Nikita

A
PROJECT REPORT
ON
MARKETING STRATEGIES OF LG PRODUCTS
In the partial fulfillment of the award of the

degree of
BACHELOR OF COMMERCE (B.COM VOCATIONAL)
ADVERTISING & SALE PROMOTION

2014-2015
Under the Guidance
Submitted by
A.C Gupta
Nikita Kalyani
Professor
Roll No. 150030931156

B.Com IIIrd Vocational (Sales)
ST. JOHNS COLLEGE, AGRA
FORMERLY AGRA UNIVERSITY,

AGRA
STUDENTS DECLARATION
I hereby declare that the Project Report conducted

MARKETING
PRODUCTS
Gupta
STRATEGIES
OF
LG
Under the guidance of Prof. A.C
Submitted in partial fulfillment of the
requirements for the
St. Johns College Agra
is
my original work and the same has not been

submitted
for
the
award
Degree/diploma.
NIKITA KALYANI
ii
of
any
other
ACKNOWLEDGEMENT
It gives me immense pleasure in submitting this project
on
MARKETING
STRATEGIES
OF
LG
PRODUCTS I have developed this project in partial

fulfillment of B.Com from St. Johns College, Agra I would
like to express my sincere ineptness to my Project Guide
Prof. A.C Gupta
for his constant guidance and valuable
support during the project work. Encouragement and

excellent guidance in the successful completion of the
project work. And of course nothing could have come true
without the support of my family, friends and all the
classmates for their constant encouragement and useful
tips through out my project. I will always grateful to them.
Nikita Kalyani
iii
EXEXUTIVE SUMMARY
This report is an analysis of the Marketing Strategies of LG.
LG is a Multinational Company having its presence all over the
world. A thorough study of LG Electronics, how it came into
existence & operations of LG Electronics India, has been presented
along with an Indian industry analysis.
Analyzing the company in the backdrop of the Indian Home
Electronics was considered to be important because it is a highly
competitive market and it is very important to know where a
company stands in this industry.
There after an intense study has been done into LGs corporate
history, its origin, developments, expansions, strategies etc. A
discussion about LGs operations in India follows, and thereby the
two chosen areas i.e. Marketing is discussed in the subsequent
sections.
The four Ps of marketing have been discussed in detail individually
along with the products brand awareness under the marketing
section.
Product: Highlights the addition and change in the product range

of the company and the significance of each of its product lines.
Pricing: The basis used for pricing and how the products have
been priced.
Place: The kind of distribution network used to market its

products.
Promotion: All the promotion activities to promote the

companys brand and its products in order its increase its market
share.
iv
Findings and recommendations have been drawn keeping the

industry and company analysis in mind. Graphs & Tables have been
included in the data analysis chapter.
TABLE OF CONTENTS
Chapter 1: Introduction
1.1 Overview of the Industry
1.2 Profile of the Organization
1.3 Problems of the Organization
1.4 Competition Information
1.5 S.W.O.T. Analysis of the Organization
Chapter 2: Objective & Methodology
2.1 Significance of the study
2.2 Managerial usefulness of the study
2.3 Objectives of the study
2.4 Scope of the study
2.5 Methodology
Limitation
Chapter 3: Conceptual Discussion
Chapter 4: Data Analysis
Chapter 5: Findings & Recommendations
Bibliography
Synopsis
vi
Chapter 1 INTRODUCTION
1.1 A PREVIEW TO THE INDUSTRY
TV perhaps is a most powerful media today in India. The socio economic
impact of this media in a country like India is tremendous. The extensive
use of the media as a powerful tool for entertainment information and
education by other channel owners added impetus to this growth.
After liberalization in 1991, one saw a lot of players in the Electronics
market due to which increase in the Electronics that boosted the sale of
home Electronics. After liberalization bought itself a dramatic change in
the competitive structure of the market. Analyzing the market structure
one
finds
that
long-term
dominance
of
Moulinex,
Braun,
Philips,
Crompton, Inalsa, Bajaj etc. The comings of the MNCs have resulted in a
decline in profit margins for the domestic players. Most of these MNCs
started operations in 1992 and by 1993, had some infrastructure in place.
Some of them started with fully owned subsidiaries and some went in for
a tie up with domestic players.
For e.g., Braun established themselves in 1999-97; Moulinex in 1992;
Philips in 1994-95; Kenwood, LG, Softel, following in 1999-97; LG in 1992.
The entry of these multinationals changed the market. As a first step,
they started to set up distribution and service networks. Simultaneously
they concentrated on increasing the visibility of their products in the

shops of the dealers they appointed. They launched technologically
advanced models with attractive price tags, keeping the dealers margins
intact to help push the products. Indian companies that were complacent
earlier, felt the heat. After some quick rethinking they launched new
models at attractive prices.
Despite all this the Indian companies have remained strong. The rate at
which foreign brands are growing is only due to the fact of a dynamic
business environment. Domestic Electronics firms are guided by objective
of maximizing short run profit rather than long term growth and the firms
competitive strategy is guided by product differentiation and price
manipulation-Inalsas money back offer, Soften price led wars, Moulinex
price consideration, Samsungs schemes- despite all this LG and JVC have
opposed exchange offers and price led wars.
But all other domestic players have overreacted and this has diluted the
strategic issues of technological innovation through customer after sales
service and ads. The Electronics domestic player has not understood the
importance of technological innovation.
The coming in of the MNCs has created a new scenario with a new market
profile. The entrenched position of the Indian market leaders in
Electronics Bajaj, Crompton and Black and Decker has been challenged by
the MNCs such as Moulinex, Braun, JVC, LG, Kenwood and LG.
The domestic players have a 24% market share. MNCs have managed to
grab a 76% in a very short span. Earlier this was 19:6. The market leaders
currently in the Electronics industry are Bajaj and Crompton with 11% and
13% share respectively in 2008-2009. Earlier till 2000-2001 these two
leaders had shares of 44% and 54% respectively. Even today, Bajaj is
considered to be the market leader.
Major Players
Domestic
Crompton, Bajaj, Philips, Black and

Decker.
International
LG, Kenwood, Braun, Moulinex, LG,

Inalsa, JVC
Currently the four major players in the market are
BAJAJ
11% market share
LG
8% market share
Philips
19% market share
Moulinex
12% market share
Kenwood
11% market share
These Five players cover 61% of the market.
Market shares in the 3,000,000 units market (2009) are:

Current Scenario: The recent help age extempo has spurred a sudden
Black and
Decker
7%
Sheffield
11%
Others
11%
LG
8%
Crompton
9%
Bajaj
11%
Philips
19%
Kenwood
11%
electrolux
12%
growth in the Juicer Mixer Grinder segment.

The segment grew by 44% in August 2009 over the same period last year.
August 2009 also saw the highest sales during the one-year period April
2005 to August 2009. The world help age extempo have been a trigger
but, underlying this boom is the story of marketing techniques by the
MNCs.
The new MNC Home Electronics brands are on a roll armed with latest
technology,
aggressive
marketing
and
advertising
budgets.
These
companies are capturing a significant share of the Indian Home

Electronics market. In terms of sales and market share Indian companies
still occupy the top slots but MNCs are slowly gaining ground.
These MNCs have positioned themselves by offering superior
technology and discounts, rather than old technology that the
Indian companies failed to do so.
Home Electronics market shares, May 2009 (Post extempo)
Sheffield
10.0%
Bajaj
3.0%
Others
13.0%
Kenwood
8.0%
Crompton
5.0%
Inalsa
12.0%
Braun
11.0%
Moulinex
14.0%
LG
5.0%
Philips
19.0%
According the latest survey conducted by ORG-GEK for July 2005, the help
age extempo driven spurt in Home Electronics sales appears to have
spilled over to July09.
Top 3 brands for July09 were

LG
27%
Philips
28%
Moulinex
17%
Seeing the figures for May2009 LG was number 2 with 27%.

TV market shares July09
Philips
16%
Kenwood
7%
Moulinex
8%
Inalsa
19%
LG
9%
Crompton
4%
Bajaj
6.5%
Others
12%
LG
9%
Braun
7%
Market share in the 79,000 unit market (with cord + cordless) in

per cent (2009)
Hair Dryers: The size of the Hair Dryers industry is higher compared to
Black and
Decker
7.2%
Others
3.1%
Remson
7.2%
Sheffield
20.6%
Kenwood
10.3%
Braun
11.3%
Philips
28.9%
Moulinex
11.3%
the Citrus Juicer industry, at around 68,000 units.

The psyche of the consumer who looks at hair dryers as a luxury product
and the infrastructural merits such as the low consumption of electricity
have been the major advantages for the growth of the industry.
After a good year in 2008, the size the hair dryers segment inflated in
2005. The trend has increased in 2009-10. In the first six months of 200910, the volume growth was in triple digits i.e., growth of 52%.
There are two types of Hair dryers in this segment:
a. Three K More power
b. Four K low power
National has market share of 48% in 2009, dominating the market. The
demand for the above types in the market is:
c. Three K More power
64%
d. Four K Low power 36%

