LG Electronics India was established in 1997 as a subsidiary of LG Electronics in South Korea. It manufactures electronics like TVs, washing machines, air conditioners, and microwave ovens (MWOs) at facilities in India. LG promoted its products through health-focused advertising, highlighting features like reduced eye strain from TVs. To expand MWO sales, LG launched a direct marketing campaign in 2004, customizing models and promotions based on consumer research in different regions. Direct marketing helped educate consumers and promote new product features. Intense competition prompted LG's aggressive promotional strategy.

1. CASE STUDY
LG Electronics India Pvt. Ltd. (LGEIL), the home appliances and
consumer electronics major, was established in 1997 as a wholly-owned
subsidiary of LG Electronics headquartered in South Korea. LGEIL has
manufacturing facilities at Noida and Maharashtra, and manufactures
color televisions, washing machines, air conditioners, vacuum cleaners,
refrigerators, microwave ovens (MWO‟s), etc. It is one of the most eco-
friendly LG facilities in the world.
LGEIL was a trendsetter in promoting its products to the consumers
through the platform of health. Its advertising campaigns focused on the
health aspect. The color television segment highlighted the “Golden
eye” technology that reduced strain on the eye while watching
television. The air conditioners‟ campaigns emphasized the “Plasma
healthy air system” that gave pure and fresh air, keeping pollution at
bay. The MWO‟s are promoted via the “Healthy wave” system.
Similarly, the washing machines were promoted as “Fabricare” systems
that take the health platform down to ones‟ clothes. Analysts pointed out
that health was a valid platform for any brand to base its promotion on.
Moreover consumers aspired for more than just functional benefits and
companies could differentiate themselves through the health plank.
According to Mr.Arora, head marketing at LGEIL, “our advertising
strategy has been to communicate whatever products actually deliver
health convenience, advanced features, and technological superiority.

2. LG communication till date was centered at the theme of „protective
health‟. It was driven by LG‟s concern for the consumers‟ health, and
having technology that work towards protecting them”.
To expand the microwave category, LGEIL decided to promote its
MWO‟s through the direct marketing route on 2004. It fixed a
budget of about Rs.15million for direct marketing institutes for the
product. Mr.Saurabh Baisakhia(Baisakhia), product group head of
the MWO division, said, “We could achieve a major market share
in such a short span mainly due to the fact that we were able to
identify consumer buying behavior in different zones and realized
that he need of consumers‟ vis-à-vis this product is not
homogeneous. Thus, we launched different capacity models for
different zones”. The company‟s market research revealed that the
twenty-liter model was preferred in Kolkata, while in the North;
the thirty-liter one was sought. In Chennai, the basic MWO model
was popular since consumers were price-sensitive. The research
also revealed that customers were unaware of the usage and utility
of microwave ovens.
The primary objective of the direct marketing campaign
was to reduce the problems faced by consumers after product
purchase. LGEIL also aimed at removing the misconception that
MWO‟s were just a heating device. As part of its direct marketing
efforts, it gave home demonstrations to explain all the features of

3. the microwave oven models. It also planned launch new models of
MWO‟s to cater to tastes and convenience of different customers.
Baisakhia said, “We have tried to create excitement about this
category to our constant product launches which would cater to
each segment. Constant home demonstrations helped in attracting
consumer attention”. Direct marketing helped the company
communicate the product improvisations directly to the consumers.
For instance, the company focused on communicating a unique
feature such as the 25-recipe memory for the 25 liter grill.
Intense competition from players like Samsung and
Electrolux forced the company to opt for such aggressive and
unique means of promotions. Samsung electronics, its main
competitor, soon followed suit with its direct marketing campaign
called “Spot the Van cooking fiesta” in the northern states of the
country. As part of this campaign, a mobile van carried the entire
range of microwave ovens to dealers and consumers to
demonstrate the product features. Special offers were also made to
consumers during the direct marketing campaign. Samsung too
emphasized on the health aspect through its “freshetarian”
advertising campaign for its refrigerators and “Samsung bio TV”
for televisions, that was certified by the Indian Board of
Alternative Medicine. Sansui, another player in color TV segment

4. also introduced „Smart Eye‟ TVs that reduced the strain on the
viewers‟ eyes even after long hours of watching television.
QUESTIONS FOR DISCUSSION:
1. Enumerate the reasons for LG opting for the direct marketing
route to promote microwave ovens.
2. Many companies in the consumer electronics segment have
begun to focus on the ‘health’ platform in their advertising
campaigns for their products to attract consumers’ attention.
In such a situation, how could LG differentiate itself from the
clutter through the use of various other marketing
communication elements?
Student opinion: LG should continue its direct marketing campaign till
the time consumers‟ start feeling comfortable and they become well
aware of the product. Once the consumer has gained the complete
knowledge about the usage of the product, the company can stop direct
marketing and switch to other media as direct marketing is a very
expensive method of marketing.

5. The company these days is facing immense competition from
“Samsung” as it is also trying to target its customers through the
platform of health. It should continue giving direct offers to the
customers through direct marketing and also find new and innovative
ways to differentiate itself.
ANS.1: The route of direct marketing adopted and health
campaigns by LG proved to be very successful by taking it to the
number one position with the highest market share. The objective
of direct marketing was to serve the customers in a better way
after the purchase by teaching them the various uses of
microwave... Also, LG was able to identify customer buying
behavior in different zones and could customize its products
accordingly. Direct marketing also helped the company
communicate the product improvisations and customizations
directly to the customers. It was quick to respond as per the
customer requirements. Therefore LG opted for the direct
marketing route to promote microwave ovens.
ANS.2: In case LG intend to have an entire range of washing machines
to cater to all segments of the market, it should have a smaller capacity
washing machine as Videocon ( 3 Kgs etc ) as the market for them is

6. still very large. The colors of LG Semi Automatic Washing Machines
(Off White, Pale Beige, and Light Grey) are very trendy and appeal to
the customers. It has to give more warranty periods like other players do
in the industry. More Demonstrators are required for LG Products.
Instead of go for a limited distribution network it has to build a wide
channel network.
The communication strategies for washing machines are not
fruitful for the target segments. So, there should be developed a
new communication strategy for it. Instead of going for clean
clothes and longer life for clothes, the ad theme should target to
the women‟s or females, which other players do like Videocon &
Whirlpool. Because, a lady in the family is the main buyer in
purchasing the product. So, a new USP was to be developed.