lg marketing project.doc

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A

PROJECT REPORT

ON

ANALYSISOF LG CONSUMERDURABLES GOODS

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Executive summary

Indian Consumer durables market used to be dominated by few

domestic players like godrej Voltas allwyn and kalvinater. But postliberalization much foreign company have entered into Indian market

dethroning the Indian player and dominating Indian market the major

categories in the market CTV, REFRIGRATOR, AIR CONDTIONERS AND

WASHING MACHINE

India being the second largest growing economy with huge

consumer class has resulted in consumer durables as the fastest

growing industries in India LG, SAMSUNG the two Korean companies

has been maintaining the lead in the industries with LG being leader in

almost all the categories.

The rural market is growing faster than the urban market, although the

penetration level is much lower .The CTV segment is expected to the

largest contributing segment to the overall growth the industry. The

rising income levels double-income families and consumer awareness

are the main growth drivers of the industries.

Consumer durables major LG Electronics India Pvt Ltd (LGEIL) will invest

nearly Rs 500 crore in India this year in research and development,

brand-building and other marketing initiatives.

The company, having a turnover of Rs 9,500 crore and market share of

26 per cent, is investing Rs 360 crore on brand-building and other

marketing initiatives and around Rs 140 crore on research and

development, besides launching new platforms in information

technology and related areas,

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LGs innovative 211 campaign to provide quality after-sales service,

will also be expanded from the existing 22 to 40 cities by next month,

The campaign, for which IT infrastructure has been set up, includes the

companys response to customer complaint within two hours. The fixing

time for complaints varies from one hour to a maximum of 24 hours.

INTRODUCTION

Before the liberalization of the Indian economy, only a few

companies like Kelvinator, Godrej, Allwyn, and Voltas were the major

players in the consumer durables market, accounting for no less than

90% of the market. Then, after the liberalization, foreign players like

LG, Sony, Samsung, Whirlpool, Daewoo, and Aiwa came into the

picture. Today, these players control the major share of the

consumer durables market.

Consumer durables market is expected to grow at 10-15% in 2007-

2008. It is growing very fast because of rise in living standards, easy

access to consumer finance, and wide range of choice, as many

foreign players are entering in the market

With the increase in income levels, easy availability of finance,

increase in consumer awareness, and introduction of new models,

the demand for consumer durables has increased significantly.

Products like washing machines, air conditioners, microwave ovens,

color televisions (CTVs) are no longer considered luxury items.

However, there are still very few players in categories like vacuum

cleaners, and dishwashers

Consumer durables sector is characterized by the emergence of

MNCs, exchange offers, discounts, and intense competition. The

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market share of MNCs in consumer durables sector is 65%. MNC's

major target is the growing middle class of India. MNCs offer superior

technology to the

Consumers whereas the Indian companies compete on the basis of

firm grasp of the local market, their well-acknowledged brands, and

hold over wide distribution network. However, the penetration level

of the consumer durables is still low in India.

Classification of consumer durables sector

1. Consumer electronic include vcd/dvd, home theatre, music player,

color television (CTVs), cameras, camcorders, portable audio, Hi-Fi,

etc

2. White goods include dishwashers, air conditioners, heaters,

washing machines, refrigerators, vacuum cleaners, kitchen

appliances, non-kitchen appliances, microwaves, built-in appliances,

Tumble dryer, personal care product etc.

3. Moulded luggage include plastics

4. Clocks and watches

5. Mobile phones

Scope

1. In term of purchasing power parity (ppp), India is the 4th largest

economy in the world and overtake Japan in the near future

become the 3rd largest.

2. Indian consumer durable market is expected to reach $400 billion

by on 2010

3. India has the youngest population amongst the major countries.

There are lot of people in the different income categories nearly

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the two third population is below the age of 35 and nearly 50% is

below 25.

4. There are 56 million people in middle class, who are earning

us$4,400-US$21,800 a year. And there are 6 million richhousehold in India.

5. The upper-middle and high-income household in urban areas are

expected to grew to 38.2 million in 2007 as against 14.6 million in

2000.

Opportunity

1. In India the penetration level of white goods is lower as compared

to other developing countries.

2. Unexploited rural market.

3. Rapid urbanization.

4. Increase in income level, i.e.increase in purchasing power of

consumers.

5. Easy availability of finance.

Threats

Higher import duties on row materials.Cheap imports from Singapore, China and from other Asian countries.

