Marcom Plan of LG Home Appliances Presented to:- Ms. Ashita Agarwal Director ISMC Presented by:- Raj Kumar Singh Roll No. 5 th PGPIMC 06-08

Introduction LG Electronics India Pvt. Ltd. A wholly owned subsidiary of LG Electronics, South Korea was established in 1997. LG set-up state-of-art manufacturing facility at Greater Noida,( NCR, Delhi) in 1998 with the investment of 500 crore. The plant manufactured:- Color Television Washing Machine Air Conditioners Microwave oven

LG Electronics India Pvt. Ltd. A wholly owned subsidiary of LG Electronics, South Korea was established in 1997.

LG set-up state-of-art manufacturing facility at Greater Noida,( NCR, Delhi) in 1998 with the investment of 500 crore.

The plant manufactured:-

Color Television

Washing Machine

Air Conditioners

Microwave oven

Introduction LG started the production of its eco-friendly refrigerators and established its assembly line for its PC Monitors at its Greater Noida manufacturing unit, in 2001. LG has established in 2 nd manufacturing unit in Pune in 2004, which has commenced its operation in October this year. LG is market leader in various segments like color TVs, microwave ovens, frost-free refrigerator, washing machine and air conditioners.

LG started the production of its eco-friendly refrigerators and established its assembly line for its PC Monitors at its Greater Noida manufacturing unit, in 2001.

LG has established in 2 nd manufacturing unit in Pune in 2004, which has commenced its operation in October this year.

LG is market leader in various segments like color TVs, microwave ovens, frost-free refrigerator, washing machine and air conditioners.

Introduction Products of LG Television Flat LCD Plasma

Products of LG

Television

Flat

LCD

Plasma

Introduction Refrigerator Washing Machine Air-conditioner Microwave oven PCs Mobile Phones

Refrigerator

Washing Machine

Air-conditioner

Microwave oven

PCs

Mobile Phones

Market Segmentation:- LG has segmented its market on the basis of following: Demographic Income Occupation Geographic Tier 1 cities Tier 2 cities Psychographic Life style Personality Behavioural Value Benefit sought

LG has segmented its market on the basis of following:

Demographic

Income

Occupation

Geographic

Tier 1 cities

Tier 2 cities

Psychographic

Life style

Personality

Behavioural

Value

Benefit sought

Targeting LG has targeted its market on the basis of the product that they are offering to the consumer. They are targeting: Upper class segment Upper end They are targeting to those consumer who are more concern of life style product. Their product is more of upper mid class and premium segment, so their target audience are those consumers, who want quality product as the best price.

LG has targeted its market on the basis of the product that they are offering to the consumer.

They are targeting:

Upper class segment

Upper end

They are targeting to those consumer who are more concern of life style product.

Their product is more of upper mid class and premium segment, so their target audience are those consumers, who want quality product as the best price.

Targeting They have LCD and Plasma Television and TV DIOS refrigerator for premium segment. They are also targeting those consumer, who are more concern of safety and health issues. LG is now going to shift over to mid class segment and want to mass market their product. ( www. india ntelevision.com/interviews . Sandeep Tiwari )

They have LCD and Plasma Television and TV DIOS refrigerator for premium segment.

They are also targeting those consumer, who are more concern of safety and health issues.

LG is now going to shift over to mid class segment and want to mass market their product.

( www. india ntelevision.com/interviews . Sandeep Tiwari )

PEST Analysis Political Factor:- High Import Duty Plants in tax- incentive areas like Greater Noida and Pune. Export promotion schemes of the Indian Government like EPCG (Export Promotion Capital Goods scheme) and EOU (Export Oriented Unit) status . Economic factor Increase in per capita income Growing GDP High disposable income Increase in spending power

Political Factor:-

High Import Duty

Plants in tax- incentive areas like Greater Noida and Pune.

Export promotion schemes of the Indian Government like EPCG (Export Promotion Capital Goods scheme) and EOU (Export Oriented Unit) status .

Economic factor

Increase in per capita income

Growing GDP High disposable income

Increase in spending power

PEST Analysis Sociocultural factor They are manufacturing eco-friendly product. Increasing life style. Technological factor Improvement in technology made the electronic product cheaper. Quality of product has been increased.