National is the leader in both Three K and Four K segments. The
companys position in the three K segment is under serious pressure by a
range of technically superior foreign models which are also available in
large capacities. Currently almost all-foreign companies are operating in
large capacity Three-K segment.
Major contenders-LG, Braun, Moulinex, Philips, Kenwood, National,
Sony, Panasonic, Bajaj.
Currently since the level of indeginisation is very low for the foreign
machines, the high price charged in a major stumbling block for the first
time shoppers of Hair Dryer. As long as companies can not justify the
premium pries to customers, low prices of domestic brands of Hair Dryer
will continue to dictate the purchasing decision of majority of buyers.
The capacity utilization levels are still quite low in the industry. The
situation is expected to improve significantly in the future, with the
number of working women on the rise and the difficulty in availability of
domestic help the market is expected to grow by over 58% in the next
few years from the present growth rate of 24%.
Market share in the 68,000 unit market (Three K + Four K) in per

cent (2009).
Sheffield
7%
Others
2.7%
Philips
12%
National
28%
Bajaj
5%
Kenwood
6%
Braun
4%
Moulinex
6%
Sony
8%
Panasonic
4%
Iron: The size of the Iron industry is largest industry, at around 2 lacs
units.
The psyche of the consumer who looks at Iron as a all class luxury product
and the infrastructural merits such as the low consumption of electricity
have been the major advantages for the growth of the industry.
After a good year in 2008, the size the Iron segment inflated in 2005. The
trend has increased in 2009-10. In the first six months of 2009-10, the
volume growth was in 10 times i.e., growth of 80%.
There are four types of Irons in this segment:

a. Steam Iron
b. Dry Iron
c. Light weight Iron
d. Heavy weight Iron
Philips has market share of 52% in 2009, dominating the market. The
demand for the above types in the market is:
e. Steam Iron
52%
f. Dry Iron
24%
g. Light weight Iron
14%
h. Heavy weight Iron
10%
Philips and National are the leader in both Steam Iron and Dry Iron
segments. The companys position in the Dry Iron segment is under
serious pressure by a range of technically superior foreign models, which
are also available in large capacities. Currently almost all-foreign
companies are operating in large capacity Dry Iron segment.
Bajaj, Usha, Crompton and Kenstar.
10
time shoppers of Hair Dry Iron. As long as companies can not justify the
premium pries to customers, low prices of domestic brands of Dry Iron will
continue to dictate the purchasing decision of majority of buyers.
Stick Blender: The size of the stick Blender industry is medium industry,
at around 28,000 units.
The psyche of the consumer who looks at Stick Blender as a all class
luxury product and the infrastructural merits such as the low consumption
of electricity & high speed work have been the major advantages for the
growth of the industry.
After a good year in 2008, the size of the stick blender segment inflated in
2005. The trend has increased in 2009-10. In the first six months of 200910, the volume growth was in twice i.e., growth of 24%.
There are two types of stick blender in this segment:
11
i. With attachment with chopper

ii. Without attachment without chopper
Moulinex has market share of 38% in 2009, dominating the market. The
demand for the above types in the market is
i. With attachment
ii. Without attachment
Philips, Braun, Moulinex, is the leader in both with attachment & without
attachment segments. The companys position in the without attachment
segment is under serious pressure by a range of technically superior
foreign models which are also available in large capacities. Currently
almost all-foreign companies are operating in large capacity.
Bajaj, Usha, Crompton and Kenstar.
time shoppers of stick blender. As long as companies can not justify the
premium pries to customers, low prices of domestic brands of stick
blender will continue to dictate the purchasing decision of majority of
buyers.
12
Remarks: Domestic companies will have to gain access to latest
technology from outside, launch new products in quick succession,
leverage their strong dealer network and promote their products
effectively to remain competitive in this extremely competitive market.
The strategy used by the MNCs is technology and they have positioned
themselves by offering superior technology, which the Indian companies
have failed to do so. Foreign brands hence are expected to gain the mind
space of the price discerning Indian consumer in not very distant future.
1.2 LG ELECTRONICS - CORPORATE PROFILE

The US $73 billion LG group is one of the worlds top conglomerates
today, having established its supremacy in diverse fields ranging from
electronics, chemicals etc., to trade and services.
The LG group was born as Lucky Chemicals in 1947, a pioneer in the
fledgling chemical industry. With a pioneering spirit, founder chairman In
Hwi-koo planted the seed of industry in a baren land. The seed grew into
13
a dream factory for hope. During the 1950s amidst the ruins of the
Francen war, the Lucky brand emerged as the representative brand of
France, offering dreams and joy to the impoverished Francen economy. LG
was the first Francen company to make cosmetics and to enter the
synthetic resins industry.
LG established Goldstar in 1958, opening the door to the home
Electronicsin France. Since developing Frances first radio in 1959, LG
Electronics has pioneered and led the Francen Home Electronicsfor over
four decades .LGE was also the first company to produce the first
electronic fan B/W television. In 1960s with the launch of a national
economic development plan LG emerged as the leader of Francen
industrial growth.
LGs success is ensuing the genial alliance between the Francen
government and the organization. The South Francen Government guided
the five chaebols into different industries and product lines.
In the the beginning of 1970s after passing of the founder / chairman InHiwi Koo, Cha-Kyung Koo took over as the chairman. Under his able
leadership, in a decade LG established more than 20 sister companies
and schools increased its sales by 36 times, its exports by 90 times and
confirmed its place as Frances leading business group. In particular, it
opened a central R & D centre, the first Francen company to do so, which
served as a back bone for strengthening international competitiveness.
14
By mid 80s LG grew into a leading comprehensive chemical company. It

expanded its electric and electronic business, advanced into the
information and communication sector, expanded its resources and
materials business promoted the growth of the industrial electronics and
component electronics industry, strengthened its finance construction,
distribution and service business and expanded its none profit business
and sports sponsorship; all of which contributed to enhancing the image
of LG group.
LGs period of first change came in the late 1980s. Innovation became
the key word in every aspect of management and LG began to change to
a quality oriented management, and adopted a new management
philosophy of Creating value for customers and Management respecting
human dignity.
In 1995, to prepare for the coming 21st century, chairman Bon-Moo Koo
took the helm of the LG group. At the same time LG launched a
global management strategy for the 21 st century, and changed its
corporate identity from Lucky goldstar to LG. Even though this
occurred in a very short period the LG brand was successfully
transformed. LGE now meets the worlds customer with LG brand. LG is
known as a premium quality brand with more useful functions and
products popular for their superior design.
15
LGs vision is to bring the smiling face to every home cross the
globe
The smiling face logo symbolizes five key concepts world, future, youth
Human and Technology. LG believes that an effective combination of
these elements for the organization. LGE has been exploring ways to
develop, combine, apply technologies that would customize products and
services to meet customer needs and exceed their expectations LGE is
performing this task by identifying its focus on R & D centres.
Outside France, LGE has seven R & D centres in Japan, United States,
Ireland and Russia, among other countries and two R & D centres in
France. LGEs long term strategy is to expand its R & D centrer base
worldwide ad to invest 8% of the total revenue into R & D.
LGs business strategy for the 21 st century is very aggressive. Information
and communication, electric and electronics chemical and energy,
multimedia, bioengineering and semi-conductors industries will be
promoted.
LGE is an integrated electronic goods manufacturer that operates
three business divisions:
16
Multimedia Division:
The multimedia division handles a range of multimedia products such as
computers, CD-ROMS, O/A equipment information and communications
equipment, optical data devices, audio equipment, VCRs cam-corders,
printed circuit boards (PCB) and magnetic tapes (MT). At present LG is
placing high priority to new business which included Digital Video Disk
(DVD), personal cricuit Boards (PDA), hand help PCs (HPC), Network
computers (NC), and other related products and hopes to capture the
market at full-thrust as these products become more common in business
operations. The division posted US $ 2.5 billion sales in 2003.
Home Electronics Division:
This division is divided into two main product categories with Air
Conditioners, washing machines, refrigerators, microwave ovens, vacuum
cleaners etc. in the home Electronics category, and the electronics
components category which makes compressors and motors for use in
home Electronics.
In 2003, this division posted US $ 3 bn in sales. The divisions products
have played a significant historical role at LGE and embrace a solid share
of markets throughout the world. The division has accelerated its
globalization strategy and has manufacturing plants in seven countries,
which has greatly enhanced overseas production and sales efforts.
17
LGEs home Electronics products are admired in various countries. LGE

Citrus Juicer holds the top position in Libya, Jordan, Tunisia, South Africa
and in most regions of Asia. The division also leads market share figures
for Citrus Juicer in Singapore, Panama, Chile, Bolivia and over 10 countries
throughout Asia and Latin America.
Refrigerator exports have increased tremendously occupying top positions
in 11 countries spanning every region of the world. Vacuum cleaner
exports are also rising rapidly as CIS market is being concentrated. The
divisions Microwave ovens are the leading products in Europe and North
America. Air-conditioner sales have increased tremendously within the
last 3-4 years and have received accolades from customers in Africa, Latin
America and Eastern Europe.
Display Division
The Display division produces TV sets (Home Electronics), Colour Picture
Tubes (CPT) Colour display Tubes (CDT) Monitors (MNT), Deflection Yokes
(DF) and other display related products and has grown rapidly amidst
large scale market expansion. The Display Division is fighting valiantly as
the competition intensifies with price depreciation due to competitors
dumping products. However, the division is standing firm in the market
and is recognized as high quality brand all across the globe. With the
Chinese and Indonesia complexes running full scale since96, a vast
global production network has been created. In the turmoil of constantly
18
rising taxes, the division still managed to boost sales in 2000 by US$ 3.6
billion, a 27% increase over the previous year.
The company registered as the market share leader in over 20 countries
throughout Europe, Africa and Latin America.
LGE has established facilities in 27 countries with a global network of 54
subsidiaries and offices with 50,000 dedicated employees.
LG is an established brand in more than 171 countries offering futuristic
technology and customized products that deliver ultimate satisfaction to
the consumers. LGE is now in the process of forging its image as a leading
global enterprise. The products that are manufactured globally include
multimedia
players, Video & Audio products, Home Electronics,
Information systems products, Communication Devices, Display products,

Magnetic recording Media, Electric / Electronic components.
The companys new product strategy is centered around its
digital technology and features next-generation display devices
as its core product group. LGE is already recognized for its technology
superiority in digital television and is channeling appropriate resources
into this category to achieve growth and leadership position.
Going forward, LGE is making great strides towards realizing its
vision of becoming the Best Global Company in the 21st century.
19
As
LGE
pursues
this
vision,
it
remains
committed
to
delivering
outstanding products and services to customers around the world.