Brands in consumer electronic sector

MNCs NATIONAL REGIONALLG )

SAMSUNG ) KOREA ONIDA BUSHHYUNDAI ) VIDEOCON CROWNBPL SALORA

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TCL ) CHINA GODREJ T-SERIESHAIER ) VOLTAS WESTON

IFB BELTAK PHILIPS ) HOLLAND OSKAR

PANASONIC )SHARP )HITACHI )SANSUI ) JAPANAKAI )AIWA

WHIRLPOOL )

ELECTROLUX

TODAYConsumer durables sector is characterized by the emergence of

MNCs, exchange offers, discounts, and intense competition. The market

share of MNCs in consumer durables sector is 65%. MNC's major target

is the growing middle class of India. MNCs offer superior technology to

the

LG, SAMSUNG the two Korean companies has been maintaining

the lead in the industries with LG being leader in almost all the

categories.

The company, having a turnover of Rs 9,500 crore and market share of

26 per cent, is investing Rs 360 crore on brand-building and othermarketing initiatives and around Rs 140 crore on research and

development, besides launching new platforms in information

technology and related areas,

LG Electronics is one of the leading companies in the field of

electronics with a global presence in many countries. . Before briefing, I

have divided the introduction part into three main sub parts.

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1. LG Global

2. LG India

3. LG Pune

History of company

The company was originally established in 1958 as Gold Star, producing

radios, TVs, refrigerators, washing machines, and air conditioners.

The LG Group was a merger of two Korean companies, Lucky and Gold

Star, from which the abbreviation ofLG was derived. The current "Life'sgood" slogan is a backronym. Before the corporate Name change to LG,

household products were sold under the Brand name ofLucky, while

electronic products were sold under the brand name ofGold Star. The

Gold Star brand is still perceived as a discount brand.

In 1995, Gold Star was renamed LG Electronics, and acquired Zenith

Electronics of the United States.

Global Operation

LG Electronics is playing an active role in the world market with its

assertive global business policy. As a result, LG Electronics controls 110

local subsidiaries in the world with around 82,000 executive and

employees.

LG Group

1. LG.Philips LCD

2. LG Chemical

3. LG Telecom

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http://en.wikipedia.org/wiki/LG_Grouphttp://en.wikipedia.org/wiki/LG.Philips_LCDhttp://en.wikipedia.org/wiki/LG_Chemicalhttp://en.wikipedia.org/wiki/LG_Telecomhttp://en.wikipedia.org/wiki/LG_Grouphttp://en.wikipedia.org/wiki/LG.Philips_LCDhttp://en.wikipedia.org/wiki/LG_Chemicalhttp://en.wikipedia.org/wiki/LG_Telecom


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4. LG Powercom

5. LG Twins

6. LG Dacom

Business areas and main products

Mobile communications

(a) CDMA Handsets,

(b) GSM Handsets,

(c) 3G Handsets,(d) Cellular Phones

Digital appliance

a) Air Conditioners,

b) Refrigerators,

c) Microwave Ovens,d) Washing Machines,

e) Vacuum Cleaners,

f) Home Net,

g) Compressors for Air Conditioners and Refrigerators

Digital display

a) Plasma TVs,

b) LCD TVs,

c) Micro Display Panel TVs,

d) Monitors,

e) PDP Modules,

f) OLED Panels,

g) USB Memory,

h) Flat Panel Computer Monitors

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http://en.wikipedia.org/wiki/LG_Powercomhttp://en.wikipedia.org/wiki/LG_Twinshttp://en.wikipedia.org/wiki/LG_Dacomhttp://en.wikipedia.org/wiki/Air_conditioninghttp://en.wikipedia.org/wiki/Refrigeratorhttp://en.wikipedia.org/wiki/Microwave_ovenhttp://en.wikipedia.org/wiki/Washing_machinehttp://en.wikipedia.org/wiki/Vacuum_cleanerhttp://en.wikipedia.org/wiki/Compressorshttp://en.wikipedia.org/wiki/Plasma_displayhttp://en.wikipedia.org/wiki/Liquid_crystal_display_televisionhttp://en.wikipedia.org/wiki/Computer_Monitorshttp://en.wikipedia.org/wiki/LG_Powercomhttp://en.wikipedia.org/wiki/LG_Twinshttp://en.wikipedia.org/wiki/LG_Dacomhttp://en.wikipedia.org/wiki/Air_conditioninghttp://en.wikipedia.org/wiki/Refrigeratorhttp://en.wikipedia.org/wiki/Microwave_ovenhttp://en.wikipedia.org/wiki/Washing_machinehttp://en.wikipedia.org/wiki/Vacuum_cleanerhttp://en.wikipedia.org/wiki/Compressorshttp://en.wikipedia.org/wiki/Plasma_displayhttp://en.wikipedia.org/wiki/Liquid_crystal_display_televisionhttp://en.wikipedia.org/wiki/Computer_Monitors


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Digital media

a) Home Theater Systems,

b) DVD Recorders,

c) Super Multi DVD Rewriters,

d) CDRW,

e) Notebook PCs,

f) Desktop PCs,

g) PDAs,

h) PDA Phones,

i) MP3 Players,

j) New Karaoke Systems,

k) Car Infotainment

LG BRAND IDENTITY:-

The brand of LG is delightfully smart. LG strives to enhance the

customers life and lifestyle with intelligent features, institutivefunctionality and exceptional performance.

