LG - CASE STUDY RURAL MARKETING
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The document discusses LG's rural marketing approach in India. To penetrate the rural market, LG increased its branch and service center presence, gave area managers more power, and localized products and promotions. LG's approach focused on availability through widespread service centers, affordability by offering cheaper products, acceptability by localizing features, and creating awareness through cricket promotions and word of mouth. This approach helped LG gain 20% revenue from rural India and the largest share of the color TV market. However, competitors like Samsung began targeting premium buyers more aggressively, and LG's growth declined as it focused solely on the mass market.
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LG - CASE STUDY RURAL MARKETING
- 1. Arveen Shaheel B 050 Case Study – Rural Marketing Approach
- 2. Rural Market - India • The Indian rural consumer lives in over 600,000 villages across the country, accounting for over 70% of the population of the country. • For several product categories, rural markets account for well over 60 per cent of the national demand. Quantitative; Untouched; Major Focus Market in India http://www.scribd.com/doc/9093129/LG-Rural-Final
- 3. • Increased branch numbers in the Rural Market • Posted 93 area managers across the country • Delegating Area managers with more power Making the dealings with the dealers more transparent LG • Publicizing by means of road shows, society demonstrations, and localized shows in rural India Understanding the Rural Market To penetrate the rural market & direct interaction with consumers http://www.scribd.com/doc/9093129/LG-Rural-Final
- 4. • Availability – Place 65 Remote Area Offices; 230 service centers; 2,600 mobile authorized service personnel • Affordability – Price Sampoorna- Rs.3000; Cineplus- RS 4900 Rural Market – 4A approach Making the product Reachable & Affordable – Secrets of Conquering Rural Market http://www.scribd.com/doc/9093129/LG-Rural-Final
- 5. Rural Market – 4A approach Localizing & Creating awareness for the mass – Secrets of Conquering Rural Market http://www.scribd.com/doc/9093129/LG-Rural-Final • Acceptability – Product Product localization LG came out with Hindi and regional language menus on its TVs. LG was the first brand to introduce gaming in TVs in continuations of its association with cricket • Awareness – Promotion Supporting India Cricket Team – ”LG ki Dua, All the Best” Direct engagement with Customers Word of Mouth
- 6. Results • 20% of the company’s revenue comes from rural India • Largest Market share in Color Televisions (CTVs) • Positive Customer Perception Implications • Company started losing ground, as other foreign brands like Samsung and Sony have became more aggressive. • LG’s revenue growth dropped from 43% in 2002-04 to 13% in 2005-08. • LG ignored the growing—and untapped—potential of ‘VIP buyers’. Implications of Rural Market Approach Mass Market Brand v/s Premium Market Brand
- 7. Battle of the 2 worlds It has to change its positioning
- 8. Too late? It worked • LG Worldwide and LG India are two different worlds. • Premium High-Tech Brand v/s Mass Market Brand • LG India mass market strategy worked, because If a company wants to be a market leader and successful in India, it had to occupy this space. Changing Times • Rival Samsung already synchronized its latest range of LED TVs, touch-screen phones like Ultra Touch and Samsung Jet, and Side By Side refrigerators. Gaining the benefits of entering the market first. Latest News, • LG to launch 12 smart phones in India in 2012 Indulgence over utility – Latest Mantra http://business.outlookindia.com/printarticle.aspx?261651