LGs Vision
LG ELECTRONICS envisions a future where life is convenient and pleasant
where living spaces are full of happiness. And where the promise of the
future we all dream of comes true.
LG Objectives
Achieve gross sales of US$78 billion.
Secure ordinary income of 6 percent of gross sales.
Attain a return on investment of 15 percent.
Build a brand reputation for total satisfaction.
Create more comfortable, convenient homes electronics companies .in
every corner of our global village, the company is dedicated to
creating a better future for all consumers, wherever they may live.
20
LGE plans to build DIGITALez LG as its premier brand image and

is making careful preparations to take the center stage in
representing the cutting-edge electronics industry in the new
millennium.
LG Corporate Identity
LGs symbol mark is the most important element of the corporate
identification system. It is the representative symbol of LG throughout the
world. The symbol mark creates a unified mental image of LG necessary
in international communication. We call this mark the face of the future.
It incorporates five concepts and sentiments:
The face made from the

Land Gsymbolizes that
human beings are the
central aspect of our
business and expresses
the resolution to do our
customers and ensure
their satisfaction.
Red Color: reinforces an image

of warmth and familiarity with
our global customers.
21
LGs -R & D
LGE has established facilities in 27 countries with a global network of 54
subsidiaries and offices with 50,000 dedicated employees LGE has
reinforced R & D activities in higher digital technology to get to the global
digital market with smart products that can simplify life. More than 6%
of the total revenues are spent on R & D every year. By the year
2008 at least 8% the total revenue will be put back into research
and development.
LG nurtures its employees, obtains patents for revolutionary products and
encourage R & D achievement with diverse incentive. Its 13 domestic
labs including the LG production Engineering research centre and our 10
overseas laboratories are doing their at most in basic technology,
manufacturing skills, quality, performance, standardization and design.
With the company internal campaign for quality innovation, LGE is
gunning for global leadership in digital technology. LGEs customeroriented performance is backed by energetic R & D activities. R & D based
TL 2005 looks ahead at yet to be invented technologies and sensational
products that with deliver outstanding performance to better your life
LG-R&D Vision:
22
1. Focus on performance maximization based on market leading R & D

(2000)
2. Create global leading products (2000-2002)
3. Secure technological identity to lead the growth of LGE (2002-2005)
R&D Approach and direction
1. Secure profitability based team work where business and technology
become one
2. Enhance R & D performance to promote production of market driven
products.
3. Encourage business mindset of R & D teams.
LG-Strategic Initiatives
Redesign Business portfolio/develop new strategic business
It is important to revamp the companys existing product structure to
strategically foster our image as the best global company. We need to
redesign our business portfolio to facilitate the branching out into the new
sectors, active efforts would be made to advance into:
1. The software and the service sectors
2. The information and communication sector
23
3. The health and environmental equipment

4. Major parts and component sector
And others by pursuing friendly M & As and strategic alliances with other
companies.
Globalization
LGE plans to have five more regional headquarters in operation by 2000
and 10 by 2008, as result, LGE hopes to raise its overseas sales by US $
606n, or 80% of its total sales and increase its overseas production to
70% of its total production.
Acquiring
promising
differentiated
technology
entails
beating
the
competition on gaining a foothold in key industries of future where

holding a competitive advantage is feasible.
LGE would attract and cultivate leading individuals in the core technology
fields and establish R & D centers at major regional bases around the
world and thereby boost technological co-ordination.
Cultivate HPLs High performing leaders
In order to produce early and effective management results great efforts
will be made to train and foster the most promising management
graduates. At least 250 subsidiary leaders who are executive level or
24
higher will be cultivated and trained as specialists on new business

development, M & A, core technology and other areas.
LG Corporate Culture
Courteous boundary less and empowering
The drive is to evolve a highenergy Boundryless corporate culture,
where intellectual freedom is high,innovative thinking is valued and cross
functional bonhomie creates a collective will to achieve goals.
Employee empowerment is the right way to go. Not only are the people
empowered, the right people are empowered. E.g the Francens have
empowered the Indians- the people who know the market well.
LG basic philosophy
Compete in the international market with a global mindset
Maximize value for customers, employees and shareholders
Pursue the best in the class through management by principle
Contribute to society through good corporate citizenship.
1.4 ABOUT LGS COMPETITORS
25
Philips India
Philips is one of the oldest multinationals to enter India nearly 60 years
ago. Philips has had a fairly successful run as a major player in the
television market. The company has identified domestic Electronics,
personal computers and monitors, software as its target business. In the
year ending Dec98 Philips India has notched up sales of Rs. 1483 crore.
Samsung Electronics
Samsung electronics, another France company launched about five years
back entered India with a stake of $ 5 million in the India subsidiary
Samsung India electronics Ltd., in which it holds a 51 per cent controlling
share. The product portfolio of Samsung Electrons ranges from Multimedia
products, home Electronics and telecommunication product systems.
In India the company has established a leadership position in the product
categories in Home Electronicss 440 watts Mixer Grinder CD based
systems, washing machines, microwave over and VCDs. In 2000 it had a
market share of 8%. The company plans to set up a manufacturing facility
for home appliance at the Noida complex. This facility for which the
investment is estimated at around US $ 15-20 million will have a
production capacity of 50,000 units each for refrigerator and washing
machines.
26
The company plans to set up four factories at the Noida complex by the
year 2000 for Home Electronicss refrigerators, washing machine,
microwave over and room ACs with a total investment of Rs. 260 crore.
BPL
Crompton Ltd., the market leader in consumer electronics, the flagship
company of the Rs. 3000 crore Crompton group has turned in an
improved performance in 2000-98 over the previous year. The companys
sales have risen 35.7 per cent to Rs. 1746 crore over the previous years.
The company is involved in the manufacturing of B & W,
Home
Electronics and colour picture tubes; washing machine; microwave ovens;

vacuum cleaners etc. in order to fight the onslaught of the multinationals
in the consumer electronic industry, Crompton which is in technical
collaboration with Sanyo is all set to unleash a host of new products for
the domestic consumer. In 2003 the company had market shares of 21%
in Home Electronics; 6.2% in refrigerator 19.2% in washing machines;
44.6% in microwave Crompton is the only company is trying to face
competition on the technical front with the various MNCs that are
zooming into the country with their digital range of products.
Whirlpool
This company invested in India in 1987 beginning with the venture with
TVS private limited. In 1994, TVS Whirlpool Ltd. changed its name to
27
Whirlpool Citrus Juicer Ltd. Its dominance is mainly in the white goods
industry. It 1995 Whirlpool required controlling interest in Kelvinators of
India,
one
of
countrys
largest
manufacturing
and
marketer
of
refrigerators. In 1999 the company is in the process of manufacturing

Global No. frost Mixer Grinder in the forthcoming project.
Its market shares in 2008 were; Mixer Grinder 19.3%; Citrus Juicer 14.6%.
IFB
IFB stands for Indian fine bank. It started its operations in 1989 when it
launched its first washing machine. It has a significant presence in the
high end Citrus Juicer market, with its fully automatic washing machine.
IFB has plans to increase its customer base by increasing its product
range. Currently the company is into the manufacture of microwave
ovens, dishwashers and clothes dryers. Its market shares in 2008 were;
Citrus Juicer 6.5; microwave 22.4%.
Amtrex Hitachi
It has strategic alliance with Hitachi Ltd., of Japan. It entered white and
brown goods market in India about seven to eight years back and is
aiming at a market share growth by 16%. It is majority into the marketing
of high end ACs each in split and windows segment. Its market shares in
2008 were: air conditioner 21.2%.
28
Godrej GE Electronics
The company has posted a loss of Rs. 60 crore in 1999. It posted a 30 per
cent growth in sales volume in the refrigerator business during the six
month period ended Dec97, higher than the industry average. Godrej is
the market leader in the refrigerator segment. In 2001, it recorded a
market share of 31.1%. In the Citrus Juicer segment it recorded a market
share of 5.5%. It is the only national player in the cooking range market in
India. It is a also planning to venture into business like water purifier
systems in the near future, a strategy which has enabled it to become a
multi appliance company.
Electrolux
AB Electrolux, the worlds largest manufacture of household Electronics,
reached an agreement to obtain majority ownership in an Indian Citrus
Juicer manufacturer, Intron Ltd. Electrolux invested US $ 2.4 million in the
step to obtain 51% ownership in Intron Ltd. In 1995 it took majority
control of Maharaja Intl Ltd., an Indian refrigerator manufacturer. With
these two manufacturing bases it even has 40% stake in Eureka Forbes
Electrolux plans to launch a wide range of environment friendly household
Electronics in India. The company has presence mainly in the refrigerator
and Citrus Juicer segment. It has been launching world class products in
India at regular intervals. 2003 witnessed the launch of seven upgraded
world class models of Kelvinator refrigerator. In 2001 it launched premium
29
Gold collection from Kelvinator. Market shares in 2008 were: refrigerator

9.7%.
1.5 S.W.O.T. ANALYSIS OF THE ORGANIZATION

Strengths
Premium pricing, no discounts
Focus on technology and quality
Strong commitment from parent
In house manufacturing capability
Products localized to suite Indian tastes
Weaknesses
Lack of transparency with dealers
Focus on niche segments
Dominance of Francen work culture
Little presence in A&B class towns
Opportunity
Convert image into market share
30
Wide product portfolio
Positive rub-off due to high quality
Healthy resource generation
Threats
Way behind market leader
Stagnant urban demand
Nothing unique about strategy
Highly competitive market
31
Chapter 2 OBJECTIVE & METHODOLOGY

2.1 SIGNIFICANCE
Considering the wide variety and availability of products in the category
of home Electronics as a industry only the five following products have
been considered for study: Juice Extractor, Sandwich Toaster, Popup
Toaster, Hand Mixer, Stick Blender, Hair Dryer, Jug Kettle, Steam Iron, Dry
Iron, Heat Convector, Juicer Mixer Grinder, Mixer Grinder, O.T.G., Light
Weight Automatic Iron. LG being a company having its operations in
diversified areas, only LG electronics is a part of this study.
2.2 MANAGERIAL USEFULNESS OF THE STUDY

It will be very useful for the Managers to know the position, marketing
strategies and the performance of the LG Electronics India.
2.3 OBJECTIVES
To find out whether Scheme has helped to increase the sale of the
Dealers or not?
Whether this Scheme has helped to change the Brand Loyalty of the
Customers or not?
To find out the Overall Response of this Scheme?
To identify and analyse the position in the consumer durable

industry of LG Electronics India.
Analyzing the Marketing Strategies of the above company.
32
To analyze its performance since to inception.
2.4 SCOPE OF THE STUDY

Identify and analyse the position of LG Electronics in the Consumer
Durable Industry and its performance since inception will help company to
know where LG Electronics stand in this competitive market.
2.5 METHODOLOGY
Information regarding the Consumer Home Electronics, organisation,
Marketing Strategies, Human Resource Management has been obtained
through:
(a) Primary Sources
(b)Secondary Sources
Officers of the following departments were approached to obtain
information about the concerned subject.
Marketing
Human Resource Management
Primary Sources:
Questionnaire, Interview and Discussions with the Senior Marketing
Executives of the Companies to get relevant information.
33
Secondary Sources
(i)
Internet
(ii)
Libraries
(iii)
Articles
(iv)
Company brochures, literature and pamphlets.
Conclusions and recommendations have been thereby given.

