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LG Refrigerator Price

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Many people raised their eyebrows when LG introduced their slogan, 'Life is good', but this South Korean has successfully completed all its promises by provided some of the best appliances ever. When …

Many people raised their eyebrows when LG introduced their slogan, 'Life is good', but this South Korean has successfully completed all its promises by provided some of the best appliances ever. When this company entered the market, some of the major kings like Kenmore, Maytag and Whirlpool were ruling the hearts of people. This is the reason why LG did not receive much appreciation in early days as this brand was considered to be a cheap of alternative of the above mentioned brands.

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  • 1. SECTORAL ANALYSISOFREFRIGERATORS Presented by: Sheetal Kumbhare
  • 2. A chilled glass of water, a large mug of beer, a tall glass of refreshing laaemonade, a nice bowl of cold salad and a big helping of a frozen dessert. Summer dreams are made of these.But ever imagined what would happen to those dreams if not for a big, vertical, rectangular box called the refrigerator?
  • 3. SECTORAL ANALYSIS OF REFRIGERATORS
  • 4. HistoryBefore the invention of the refrigerator, ice houses were used to provide cool storage for most of the year.At the start of the 20th Century ice boxes were used to store the food products.The first refrigerator to see widespread use was the General Electric "Monitor-Top" refrigerator introduced in 1927 .Gradually with the development of technology different types of refrigerators are manufactured and today it is one of the most common household .
  • 5. Ice boxes
  • 6. Monitor-top refrigerator of GE
  • 7. BACKGROUND  Refrigerators have been manufactured in India since 1950s. Till the 1980s, players like Godrej, Kelvinator, Allwyn andVoltas controlled almost 90% of the market.Earlier, the white goods sector was categorized as a luxury goodsindustry and was subject to oppressive taxation and licensing.Thesituation changed after the liberalization of the Indian economy inthe early 1990s. Post-liberalization, a number of foreigncompanies entered the market and many domestic players alsodiversified into refrigerators. BPL and Videocon who already had apresence in the consumer electronics market, leveraged theirstrengths to enter the durables sector.          
  • 8. Present Scenario 2nd highest aspirationalIn India, refrigerators have the value of all consumer durables, with the exception of televisions. This accounts for the high growth rate of the refrigerator market.Refrigerators are presently being manufactured in two basic designs which are referred to as Direct Cool (DC) and Frost Free (FF) refrigerator.The direct cool segment continues to dominate Indian refrigerator market compared to more expensive frost- free models. The growth in this segment though marginal, has been driven by factors like availability of low priced models as due to competitive pricing and a growing middle class.
  • 9. OVERVIEW Indian refrigerator market is valued at Rs4000 crore Refrigerators hold only 16% of consumer durable market that is valued at around Rs. 20,000-25,000 crore in India. Its market is growing at the rate of 7-8% annually. Refrigerators constitute the second largest product segment within the Indian consumer durables sector in India, with an estimated annual turnover of Rs 39 bn during FY2005 with an estimated sale of 4.1m units.Projected sales for the year 2007-2008
  • 10. INDIA V/S GLOBALThe penetration of household refrigerators in India, the fifth largest consumer durable in terms of penetration, is 13% compared to well over : 90% in Malaysia, Australia, Singapore, Hong Kong and Korea; around 80% in Thailand; close to 40% in Philippines and China and 20% in Vietnam and Indonesia.When you compare the annual commercial sales of AC and refrigeration equipment in the US at US $ 200 per capita and in China at US $ 3 per capita with a dismal US $ 0.25 per capita in India.
