Project Report On INTERNATIONAL MARKETING STRATEGIES OF

BACHELOR OF BUSINESS ADMINISTRATION of GURU GOBIND SINGH UNIVERSITY,

NEW DELHI INSTITUTE OF MA

PREFACE

I, student of RAI UNIVERSITY am pursuing a MBA course and towards the partial fulfillment of it have undergone a project. I have put my sincere efforts to accomplish my objectives within the stipulated time. Despite all the limitations, obstacles, hurdles and hindrances, I have toiled and worked to my optimum potential to achieve the desire goal. Being neophytes in the highly competitive world of business, I came across some difficulties to make my objectives a reality. Anyhow, with the kind help and genuine interest of one and all and formally supported by the guidance of my guide, I am presenting this hand carved effort in colored. I tried my level best to conduct a research to gain a thorough knowledge about the project in my topic International Marketing strategies of LG Electronics I have put the best of my efforts and have also tried to do justice with the available. If anywhere something is found unacceptable or unnecessary to the theme, you are welcome with your valuable suggestions.

CONTENTS
Abstract Preface Industry Prospects Vision Industry Overview History Future Prospects Product Profile HR System Social Commitments Strategic Alliances Objective Methodology Findings and Analysis Limitations Conclusion and Recommendations Bibliography

CHAPTER-1 ABSTRACT
This study is divided into several parts. This project highlights the objective and aims of L.G Electronics sales promotion strategies and how successful these promotions have been. By Questionnaire- Survey, the preferences and purchase pattern of the consumers have been highlighted. This has helped significantly in determining what kind of promotional campaigns will be successful, what is lacking in current campaign and things to consider in future before making a promotional campaign. In the end, conclusion has been made regarding the whole analysis and several recommendations have been suggested, which could help in boosting the success rate of sales promotion by L.G Electronics.

CHAPTER-2

INDUSTRY OVERVIEW
The consumer durable goods industry is a highly growth oriented Industry, which is seeing high net growth inspite of the recession which has gripped the major industries worldwide. In 2003, despite the various global difficulties, the industry achieved higher yearly Sales growth over the previous year. But 2004 will bring great challenges for the industry as uncertainty in global business and continued weakness in the world markets carries over from the previous year. But the Indian market has been able to post robust growth in this industry inspite of the recession in the world markets. The reason, which has helped this industry, is the desire of the Indian people to acquire the latest that the technology and the companies have to offer in the product portfolio ranging from CTVs & their higher end versions of plasma & projection Tvs, Airconditioners, Refrigerators, Washing machines, Cellphones, Microwave Ovens etc. This desire stems from the fact that people have money at their disposal and want to spend it only on the Products, which give them, value for money. This is because after a hard days work people want to relax for which they purchase products that help them to do so. For example: washing machines that require only the clothes be put into it, air conditioners which provide relief from extreme hot and cold weather, Cellphones that help in connectivity and other similar products with their associated features that help in making life smooth for the people. Companies are cashing on this aspect to fuel their growth and are even succeeding in their efforts if they provide good quality

products. This industry is also witnessing growth because the companies are concentrating on strengthening the R&D and expanding investments in home & overseas market and by also developing core technologies. They are working hard to expand their market position by producing innovative products as well as improving product quality and cost competitiveness.

CHAPTER-3 COMPANY PROFILE

Global Top 3 By 2010 LG Electronics pursues its 21 s t century vision of becoming a true global digital leader who can make its customers worldwide happy through its innovative digital products and services. LG Electronics sets its mid-term and long-term vision anew to rank among the top 3 electronics, information, and telecommunication firms in the world by 2010. As such, we embrace the philosophy of "Great Company, Great People," whereby only great people can create a great company, and pursue two growth strategies involving "fast innovation" and "fast growth." Likewise, we seek to secure three core capabilities: product leadership, market leadership, and people-centered leadership.

Growth Strategy Fast Growth:

Fast growth is the result of strategies designed to expand the market size and earnings quickly, in the process improving the growth rate in terms of monetary value rather than quantity.

Fast Innovation: Fast innovation involves setting extremely high innovation goals and securing a competitive edge, aiming for a target of 30% more than what our competitors can do. Fast innovation also means 30% more sales and improvement and in our market 30% share, new product development unveiling these faster, technology

development and establishment of corporate value three years ahead of competitors. Core Capabilities Product Leadership: Refers to the ability to develop creative, premium products through specialized new technologies. Market Leadership: Refers to the ability to achieve the "LG brand is No. 1" goal backed by its formidable market presence worldwide. People Leadership: Refers to talented people who perform excellently by internalizing and practicing innovations. Corporate Culture Though a company implements perfect management strategies and boasts of outstanding and talented people, it should have an appropriate capabilities. corporate culture to unleash the power of these

No 'No'- Challenge: We foster a corporate culture whereby we suggest an alternative before saying "no" and aggressively work towards fulfilling our goal. 'We' not I: We pursue a corporate culture whereby we embrace a strong teamwork. Fun to work: We create a workplace where individuals' creativity and freedom are respected and working is made fun.