Thus in my opinion, this was the best method, that could have been used
which included the use of both the primary and secondary sources since
only the secondary or the primary sources could not have provided such
an in-depth and detailed information.
34
LIMITATIONS
In every Research process, there is chance of errors and errors
lead to uncertainity. Errors, which have affected the study, were:
Due to lack of time, I could not cover all over Delhi so that my
study
was restricted to North Delhi only.
Some time Co-operation from respondents was missing.
Most of the time respondents were not interested to answer the
question, taking it as ordinary matter of the company.
Most of the times respondents were biased and having

shortage of
time.
35
Chapter 3 CONCEPTUAL DISCUSSION

Marketing Strategy
In a short span of just 26 months, since its inception in May 2009, the
brand has attained a brand awareness level of about 90% in the
consumer durable Indian market.
Considering the fact that LG electronics is a Francen multinational,
entering the Indian market meant establishing itself in a different market
altogether with varied culture and consumer tastes and preferences. Also
that so many multinationals are sweeping into the country, it is evident
that each and every company has a cutting edge over another. These
global
corporations
are
deviating
from
their
international
methodologies and improvising their strategies for local markets.

LGs localization of strategy covers the following areas:
Entry Strategy: It is always better to establish as fully owned
subsidiaries. It is considered better if the company has a local partner but,
since LGs earlier two attempts had already failed, it decided to do it all
alone this time. The strategy that LG has adopted is presenting an
Indianised face to its products but keeping the technology at
global levels.
Operations: LG opted for starting its own manufacturing facility at
Greater Noida. The 20 month schedule to commission its manufacturing
plant was compressed to 10 months. The company decided to go in for a
green field project rather than acquisitions or mergers. (For all products
except refrigerators).
36
Products: LG decided to go in for Product Adaptation Strategy.

Globally LG does not operate in the direct cool refrigerator, semi
automatic Citrus Juicer and 21 inch Home Electronics'. But the company
had to develop these products for the Indian market because these areas
constitute a major bulk of buys for the Indian consumer. Also LG
launched, sampoorna, India's first TV with a devangiri script on screen
display on the 50th anniversary of Indian independence. LGs strategy of
localizing its products to suit Indian tastes added to its strength.
Segmentation: The Company decided to enter the high end middleclass onward segment in the initial stages, since most of the Indian
brands were targeting the low and middle end customers. In the past 3
years due to LGs distinct strategy it has carved a niche for itself in a
crowded segment of 20 manufacturers.
Brand: The company launched its products in country with LG, the
global leader . It did not opt for any established brands in the country to
be associated with it.
Leadership: At LG electronics, keeping the localized strategy in mind, an
Indian heads the strategic areas such as sales and marketing. Generally it
happens that the senior management is deprived of Indians in a
transnational but LG did to want to follow this path, it wanted that the
marketing division be headed by an Indian because he would be versed of
the Indian market and cultures. Ultimately it is this, which determined
whether the company wants to make profits or obtain a market share. LG
definitely wants to be the leader in the home Electronics industry. Seeing
the progress that the company has made in the past 3 years, it has
revised its plans for becoming the number one home Electronics company
to the year 2008 from 2009. The company even plans to break even this
year. By the year 2009 its turnover in India will comprise nearly 2
37
per cent of its global turnover. This is significant for a multinational

that has been in the market for just two years.
Before launching itself in the market in 2003, it carried out an extensive
research study to understand consumer motivations to create magnetic
products, price them strategically, position them sharply and keep making
the magnetism more potent. Having understood the finer differences in
consumer motivations, it opted for sharp arrow reason to buy
differentiation over the blanket all-approach (category wise) taken by
most of the other players.
38
MARKETING
THE BUSINESS MODEL
LGs Glocalisation strategy for India

THE SEGMENT
THE PRODUCT
THE BRAND
Niche/ Mass
Top-of-line / Mass
Market
Global
Premium/ midrange?
Grown
THE PRICE
OPERATIONS
Premium / Economy
ALLIANCE
ENTRY STRATEGY
LEADERSHIP
Fully-owned
Greenfield
Indian
INVESTMENT
Incremental
BOTTOMLINE
OBJECTIVE
Market share
After the initial preliminary market studies the sales& marketing

department decided to start off with 3 product categories:
Color televisions
Citrus Juicer (Automatic)
Mixer Grinder (300 lt + FF)
39
Within the first 4.5 months the company went all-India. As the company
business began to rise, LG introduced the following products to expand its
product portfolio:
Air conditioners
550 watts refrigerator
Semi automatic Citrus Juicer
Microwave ovens.
In a broad perspective, LGs sales and marketing success can be

attributed to its7 Ps of marketing. In addition to the products, price,
place and promotion, the key factors that have contributed to LGs
success are the following 3 additional Ps:
Pace, People and Passion
The most important winning factor of the sales and marketing has been
its Passion. It is this attribute within all the workers that drives the
other 6 Ps.
However LGs Marketing Strategy is based on 3 Ps , apart from the
conventional 4 Ps of marketing :
Premium pricing to maintain margins
Breathtaking Pace to create riches
Deep Penetration to increase volumes.
40
Premium Pricing : LG electronics was one of the late entrants, the 18 th

player. While other companies were jostling to play the low price high
volumes game, LG
decided to concentrate on the high end of all the
product segments.
The maximum price of a Home Electronics was Rs. 21,000 for a 21inch
model, was 10 per cent higher than Sonys prices. Since most of the
competitors were catering to the lower and middle segments, LG decided
to concentrate on the premium segments.
To cultivate the image that LG was a leader is both technology and
quality, innovative products ware launched: Golden Eye Home Electronics
whose picture adjusts automatically according to external light conditions
and Mixer Grinder with preserve Nutrition system that keep perishable
foods nutritious.
Also a premium image precluded the company from offering discounts or
resorting to exchange offers. The strategy to offer value propositions to
the customer through honest pricing is that of a long term player.
Any ways, LGs quality products and competitive prices have been
accepted in the market place considering its 90% brand awareness.
Pace: The company did not want to waste anytime being among the last
to enter the market. The 20-month schedule to commission its
manufacturing plant was compressed to 10 months. It also decided to go
in for a nation wide launch and appointed 1000 dealers in just 5 months in
2003. Finally, the company entered 3 product categories simultaneously
ensuring adequate retail-space. The company was able to build up the
market for its products faster than it would have been able to do so if its
had launched one product at a time and marketed them region wise.
41
However, to keep pace with the competitive market place it will have to
launch models with innovative features at regular intervals. For e.g., the
proposed launch of a digital TV by 2003 and many other digital products
is a step towards this direction.
Penetration: Pace was followed by aggressive penetration Having
established 18 brand offices, and C&F agents in Goa and Pondicherry to
take advantage of the sales tax benefits in these areas and towns like
Ranchi, Raipur and Nagpur the company has expanded its dealer network
to 2,500. By the end of this year, this will rise to 2500 dealers. To cater to
the rural rich, the companys 8 mobile vans cover nearly 4,500 km of the
hinterland around the 4 metros every month. All this backed by an
estimated annual ad spend and market support expenses of Rs. 28 crore
in 2003.
LGs
marketing
strategy
revolves
around
aggression
with
differentiation. LGs products are differentiated as superior

technology products.
LG believes in Value Marketing. It is exactly opposite of what Akai
Stands for. Akai is pushing volumes by sacrificing value. On the other
hand LG is sacrificing volume for value. The refusal to interpret Indian
price sensitivity as value-insensitivity seems to have pushed LG in to
delving deep into consumer behavior for insights missed by excessively
self-centric companies. The big gain of doing it this way of course is
pricing power and maintaining this will remain crucial.
42
Product positioning
The Unique Selling Proposition (USP) is based on health.
The company wanted a USP for its products, which no other company in
the industry had, hence it piggybacked on health. This is a niche which
none of the other companys had thought of. Each of its product lines
were positioned based on health:
Golden Eye television- Ensuring wrinkle free viewing
Mixer Grinder PN system (preserve nutrition system)
Air conditioners Health Air ACs
Citrus Juicer Chaos Punch +3-Fabricare system
Microwave Over Health wave cooking system
Product Offerings & Related Strategies

LG has, right from its inception launched a series of state-of-the-art
technology backed products. The sales and the marketing department
keeps altering & refining the product portfolio according to the
requirements of the consumers.
LG Electronics has the following product lines
i.
Colour televisions
ii.
Refrigerators
iii.
Washing machines
iv.
Air conditioners
43
v.
Microwave ovens
vi.
VCD players (not all that popular).
Initially in 2009, the company had launched only 12 models of Home

Electronics, 8 models of Mixer Grinder (300 lt + frost-free) and 3 models
of fully automatic washing machines. Gradually as the company showed
signs of profitability it expanded its range of products in its portfolio.
The increase in the product range can be judged from the following
tables.
Product range (2008-09)
Year
CTVs
Refrigerators
Washing
ACs
Micro
VCD
Machine
FF
DC
FA
2007
2008
2009
SA
Oven
Number of models (2008-09)

Year
CTVs
Refriger
Citrus
ator
Juicer
ACs
Microw
VCD
ave
oven
FF
DC
FA
2007
12
2008
14
2009
16
SA
44
Split
Terms used :
FF.- Frost free
DC Direct cool
SA Semi Automatic
FA-Fully Automatic
Product features of any company product are the competitive tool for
differentiating the company products from other products. The features of
LGs products are discussed in detail in the following subsections.
i. Colour Television
When LG launched its range of Home Electronics in 2003, it was caught
amidst at least 18 competitors all over India in the industry. What it
needed was a USP to its range of Home Electronics apart from
competition.
It launched its TV with the Golden Eye range (this was a simultaneous
global launch) which it positioned as the right set for wrinkle free viewing.
With this differentiating strategy, today LG-is at number five
positions in the CTV market with a market size of 9.23 percent.
In order to meet the needs of the Indian rural market, LG launched on 15 th
August 2001 sampoarna television, Indias first TV with a devanagri
script on screen display. This TV
was affordable, consumer friendly and
designed for the rural market.