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The brand platform:-

The LG brand is composed of four basic elements

1. Value

2. Promise

3. Benefits

4. Personality

The Brands core Value that never changes.

a. Trust,

b. Innovation,

c. People

d. Passion

The benefits that are consistently delivered to the customer includes

Reliable products

Simple design

Ease of use

Extraordinary Experience

Personality describes the human characteristic that are expressed to

the customer through

Trustworthy, Considerate

Practical, Friendly

The Internal Culture of LG:

LG practices four cultures

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1. Learning Culture

2. Boundary less Environment

3. A Carrier

4. Growth

According to LG, the Learning Culture continuously helps the employee

to learn more and more to develop the habit of continuous learning.

Boundary less Environment means that there is no difference

between the levels of employees. There is transparency between the

work and mutual understanding between all the employees.

A carrier is highly growing in LG and one who is the employee can

develop their carrier largely. A new comer will feel fully comfortable in

the company and for a new comer the company is very helpful in the

overall growth of personality.

Growth in LG is very high for those who are in the company and for

those who want to join in LG. The company is growing with fast

innovation and the BLUE Ocean strategy is one of the examples of

growth.

Mission

The mission of LG is to provide the customers with utmost satisfaction

through leadership.

The fundamental policy of development is to secure product leadership

that the

Customers may have the utmost satisfaction.

Product Leadership

We are focusing on six development areas to become the product

leader.

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1. New Machine

2. Reliability

3. Conventional Installation

4. Environment Friendly Product

5. Low Noise & Vibration

6. Energy Saving

Quality Innovation

The policy of quality assurance is to provide customers with utmost

satisfaction by supplying zero defects.

LG proceeds in a hierarchal manner. It is named as LG WAY.

From top to bottom:

No.1 LG is the VISION

Jeong-DO Managementis LGs unique application to ethics. LG will

succeed through fair management practices and constantly developing

our business skill.

a) Honest with our customer

b) Providing great values to customer through constant innovation &

and development.

c) Equal opportunities

d) Equal Treatment

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Management Principle - Creating value for customer

Code of conduct of LG:

1. Responsibility and obligations to customers :

Respect for Customers

Creating Value

Providing Value

2 Fair competition Pursuit of Free Competition

Compliance with Laws and Regulations

3 Fair Transaction : Equal Opportunity

Fair Transaction Procedure

Support and Aid for Business Partners

4 Basic Ethics for Employees

Basic Ethics Completion of Duty

Self Development

Fairness in Performance

Avoidance of conflict with company interest

5 Corporate Responsibilities to employees Respect for human dignity

Fair Treatment

Promoting Creativity

6 Responsibilities to society and country

Rational Business Development

Protection of stock holder interest Contribution to social development

Environmental Conservation

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LG INDIA:

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). LG set

up a state-of-the art manufacturing facility at Greater Noida, near

Delhi, in 1998, with an investment of Rs 500 Crores.

LG corporate office is located at Plot no.51, Udyog Vihar, Kasna Road,

Greater Noida, India.

This facility manufactured Color Televisions, Washing Machines, Air-

Conditioners and Microwave Ovens.

''Company is setting up a chain of exclusive premium showrooms. LG

plans to launch 60 premium Brand Shoppes by the end of the first

quarter of this year. At present, LG has a total of 83 LG stores across

the country, of which 45 are shoppes and 38 are exclusive stores.

Brand shoppes will be placed in the premium segment and the target

audience will comprise buyers interested in premium and high end

products.

LG Brand Shoppe goes beyond the concept of a normal exclusive store

by having a more interactive environment and additional lifestyle

orientation on display so that the customer can actually experience the

LG products in his or her own home settings.

LG Electronics India Ltd (LGEIL), consumer durables leader with 27%

market share, is planning a brand new image. To attract inspirational

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and young consumers across India, company will roll out a new

marketing strategy. The exercise will cost the company Rs 360 crore.

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 more than 50 lakh households in India. LGEIL is

celebrating the 11th anniversary this year.