MISSION LG Digital Design makes Customer's Dream True

INDUSTRY OVERVIEW
Overview LG Electronics, Inc. (Korea Stock Exchange: 6657.KS) was

established in 1958 as the pioneer in the Korean consumer electronics market. The company is a major global force in electronics and information and communications products with more than 64,000 employees working in 76 overseas subsidiaries and marketing units around the world. With annual total revenues of more than US $16.9 billion (non-consolidated), LG Electronics comprises three main business companies : Digital Display & Media, Digital Appliance, Telecommunication Equipment & Handset. LG Electronics' goal is to enable the intelligent networking of digital products that will make consumers' lives better than ever. Corporate Name Established Corporate Office LG Electronics Inc. October 1, 1958 (As a private Company) LG Twin Towers 20,Yoido-dong, Youngdungpo-gu Seoul, Korea 150-721 Tel: 82-2-3777-1114 URL: http://www.LGE.com Chairman & CEO Mr. S.S.Kim Business Area and Main Product Digital Display & Media Company Digital TV, PDP, Monitor, CD-ROM Drives, DVD-ROM Drives, CD Rewritable Recorder, VCR, DVD Player, Audio, Security System, Recording Media, Video

Phone, PC Camera, Banking Automatic System, PCB Digital Appliance Company Air Air Conditioner, Conditioner, Refrigerator, Compressor Microwave for Oven,

Washing Machine, Vacuum Cleaner, Compressor for Refrigerator Telecommunication Equipment & Handset Company TDX, System), STAREX, System optical Integration switching (SI) systems, etc.

Implementation of advanced IBS (Information Building service, Implementation of advanced IBS (Information Building System), System Integration (SI) service, Handsets for satellite, mobile multimedia and IMT-2000 services, etc. Number of Employees 64,082(27,814 in Korea/ 36,268 overseas)

Financial Highlights (in Millions ) 1999 SALES 2000 2001 2002 2003 2004

9,852.8 10,546.1 14,835.7 16,601.0 18,602.9 20,176.9 4,881.2 9,954.5 728.5 6,084.1 6,654.9 4,793.7

(Domestic) 2,569.8 2,704.0 (Export) Ordinary Profit 7,283.0 7,842.1 167.1 2,587.9

10,516.9 11,948.0 15,383.2 573.7 675.2 836.8

HISTORY
The 1950's 1958 1959 Gold Star (today's LG Electronics) established Korea's first radio produced

The 1960's 1962 1965 1966 1968 1969 Radio exported to the US and Hong Kong as Korea's first Korea's first refrigerator produced Korea's first black & white TV produced Korea's first air conditioner produced Korea's first washing machine produced

The 1970's 1974 1977 1978 Gold Star Communication went public Color TV produced Exports surpassed US$100 million as Korea's first in the electronics industry

The 1980's 1980 1982 1984 1986 1989 First EU sales subsidiary in Germany (LGEWG) established Color TV plant in Huntsville in the US established Sales surpassed 1 trillion Won European-standard VCR plant in Germany established Sales subsidiary and a joint production subsidiary in Thailand established

The 1990's 1990 1993 Ireland-based design technology center established With the establishment of Huizhou subsidiary, China,

marketing in China begun full swing Company name changed to LG Electronics and the US-based Zenith acquired 40-inch PDP TV and the world's first IC set for DTVs developed; India production subsidiary (LGEIL) established World's first 60-inch PDP TV developed LG-Philips LCD, a joint venture with Philips, established

1995

1997 1998 1999

The 2000's LG Information & Communications merged, the word's first 2000 Internet-enabled refrigerator launched; global sales of refrigerators reached the number one position Asynchronous 2001 world's first IMT-2000 equipment commercialized; machine, the air

Internet-enabled

washing

conditioner, and microwave oven launched; LG-Philips CRT, a joint venture with Philips established Under the LG Holding Company system, the Company spun

2002

off to LG Electronics (LGE) and LG Electronics Investment (LGEI); the first home networking system commercialized in the global market World's first synchronous-asynchronous the world's largest IMT-2000 76-inch mobile TV

2003

phone

developed;

PDP

developed; CDMA mobile handsets took the largest share in the US CDMA market

MANAGEMENT STRUCTURE
BOARD OF DIRECTORS STANDING Name BOD Title Current Position S. S. Kim Representative Director Chief Executive Officer Young Soo Kwon Director Chief Financial Officer NON - STANDING Name BOD Title Current Position Yu Sig Kang BOD Chairman Vice Chairman, LG Corp. Suk Jean Kang Outside Director President, CEO Consulting Group Il Sup Kim*