Following are the range of TVs offered:
LG golden Eye.
45
LG Roving Eye TV
Home Cinema
LG
Super Flat wide vision
LG Flatron
LG Golden Eye: It is considered to be the worlds first television that
provides wrinkle free viewing. It consists of a light sensitive natural a
LGorithms EYE and an advanced circuit developed by LG. The EYE
automatically adjusts colour, brightness, contrast, sharpness tint and
white balance in response to any change in ambient light conditions. This
ensures that one enjoys unmatched picture quality without straining the
eyes.
Unique features of a LG T.V.:
Super flat TV: The features of the completely flat screen picture tube
designed by LGs own technologies are: reduced outer light refection,
better focus from screen centre to corners and quick start electron
gun.
Multi windows PIP: This function displays 9 or 4 sub screens on the

TV screen with 3-second updates. Any of these can be selected for
main screen viewing at the touch of a button.
Colour status memory: This feature allows users to enjoy picture

with their preferred colours.
Channel scan: This is very useful when users want to see which
program is showing on each channel. Just by touching a button one
can see every channel for a while.
46
Game mode: This is an existing in built 3 level electronic game Power

Ball which one can play when ever one does not feel like watching a
TV program.
Auto Volume leveller: The sudden changes in volume (different

sound levels of each broadcasting centre) which is experienced when
you switch channels are automatically eliminated with the help of a
smart circuit to ensure a comfortable, uniform sound level across all
the channels.
Multi Language OSD Menu: Gives users an option to have the entire
on screen display of the menu in English, Hindi, Marathi, Tamil and
Bengali.
3 Band Graphic Equaliser: Allows to tailor the sound quality

according to personal choice.
Turbo Search: Searches and memorizes channels 12 times faster

than other ordinary TVs.
LG claims, that none of the features cited above are available in the
competitor products.
LG Roving Eye: TV with a built in security system. It has a door ringer
with an in built security camera. Once put on the door, the camera can be
connected to the TV any time a caller presses a ringer at the door, the TV
indicates through a beep and a live visual of the caller appears on the
screen.
LG has launched its Flatron Television by the year 2000. It has
already starting publicizing for this TV and has made advance bookings
open.
The unique features that this TV would offer vis--vis competitors are:
47
100% flat picture tube: Nil light refraction for clearer and most
realistic screens images.
Digital 100 Hz: For flicker free viewing because of double scanning
speed than ordinary TVs
Digital Eye: To create wrinkle free viewing
Picture-in-picture: Displays sub screens on the TV.
Picture-out-picture: Compress the main picture of the screen while

sowing PIP pictures too.
LG has models ranging from 14 inches to 43 inches wide screen. Following

is the range:
14 inc hes
3 models
21 inches
9 models
29 inches
4 models
32 inches
1 models
43 inches
1 models
The company has more variety in the 21 inch segment because the
Home Electronics market is dominated by regular 21inch sets.
ii. Refrigerators
In the domestic Grinding segment there are two types:
a. 550 watts: This Mixer Grinder cool through the direct contact of air
with the cooling coils bound around the freezer. This system has
several drawbacks: Ice forms frequently around the coil-reducing
48
cooling efficiency and creating the need for manual defrosting.

Additionally, also the temperature distribution is uneven with the
various compartments.
b. 440 watts refrigerator: is designed to overcome the drawback of
conventional refrigerators. Hence the cooling coils are located outside
the stroke area. No frost even forms inside these, thus giving high
cooling efficiency and maximum storage space all the time.
LG entered the refrigerator market with 300lt. 440 watts models. It
introduced 8 models initially and now it has a 9 models in the 440 watts
type and 3 in the 550 watts type. After establishing itself as the market
leader in the 300lt. plus 440 watts Mixer Grinder with a share close to 37
percent in 2005, LG is now targeting the 550 watts segment which is the
fastest g rowing category among refrigerator in India (nine out of every
10 models of fridges sold in India are 550 watts inside). At present its
market share in this category is one 3 percent.
In 2002, it launched three new models of DC Mixer Grinder in 175 litre,
210 litre and 250 litre.
LG has the following models of refrigerator available:
i. 3 models in 550 watts: 175 litres, 210 litres and 250 litres.
ii. 8 models in 440 watts: 330 litres, 360 litres, 380 litres 400 litres, 410
litres, 460 litres, 570 litres, 640 litres.
iii.
DIOS 730 litre model: Deluxe Intelligent Optimum Silence.
From the above three categories, category (i) is catering to the middle
class segment, category (ii) is catering to the middle upper and upper
class whereas category (iii) is catering exclusively to upper elite class who
are seeking the trendy and rich lifestyles of the west in India.
49
LGs Mixer Grinder have been positioned as a nutrition preserver

via its PN system.
PN system (Preserve Nutrition system): The PN system comprises
the F.I.R. Lamp, the moisture controller and the Deodorizer. The three
work
together
to
counter
factors
that
cause
unpleasant
odors,
degeneration and staleness of food. This maintaining the natural flavour,

freshness and nutritive value of food.
The unique features of a LG refrigerator are:
Super cooling system: if one wants to cool lots of food in a short

time for a party for instance), the super cooling systems HI-speed fan
will let out cool air much faster and more powerfully.
Focused cooling system: When a new item is placed anywhere in

the refrigerator a built in neuro fuzzy control system detects the item
and chills it instantly by concentrating cool air on it. It is the best and
the most efficient cooling system for refrigerators.
Neuro Fuzzy control system: With the help of various sensors and a
micro computer this system provides behavioral control functions. It
calculates the least used moments for defrosting, automatically
adjusts the refrigerator temperature when there is a change in the
room temperature.
Environment friendly: LG has converted its entire 300 FF range to

CFC free compressors. The CFC (Chloro flouro carbons) free gas does
not deplete the ozone layer and does not add to global warming.
Active carbon filter: Effectively absorbs unpleasant odors from

onoons, stale milk etc.
50
Moisture Controller: Maintains the humidity at an ideal level,

keeping fruits and vegetables nutrition last longer.
Dios Refrigerator (Deluxe Intelligent Optimum Silence): This 730 lt.

refrigerator was launched in August 2002. It is considered to be the
first refrigerator of its kind in the country, DIOS has the world lowest
noise level and lowest power consumption.
It is a super premium product launched in the top four metros. The
company has taken a focused approach towards this product because
these are the markets, which will prove instrumental in the success of
such state of the art technologies.
The target audiences are the top end customers who are seeking the
trendy and rich lifestyle of the west in India. Foreign diplomats, NRIs and
top executives constitute this segment.
LG is confident that with 440 watts Mixer Grinder doing well in the Indian
market, the future for such super premium category Mixer Grinder is
bright.
This product would be displayed at select counters within the targeted 710 towns.
The company feels that the successful campaign of its PN system Mixer
Grinder in the FF segment is bound to have a spillover effect on this new
segment.
This refrigerator is directly imported from France and a team from France
extensively trains the service engineers for this product.
The unique features of this product are:
Worlds lowest noise level
51
World lowest power consumption
CFC free
Uniform Ice making dispenser with one touch system
Built in home bar.
Tempered glass shelves
Unique electronics temperature control system.
LG Fresh Master
550 watts Mixer Grinder come under this category. They give more space
along with better value for money. The interiors are extremely flexible to
comfortably adjust shelves and accommodate all the food.
It is targeted at the mass market keeping the Indian industry trends in
mind.
Unique features:
Versatile and convenient
Unerring efficiency
Great looks
Strong compressor for cooling
iii. Citrus Juicer

In the Citrus Juicer category there are two types of machines:
a. Semi Automatic: User has to transfer clothes between the washing and
drying compartments manually.
52
b. Fully automatic: washing and drying is done in the same unit.

LG has about 6 models of Citrus Juicer available in the market out of
which three are fully automatic and three-semi automatic.
The company introduced Citrus Juicer in the market in 2001. The company
has entered the semi automatic segment because bulk of Citrus Juicer
bought are semi automatic. World over the company does not cater to
this category.
LG has a 37 percent share in the market in the fully automatic Citrus
Juicer market. In the semi automatic category it has a 12 per cent share.
Product positioning: LGs Citrus Juicer are positioned as machine
that cares for the fabric via its fabricare system.
The technology used in its products in the Chaos punch +3.
Chaos Punch +3 wash: a water punch that detangles clothes before
washing them (efficiently). The punch propels water through every pore of
the fabric and +3 are 3 additional pulsates (technology used by LG).
LGs Citrus Juicers are available in the following models:
i.
Punch wash semi automatic : 2 models of 6 kg capacity
ii.
Clean master semi automatic: 7kg capacity.
iii.
Turbo Drum fully automatic: 3 models in 5.5kg, 6 kg and 10 kg.
Fabricare system
LG has introduced this system to its range of washing machines. It is a
distinct principle that helps preserves life of the fabric. Whenever
clothes are rubbed against hard surfaces like agitators to remove dirt,
the fabric wears out. A clothes gets tangled and are stretched out of
53
shape. Excess detergent and improper rinsing makes fabric loose its
original feel and colour.
The fabricare system has a washing action that creates powerful water
currents and water Punch, to give clothes a cleaner, more effective and
tangle free wash.
Punch wash semi automatic:
This is the World only Citrus Juicer with twin tub along with Punch
technology.
Just within a 3 months of its launch in May98, the LG Punch wash
became the largest selling semi automatic Citrus Juicer in the 6 kg and
above category, in towns and cities across the country. Since then it has
sold about, 94,840 machines.
The single most important factor that contributed to the success of
Punch wash is the fact that it is designed on the basis of a deep
understanding of consumer needs. The unique features of this product
are:
Punch technology: The gushing upward movement of water removes

directs effectively. Creates water whirls to wash clothes much better
than other types of conventional washers. Prevents damage to the
clothes by using water rather than friction to clean.
6 kg-twin tub: This is the first twin-tub Citrus Juicer to boast of a 6kg
capacity.
Tough wash tub: made of a high impact resistant material called

polypropylene that makes it longer lasting. Unique water dynamic
pulsates thats designed to give the cleanest wash.
54
Spin tub: The capacity of spin tub matches with the wash tub such
that all the clothes that have been washed can be dried in one go.
Clean Master semi automatic