LG Soft India the innovation wing of LG Electronics in Bangalore is LG

Electronics' largest R&D centre outside Korea. We at LGSI focus on

niche technology areas such as mobile application development, digital

video broadcast and biometrics software and support LG Electronics

with our expertise. Motivated by a passion for technology, a strong

work culture and loyalty to the organization, we are determined to see

LG become one of the top three brands globally.

Prominent consumer electronic company, LG Electronics Inc. has said

that it expects the sale of its products in India to up by 15 per cent in

2008. Moon Bum Shin, managing director of LG Electronics India has

said that the company has earmarked 4.8 billion rupees for investment

purpose in India this year. The said money will be used to market as

well as manufacture new products.

LG Electronics, which is originally a South Korean Company with branch

in India, informed that its sales of GSM mobile phones, color televisions,

air conditioners and other household goods in the Indian market was to

the tune of 95 billion rupees ($2.4 billion) in 2007. As per Shin's

estimate, the sales in 2008 would be around 110 billion rupees.

In order to achieve its target, Shin said LG Electronics will concentrate

on catering to the high-end consumer market which will help boost

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sales this year. India churns out six (6) per cent of LG Electronics global

revenues of $42 billion. The Indian branch of LG exports to 40 countries.

India challenges

The challenges faced by LG when entered in Indian market

1. Low brand awareness about LG in India.

2. One of the last MNCs entered in India (Samsung, Panasonic

entered in 1995 in India).

3. High import duty

4. Compitition from local market players and other MNCs in

consumer durable segment.

5. Price sensitiveness of the Indian consumer

LGEI over comes these challenges to emerge as

Innovative marketing strategy

1. Launch new technologies in consumer electronic and home

appliances.

2. LG was the first brand to enter in cricket in big way a way, by

sponsoring the 1999 world cup followed it up in 2003 as well.

3. LG brought in four captains of the Indian cricket team to endorse

its products. LG invested more then US$ 8 million on advertising

and marketing in this sport.

4. LG has differentiated its product using technology and health

benefits. CTV has Golden eye technology Air conditioner has

Health air system and microwave ovens have the Health

wave system.

Local and efficient manufacturing to reduce the cost

To overcome high import duties LG manufactures TV refrigerator in

India at manufacturing facility at Noida and Pune. LGEI had already

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commissioned contract manufacturing at Mohali Kolkata and Bhopal for

CTVs. This has helped LGEI to reduce cost. LGEI implementing the

Digital manufacturing system (DMS) as the cost cutting innovation

this system is follow-up to the six sigma exercise LGEI had initiate

earlier.

R&D potential

LG has the research and development facilities in Bangalore and Pune.

Both the unit carry out R&D department for the domestic as well as the

parent company it also dose customize R&D for the specific countries to

which it export product.

Regional channel and wide distribution network

1. LG has adopted the regional distribution channel in India. All the

distributers work directly with the company. This has resulted in

quicker rotation of the stock and better penetration into B, C, D,

class market.

2. LG also follows the stock rotation policy rather then dumping stock

on channel partners.

Product localization:-

1. Product localization is the key strategy used by the LG

2. LG came out with Hindi and regional language menus on its TVs.

3. Introduced the low-priced Cineplus and sampooma for the

rural market.

4. LG was the first brand to introduce gaming in TVs in continuations

of its association with cricket LG introduce cricket game in CTVs

MAJOR KEY SUCCESS FACTORS

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1. Innovative marketing - LG was the first brand to enter cricket in a

big way, by sponsoring the 1999 World Cup and followed it up in

2003 as well.

2. Local and efficient manufacturing to reduce cost - To overcome

high import duties, LG manufactures PC monitors and refrigerators

in India at its manufacturing facility at Noida, Delhi.

3. Commissioned contract manufacturing at Mohali, Kolkata and

Bhopal for CTVs.

4. Product localization - Product localization is a key strategy used by

LG. It came out with Hindi and regional language menus on its TV.

5. Regional distribution model - This has resulted in quicker rotation

of stocks and better penetration into the B, C and D class markets.

6. Leveraging Indias IT advantage - LG Electronics has awarded a

contract to develop IT solutions to LG Soft India (LGSI). The project

involves development and support for ERP, SCM, CRM and IT-

enabled services for LG.

Strategies adopted by the organization

LG follows 10 commandments which are as follows.

