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Case Study Presentation on LG

Presented By:

Vishal Chavan 114

Meet Nandu 42

Vishal Parab 115

Shamim Khan 73Ketan Rupwate 91

Saurabh Roy

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Rural Market

Rural India holds 70% of total population and

accounted for more than half of Indian

consumption

Consumption growth will be increasing from

3.9 to 5.1 in next two decades

Large potential market worth over 26 trillion

rupees($577 billion)

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Story

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LG Electronics

LG Electronics is the world's second-largest

manufacturer of Television sets and third-

largest producer of mobile phones

By 2005, LG was a Top 100 global brand, and

in 2006

LG Display, is now the world's largest plasma

panel manufacturer

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History

The company was originally established in 1958 as Gold Star,producing radios, TVs, refrigerators, washing machines, and

air conditioners

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The LG Group was a merger of two Koreancompanies, Lucky and Gold Star

Before the corporate Name change to LG,

household products were sold under the Brandname ofLucky

electronic products were sold under the brandname ofGold Star

In 1995, Gold Star was renamed LG Electronics,and acquired Zenith Electronics of the UnitedStates

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Business Divisions

Home Entertainment

Mobile Communications

Home Appliances Air Conditioning

Business Solutions

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Challenges for LG

Low brand awareness about LG in India.

One of the last MNCs entered in India

High import duty

Competition from local market players and

other MNCs in consumer durable segment.

Price sensitiveness of the Indian consumer

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Rural Marketing

Segmentation & Targeting of rural consumers

(on basis of occupation, disposable income)

i. Shopkeeper/Tradersii. Service

iii. Farmers

iv. Other labor

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shopkeepers

/ traders

8%service

13%

farmers

33%

other labor

46%

Rural Household Segments

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Shopkeeper/

trader

26%

Service

34%

Farmer

33%

Other7%

Consumer Durables owned by different segment

consumers in Rural India

The service class comprises 13% of the rural households but owns 34% of consumer

durables

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Product

Innovative products

Wide range of product category according to

consumer demands Product localization :

Hindi and regional language menus, first

brand to introduce gaming in TVs

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Product Differentiation

CTV Golden Eye TechnologyAC health Air System

Microwave Health Air System

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Price

Penetration Pricing

Penetration pricing for the rural India

Skimming Pricing

Skimming pricing for the High end products

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Place

Local and efficient manufacturing to reduce

the cost

Regional channel and wide distributionnetwork:

distributors work directly with the company

has resulted in quicker rotation of the stock

and better penetration

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LG Electronics India (LGEIL) is a market leader inconsumer durables in India with -

two manufacturing plants

14 electronic manufacturers

800 vendors of raw materials

37 sales points & 44 stock points

140 area offices

5,000 dealers and

12,000 sub-dealers

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Promotion

Hoarding, Posters, banners are used so as to

grab the attention of the customers

Discount at festival time LG also uses the radio FM for the promotion

activities

Use of Doordarshan to connect with ruralIndia

Sponsorships

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Conclusion

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Thank You!!