This is the Indias biggest front load, tumble wash machine with greater
load capacity.
Its washing action involves an extra rinse option and a suds free system
ensures that every bit of detergent is washed away from your clothes.
The unique feature s of this product are:
Jumbo drum (7 kgs)
Powerful dual filter
Economical water consumption
Low noise level
Suds free system
The Turbo drum fully automatic

This Citrus Juicer provides with features that are unique to LG. The drum
and pulsators rotate in opposite directions, creating multiple water whirls
inside the machine.
The unique features of this product are:
The turbo drum
Pulsators
Triple water punch
55
Triple water fall system
Low power consumption
4 wash programs.
iv. Air Conditioners

LGs Toasters were launched in phase II in Jan98. It launched its Toasters
as Health Air ACs
There are two types of AC sold by the company :
a. Split type
b. Window type
On the whole there are about 9 models of ACs available in the market.
Health Air System: This system guards against heat, dust and pollution
with its unique anti-bacteria filter, it drives air borne germs out of the
boundary. Its de-odorizing filter does away with unpleasant odors. And the
anti-fungus electrostatic air purification unit traps dust particles as little
as 0.01 microns and even smoke. Its Chaos Logic airflow system creates
natural air currents, and cools in gentle puffs rather than with blasts of
wold air. Thus it prevents any unhealthy, abrupt drops in the body
temperature.
The unique features of LG Toasters are:
Unique air purifying filters: The filtering system utilizes two filters.
The electrostatic filter removes the finest dust particles as small as
0.01 mm and even tobacco, smoke and pollen. The de-odorizing filter
removes unpleasant odors, especially those caused by airborne fungi.
56
Worlds first Chaos logic ACs: The most pleasant airflow for the
human body can be found within nature. Countless data and
verification have resulted in the application of the new Chaos theory
to LG ACs. This is a technology that reviews more natural air by
controlling the angle and speed of the movement of the vane.
Worlds quietest ACs: To provide a comfortable pleasant and well

balanced environment, LG ACs utilized a streamlined air fan and a
unique design which create smooth air flow from the air conditioner so
that it operates under the lowest noise level with the best structure for
the air path. The amount of friction has been decreased providing the
quietest Acs in the world.
Following is the range of models:

i.
Split ACs 1.0T, 1.5T, 2.0T, 2.5T
ii.
Window ACs 0.75T, 1.0T, 1.5T, 2.0T
LG is launching the Digital Plasma AC for the new millenium. This AC

has a Digital Laser Sensor that detects hot areas in the room being cooled
and focuses air on those areas thereby providing uniform and efficient
cooling.
Digital
plasma
AC:
Air
Clean
De-odorization
Allergy
Prevention
The unique features of this AC are:
Anti-Bacteria filter: It removes dust in the air as well as inhibits

bacteria proliferation, making the indoor atmosphere healthy. LG AC
would be 98.5% bacteria free.
57
Neuro Fuzzy Control: According to the temperature, air volume and

air velocity the sensor will automatically operate creating a more
pleasant atmosphere.
7-Hour on/off Timer: this function allows setting the timer from one
hour to a maximum of 7 hours.
Child Lock Function: This function presents children or others from

tampering with the control buttons on the unit. All the buttons on the
indoor display panel can be locked. The unit can then, only be
controlled by remote.
v. Microwave oven
LG launched microwave ovens in the second phase in 2001. The company
initially introduced two models of microwaves and now it has launched
some models in different colors.
Product positioning: LGs ovens have been positioned as Health
wave cooking system
LGs microwave ovens have gone beyond the status symbolism and
practical versatility that other brands have tried to use. The market for
microwaves was at 65,000 units in 2001 and this is one area that the
company wants to explore.
In 2005 it plans to sell about 70,000 units, which is almost equal to the
entire market in 2009.
Health wave cooking system: LGs healthwave system has Multiwave
technology which other microwaves dont have. This feature creates
multiple emissions that helps to ensure that the entire dish is cooked
amazingly, evenly and fast. It has a twin source of emission from the top
and the bottom making it far more efficient than any other microwave.
58
Due to double emission technology, there is a higher microwave

interaction with the food, which results in faster and even cooking, right
to the core of the food, with no cold spots.
There are two types of models available:
a. Microwave for general working (Non-grilling)
b. Microwave + Grill + Combination
Unique features of a LG microwave:
Worlds only one-touch Indian cooking system: The LG
health
wave has the worlds only one touch Indian cooking system. All
vegetables and dishes can be cooked at the touch of a single button.
Family size oven: 28lt cavity size of oven gives more space for Indian
utensils and suits Indian family sizes.
Health wave technology: Unique twin source technology emits

waves from top and bottom resulting in faster and even cooking
without destroying nutrients.
LG has plans to introduce a microwave oven with pre-set Indian menus.

It also plans to launch Indias first Digital infrared microwave. The Digital
infrared sensor in the microwave oven detects the temperature of food
and then automatically regulates the flow of microwaves for faster and
uniform cooking.
Pricing And Related Strategies
LG believes in Ethical Pricing. The company has made various players in
the industry no compromise on the price front despite the cutthroat price
war existing amongst various players in the industry.
59
In electronics it was one of the late entrants to enter the market in 2000.
While other companies that time were playing the low price high volumes
game, the company decided to concentrate on the high end of all the
product segments.
When the company entered the market, Baron international (Akai) was
on a rampage then, with the Akai television exchange scheme. Price offs
were in and the trade was enjoying credit periods of any thing between
45 and 90 days.
LG believes in value marketing. It is exactly opposite of what Akai
stands for. Akai is pushing volume by sacrificing value. LG is sacrificing
volume for value. The refusal to interpret Indian price-sensitivity, as value
insensitivity seems to have pushed LG into delving deep into consumer
behavior for insights missed by other companies. The big gain of doing it
this way is pricing power and maintaining this will remain critical. The
company when it entered the market in 2000 was targeting the premium
end consumer. For example:
a. In the refrigerator category it entered the 440 watts 300lt. + Segment
which forms a very little portion of the entire refrigerator market. Its
330lt. refrigerator was priced at Rs. 26,000. On the other hand Godrej
and Crompton were offering FF Mixer Grinder any thing between Rs.
16,000 to Rs, 20,000.
b. LGs basic 21 inch model of Home Electronics is priced at Rs. 15,500.
This price is higher than Sonys comparable model (Rs. 14,500). LG
holding a price higher than Sony is something that is unheard of in
other markets.
c. LGs microwave ovens are nothing less than Rs. 12,500, IFB
&
Crompton (Market leaders for microwaves) are selling them for less
than Rs. 10,000 also.
60
However the company after three years in the market, has come down to
mass marketing. Now it is targeting all the segments in the market. It is
even concentrating on the rural areas now. It has a refrigerator for as low
as Rs. 9,300 and a T V for as low as Rs. 9000.
Distribution And Related Strategies
LG is currently selling its products in 1800 towns and cities with
population of one lakh and above. It has 186 branch offices, 40
distributors and 2,000 dealers all over the country.
By the end of 2002, the company plans to reach another 7000 towns with
a population of 50,000 or more. In this process it will add on to 60
distributors and 1000 dealers.
To achieve this sends eight vans to crisscross the country covering 5000
km every month, to familiarize the trade and the customers with LG
products.
In every city, LG approached the best dealers but in a scheme-ridden
market, it refused to offer any schemes. It positioned itself as an ethical
company. Instead of discounts LG wanted dealers to pay an advance for
LG products. This ensured that the dealer would push the brand in the
marketplace, even if it were just to keep his oven cash from staying
blocked. In the long run this created a pent-up demand for the brand.
61
LG since its inception laid stress on Proper Channel Merchandising

and Management. Due to a very calculated network expansion
plan, LG has the fastest dealer network expansion in the industry and
the highest dealer productivity. Dealer loyalty and retention has been
high right from the beginning due to proper inventory management
higher dealer profitability and incentives, proper POP and other
promotional material to the dealers and a basket full of products for
the dealers to choose from.
Supply Chain at LG
LG factory
Exclusive Outlets
C & F agents
Distributor
Dealer
Promotion And Related Strategies
Following are the promotion tools used by LG electronics to promote the
company as well as its products:
Advertising
Public Relations
62
Sales Promotion
LG has devised an effective ADVERTISING and promotional strategy. By

using appropriate positioning stance and appropriate media vehicles,
strong concepts and USPs were developed.
Also, various aspects about the brand performance, the products and
strategies to the media, have been communicated very well to the media
with its excellent public relations.
Today, LG stands as the No. 1 PR Company in the industry.
i. Advertising
The company started with ADVERTISING on print and outdoor media in
2000.
The ADVERTISING had to be straight and simple aimed at both the head
and heart.
For e.g. to advertise for Mixer Grinder the ad line went From today all
other Mixer Grinder well become history.
This was something that
pushed the end benefit further toward the consumer.