Sociocultural factor

They are manufacturing eco-friendly product.

Increasing life style.

Technological factor

Improvement in technology made the electronic product cheaper.

Quality of product has been increased.

SWOT Analysis Strength Market leader in home appliances segment. Manufacturing unit in tax-incentive areas. Wide range of product categories to tap the consumer of middle class, upper middle class and high class. LG, having the widest distribution network in the industry (47 branches, 175 area offices and over 10,000 trade partners) (www.exchange4media.com/e4m/interview/dialogue_detail.asp?id=241 - 41k - ) Shifting to rural market Weakness Consumer compare LG products with its competitor Samsung, not with another foreign brand. Similar product categories as compare to its close competitors Samsung.

Strength

Market leader in home appliances segment.

Manufacturing unit in tax-incentive areas.

Wide range of product categories to tap the consumer of middle class, upper middle class and high class.

LG, having the widest distribution network in the industry (47 branches, 175 area offices and over 10,000 trade partners)

(www.exchange4media.com/e4m/interview/dialogue_detail.asp?id=241 - 41k - )

Shifting to rural market

Weakness

Consumer compare LG products with its competitor Samsung, not with another foreign brand.

Similar product categories as compare to its close competitors Samsung.

SWOT Analysis Opportunity Shifting to rural market. Control over the white goods market, as we know highest market share in home appliance market. Home appliances market is growing very fast, so there is a opportunity for LG to launch new products. Threat The closest competitors Samsung is also from south Korea, and consumer compare LG products with Samsung product. Price war with its closest competitors, Samsung. Competitions from Indian brand and from new entrants.

Opportunity

Shifting to rural market.

Control over the white goods market, as we know highest market share in home appliance market.

Home appliances market is growing very fast, so there is a opportunity for LG to launch new products.

Threat

The closest competitors Samsung is also from south Korea, and consumer compare LG products with Samsung product.

Price war with its closest competitors, Samsung.

Competitions from Indian brand and from new entrants.

Positioning Strategy With the tagline Life’s Good, LG positioning is to differentiate their products on the basis of technology which appealed to the consumer on the basis of health benefits. With the tagline ‘Life’s Good’ its corporate philosophy to make peoples' lives better, convenient and healthier . Their positioning strategy are technologically intelligent and futuristic. As they are in upper and premium segment, so they are featuring that their brand is young, vibrant and premium.

With the tagline Life’s Good, LG positioning is to differentiate their products on the basis of technology which appealed to the consumer on the basis of health benefits.

With the tagline ‘Life’s Good’ its corporate philosophy to make peoples' lives better, convenient and healthier .

Their positioning strategy are technologically intelligent and futuristic.

As they are in upper and premium segment, so they are featuring that their brand is young, vibrant and premium.

Positioning Strategy LG has differentiated its product using technology and health benefits. The CTV range has ‘Golden Eye Technology’ air-conditioners have the ‘Health Air System’ and Microwave ovens have the ‘Health Wave System’. They are talking about the value and changing lifestyles in their positioning strategy.

LG has differentiated its product using technology and health benefits. The CTV range has ‘Golden Eye Technology’ air-conditioners have the ‘Health Air System’ and Microwave ovens have the ‘Health Wave System’.

They are talking about the value and changing lifestyles in their positioning strategy.

Competitive Analysis Major Competitors of LG

Major Competitors of LG

Competitive Analysis Market share 24.6 Others 23.4 samsung 8.7 Onida 17 Videocon 26.2 LG

Market share

Competitive Analysis Market share of Television:- 9.6 Onida 2.3 IGO 1.4 BPL 4.4 Videocon 5.3 Sansui 6.2 Philips 23.6 Sony 24.6 Samsung 21.7 LG

Market share of Television:-

Competitive Analysis Market share of Microwave market: 11.2 Others 9.6 Electrolux] 9.8 IFB 12.4 Kenstar 18.5 Samsung 38.5 LG

Market share of Microwave market:

LG Vs No.2 Player 13.8(whirpool) 34.8 Washing Machine 19.7(samsung) 41.1 Microwave oven 15.1(samsung) 25.5 CTVs 21.2(whirpool) 27.2 Refrigerator No.2 Player LG Market share in volume terms Category

Competitive analysis The market share and data shows that Samsung is main competitors of LG electronics in India. The target audience of both companies are same. Product category are more or less same. Close fight between the two companies.