  • 11. SWOTStrengths Weaknesses1. Presence of established distribution 1. Demand is seasonal and is highnetworks in both urban and rural areas during festive seasonal2. Presence of well-known brands 2. Demand is dependent on good3. In recent years, organized sector has monsoonsincreased its share in the market vis a 3. Poor government spending onvis the unorganized sector. infrastructure 4. Low purchasing power of consumersOpportunities1. In India, the penetration level of Threatswhite goods is lower as compared toother developing countries. 1. Higher import duties on raw2. Unexploited rural market materials imposed in the Budget3. Rapid urbanization 2007-084. Increase in income levels, i.e. 2. Cheap imports from Singapore,increase in purchasing power of China and other Asian countriesconsumers5. Easy availability of finance
  • 12. Types of refrigerators :On the basis of technology the refrigerators are of two types : (a) Direct cool (b) Frost freeDirect cool refrigerators are the low range/price products and frost free refrigerators are the premium products with advanced features.Direct cooling ones are mostly single door refrigerators and frost-free refrigerators are mostly double and multiple doors.
  • 13.  Also on the basis of capacity the refrigerators are of different types:Mini (50 to 100 ltrs)- Right for a bachelorSmall (170 to 200 ltrs)- Right for a couple and a small kitchenMedium(200 to 450 ltrs)- This is for nuclear household, not too small nor too big.Large (450 to 800 ltrs)- This is for big home and big budget
  • 14. Category Wise Market Share (Units) Frost Free 29% Direct Cool 71% Categoy Wise Market Share (Revenue) ,Frost Free 43% ,246.74 ,Direct Cool 57% ,327.37
  • 15. Need Family Convenience Product Family Consumer Durables Product Class Home Appliances Product Line Refrigerators Product Type Direct Cool, Frost Free BrandsLG, Whirlpool, Samsung, Godrej, Kelvinator SKU’s 165ltrs, 180 ltrs, 200 ltrs, 350 ltrs
  • 16. MARKET SHARE ANALYSIS—2001-06
  • 17. Performance Measures GodParameters Rerigerator Industry LG Samsung Whirlpool BPL rejPurchase exp. At thestore 61 60 54 65 66 58Billing process 55 58 49 58 52 60Delivery process 57 53 56 57 59 58Product usage &performance 65 64 66 73 63 62After sales service 68 76 64 64 67 63Customer schemesand promotion 47 44 47 44 49 49Advertising & comm. 53 59 53 53 49 52
  • 18. Customer Satisfaction Index Customer Satisfaction IndexElectroluxVideoconWhirlpool Godrej CSI Score BPLSamsung LG 46 47 48 49 50 51 52 53 CSI Score
  • 19. MARKET SHARE OF VARIOUS BRANDS IN 2006-07 29% 30% LG SAMSUNG WHIRLPOOL OTHERS 16% 25%
  • 20. Loyalty Segment Industry Average Electrolux Whirlpool Godrej High risk Trapped BPL Accesible Videcon True loyals LG Samsung 0% 20% 40% 60% 80% 100%
  • 21. MAJOR PLAYERS refrigerator industry has become highly competitive as a number of brands have entered the market and the consumer has a wide choice.Company BrandsBPL Limited BPLVideocon International Limited Videocon, Electrolux , Kelvinator and AllwynLG Electronics India Limited LGSamsung India Electronics Limited SamsungWhirlpool of India Ltd  WhirlpoolGodrej & Boyce Mfg. Co. Ltd. GodrejVoltas Limited Voltas
  • 22. Market players taken for analysisLG Electronics Whirlpool India Samsung
  • 23. REFRIGERATORS-Your key to healthier lifestyle
  • 24. COMPANY HISTORYEstablished in 1997, LG electronics India Pvt. Ltd operates in India through a wholly owned subsidiary LG electronics, South Korea.LG set up a state-of-the art manufacturing facility at Greater Noida. This facility manufactured Color Televisions, Washing Machines, Air-Conditioners and Microwave Ovens. During the year 2001, LG also commenced the home production for its eco-friendly Refrigerators and established its assembly line for its PC Monitors at its Greater Noida manufacturing unit.Besides all this, LG India is one of the very few companies in the country that has an internal Energy, Environment, Safety and Health Department. This function caters to activities like Energy Conservation, Environmental Issues, Work Place Fire and Safety as well as Occupational Health for the benefit of the employees.