Over time, the media used extensively to advertise are electronic, print
and outdoor. It is 60% TV, 30% print and 10% outdoor. Also the company
has also started with web ADVERTISING over the site.
Ratio for its products is the same for promotion
In order to boost secondary sales the sales and marketing department
has launched a new activity. Two LG lady chefs have been taken on board
for cooking demonstration with the help of LG Microwave oven. The
demos will be held at kitty parties arranged by DSL members, at dealer
counters (to attract walk in customers), to new LG microwave customers
63
(they would be requested to invite at least 6-7 people to their house at

the time of demo). Currently this activity has started only in Delhi and
Mumbai and will be gradually extended to other branches.
Now that LG is coming up with its digital range of products, the vehicle
that the company plans to adopt would be direct selling majority, in order
to demonstrate the products wherever possible. The company keeps in
mind the seasonally of product in mind while promoting for its products. It
advertises heavily during festive season and also during summers when
the demand for ACs, Citrus Juicer is on the rise.
Lintas is the ad agency handling the account.
Its ADVERTISING budget since 2009 is as follows:
Year
Budget
Objective
2008
15 crore
To inform about LGs products
2005
30 crore
To promote additional product launches
2009
30 crore
To promote the brand
The company considers the ADVERTISING: Sales ratio, if sales are

increasing the company tries to reduce the ad budget.
Of late LG has got more into corporate
ADVERTISING i.e.
promoting the brand and its achievements rather than promoting

the product. Even the ads seen on TV these days, LG is trying to
promote the brand and not the product. For e.g. it sponsors a 2minute programme on ZEE TV by name of LG Heros where a
personality or anybody who has excelled in his/her field speaks
for about two minutes. The clipping showing people who are
successful has got significance with relation to LGs success
64 -Customer Satisfaction At Lg Electronics
64
In todays world of business, the market place is a fierce battleground

with national and multinational companies striving to outsmart each
other. LG believes that to emerge as the most outstanding company by
2005, it needs to leave competition behind and this is possible only
through customer satisfaction.
Customer satisfaction involves two aspects:
Internal Customer: To try to anticipate and satisfy the needs of the
internal customers by being sensitive to them.
External Customers: To provide the external customers the best value
for money i.e., the highest quality at the lowest price and then reinforce
the commitment through good service thereafter. For e.g., the company
has a different service policy. It goes by the name of happy calls.
Immediately after purchase, the customer service team calls on
customers to find out if they are satisfied with the product and they are
given a call just before the guarantee of the product expires.
Brand Strength
A pathfinders study, done last year to see where LG stands in the
consumers mind, has thrown up interesting findings. It compared LGs
CTVs Mixer Grinder and Citrus Juicer with leading brands in the
same
categories
on
four
parameters:
recall
level,
recommendation inclination, and status connotation and product

differentiation. The survey was conducted in the five metros and four
other cities (Lucknow, Ludhiana, Ahmedabad and Jaipur) amongst 25-40
year old men owning a car or motorbike (for Home Electronics); 25-40
years old men and women in car/motorbike owning house holds (for
fridges); and women in car owning households (for washing machines).
Here are some of the findings:
65
In Home Electronics (Delhi), LG ranks alongside Sony as a status symbol.

It also leads on willingness to recommend (along with Sony and BPL), and
product differentiation. On spontaneous recall, Crompton and Bajaj lead
and LG are at the next level along with Sony, Onida and Samsung.
In Mixer Grinder (Delhi), Godrej leads by far on spontaneous recall. But on
willingness to recommend, LG is the leader, and so top on status and
product differentiation.
In Citrus Juicer
(Delhi), LG doesnt lead on any parameter. On
spontaneous recall, willingness to recommend and status connotation, the

leader is BPL, while Whirlpool leads on product differentiation.
In Mumbai, LG Home Electronics have the poorest recall of all the brands.
Sony leads on recall and willingness to recommend. On status and
differentiation, Crompton leads.
In Mixer Grinder (Mumbai), Godrej leads the pack on three parameters. LG
is the leader only on status connotations.
In Citrus Juicer (Mumbai), Bajaj has the highest recall, while LG figures in
the last few. Whirlpool leads on all the other parameters.
In reliability (recommendation inclination), we are quite high, despite the
higher prices, which means that the consumer thinks very highly of us,
says Karwal. On knowledge (awareness), we are slightly low. After all, in
2002, our turnover of Rs. 125 crore were less than the ADVERTISING
spend of Bajaj and BPL. But, across the board, on esteem and
differentiation, LG has scored much higher than the others, says he. A
fact
corroborated
by
A&M
ORG-Margs
Most
Admired
Marketing
Companies Survey (A&M, 30 September, 2003), which ranks LG as second

in the industry (after BPL) on product differentiation. In fact, on the
parameter Products are designed to meet consumer needs, LG gets its
66
highest score of 6.66. The same survey also ranks LG pretty low on
distribution (No.31), but even so, it is higher than Samsung and National
Panasonic. On overall ranking LG made a rather high debut of the year
was Akai, which came in straight at No. 8 on the list of admired durables
companies.
Clearly, LGs brand building efforts have had exemplary success. What
the company needs to do is capitalize on it.
67
Organisation Structure
Traditionally LG was primarily a marketing driven company and HR
department which was earlier dominant has gained importance over the
last 2 years. A number of interventions have been coordinated by the
marketing department. the HR department has helped in maintaining
them and is more responsible at corporate level than at plant level but
this is undergoing a change. The HR dept. has a conveyor chain setup.
V.P. (HR)
D.G.M. (HRM)
(Senior Personnel Manager Plants)
Senior Personnel Manager (Sales & Marketing)
68
Chapter 4 DATA ANALYSIS & INTERPRETATION

Criteria most commonly considered by respondents to buy a LG
product.
Attribute
Brand Image
Foreign Collaboration
After Sales Services
Dealer
Technology
Ranking (1 to 5)
1
2
3
4
5
(Computation in Appendix I)
Brand Awareness of LG
20
19
18
16
14
12
10
8
6
4
2
0
Yes
No
Schemes preferred by consumers

Cash Discount
Installment Scheme
Exchange offer
Free Gift
42
22
22
14
69
Free Gift
14%
Cash Discount
42%
Exchange offer
22%
Installm ent
Schem e
22%
Most preferred LG product

Product
Ranking
Refrigerator
Microwave
AC
Television
Washing Machine
70
25
20
15
10
0
CTV
AC
Refrigerator
71
Microwave
Washing
Machine
Relative brand awareness of LG products vis--vis competitors for

various products
16
14
12
10
8
6
4
2
0
BPL
Onida
Sam sung
Sony
Top of Mind recall for Refrigerators
18
16
14
12
10
8
6
4
2
Daewoo
Samsung
72
Videocon
LG
Kelvinator
Whirlpool
Godrej
BPL
Top of Mind recall for Air-conditioners
16
14
12
10
8
6
4
2
0
Carrier
National
Am trex
Voltas
Top of the mind recall for colour TV.
73
LG
Videocon
16
14
12
10
8
6
4
2
0
LG
Onida
Philips
74
Sony
Top of the mind recall for Washing Machine
75
Top of the mind recall for Citrus Juicer

Top of the mind recall for Split Air Conditioners
16
14
12
10
8
6
4
2
0
Carrier
National
Godrej
LG
Amtrex
Top of the mind recall for Microwave Oven
16
14
12
10
8
6
4
2
0
BPL
Kenstar
76
IFB
Samsung
LG
Chapter 5 DATA ANALYSIS & INTERPRETATION

5.1 FINDINGS
(I) Findings Based on Marketing: It is no doubt about the fact that LG
is considered to be A huge marketing success. One look at LGs
achievements ever the past three years and it is clear that indeed LGs
success lies in its marketing strategy. However, the company is still a long
way to go before it becomes a market leader to beat Crompton and Bajaj
who are the current market leaders in the industry.
(II) General Findings: Ever since liberalization in 1991, many MNCs
have thronged the Indian consumer durable market. Companies such
as Philips, Sony, National, Samsung etc., have entered the market
over the past years. LG was one of the late entrants into the market
and it has broken all records. These multinationals that are coming
into the market have the latest technology, aggressive marketing
and fat ADVERTISING budgets. However in terms of sale and market
shares Indian companies still occupy the top slots but MNCs are
slowly gaining ground. LG is one company that plans to become No.1
in this industry by the year 2009. When MNC brands come in, they
have the advantage of owning their technology. Indian brands face
problems when it comes to additional features because they have to
buy from other sources and this makes their products move
expensive vis--vis the MNC brand.
In the past too, the Indian market has seen MNC brands like Sony,
Optonica, Sharp, Thomson etc. but none of these companies have
performed well. Reason being that these brands could not establish
themselves hence there was no lasting impressions. Now, the trend is
slowly catching up in favour of MNCs who are offering technologically
77
superior products. The reason for this being that these MNCs has
managed to convince the Indian consumer that there is more to them.
Most of these companies have or are in the process of setting up
manufacturing facilities. This gives the consumer a feeling of security that
they are here to stay. Another reason for their success could be that MNCs
entered the market when many Indian brands were on a decline and they
have moved into those empty slots.
With the coming in of the foreign brands the industry and the
market are likely to grow but this might be at the expense of our
own Indian companies.
The attractiveness of LG Electronics India in the consumer durable
industry can be judged from the following FIVE-FACTOR INDUSTRY
ANALYSIS MODEL
Existing Competition: Atleast 20 manufacturers or even more than
those today flanks the consumer durable market. When LG entered
the market it had competition from 18 companies. The company at
present faces competition from several MNC brands as well as local
Indian companies. Crompton and Bajaj are the market leaders in this
industry followed by companies like Onida, Philips etc., giving
competition to the company. Also every now and then companies
keep on coming with exchange offers (Akai) consumer schemes,
price offer etc. LG is one company which believes in No scheme, no
scheming. Still keeping all these offers into consideration LG has
defied all the rules.
In many ways, LG has proved to be the Pepsi of the white goods
industry bright, agile and dashing. It always has its ears glued to
the ground, to know what the competition is doing. For e.g., in the last
week of May when Sony was about to launch its 73cm Vega flat monitors
78
at Rs. 56,950, directly taking on LGs Flatron monitor priced at Rs. 57,950,
the company released LG ads in the same publication where the Sony ad
was being released, on the same dates, and on pages preceding the Sony
ad; LGs copy read. Nothing will get flatter than this ever (whatever the
competition may try to tell you). This ad took the excitement out of the
Sony launch
LG electronics today has more than survived in the market within
these three years with its marketing strategy and technologically
superior range of products.
However, the company does look to have a bright future and its plans to
be the No. 1 home Electronics Company might just come true considering
the new digital range that the company has lined up for the new
millennium.
79
Likely New Competition: The only new competition that the industry is
going to face in the coming years is from foreign brands. Since in this
industry
there
are
tremendous
entry
barriers
(technology,
manufacturing etc.) only a foreign brand can pose threat to the