1. Foster working environment-5S Environment

2. Fast execution is key to success

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3. Transparent and fast communication-open communication

4. Update market -knowledge Demographics

5. Win Win relationship with the trade partners

6. Customer is the king

7. Even Billing Road to ach supplier A

8. Be in touch with the market (70% Market, 30% Office).

9. Plan and Execute annual marketing Calendar-Time to market

10. Display share of 50% -to get 50% consumer share.

LG market share of consumer appliances and consumer electronic:-

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LG position of CTV in various states in India

LG position of AC in various States in India

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LG position of Audio & Home Theater in various in India

LG position of DVD in various in India

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LG position of MWO in various states in India

This analysis is based on the ORG survey conducted by LG which

represent the LG position of different consumer durables in various

states in India. I select different brand in different category as per the

market share and the demand of product in market. This analysis

represents the LG market position during the period of March 2008. It

shows that LG has captured maximum market share almost in every

category. LG and Samsung have the maximum market in consumer

durable market but LG dominate the almost all the category in

consumer durable.

Prominent consumer electronic company, LG Electronics Inc. has said

that it expects the sale of its products in India to up by 15 per cent in

2008. Moon Bum Shin, managing director of LG Electronics India has

said that the company has earmarked 4.8 billion rupees for investment

purpose in India this year. The said money will be used to market aswell as manufacture new products.

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LG Electronics, informed that its sales of GSM mobile phones, color

televisions, air conditioners and other household goods in the Indian

market was to the tune of 95 billion rupees ($2.4 billion) in 2007. As per

Shin's estimate, the sales in 2008 would be around 110 billion rupees.

In order to achieve its target, Shin said LG Electronics will concentrate

on catering to the high-end consumer market which will help boost

sales this year. India churns out six (6) per cent of LG Electronics global

revenues of $42 billion. The Indian branch of LG exports to 40 countries.

Shin remarked that the company was targeting an increase of exports

to $300 million in 2008 from $230 million in 2007.

.The key strategies being implemented include increasing the number

of its regional offices from six to eight. LG has split its southern regional

office into two, one comprising the states of Tamil Nadu and Kerala and

the other consisting of Andhra Pradesh and Karnataka. In addition, it

has split one of its northern regional offices by making Uttar Pradesh a

separate region after spinning it out from Delhi NCR. The other four

regional offices take care of East, Gujarat and Madhya Pradesh,

Maharashtra & Goa and Punjab, Haryana & Rajasthan respectively.

In the coming year, LG is also repositioning its marketing spends,

resulting in a significant increase in its mass media expenditure for

better brand visibility. LG had a marketing budget of Rs 320 crore in2007 with a 60:40 split in favor of below-the-line activities. Next year,

the company plans to increase the share of mass media even as overall

marketing spends would be raised by just about 10-15%.

Distribution and Marketing

The company has number of dealers and warehouses. They have LG

exclusive shopee. For the marketing of the products a number of

activities are followed

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1. Exhibitions are conducted from time to time.

2. Society and college activities are conducted.

3. Hoarding, Posters, banners are used so as to grab the

attention of the costumers.

4. Day to day advertisement in leading newspaper.

5. Discount at festival time.

6. For dealer relationship they arrange dealer meting at several

time in the year

7. LG divide dealer in gold silver etc. category to know the

performance of the dealers.

8. They have their sales persons at various sub dealer store and

at mordent trade store for particularly for the promotion of the LG

product.

9. LG also uses the radio FM for the promotion activities.

10. Also provide capon and scratch card for festive season.

CUSTOMERSERVICE

The best and the biggest international brands are here in India but the

irony if it all: where is the after-sales-service? So integral to a brand, so

critical for its success and so taken for granted in developed markets! In

India, after sales service is, for want of a better description, the pits. So

whats stopping the best companies from pulling out all the stops when

it comes to providing the best service? Do customers expect for too

much? Or is it that in India they dont really care. Brand Equity fanned

out to MNC as well as Indian consumer durable companies, stockiest

and dealers, analysts and market researchers to get a feel of whats

really keeping after sales from being used as a cutting edge marketing

tool in pushing products across categories.

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Customers support following the purchase of a product or service. In

some cases, after-sales service can be almost as important as the initial

purchase. The manufacturer, retailer, or service provider determines

what is included in any warranty (or guarantee) package. This will

include the duration of the warranty traditionally one year from the

date of purchase, but increasingly two or more years maintenance

and/or replacement policy, items included/excluded, labor costs, and

speed of response. In the case of a service provider, after-sales service

might include additional training or helpdesk availability. Of equal

importance is the customer's perception of the degree of willingness

with which a supplier deals with a question or complaint, speed of

response, and action taken.

LG also had a big problem of after saleservice in India. During my

project I also came to know that after sale service becomes the big

issue in Pune region. Customers as well as dealer were facing the

problem of after sale service. Because of this problem many dealer in

Pune region were not ready to sale LG product. So it becomes the big

issue.