The market share and data shows that Samsung is main competitors of LG electronics in India.

The target audience of both companies are same.

Product category are more or less same.

Close fight between the two companies.

LG Vs Samsung Communication strategy of LG Tag line “Life's Good” Brand ambassador Abhishek Bachchan LG positioned itself as a Indian brand. They are hitting at the emotional attributes of Indian consumer. The warmth and affection that a brand showers upon its target audience will be reciprocated.

Communication strategy of LG

Tag line “Life's Good”

Brand ambassador

Abhishek Bachchan

LG positioned itself as a Indian brand. They are hitting at the emotional attributes of Indian consumer.

The warmth and affection that a brand showers upon its target audience will be reciprocated.

LG Vs Samsung For television market they are using child, because child play the role of influencer in purchase of TV sets. LG home appliances communication message is totally based on health message like Golden Eye technology and Intello. They want to position the brand as being young, vibrant and premium. So they picked Abhishek as he portrays Indian values.

For television market they are using child, because child play the role of influencer in purchase of TV sets.

LG home appliances communication message is totally based on health message like Golden Eye technology and Intello.

They want to position the brand as being young, vibrant and premium. So they picked Abhishek as he portrays Indian values.

LG Vs Samsung Communication strategy of Samsung Samsung the second market leader in home appliances in India. Brand communication message “DigitAll inspiration” They positioned itself as a brand which offers freshness and technologically strong. Samsung in India signed seven cricket celebrities to cash the image and popularity of cricket.

Communication strategy of Samsung

Samsung the second market leader in home appliances in India.

Brand communication

message “DigitAll inspiration”

They positioned itself as a brand which offers freshness and technologically strong.

Samsung in India signed seven cricket celebrities to cash the image and popularity of cricket.

LG Vs Samsung In order to create brand awareness, they come up with ‘Team Samsung India’. They want to tap their target audience by offering them fresh product.

In order to create brand awareness, they come up with ‘Team Samsung India’.

They want to tap their target audience by offering them fresh product.

Marketing Strategy The marketing objective of LGEI, aims to focus on the premium segment of the market that fetches greater margin opposed to volumes. LG aims to utilize their core capabilities of product leadership, market leadership and people leadership and enhance their corporate culture of team work and fun workplace to achieve their mission of becoming "2 by 10", that is, double our sales volume and profit by year 2010. The company want to capture 50% market share, by the end of 2010.

The marketing objective of LGEI, aims to focus on the premium segment of the market that fetches greater margin opposed to volumes.

LG aims to utilize their core capabilities of product leadership, market leadership and people leadership and enhance their corporate culture of team work and fun workplace to achieve their mission of becoming "2 by 10", that is, double our sales volume and profit by year 2010.

The company want to capture 50% market share, by the end of 2010.

Marketing Strategy LGEI, aims is targeting a turnover of Rs.15,000 crore by this year and proposes to close the current calendar year with a turnover of Rs.7,000 crore. The company has recorded a 119 per cent volume growth in the flat TV segment during the period, 61 per cent in refrigerators, 21 per cent in washing machines, 45 per cent in microwaves and 75 per cent in air conditioners. The company want 13% sales growth in each segment in this year as compared to last year.

LGEI, aims is targeting a turnover of Rs.15,000 crore by this year and proposes to close the current calendar year with a turnover of Rs.7,000 crore.

The company has recorded a 119 per cent volume growth in the flat TV segment during the period, 61 per cent in refrigerators, 21 per cent in washing machines, 45 per cent in microwaves and 75 per cent in air conditioners.

The company want 13% sales growth in each segment in this year as compared to last year.