  • 25. LG India has also been taking on a slew of initiatives as a part of Corporate Social Responsibility. LGEIL is proud to have adopted about 24 villages around our Greater Noida facility. LG extends Free Medical Care, which comprises of free check ups and a free distribution of medicines on a daily basis.Its positioning statement is “high volume and lower margin”.
  • 26. Its vision was to become a Health Partner for its consumers worldwide and therefore formulated its corporate philosophy to make peoples lives better, convenient and healthier like refrigerators have the PN System, which preserve the nutrition in food.The company has achieved a turnover of Rs 7500 crore in 2005.LG India has also been taking on a slew of initiatives as a part of Corporate Social Responsibility. LGEIL is proud to have adopted about 24 villages around our Greater Noida facility. LG extends Free Medical Care, which comprises of free check ups and a free distribution of medicines on a daily basis.
  • 27. LG REFRIGERATORSSpecial feature to preserve nutrition with green ion door cooling refrigerators.LG refrigerators has been rated 5 star by Bureau of Energy Efficiency (BEE).Recently they have launched the first TV- Refrigerator in India
  • 28. TYPES OF PRODUCTS SEGMENTS INREFRIGERATOR1. FROST FREE REFRIGERATORS2. DIRECT COOL REFRIGERATORS3. SIDE BY SIDE DOOR REFRIGERATORS  TV-DIOS REFRIGERATORS
  • 29. FROST FREE REFRIGERATORS Frost forms when water vapor hits the cold coils. The water vapor condenses - turns to liquid water. When the water condenses onto the coils, it immediately freezes and forms frost. After certain intervals, the timer turns on the heating coil which is wrapped among the freezer coils. The heater melts the ice off the freezer coils. When all of the ice is gone, the temperature sensor senses the temperature rising above 32 degrees Fahrenheit and turns off the heater. 280 – 471 litres are available. There are 9 models available in this segment.
  • 30. Called as “Intellocool” refrigeratorsTARGET:Middle and middle upper class people.PRICE:The price range varies between Rs.14450 to Rs.39880CDV: 4 /5 STAR Rating (BEE) Works without StablizerIntello Compressor
  • 31. DIRECT COOL REFRIGERATORS Called as “INTELLO COOL” Available in the range of 175litres To 270litres. There are 14 models in this segment.TARGET:Middle and middle upper class people.PRICE: The price range varies between Rs.6500 to Rs.11800CDV: 4 /5 STAR Rating (BEE) Works without Stablizer Intello Compressor
  • 32. SIDE BY SIDE REFRIGERATORSTwo doors side by side. One side refrigerator and other side freezer with through the door ice / water dispensers.580 – 750 litres are available.There are 5 models available in this segment.Refrigerator with TV & Radio is also available. TV-DIOS LG India launched the World’s First TV Refrigerator – TV DIOS with a 13-inch hi- definition TFT LCD TV installed at the center of its door. The 600 litres TV DIOS also has a built-in radio tuner providing access to FM stations and is supported by built-in speakers. It has an astounding silver nano-antibacterial and nano- carbon deodorizing technology.
  • 33. Called as “Intellocool” refrigeratorsTARGET:Middle Upper and Upper / premium class people.PRICE: The price range varies between Rs.59900 to Rs.130000CDV: 4 /5 STAR Rating (BEE) Works without Stablizer Intello Compressor Dispenser
  • 34. PROMOTION / MARKETING STRATEGY Like the marketing of FMCG products, LGs marketing was heavily dependent on advertising. Its ad spend to sales ratio at 5-6% of sales was very close to that of FMCG giant HLL.PROMOTION: The campaign, Cricket First, which featured captains of the 14 teams participating in World Cup 2003, highlighted the spirit of cricket with a tagline, Captains of Cricket World, for the Captain of Consumer Electronics and Home Appliances. The company announced that it would spend around Rs 400- 500 million on advertising during the World Cup.ADVERTISING: Abhishek Bachchan, the brand ambassador for LG promotes the LG “INTELLO COOL” range of refrigerators.