But LG has taken some solid steps towards improving customers

perception and experience of after sales service. Because it very

important in competitive market to provide the best service.

L G Electronics has signed a memorandum of understanding with 23

Industrial Training Institutes to strengthen its after sales service in

India.

The company aims to recruit 10,000 people by the end of this year as a

part of its branding strategy to focus on service and move away from

discounting.

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L G Electronics has identified eight states with high after sales service

call rates to ink the deals with the ITI. Y V Verma, director HR and

management system, LG Electronics said, "The Company was trying to

find a solution for effective after sales service since last two years.

There is a huge need of trained manpower for the after sales service to

align with the company's expansion and focus on the GSM mobiles and

the personal computer segments."

1. In the initial phase the company has entered into agreements with

ITIs in the states like Maharashtra, Gujarat, Delhi, Punjab,Assam, and Karnataka and is in the last leg of signing with

Uttar Pradesh.

2. L G Electronics, with 1200 service centers, has already recruited

300 students and plans to beef up the number to 10,000 by the

year-end.

3. "The company has offered a scholarship to the selected students

for the last six months of their training programme,"

4. The company will invest Rs 8 crore (Rs 80 million) in employee

development programme this year with an aim to attain a 8 per

cent attrition rate.

5. The company moved away from the discounting strategy since last

year and is putting thrust on the quality and service in its brand

communication to position LG as a premium consumer electronics

brand.

6. At the top, the Service Division in Korea reports to the Global CMO.

(as mentioned in Dermots public interview in ET on Wednesday).

This shows commitment that Service must be made into a

marketing differentiator, and leveraged thus.

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7. LG has the widest service network across the country; some

estimates put it at a significant multiple of service-infrastructure

from our nearest competitor. While the sale size may also be a

nice multiple from nearest, it shows the company is ready to put

our money where our mouth is.

8. The company has introduced a 211 service - once you register

your complaint, we will call you back in 2 hours (hence 2), set up

an appointment for the next convenient day for you (hence the

first 1), and show up in the promised 1-hour slot (hence the

second 1). If the next convenient day for you is the next day,

thats great too. Its a disruptive action in an industry (including

LG) having traditionally shied away from its service

responsibilities, and thus not leveraging any mileage from it.

9. The company is promoting 211 through ATL, probably the first

time after-sales service is being communicated in this fashion byany product company. You may have seen the TV commercial or

heard the radio advert or seen the newspaper ad or in-shop

posters, both of which revolve around prompt response.

10.The first LG-owned service centre opened in Gurgaon. (Service in

India generally works through authorized service centers, in LGs

case they work exclusively for LG.) A company-owned service

centre tries that much harder, knows things better, and can even

contribute as a revenue center.

Objective of the project

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Primary objective

The main objective of filed survey during the project was to find

out the market share of the LG and also calculate the display

share.

Find out the positional dealer who can sale the LG product in large

volume.

The main objective of research was to identify potential dealer and

development these dealer. So LG can make them their direct

dealer.

This will ease the dependence on the some big dealer like

Maharashtra and Mahaveer electronics.

Find out the problem faced by the dealer in sales and the

distribution.

Secondary objective

The Objective was to find out that how far the exhibitions are

helpful in branding,

While purchasing the consumer durables which parameter is most

important for the consumer?

Do the consumers prefer the financial facility for buying consumer

durable?

How frequently consumers change the consumer durable?

To enhances the knowledge of consumer durable market.

To increases the knowledge consumer durable product of LG.

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To enhances the knowledge about the marketing and branding

activity.

Research Methodology:

Research methodology is considered as the nerve of the project.

Without a proper well-organized research plan, it is impossible to

complete the project and reach to any conclusion. The project was

based on the survey plan. The main objective of survey was to

collect appropriate data, which work as a base for drawing

conclusion and getting result.

Therefore, research methodology is the way to systematically solve

the research problem. Research methodology not only talks of the

methods but also logic behind the methods used in the context of a

research study and it explains why a particular method has been used

in the preference of the other methods

Research design:

Research design is important primarily because of the increased

complexity in the market as well as marketing approaches available to

the researchers. In fact, it is the key to the evolution of successful

marketing strategies and programmers. It is an important tool to study

buyers behavior, consumption pattern, brand loyalty, and focus market

changes. A research design specifies the methods and procedures for

conducting a particular study. According to Kerlinger, Research Design

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is a plan, conceptual structure, and strategy of investigation conceived

as to obtain answers to research questions and to control variance.

