LG loses top refrigerator slot to Whirlpool

LG loses top refrigerator slot to Whirlpool

Author | Source: The Economic Times | Thursday, Dec 28,2006 8:51 AM

LG loses top refrigerator slot to Whirlpool

Call it growth pangs or can you? After years of complete dominance over all categories of consumer durables, LG is facing more than just topline growth pressures.

For the first time after taking leadership position in the appliances market, LG has been relegated to the number two spot in the mass category of refrigerators. It has been overtaken by Whirlpool for the last two months running.

The ORG GFK data for retail sales in October and November puts LG behind Whirlpool in value market shares for direct cool refrigerators. Moreover, Whirlpool is just a kissing distance from LG for volume market shares for direct cool refrigerators.

What's more, Whirlpool has gained market shares against LG on a month-on-month basis in November over October. Direct cool (DC) category, a mass product, accounts for about 70% of the overall unit sales and more than half of the value of refrigerators sold in the country.

According to Anil Arora, business group head for refrigerators at LG India: “We didn't have any products in the higher capacity of DC category like our competitors and secondly, margins in the low end are very meagre. Also, we didn't want to compromise on prices just for market shares, so we suffered in a few states.” He added, “Having said that we have recently introduced three models in the higher capacity category for DC refrigerators and the impact would be visible soon.”

According to Shantanu Das Gupta, vice-president (marketing) at Whirlpool (India): “We have gained due to the success of our new DC range Genius which was launched last year and has gradually been building market shares. Plus some of our product innovations like the vegetable storage pedestal and the finish of the products have gone unmatched till now.”

However, he concedes its only halfway for Whirlpool in its bid to regain leadership in overall refrigerators, leave alone appliance market as a whole. The year to date figures still put Whirlpool behind LG in the DC category. Moreover, it is way behind LG and is currently fighting with Samsung for the second spot for the premium and high growing category of frost free(FF) refrigerators.

Besides, DC was considered to be the bread and butter of Whirlpool's product portfolio where it was particularly strong. LG had overtaken Whirlpool in DC category in 2004 two years after it became the number one player in the FF category.

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