LG increases marketing spends by 25 per cent, aims 30 per cent annual growth
While TVs and refrigerators have been top sellers for the brand, mobiles have been doing well with Indian consumers keen to pick up new technologies
It has been part of the Indian consumer story for nearly two decades and now LG is going aggressive on its expansion plans for the country. The brand has spent Rs 700 crore on marketing this year, which is an increase of almost 25 per cent against the previous year’s marketing spends. During the two-month long festive season that started in September, the brand has seen a growth of almost 30 per cent.
In an exclusive interaction with exchange4media, Sanjay Chitkara, Head- Corporate Marketing, LG Electronics India said, “Our biggest expenditure goes into in-store experience. It is a print dominated category, but we have a fair mix of all marketing mediums for our campaigns. We have seen highest-ever turnover this festive season. We are expecting exceptional annual growth this year. Our total marketing spends will be close to Rs 700 crore, which includes in-store, ATL, BTL and digital spends. This is an increase of up to 25 per cent.”
LG started its India operations in 1997, and has been a dominant market player in the country ever since. According to Chitkara, in most of the product categories, the brand has almost 30 per cent market share. Till date, the brand has sold over 45 million color TVs, and more than 25 million refrigerators in India.
LG India has almost five per cent share in LG’s global market pie. And TV and refrigerator sales are the biggest revenue contributors from India for LG’s global business. “This has been a great year for our mobile sales too. We have tripled our handset business in India this year,” said Chitkara.
When asked which markets create most traction for LG in India, Chitkara said, “North, south and west give almost 27-28 per cent traction for our business. East is behind in terms of sales at 12 per cent. However, with states like Jharkhand, Orissa, Chhattisgarh, the entire North-East belt, based on its potential, they are doing well for us. Product-wise, TVs and refrigerators are the biggest sellers. However, mobile phones are catching on, and will soon become the top sellers for us.”
The brand is increasing its activities on digital platforms. “It is a very important part of LG marketing. It is still at a nascent stage, and contributes in the higher single-digit numbers of the entire marketing budgets. We see it increasing to about 10-15 per cent in the near future. And we expect it to lead the entire marketing strategies in the long-run,” Chitkara added.
LG also has its own online store, lgbrandstore.com, that is the brand’s authorized online seller. The company routes these sales through the brands stores across the nation.
With the brand being visible across platforms, via ad campaigns, in-store activities or event sponsorships, LG is leaving no stone unturned to gain market leadership in India. In its latest campaign, LG has launched a 100-day countdown to the ICC Cricket World Cup 2015 from November 6, 2014 with the winner’s announcement of LG People’s Choice Award on November 5, 2014. Jointly hosted by Australia and New Zealand, the ICC Cricket World Cup 2015 is the flagship event of the international cricket calendar.
“As a company we believe in associating and recognising innovation and dynamism in every field. With the People’s Choice Award we are not only encouraging budding cricketing talent, but also providing a platform to cricket lovers to voice their love for their favorite players. We wish all the luck to this year’s winner, who will be announced on November 5, 2014 in Dubai,” said Chitkara.
“We have a very aggressive growth plan, and we aim to grow by 25-30 per cent annually. Consumer sentiments are very positive. We have reason to believe that this trend will grow next year too. We will be spending aggressively on all verticals. Currently, we have 1800 experience stores, each month we are adding 40-50 new stores, and we are present in the multi-brand environment too,” said Chitkara.
When asked about the trends that will drive the industry in the future, Chitkara said, “Over the year, replacement customers are increasing, we are seeing that high-ticket values are selling more. Big sized panels, smart TVs are seeing higher demand when compared with smaller sized TVs. Consumers want to experience new technologies. That’s why we are bringing those technologies to Indian consumers by customizing them according to Indian needs. Personalized technology for Indian consumers is going to drive businesses going forward.”
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