Corporate Strategy LGEI corporate strategies is to more focus on innovation to attract more technology savvy consumer and the company is aspiring for –Keep innovating. LG Electronics corporate strategy is to become a true global digital leader through fast growth and fast innovation and to be known as a company who can make its worldwide customers happy through its innovative digital products and services.

LGEI corporate strategies is to more focus on innovation to attract more technology savvy consumer and the company is aspiring for –Keep innovating.

LG Electronics corporate strategy is to become a true global digital leader through fast growth and fast innovation and to be known as a company who can make its worldwide customers happy through its innovative digital products and services.

Corporate Strategy LG Electronics has set its mid-term and long-term goal to rank among the top 3 electronics, information, and telecommunication firms in the world by 2010. LG would concentrate on staying ahead of the technology curve and develop products that deliver high value to consumers.

LG Electronics has set its mid-term and long-term goal to rank among the top 3 electronics, information, and telecommunication firms in the world by 2010.

LG would concentrate on staying ahead of the technology curve and develop products that deliver high value to consumers.

The Marketing Background Worksheet MC helps LG to create a strong and positive brand attitude and influence consumer to do action. Marketing Communications 6 Focus on innovation to attract more technology savvy consumers and the company is aspiring for keep innovating. Marketing Objectives 5 Samsung positioned itself as a brand which offers freshness and technologically strong. Competitive Evaluation 4 LG business comes from Metros, II-tiers & III- tiers cities and Rural Areas Source of business 3 There are some global players in mkt. like Samsung, Videocon, BPL, Sony, Philips. Market Assessment 2 Home appliances Product Descriptions 1 Questions Key Considerations S. No.

The Key Target Audience Worksheet LG sales and usage comes from Metros urban and rural market. The marketing objective required continued usage. Refers to STP Analysis Decision makers are the head of the family.

LG sales and usage comes from Metros urban and rural market.

The marketing objective required continued usage.

Refers to STP Analysis

Decision makers are the head of the family.

The Decision Grid consumer Family members User Owner of the store Head of the family Purchaser Decision taken by self Head of the family Decider Offers and incentives children Influencer Future prospects of the product, Industry growth Housewives& Children Initiator Trade Consumer Role Target Audience

The Communication Strategy Worksheet Communication Objective To communicate the health plus objectives. To communicate that the brand is young, vibrant and premium. To hit the emotions of the indian consumers by showing the warmth and affection.

Communication Objective

To communicate the health plus objectives.

To communicate that the brand is young, vibrant and premium.

To hit the emotions of the indian consumers by showing the warmth and affection.

The Communication Strategy Worksheet Brand Attitude Strategy:- Home Appliances product is high involvement product, and consumers require information before purchasing the product. So, to influence the attitude of the consumers, LGEI need to focus on the communication message, which is helpful to create a positive brand attitude. The communication objective of LG is to influence the target audience to do purchases.

Brand Attitude Strategy:-

Home Appliances product is high involvement product, and consumers require information before purchasing the product. So, to influence the attitude of the consumers, LGEI need to focus on the communication message, which is helpful to create a positive brand attitude.

The communication objective of LG is to influence the target audience to do purchases.

The Behavior Sequence Model --------------------- Company outlets, MBO’s ---------------- ------------------- Where purchase is likely to occur ---------------------- Offer discount Competitive product information ---------------- Timing of purchase ------------------------ -------------- Product information Brand Awareness How is it likely to occur Benefit of the product Purchase Facilitator Product Awareness Category Need Decision roles involved Usage Purchase Information search Need Arousal Consideration at each stage Decision Stages

The IMC Task Grid Brand recall By offer new product Family members Repeat purchase Usage Sales Promotion Company outlets, MBO’s Head of the family Motivate Purchase Brochures Brochures and TVCs Head of the family, decision maker Brand recognition Information Search/ Evaluation TVCs, Outdoor Print Ads, Pamphlets in Newspaper House wife, children Awareness in market Need Arousal List best IMC option for satisfying each communication task Determine best way of reaching primary target audience group at each stage Determine primary target audience group to reach at each stage List specific result desired from the appropriate communication effect needed at each stages From Decision Grid list appropriate decision stages IMC Options Where and When Target Audience Communication Task Decision Stage

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