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Group 5 Gabriele Liepinyte 1586 Mariana Proença 11089 Olivier Mollerus 1417 PowerPoint PPT Presentation


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Nova SBE International Management. Group 5 Gabriele Liepinyte 1586 Mariana Proença 11089 Olivier Mollerus 1417 Patrícia Milhinhos 11424 Angus Sullivan 1403 Chiara de Benedetto 1413 . LG Electronics: Global Strategy in Emerging Markets.

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Group 5 Gabriele Liepinyte 1586 Mariana Proença 11089 Olivier Mollerus 1417

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Nova SBE

International Management

Group 5

Gabriele Liepinyte 1586

Mariana Proença 11089

Olivier Mollerus 1417

Patrícia Milhinhos 11424

Angus Sullivan 1403

Chiara de Benedetto 1413

LG Electronics:

Global Strategy in Emerging Markets


High quality, innovative electronics products

Market value of LG Electronics grew 22%

Samsung’s twice market capitalization as Sony’s (Japan)

World’s first dual-system DVD player


Koreans’ prioritize the development of the Electronics Industry

The government encouraged foreign direct investment in technology and creation joint ventures.

Korea’s electronics were exported by the foreign countries with joint venture


Firms were encouraged to invest in local R&D

Research infrastructures to help the firms were created

Vocational schools attracted students for technical education

Universities developed experts in science and technology


LG started to export to developed markets

Product weren’t well received

Move to emerging markets

Enter markets with long-term potential


Faced adverse economical factors

LG decided to stay and expand their presence

  • Agreements with local distribution chains

  • Maximize the benefits from the government

  • Advertise their brand through soccer sponsorship

  • Customized products

  • Premium positioning strategy


1990Establishment of diplomatic relations

1998LG was one of the first Korean companies in Russia

  • First products were imported

  • Local plants opened


  • The opening of LG branded stores

  • Dedicated retail channels

  • The hosting of festivals and cooking events

  • Sponsorship

  • Local offices and R&D center

  • Sourcing local talent to fill company roles

  • Opening local manufacturing plants


1998 Russia faced with severe economic crisis

Competitors scaled back and retracted from Russia

LG invested heavily in their Russian operations

  • Local product customization

  • Distribution channels

  • Event sponsorship


  • Seal of approval for “national brands”

  • LG allowed by the Russian government to display on products

A sign of LGs effective localisation strategy


Good geographic proximity to Korea

1988 Scouting mission Hong Kong

1991 LG enters China, through

a joint venture Huizhiou

16 corporations now


1

3

2

Diseases

(SARS crisis)

Unique nature of government regulations

Geographical proximity


Same as when they entered Brazil and India, with some variations in the overall strategy

  • Build strong manufacturing presence

They tried to get local consumption instead of export


Local event sponsoring

I love China campaign (free sanitary masks against SARS)

R&D facility in Beijing

Hiring local employees (98% of employees local Chinese)


  • New market entrants

  • Local rivals

  • Dominant powers within electronics


Thank you for your attention!


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