cope up with global consumer

electronics giant. Unstable local currency in Brazilian market. Opposition by local public in during

establishment of assembling of manufacturing plant in Moscow.

SARS crisis in china.

CONCLUSION From a small South Korean company in the 1940's, LG

Electronic devices is now truly a worldwide leader within the electronic devices market. Plenty of households do have their products.

CONTINUED----- LG is the prominent leader of consumer

electronics in BRIC country. This company has a large base of R&D center world wide.

The population of emerging markets and less developed country is quiet promising. This is the opportunity for LG to take advantage of that.

The main challenge for this company is that to compete with many global player like Electolux,Sony,Matsushista,Toshiba,Panasonic etc.

RECOMMENDATIONS

LG could also look at providing easy credit schemes for its rural customers in emerging market.

The company should promote popular sports in those country where the company want to inter.

Company should continue with CSR activity that it did in BRIC county.

Company should inter into those country where growth of consumer electronic industry is higher GDP growth is also increasing.

RECOMMENDATIONS

*Company should focus on customer service center.

• Company should invest more on R&D to cope up with APPLE ,SONY, PANASONIC,SAMSUNG.etc