  • 35. Threats to the companyDespite the fact that refrigerators have immense utility to housewives and provide a solution to avoid food wastage, the penetration level is still below 20% and its market is growing at a very small pace. This may be because:People in small towns and rural areas do not consider it as a necessary product and are unaware of its utility value.Non-availability of power.
  • 36. OPPORTUNITIES India can be explored.Untapped market of ruralRURAL & URBAN PENETRATION IN INDIA 2005CRITERI RURAL PENETR URBAN PENETR TOTAL PENETR A HOUSE ATION HOUSE ATION HOUSE ATION HOLD % HOLD % HOLD % ‘000 ‘000 ‘000REFRIG 11014 8% 29515 48% 40529 20%ERATO RS
  • 37. RURAL MARKETINGLG India- tripled the number of its retail & distributor outlets in rural areas from 2004 to 2006It also tapped local forms of entertainment like annual haats and fairs and made huge investments in infrastructure for distribution and marketing.
  • 38. Rural Marketing - Promotion Support initiatives of LG Mobile Van at Kasargod
  • 39. Exhibition at Cookery Classes at differentRajamundry locations for Rural Housewives
  • 40. 1000 In Store Road Show at SatnaDemonstrators at Dealercounters in Rural Cities
  • 41. History 1911: founded by Louis Upton 1987: Whirlpool tied-up with Sundaram Clayton Ltd. of India to form TVS Whirlpool Ltd. 1995: Whirlpool Corp. acquired majority of stake in the TVS Whirlpool Ltd. 1996: Whirlpool Washing Machines Ltd. and Kelvinator India Ltd. merged together to form Whirlpool of India Ltd .
  • 42.  2003: A new mission statement of "Everybody creating loyal customers for life" was adopted. 2006: Whirlpool Corporation acquires Maytag and become the Worlds largest white goods company.
  • 43.  Success mantra of Whirlpool : Know a customer a Be a customer To share cust. Serve a customer Knowledge & insight Who are the customers Creating customer How to treat them touch-point value How to add value Sharing empathy How to create brand loyalty
  • 44. Whirlpool is transforming into a completely customer-centered company where the customer lies in the core of every of our functions . The transformation is made up of five elements : Market leadership through customer loyalty Innovation Diversity with inclusion and core competencies Passion for customer excellence Operational excellenceWhirlpool has swiftly moved from being a World Class Manufacturer to a World Class Marketer using the brand- building framework.
  • 45. Vision and mission The pervasive vision of Whirlpool is “ Every Home, everywhere, with pride, passion and performance ”. This rests on the pillars of innovation, operational excellence, customer-centric approach and diversified talent. Market share and growth rate : Currently Whirlpool commands 25% of the domestic refrigerator industry and trying to achieve 27% by this year.
  • 46.  Segmentation of market :The segmentation variables for refrigerator market are Age/ lifecycle stage Marital status: eg: Refrigerator is a very necessary household for newly married people. Social class and income. Occupation : eg: “Instant cool” feature is convenient for working women families.
  • 47. Targeting and positioning : Whirlpool is targeting the women of every Indian families and accordingly it has successfully positioned itself as the best home-maker in the world. The positioning statement is – “You and whirlpool –the world’s best home maker”The USP for the frost free segment is its 6 th sense cooling system which automatically adjusts the level of cooling .
  • 48. Products The products in refrigerator category includes Direct cool : Low range products. Product variants are named as “Genius”. Frost control : Medium range products. Product variants are named as “fusion”. Frost free: Premium and high capacity products. Product variants are named as “Professional, ice bergs , masterminds and delight”.
