DESK RESEARCH ON STP AND CHANNEL DESIGN OF LG ELECTRONICS.

1. DESK RESEARCH ON STP
AND CHANNEL DESIGN
OF LG
BY-
SHAHBAAZ AHMED
SUNDRAM SINHA
SALONI RAMAN MISHRA
RAJNI VASHISHT
SHRAVAN KUMAR
SWATI SHARMA

2. INTRODUCTION
1. MARKET LEADER OF CONSUMER DURABLES.
2. INNOVATOR IN IT AND MOBILE
COMMUNICATIONS.
3. LG ELECTRONICS INDIA PVT. LTD., SUBSIDIARY
OF LG ELECTRONICS, S. KOREA, ESTABLISHED
IN 1997.
4. MERGER OF 2 KOREAN COMPANIES , LUCKY
AND GOLDSTAR.

3. INTRODUCTION
6. STARTED THE PRODUCTION OF ECO-
FRIENDLY REFRIGERATORS AND ESTABLISHED
ASSEMBLY LINE FOR ITS PC MONITORS AT G.
NOIDA MANUFACTURING UNIT IN 2001.
7. 2ND MANUFACTURING UNIT IN PUNE IN 2004.

5. HOME ENTERTAINMENT
• HOME APPLIANCES

6. MOBILE COMMUNICATION
• AIR CONDITIONS & ENERGY SOLUTIONS

7. SEGMENTATION
GEOGRAPHIC
• URBAN
•(TIER 1 TIER
2 CITIES)
•RURAL
DEMOGRAPHIC
•INCOME
•(HIGH, MIDDLE
CLASS)
•AGE GROUP
•OCCUPATION
PSYCHOGRAPHIC
•LIFESTYLE
•PERSONALITY
BEHAVIORAL
•OCCASION
•BENEFITS

8. TARGETING
ON THE BASIS OF THE PRODUCT THAT THEY
ARE OFFERING TO THE CONSUMERS.
CONCERNED OF
SPECIFIC LIFESTYLE
PRODUCTS.
PLASMA TV, LCD, TV
DIOS RFRIGERATORS
UPPER
CLASS WHO WANTS QUALITY
PRODUCT AT THE BEST
PRICE
PREMIUM
CLASS

9. POSITIONING
1. TAGLINE- “LIFE’S GOOD”.
2. DIFFERENCIATE THE PRODUCTS ON THE BASIS
OF TECHNOLOGY WHICH APPEALED TO THE
CONSUMER ON THE BASIS OF HEALTH
BENEFITS.
3. CORPORATE PHILOSOPHY TO MAKE PEOPLE’S
LIVES BETTER, CONVENIENT AND HEALTHIER.
4. YOUNG, VIBRANT AND PREMIUM. Eg-
ABHISHEK AS BRAND AMBASSADOR, USE OF

10. POSITIONING
1. “HEALTH” AD CAMPAIGNS
2. “GOLDEN EYE TELEVISIONS” TO REDUCE EYE
STRAIN.
3. “HEALTH AIR AC’S” AS ANTIBACTERIAL FILTER.
4. “HEALTHWAVE SYSTEM” IN MICROWAVE OVENS.
5. SPONSORSHIP OF INDIAN CRICKET TEAM IN ICC
WORLD CUP 2003.
6. DISCOUNTS DURING DIWAALI FESTIVAL.

11. CHANNEL DESIGN
1. DIRECT DEALER CHANNEL-
2. SUB DEALER/ DISTRIBUTOR CHANNEL

12. DISTRIBUTION NETWORK
1. REGIONAL DISTRIBUTION MODEL- ALL
DISTRIBUTORS WORK DIRECTLY WITH THE
COMPANY.
2. 46 Branch Offices and Another 110 Area Offices
Across the Country.

13. MARKETING CHANNEL
Manufacturer
Direct Channels Indirect Channels
Direct
Sales
Online
Marketing
Telemarketing
Manufacturers’
Representatives
Industrial
Distributors
Customer Segments

14. DIRECT CHANNEL
1. STORES THAT DIRECTLY SELLS TO END CONSUMERS.
2. EXCLUSIVE STORES OR SHOWROOMS- MORE FOCUS
FOR
PROFITABILITY AND LARGE VOLUMES.
3. MULTI BRAND SHOPS.
4. 34 % OF SALES .
ADVANTAGES-
a) NO LOSS OF MARGINS THROUGH
INTERMEDIARIES.
b) COMPLETE CONTROL OVER DISTRIBUTION
PROCESS.

15. DISTRIBUTOR CHANNEL
1. SMALL RETAILERS WHO LACKS CAPITAL TO BUY
DIRECTLY FROM LG.
2. DIRECT DEALERS HAVE ATLEAST ADDITIONAL 3 %
MARGIN.
3. 49% OF SALES.
ADVANTAGES-
a) ALLOWS PENETRATION OF FRAGMENTED DISPERSED
MARKET.
b) EASES LOGISTICS FOR BUYERS WHO BUY DIFFERENT
ITEMS.

16. PROCESS OF
DISTRIBUTION
GOODS ARE DISPATCHED TO C/F’S ON CONSIGNMENT
BASIS.
DISTRIBUTORS SOURCE THE ORDER OF GOODS FROM
THE WAREHOUSES SERVED BY C/F’S
RETAILERS ORDER THEIR REQUIREMENT FROM
DISTRIBUTORS.
GOODS ARE BOUGHT BY THE CUSTOMERS FROM
RETAILERS.

17. MARKETING STRATEGY
1. OBJECTIVE- FOCUS ON INNOVATION TO
ATTRACT MORE TECHNOLOGY SAVVY
CONSUMERS. AND THE COMPANY IS ASPIRING
FOR- KEEP INNOVATING.
2. SET ITS SHORT TERM AND LONG TERM TO
RANK AMONG TOP 3 ELECTRONICS,
INFORMATION AND TELECOM FIRMS IN THE
WORLD.

18. E-CHANNELS
1. SOCIAL NETWORKS
2. VIDEO CHANNELS- YOUTUBE.
3. MOBILE APPS AND WIDGETS.

19. COMPETITIVE ANALYSIS

20. MARKET SHARE
LG
26%
SAMSUNG
23%VIDEOCON
17%
ONIDA
9%
OTHERS
25%
Sales
LG SAMSUNG VIDEOCON ONIDA OTHERS

21. MARKET SHARE AS
CATEGORIES

22. 1. NO. 2 PLAYER IN MARKET SHARE (VOLUME
TERMS)
2. SAMSUNG IS THE MAIN COMPETITOR OF LG
ELECTRONICS IN INDIA.
3. SAME TARGET AUDIENCE AND PRODUCT
CATEGORIES.

24. SWOT ANALYSIS
STRENGTH
•WIDEST DISTRIBUTION
NETWORK.
•WIDE RANGE OF
PRODUCT CATEGORIES
WEAKNESS
•COMPARISON WITH
RIVAL COMPETITOR
SAMSUNG .
•SIMILAR PRODUCT
CATEGORIES AS
COMPARED TO ITS
COMPETITORS.
OPPORTUNITIES
•SHIFT TO RURAL
MARKET
•GROWTH OF HOME
APPLIANCES MARKET TO
LAUNCH NEW
PRODUCTS
THREATS
•PRICE WAR BETWEEN
PRODUCTS.
•COMPETITION FROM
NEW ENTRANTS.

25. BCG
MATRIX
QUESTION MARKS- LG
COMPUTERS
STARS- LG LCD TELEVISION
CASH COW- WASHING
MACHINES, REFRIGERATORS,
MICROWAVE OVENS.
DOGS- LG MOBILE