LG to Strengthen Premium Marketing
LG Electronics plans to continue to pursue its celebrity marketing campaign featuring Hollywood or Hollywood stars, LG's top marketing officer said.
The consumer electronics company also plans to increase its marketing budget for flagship products next year.
"We will invest more in advertizing our key products in major markets next year. Also, LG Electronics will continue the marketing campaign to justify premium pricing," Dermot J.M. Boden, a chief marketing officer (CMO), said in an interview with The Korea Times, last week.
"LG has been increasing the budget at a time when everybody else is reducing. The recession has been a key issue for everybody, but our market shares this year went up in every category," he said, noting that its "3C policies" ― consistency, continuity and creativity ― have made a great contribution.
LG Electronics is the runner-up to Samsung Electronics in the global flat-screen TV market after passing Japan's Sony.
It is also the world's third-biggest handset maker after Nokia and Samsung. Such ranking upgrades came within a few years of each other.
Citing sensitivity over the issue, the executive declined to give further financial terms. But LG officials say the marketing budget for 2010 will approach 7 percent of total revenue.
"The outcome of celebrity marketing was very satisfactory. I am sure we will continue to do this. But the targets and segments will be decided selectively, according to our corporate priorities," the executive vice president said.
Boden says LG has been on a long journey with its brand repositioning. "The biggest challenge is how we make ourselves a premium brand."
Asked about specific areas that LG hopes to capitalize on with the celebrities, he hinted at LCD TVs with light emitting-diodes (LED) as backlights and touch-based multifunctional handsets.
"So-called LED TVs and high-end phones are important products as part of generational progress. Overall, progress is ongoing. With regard to LED TVs, there's definitely an opportunity," Boden said, adding the campaign is exciting and compelling.
LG is a playing catch-up in the global LED TV market, which is currently dominated by its rival Samsung Electronics.
Amid strengthening environment-related regulations and increasing consumer appetite for clearer viewing images, the global LED TV market is rapidly growing.
LG aims to sell 5 million or more LED TVs in 2010 as the world's second-biggest TV brand tries to catch Samsung in the premium flat-screen TV market.
In mobile phones, LG plans to take a bigger piece of the pie in the smart phone category by capitalizing on the North American market, where it has a strong market share.
LG has been engaged in a joint marketing campaign with celebrity Sienna Miller for its New Chocolate mobile phones.
It hired a top Norwegian model to propel its Scarlet LCD TVs last year.
Boden says LG is now taking the strategy of seeking opportunities that will connect it more closely to its overall audience. It is endeavoring to create a balanced program of activities to create connection with its consumers.
Sporting events have been the main focus for driving brand awareness this year. LG signed a new partnership agreement with the the International Cricket Council (ICC) running from the Twenty20 event to the end of the 2015 ICC Cricket World Cup.
LG also became a sponsor and technology partner of Formula 1 in a five-year deal. The cricket and motor racing deals follow a sponsorship deal in 2005 with Fulham FC, which is contracted until 2010.
Boden, who joined the company in 2007, is one of the first foreign executives brought in as part of CEO Nam Yong's efforts to turn the company into Korea's first truly global company in terms of management style and human resources policy.