LG repositions brand on aspiration plank
12 November 2007
Chennai: LG Electronics India is planning to reposition its brand as an aspirational one, rather than the present ''value-for-money'' positioning, by offering a range of "differentiated" products, and moving on from the "me-too" category.
According to Moon Shin, managing director of LG, going forward the company''s advertising will cease to comment on pricing, preferring to communicate on features, quality and our after-sales service support.
Given that, the company is reportedly planning on introducing more futuristic and technologically advanced products, including a range of differentiated products in the IT, flat panel display and mobile phones segments, which the company sees as future growth engines for the years to come.
In 2006, LG India had reported a turnover of Rs8,250 crore, and is hoping to book Rs9,500 crore as the present year''s turnover.
According to Shin, October alone saw record sales of Rs1,100 crore, which suggests the company is headed in the right direction given its target of doubling turnover by 2010.
LG, according to Shin, spends around 5 per cent of its turnover on research and development. The company is also reported to be mulling a product portfolio expansion in the home appliances segment, with new products such like 80 to 100 litre wine cellars, air purifiers and a new range of vacuum cleaners, along with 22-inch LCD TVs, 32-inch Plasma TVs, which would be the smallest in the plasma category in the Indian market.
Commenting on pricing, Amitabh Tiwari, business head for consumer electronics, LGEIL said that the 22-inch LCD TV would be probably priced at par with the 29-inch conventional flat-screen TVs, which typically range around Rs20,000, and the 32-inch Plasma will be priced around the range of a 26-inch LCD TV.
LG''s last year ad-spend was in the range of Rs550 crore, and reportedly the company is planning to shell out over Rs940 crore this year on advertising, with a planned 60 per cent increase for 2008, according to Shin. This increased ad spend is aimed at better penetrating the southern market in particular. GroupM manages LG''s media buying, while Lowe is the company''s advertising agency.