Types of research is:

Descriptive Research

The type of research adopted for study is descriptive. Descriptive

studies are undertaken in many circumstances when the researches is

interested to know the characteristic of certain group such as age, sex,

education level, occupation or income. A descriptive study may be

necessary in cases when a researcher is interested in knowing the

proportion of people in a given population who have in particular

manner, making projections of a certain thing, or determining the

relationship between two or more variables. The objective of such study

is to answer the who, what, when, where and how of the subject

under investigation. There is a general feeling that descriptive studies

are factual and very simple. This is not necessarily true. Descriptive

study can be complex, demanding a high degree of scientific skill on

part of the researcher.

Descriptive studies are well structured. An exploratory study needs to

be flexible in its approach, but a descriptive study in contrast tends to

be rigid and its approach cannot be changed every now and then. It is

therefore necessary, the researcher give sufficient thought to framing

research.

Questions and deciding the types of data to be collected and the

procedure to be used in this purpose. Descriptive studies can be divided

into two broad categories: Cross Sectional and Longitudinal Sectional. A

cross sectional study is concerned with a sample of elements from a

given population. Thus, it may deal with household, dealers, retail

stores, or other entities. Data on a number of characteristics from30


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sample elements are collected and analyzed. Cross sectional studies

are of two types: Field study and Survey. Although the distinction

between them is not clear- cut , there are some practical differences,

which need different techniques and skills. Field studies are ex-post-

factor scientific inquiries that aim at finding the relations and

interrelations among variables in a real setting. Such studies are done

in live situations like communities, schools, factories, and organizations.

Another type of cross sectional study is survey result, which has been

taken by me. A major strength of survey research is its wide scope.

Detail information can be obtained from a sample of large population

.Besides; it is economical as more information can be collected per unit

of cost. In addition, it is obvious that a sample survey needs less time

than a census inquiry. Descriptive research includes survey and fact

finding enquiries of different kinds of the major purpose. Descriptive

research is description of the state of affairs, as it exists at present. The

main characteristic of this method is that the researcher has no control

over the variables; he can only report what has happened or what is

happening. The methods of research utilized in descriptive research are

survey methods of all kinds including comparative and co relational

methods. The reason for using such needs to be flexile in its approach,

but a descriptive study in contrast tends to be rigid and its approach

cannot be changed ever now and then.

Data collection methods:

After the research problem, we have to identify and select which type

of data is to research. At this stage; we have to organize a field survey

to collect the data. One of the important tools for conducting market

research is the availability of necessary and useful data.

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Primary data: For primary data collection, we have to plan the

following four important aspects.

Sampling

Research Instrument

Secondary Data - The Companys profile, journals and various

literature studies are important sources of secondary data.

Data analysis and interpretation

1. Questionnaires

2. Pie chart and Bar chart

Questionnaires:

This is the most popular tool for the data collection. A questionnaire

contains question that the researcher wishes to ask his respondents

which is always guided by the objective of the survey.

Pie chart:

This is very useful diagram to represent data , which are divided into a

number of categories. This diagram consists of a circle of divided into a

number of sectors, which are proportional to the values they represent.

The total value is represented by the full create. The diagram bar chart

can make comparison among the various components or between apart and a whole of data.

Bar chart:

This is another way of representing data graphically. As the name

implies, it consist of a number of whispered bar, which originate from a

common base line and are equal widths. The lengths of the bards are

proportional to the value they represent.

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Preparation of report:

The report was based on the analysis and presented with the findings

and suggestions. The sample of the questionnaires is attached with the

report itself.

Sampling Methodology:

Details of the sampling methodology, I have made questionnaire. The

one is made for the Customer.

No. of questions in questionnaires for customer: 07

No. of question related to LG product: 03

No. of people met during the research: 200

No. of respondents during the research: 50

Sample unit

Professionals, Business man,

Employees, House wife,

Working women, Students

Analysis:

Q1. Have you purchased any consumer durable duringExhibitions?

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Yes

No

Inferences

1. 65 % of Customer have not purchased any consumer durable from

exhibitions.

2. Only 35 % people have purchased.

3. It shows that consumers are coming in the exhibition for

knowledge of product and also they want to know that weather

there is actual price difference in exhibition and shop or not.

4. Consumer also want to compare to the different brand which are

available in the exhibition.

5. So exhibitions are more useful to increases brand awareness.

6. People are less interested to purchase product from the exhibition.

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Q.2While purchasing consumer durable which parameter

influences you?

Price

Product feature

Brand

Service

Durability

Inference

1. 30% of customer gives importance to price. So it shows that

Indian consumers are very price sensitive. They give more

importance to price over the brand.

2. 26% give importance to brand. So price and Brand matter a lots

for the costumers. And they are also want best brand in best price.