Outside Director Professor, Ewha Womens University Nyum Jin* Outside Director Professor, Sogang University Sung Won Hong* Outside Director Chairman, G-Mobile AUDIT COMMITTEE Name Title Current Position Note Suk Jean Kang* Outside Director Chairman, CEO Consulting Group Advisor Il Sup Kim* Outside Director Professor, Ewha Womens University Advisor Nyum Jin* Outside Director Professor, Sogang University Advisor

SENIOR CORPORATE OFFICERS Name Title Current Position S. S. Kim Vice Chairman Chief Executive Officer Woo Hyun Paik President Chief Technology Officer Jong Eun Kim President Head of European Headquarters Nam Kyun Woo President Head of Digital Display & Media Company Hee Gook Lee President Chief of LG Electronics Institute of Technology Mun Hwa Park President Head of Telecommunication Equipment & Handset Company Jin Bang Son President Head of LGE China Holding Company

Ju Ik Song Executive Vice President Chief of Korea Marketing Operation Myeong Kyu Ahn Executive Vice President Head of North American Headquarters Young Ki Kim Executive Vice President Chief of Human Resources

FUTURE PROSPECTS
LG Electronics India Pvt. Ltd., a wholly owned subsidiary of LG Electronics, South Korea was established in January, 1997 after clearance from the Foreign Investment Promotion Board (FIPB). The trend of beating industry norms started with the fastest ever-nationwide launch by LG in a period of 4 years with the commencement of operations in May 1997. LG set up a stateof-the art manufacturing facility at Greater Noida, near Delhi, in 1998, with an investment of Rs 500 Crores. 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. The beginning of 2003 saw the rolling out of the first locally manufactured Direct Cool Refrigerator from the plant at Greater Noida. Financial Performance: Turnover for 1997 : Turnover for 1998 : Turnover for 1999 : Turnover for 2000 : Turnover for 2001 : Turnover for 2002 : Turnover for 2003 : Rs. 125 Crores Rs. 485 Crores Rs. 1056 Crores Rs. 1903 Crores Rs. 2216 Crores Crossed Rs. 3000 Crores Clocking a turnover of Rs. 4,500 Crores

The Greater Noida manufacturing unit line has been designed with the latest technologies at par with international standards at Korea and is one of the most Eco-friendly units amongst all LG manufacturing plants in the world. LG

has been able to craft out in five years, a premium brand positioning in the Indian market and is today the most preferred brand in the segment Various studies have shown that the consumer is well informed on the health awareness front. LG was one of the first companies who recognized the emerging change in consumer needs and decided to differentiate their products on the basis of technology, which appealed to the consumer on the basis of health benefits. 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. For example: The CTV range offered by LG has 'Golden Eye' technology, which senses the light levels in the room and adjusts the picture to make it more comfortable for the eyes. The entire range of LG air-conditioners have 'Health Air System', which not just cools, but keeps pollution out. Similarly, microwave ovens have the 'Health Wave System', refrigerators have the 'PN System', which preserve the nutrition in food and washing machines have 'Fabricare System', which takes the health factor down to ones clothes. All the products offered by the company have unique technologies, developed by its R&D departments that give customers a healthier environment to live-in. The year 2001 witnessed LG becoming the fastest growing company in the consumer electronics, home appliances and computer peripherals industry. The company had till the month of October 2001 achieved a cumulative turnover of Rs 5000 Crores in India since its inception in 1997, making it the fastest ever Rs 5000 Crores clocked by any company in the Indian consumer electronics and home appliances industry. Having achieved this milestone, LG achieved another benchmark with the first ever sales of One Lakh ACs (Windows and Splits) in a calendar year. LG is poised to surpass its turnover target of Rs. 2700 Crores this year and clock a turnover of Rs. 3000 Crores. This year, LG has emerged as the leader in Color Televisions, Semi Automatic Washing Machines, Air Conditioners, Frost-Free Refrigerators and Microwaves Ovens. In Color Televisions having set the sales target of one

million units of Color Televisions for 2002, LG has already achieved the one million mark in the month ahead of its target. LG Electronics India is the fastest growing company in the consumer electronics, home appliances and computer peripherals industry today. LG Electronics is continually providing superior technology products & value for money to over 50 Lakh households in India. LG Electronics already have various ranges of products & Planning to more with all their variants and deviants. LGs Marketing Network is also big as enough, company is planning to increase it more. LG Electronics currently has 65 Regional Area Offices, 60 Central Area Offices with 40 branches all over India. So, the future prospect of LG Electronics in India seems to be very bright.

PRODUCT PORTFOLIO
TELEVISIONS

PROJECTORS LCD Projector

PLASMA TVS

AUDIO PLAYERS DVD MOVIE STATION

VCD MOVIE STATION

REFERIGERATORS

WASHING MACHINES (FULLY AUTOMATIC)

AIR CONDITIONERS MULTI SPLIT ACS

MICROWAVE CONVECTION RANGE