  • 49.  Whirlpool refrigerator Fusion is available in two models which is designed to operate even with an irregular power supply, which is a common problem in many Indian cities.Whirlpool has introduced new Delight frost- free refrigerators in eight models in 230-L, 260-L and 300-L capacities. A unique feature is LED lighting, a white light that is “evenly distributed and optimally positioned” to enable the contents of the refrigerator to be clearly visible even when it is fully loaded.
  • 50. PROMOTION and ADVERTISING
  • 51.  Promotional and advertising strategies : Whirlpool spends six to seven times less in promotion and advertising than the competitors like LG . They have been spending the money smartly. Instead of giving ads every day, they are skewing their ads towards weekends when the customers go to shops and make enquiries. Their ads are frequently coming on days such as Dussehra, Karva Chowth, Dhanteras, etc
  • 52.  Also, they have done some smart negotiations with the major dailies and magazines by taking a twelve-month contract and blocking the primary positions like front page or back page. So they deal with competitors with greater muscle power in terms of money through smart buying and smarter planning. Regarding ads. the brand ambassadors are Ajay Devgan and Kajol
  • 53.  Strategies for the coming festival season: They are promoting the sixth sense technology which they are saying that “a woman’s sixth sense captured by technology.” For the coming Diwali season the message is “magic chalao dream home sajao”
  • 54. Samsung India is the hub for Samsung’s South West Asia Regional operations.Responsible for Samsung business inNepal, Sri Lanka, Bangladesh,Maldives and Bhutan besides India.Samsung India commenced operations in India inDecember 1995, today enjoys a sales turnover ofover US$ 1Bn in just over a decade of operations inthe country. Samsung has been the "fastest growingbrand in the world.Headquartered in New Delhi, Samsung India has a network of 20 Branch Offices and 40Area Sales Offices located all over the country." With a total brand value estimated to be US$10.8billion, Samsung now ranks 25th inBusinessWeeks Top 100 Global Brands
  • 55. Samsung (2007-08)•Samsung has launched nine new refrigerator models, both frost-free anddirect-cool.•Samsung, which is the market leader in the over-350 litre frost-free refrigeratorsegment, is seeking to consolidate its position by launching three new,advanced, feature-rich models in 375 litres, 400 litres and 704 litres in theIndian market. The company currently has a range of 42 frost-free modelspriced between Rs13,000 and Rs 1.5 lakh.•In the direct cool refrigerator segment, the company has extended thecategory by introducing two new models of 180 litres and 195 litres.•Expecting to expand refrigerator channel by 25 per cent this year.•Targeting a market share of 18 per cent in the refrigerator segment this yearfrom 15.8 per cent last year.
  • 56. Samsung plans to reach out to more tier-II cities. Showcasing products in 135 cities this year against 120 last year.The South had emerged as a key contributor to the companys overall revenues.The share of Southern sales has gone up from 24 per cent to 31 per cent, equaling the contribution from the Northern States.In a bid to cash in on the growing interest in the South, the company has lined up 11 `Dream Home roadshows in the region this year. The number of `brand shops would go up by 30 per cent from 82 currently.
  • 57. PRODUCTSTV, Video & InformationAudio Technology ProductsTV MonitorsDVD Hard Disk DriveCAMCODER Optical Disk DriveAudio Laser PrintersHome Theater FaxMP3Home Appliances MobileWashing Machine PhonesRefrigerator GSM CDMAMicrowave OvenAir Conditioner
  • 58. Positioning Samsung positions itself as technology leader and not only as a volume player and a price warrior. Strategy is value driven, not price driven. Expecting leadership on the basis of top quality, leading edge technology, priced competitively and backed by strong after sales service," Global CEO Yun Yongs vision: "We want to be the Mercedes of home electronics.“ The drivers this time at Samsung -- in fact, the company has put these well above the traditional 4 Ps of marketing -- are design and innovation. "Good designs and innovative technology will be the most important differentiator for Samsung from competition"If you are able to deliver the latest technology at an affordable price, the consumer will not be willing to go back to outdated technology
  • 59. How many customers actually pay attention to differentiation on the basis of technological innovations such as Twin Cooling or Silver Nano (for refrigerators), or even one based on design?The sales staff at the showrooms are not able to point out the key differentiators.To tackle this issue, last year, the company started the Samsung Marketing Academy, which conducts regular training programmes to educate the sales forces, shop-owners and company employees on the companys technology and design, how it is different from what competitors are offering, and how to better explain the difference to the consumer.By equipping the salespeople to sell knowledge-oriented lifestyle products, the company is hoping to provide customers a more informed buying experience, which will translate into higher sales.