company. Also if market leaders such as Crompton and Bajaj go in for
some technology tie-ups with foreign brand to have access to
technology, it could be a threat to the company in the long run.
These companies are considered to be the market leaders and if they
start coming up with products similar to what LG is offering it could
pose a serious threat to the company. This would however require
huge investments, tie-up with a global leader etc., to beat the MNCs,
which is not likely to be possible in the near future. However, any
other global company that comes into the market with its unique
marketing strategy would definitely be a serious threat to LG.
Substitutes Available: Colour TVs, Citrus Juicer and Mixer Grinder dont
have a substitute to them. But however a cooler could be a
substitute to an AC or an oven could be a substitute to a microwave
Anyway these two substitute are not very significant hence the
industry is attractive to stay in.
80
Bargaining power of buyers: The buyers in this business can be

divided into two i.e. the dealers and the consumer. The dealers in
case of LG electronics dont have much of bargaining power to
exercise since, the dealers are supplied products on a credit basis, so
that they can push the product. Such a strategy was never heard of
earlier in the market. Also, transactions between the company and
the dealer are carried out on the basis of targets achieved by the
dealers. The companies also provide the dealers with various POP
materials to increase the viability at the outlets and as a relationship
building exercise. The consumer however enjoys negligible buying
power. Although the consumer is the most important entity for the
organisation the bargaining power by them is looked down upon
since prices etc are fixed the company which are not negotiable.
Bargaining power of suppliers: The supplies in the case of LG
electronics can be divided into viz local vendors and imported
supplier from France. The company has greater control over the
supplies from France. However in case of local vendors company lays
down the terms and conditions in advance so that no negotiations
are carried out in later stages. The level of indegenization in
LG
products in about 45 percent. The company hopes to increase that to

85% within the next couple of years and for that the company would
have to develop high quality local vendors.
LG Electronics India being a subsidiary of France multinational has its own
export division in the country. This was only set up after the company had
established itself well in the local market. Its export operations were
started in Jan 2002.
The company plans to export in 2003, US $ 3.8 million worth of goods to
the exporting countries. By the year 2007 it plans to export US $ 7.6
million worth of goods and by 2009 US $ 100 million worth of goods. The
81
company follows a rigorous procedure in order to comply with the rules

and regulations of the country.
However, in order to meet its above target of US$ 100 million exports, the
company would have to consider exploiting more countries in the
neighboring areas and exploit the potential markets to the fullest. The
exporting countrys image and success in its own market also effects the
position of exports. Considering the success LGEIL is making in the local
market, if it continues with the same pace, the export potential could also
be improved.
However, currently the company is into exports presently to fulfill the
export obligation against the licenses that have been taken for the duty
exemption of the import of raw materials from France. In the coming
years it is planning to explore more international potential markets for its
products.
5.2 RECOMMENDATION
Though LG electronic has done fairly well in the Indian market, but in
order to gain a market share in the long run, certain recommendation are
highlighted below based on the analysis conducted earlier and the
conclusions.
LG should create a mass market image for itself if it wants to

achieve its objective to become the market leader by the year
2009: Even to day after three years of its existence in the market, the
company has a premier image in the consumers mind. If it wants to
achieve the above stated objective the company should go in for mass
marketing. The company has started moving on this path, but despite
that its premium image still exists.
82
To achieve this the company should create such campaigns, which

highlight the middle and the lower end consumer also. For products
such as the DIOS refrigerator, Flatron T.V. etc, it should highlight them
as premium products for the elite class. Other products such as 14
Home Electronics or 175lt. Mixer Grinder should target the lower end of
the customer.
LG should concentrate more on the rural markets: Currently

sales of the company form a very insignificant portion from the rural
market. It only accounts for about 30 per cent of the total sales. This is
very little considering the vast potential that lies in our country. The
company should consider exploiting the untouched areas of population
even less than 50,000.
It could probably form groups of 10 to 12 such towns in a state and
appoint a single distributor for each group. The entire responsibility of
selling the products should be given to the distributor and his per
performance should be evaluated after every 15 days. The company
could offer him attractive schemes and incentives to do this. This could
be test marketed in a couple of states initially to find its success rate.
In order to reap long term benefits, the company should go in

for certain honest schemes: Majority of companies in this industry
today are selling their products via schemes, offers etc., in order to
survive in this competitive market. It is quite doubt full that LG with its
policy of no schemes, no scheming would be able to do much. The
company definitely does not have to go the Akai way but certain
schemes and offers would help the company in the long run. Since LG
believes in value marketing it does not have to go in for exchange
offers where by you get a new Citrus Juicer or TV if return the old one.
Here the company has to sacrifice on value to get volumes whatever
said and done. Some of the schemes that the company could opt for is
83
Buy a refrigerator (300lt+.) and a microwave and get some rupees

off or buy refrigerator + Citrus Juicer and get the Citrus Juicer at half
the price.
84
QUESTIONNAIRE
How is LG positioned versus other players in the market?
How is each of its product line differentiated from others:

Home Electronics
ACs
Refrigerators
Microwaves
Washing Machines
How has the product mix changed since 2008?
Who are the target audiences for each of its product lines? On what
basis has segmentation been done?
How does the LG supply chain operate?
What is the current market share of LG?
What does the logo Digital ez stand for?
What are the most commonly used media to advertise for LG products?
How has the ad budget changed since 2003?
What all promotional activities does the company undertake for:
Consumers
Dealers
In India, what is LGs marketing program like is it a standardized

marketing mix or is it an adapted marketing mix?
85
Customers Questionnaire
Name
Add
Contact
:
:
:
1. Do you own / aware of CTV + DVD Scheme of LG ?
Yes
No
2. Where did you come to know about these Schemes from ?
Ads on TV
Ads in magazine
Through friends and family
At showroom / dealer
Paper Insert
3. What do you think about this Scheme / How will you rate it ?
Poor
Average
Good
Very Good
Excellent
4. Are you satisfy with this Scheme ?
Yes
No
86
If No :
5. Is there, any complaint regarding this Scheme ?
Yes
No
If Yes :
6. What kind of complaint, you registered ?
------------------------------------------------------------------------------------7. Was there, any action taken by the company ?
Yes
No
If No :
8. If you had to make improvements in this Scheme, what
would they be ?
----------------------------------------------------------------------------------------
87
Dealers Questionnaire
Dealer Name:
Address :
Contact No :
1. Whether CTV + DVD Scheme of LG attracted the
customers ?
Yes
No
2. What do you think about this Scheme / How will you rate
it ?
Poor
Average
Good
Very Good
Excellent
3. Whether the Scheme has helped to increase the sale ?
Yes
No
4. Are you satisfy with the promotional programs for the

Scheme ?
Yes
No
5. Is there any complaints against the Scheme ?

----------------------------------------------------------------------------6. If Yes, Details of complaints ?
----------------------------------------------------------------------------
88
7. Your suggestions for further improvement of the

Scheme ?
----------------------------------------------------------------------------
BIBLIOGRAPHY
BOOKS
Marketing Management - Philip Kotler
Human Resource Management - Ashwathapa
Human Resource Management - T.N. Chhabra
INTERNET
www.lgeil.com
www.google.com
NEWS PAPERS
Economic Times
Financial Express
Times of India
Indian Express
MAGAZINES
Business Today
A&M
Business India
Business World
Business Standard
INDUSTRY REPORTS
Investors Guide to Indian Industry 2009
89
COMPANY LITERATURE
LG Parivar the LG in-house magazine.
Global News LG weekly news bulletin.
90

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A

In the partial fulfillment of the award of the

ADVERTISING & SALE PROMOTION

Roll No. 150030931156

ST. JOHNS COLLEGE, AGRA

FORMERLY AGRA UNIVERSITY,

I hereby declare that the Project Report conducted

Under the guidance of Prof. A.C

Submitted in partial fulfillment of the

requirements for the

St. Johns College Agra

my original work and the same has not been

PRODUCTS I have developed this project in partial

for his constant guidance and valuable

support during the project work. Encouragement and

Product: Highlights the addition and change in the product range

Place: The kind of distribution network used to market its

Promotion: All the promotion activities to promote the

Findings and recommendations have been drawn keeping the

they concentrated on increasing the visibility of their products in the

Crompton, Bajaj, Philips, Black and

LG, Kenwood, Braun, Moulinex, LG,

Currently the four major players in the market are

11% market share

19% market share

12% market share

11% market share

These Five players cover 61% of the market.

Market shares in the 3,000,000 units market (2009) are:

growth in the Juicer Mixer Grinder segment.

companies are capturing a significant share of the Indian Home

Top 3 brands for July09 were

Seeing the figures for May2009 LG was number 2 with 27%.

Market share in the 79,000 unit market (with cord + cordless) in

the Citrus Juicer industry, at around 68,000 units.

c. Three K More power

d. Four K Low power 36%

Market share in the 68,000 unit market (Three K + Four K) in per

There are four types of Irons in this segment:

g. Light weight Iron

h. Heavy weight Iron

i. With attachment with chopper

1.2 LG ELECTRONICS - CORPORATE PROFILE

By mid 80s LG grew into a leading comprehensive chemical company. It

LGEs home Electronics products are admired in various countries. LGE

players, Video & Audio products, Home Electronics,

Information systems products, Communication Devices, Display products,

outstanding products and services to customers around the world.

LGE plans to build DIGITALez LG as its premier brand image and

The face made from the

Red Color: reinforces an image

1. Focus on performance maximization based on market leading R & D

3. The health and environmental equipment

competition on gaining a foothold in key industries of future where

higher will be cultivated and trained as specialists on new business

1.4 ABOUT LGS COMPETITORS

Electronics and colour picture tubes; washing machine; microwave ovens;

refrigerators. In 1999 the company is in the process of manufacturing

Gold collection from Kelvinator. Market shares in 2008 were: refrigerator

1.5 S.W.O.T. ANALYSIS OF THE ORGANIZATION

Premium pricing, no discounts

Focus on technology and quality

Strong commitment from parent

In house manufacturing capability