3. 19% to product feature Service 16% and durability 9% Service is

also a big factor for the customer they are less interested in the

durability.

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Q3. From where you prefer buying consumer durables

Exhibitions

Co.shoppee

Showroom

Inference:

1. A majority of customers prefer to buy from showrooms. Very less

proposition of customers buys from Exhibitions.

2. 47% customers are prefer to by from the showrooms because the

showrooms are more convenient to customers they also think that

these shops give more discounts.

3. People are less interested to buy from the exhibition they only visit

the exhibition for price quotation of the product and the

comparison of the product.

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Q.4.You prefer to buy from the same as you have mentioned in

Q.3 because of following reasons

Attractive Price

Service

Demonstrations

Offers

Inference

1. Customers buy from showrooms because of the service and

convenience. These are two main factors.

2. Customers are preferred to buy from the showroom because of

they think that these convenient store may provide good after sell

service.

3. Customer also thinks that there is more chance to bargain and

they can get more discounts in these showrooms.

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4. Price also a factor that attract the customer in these showrooms.

Q.5.Which consumer durable you have and of which brand?

CTV

LCD

PLASMA

REF

WM

MW

AC

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Inference

In CTV section maximum customers have Onida, in LCD Sony is the

leader, In plasma BPL is the leader, In Ref LG is the leader, MW LG is the

leader. In WM there are companies and in AC also.

Q.6. How frequently you change your consumer durables?

1-3 years

3-5 years

5-10 years

More than 10 years

INFERENCE

1. Customers prefer to change consumer durables within 5-10 years.

In India people do not change consumer durable frequently.

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2. 23% customers do not change their consumer durable within 10

year.

3. It represent that Indian consumer do not prefer to change their

consumer durable frequently.

CUSTOMER SURVEY FINDINGS

1. Secondary supports play an important role in the customers mind

and create awareness among the customers. The secondary

support includes Demonstration, Exhibition & Even Sponsors.

2. From the survey it was found out that the majority of customers

dont buy consumer durables from exhibitions. They just visit the

exhibitions to see the co. latest model.

3. They want to buy from the showrooms or from co. showrooms. For

them service is important .Beside convenience and other factors

service is key factor.

4. Also majority of customers do not want any financing scheme for

purchasing the durables.

5. There was heavy rush on weekends so large numbers of ISDs

were appointed that day. Also the live demo calls helps in selling.

Exchange offers also generate sale.

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6. Customers are also now very choosy in buying the product and it

is important for the company to make loyal customer of their

brand.

7. In survey we found that LG has captured maximum market share

in every category. LG dominates CTV, LCD, and Refrigerator, and

Washing machine, category.

8. LG and Samsung have bottle neck competition in TV and REF.

category.

9. The product is well aware and it is on top of mind of customer.

10. Customers are also now very choosy in buying the product

and it is important for the company to make loyal customer of

their brand.

RECOMMENDATIONS AND SUGGESTIONS

1. Exhibitions do not help to generate so much sells but they should

be conducted regularly. This helps in generating awareness

regarding the product in customers which ultimately helps in sales.

2. Also it is helps in advertising for the new products. Like in this

exhibition new LCD SCARLET was advertised. Company should

always focus on service.

3. Display share should be increased where there is less than 50% as

LG also believes that JO DIKHTA HAI WO BIKTA HAI.

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4. Company should try to improve service. No doubt the company

products have technically edge over competitors but in long run it

may hamper the companys profit.

5. Company should concentrate more on its major drivers LCD, IT,

and GSM. Branding and promotions should be done effectively as

it creates a long lasting image in the mind of customers.

6. Company should also cater to the needs of sub dealers as some of

the sub dealers have potential of high sales.

LIMITATIONS

Every study has certain limitations. In my study, also there were certain

limitations, which I could not able to solve.

1. The research was conducted in a very small area.

2. My research work period witness the biggest ups and downs in

product sale of different brands, which affected the perception of

the customer. This was biggest drawback of my study.

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3. Time factor was also important for me. I had only 60 days to

complete my research, for which a full-fledged report was

insufficient for me.

4. The customer filled the questionnaire mostly in careless manner,

so it was difficult to make them hold for time.

5. I had only found the upper-middle class family to fill up the

questionnaire, but generally, an average middle class family was

required for the study.

6. The sample size is also very small which represent my research

on consumer behavior

My study is not recognizable in whole INDIA as well as outside Ranchi

due to the above limitations and less area coverage.

BIBLIOGRAPHY

www.lgindia.com

www.google.com www.wikipedia.com

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Business world

Business today

LG magazine

Economics times News paper

Times of India

lg marketing project.doc

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