  • 60. Technology and InnovationsTwin Cooling System- uses two independent evaporators that provide optimum level of cooling to the refrigeration compartment and the freezer.The i-Cool™ System- is an intelligent cooling system with three cold air outlets-at the back and on the right and left sides of the refrigerator interior, resulting in all round cooling action.Silver Fresh Technology- The Silver ions inside the refrigerator, achieve 99.9% removal of bacteria and create the perfect environment to keep food super fresh.
  • 61. •Direct Cool•Frost Free•Side By Side
  • 62. Direct CoolTarget : Middle ClassNo. of models : 6.Available both in 180/200 ltrs. capacity.PriceLow price due to high competitionRs.8,700 to Rs.10,900
  • 63. Frost Free Refrigerators
  • 64. No. of PriceCategory Models 6Frost Free Rs.13,000-Rs.22,000(Less Than 350 L) 6Frost Free Rs.29,000-Rs.56,000(Greater Than 350 L) 3Frost Free Rs.38,000 & Rs.56,000(Bottom Freezer)
  • 65. Side By SideTarget: Premium Product Targeted at Niche Market.No. of Models: 13Capacity: 545 Ltrs to 880 LtrsPrice: Rs. 56,000 – Rs. 1,41,000
  • 66. ENRICHING THE RETAIL EXPERIENCETo display Samsung products in a more lifestyle ambience and to communicate the product benefits in a more interactive manner, Samsung India has set up a widespread network of Samsung Digital Worlds, Digital Homes and Digital Plazas all over the country.
  • 67. The Samsung Brand shop network complements theover 8500 retail points for Samsung products locatedacross the length and breadth of the country.Samsung plans to continue enhancing itspenetration levels in the country to reach out to moreand more Indian consumers
  • 68. RETAINING CUSTOMERSSamsung considers After Sales Service as a key differentiator for Samsung products. In order to deliver prompt and easily accessible service, Samsung India has set up a widespread network of company owned as well as Authorized Service Centers to service its customers.The Samsung Service Plazas, as the Company owned Service Centers are called, are a first in the industry..
  • 69. The Samsung Service Plazas serve as a one-stop shopfor Samsung’s walk in customers. Customers also get achance to see the Samsung range of products andinteract with Samsung product specialists to know moreabout the company’s products and services.
  • 70. After Sales ServiceSpeed, Smile, Sure’ is the motto for Samsung Service, as the Company seeks to satisfy more and more of its customers with prompt and accurate service. A Service Helpline number gives access to Samsung Service throughout the country. Samsung India organises a Free Service Camp on an All India basis, every year, for proactively reaching out to customers and servicing their Samsung products.‘10 second to loose a customer, 10 years to gain them back’ forms the guiding principle for Samsung Service Team as it strives to satisfy the growing expectations of Indian customers.
  • 71. Promotions
  • 72. Future ScenarioWith easy availability of finance, emergence of double-incomefamilies, fall in prices due to increased competition,government support, growth of media, availability ofdisposable incomes, improvements in technology, reduction incustoms duty, rise in temperatures, growth in consumer baseof rural sector, the consumer durables industry is growing at afast pace. Given these factors, a good growth is projected inthe future, too.The penetration level of consumer durables is very low inIndia, as compared with other countries. This translates intovast unrealized potential.
  • 73. Demand and Penetration Level of WhiteGoods In India