Company Press Release:
LG Phones Take the High Road Despite Downturn
Company premiers four premium handsets in first half:
LG ARENA, LG Viewty Smart, LG-GD900 Crystal, LG-GM730
Singapore, June 16, 2009 – The economic downturn is still affecting markets around the world and the mobile phone industry’s response has primarily been to focus on mid-range handsets. LG Electronics, a global leader and technology innovator in mobile communications, is taking a different approach, continuing its premium strategy. The company has launched or plans to launch four premium handsets – LG ARENA (LG-KM900), LG Viewty Smart (LG-GC900), LG-GD900 Crystal and LG-GM730 – in the first half of this year.
LG came to this decision after a thorough study of consumer behaviour and of the market. The company found that people’s buying behaviours had changed somewhat and were now based more on rational criteria. Essentially, people are spending more time evaluating products making a purchase, to ensure that a product fully meets their needs. A recent report from Boston Consulting Group, titled Winning Consumers through the Downturn, confirms LG’s findings. The report says that whether or not consumers reduce their spending on new purchases, they will be more selective in how they spend their money, demanding excellent quality and lasting value.
Actual trends in the mobile phone market reflect this. Demand has remained relatively strong for high-end handsets in North America and Western Europe, compared to other regions. While global handset shipments declined overall in the first quarter of 2009, they grew by nine percent in North America. In Western Europe, shipments remained relatively stable, falling a mere three percent, according to Strategy Analytics. Because of the continued demand for high-end handsets, LG introduced several premium models in the first half of the year, taking a decidedly different strategy than other phone makers.
Create new markets based on customer insights
LG phones are categorized based on how the target customers tend to use their phones. At the top of each category are premium phones that provide greater value through superior features and designs. Headlinging LG’s entertainment category is the LG ARENA, which delivers exhilarating multimedia through audio, video and camera features. It has proven especially popular, selling 300,000 units since its release in March. LG Viewty Smart, the latest member of the entertainment category is packed with multimedia features, but centers around its high quality 8-megapixel camera, enhanced by a touchscreen and LG’s 3D S-Class UI.
Debuting in May at the top of the style category is the LG-GD900 Crystal. LG used innovative design techniques and materials to give this phone the first transparent keypad. Finally, the flagship phone in the convergence category is LG-GM730, which includes the latest version of Windows Mobile and takes smartphone convenience to new heights.
Free sharing of information creates better products
LG has set up an extensive system to thoroughly gather consumer insights and understand its customers more deeply. LG’s marketing, R&D and product planning teams collaborate from the start of product planning to discuss their understanding of customers’ needs and how they can integrate features to meet these needs into LG’s new handsets. Each team brings its own insights and knowledge to the process, helping create better products, based on a wider range of viewpoints.
Furthermore, LG researches how its customers around the world go about their daily lives and uses the insights gleaned in product planning and marketing. LG has also established a highly evolved monitoring and analysis system called Voice of Customer, which examines media reports, websites, blogs and other social media for feedback from customers.
“Companies have to be especially careful where they investment during a crisis. We have set about our current course based on thorough and ongoing analysis of our customers and their needs. This allows us to move forward confidently and turn this downturn into an opportunity,” said Chang Ma, Vice President of Marketing Strategy Team, LG Electronics Mobile Communications Company.
LG’s strategy is paying off. On May 25, Morgan Stanley issued a report saying that they had moved past some earlier misgivings about LG, which were based on the narrowness of its product line, lack of smartphones and weak low-end products. LG’s much strengthened product line has helped the company immensely and Morgan Stanley cites increased market share and a return to profitability as evidence.
LG plans to unveil even more premium handsets with innovative features in the second half of 2009, helping further strengthen its place in the market.
LG’s Product Categories in Detail
LG has created four categories of mobile devices, each designed to meet different customer needs. These categories are: Entertainment, Convergence, Style and Simple Connect.
Entertainment
LG phones in the Entertainment category focus primarily on delivering richer mobile experiences through music, photography, games and multimedia. These phones have a wide range of features and allow their users to play and create different types of multimedia content. LG ARENA (LG-KM900), the flagship handset in this category, is a multimedia powerhouse that delivers an exhilarating audio and video experience, enhanced by LG’s 3D S-Class UI. In addition to LG ARENA, Viewty Smart (LG-GC900) and LG Cookie (LG-KP500) are also included in this category.
The Viewty Smart is a camera phone with a first-in-its-class Intelligent Shot Mode that makes it easier to take great photos by automatically analyzing scenes and adjusting camera settings accordingly. This announcement comes just as LG has reached a major milestone with another camera phone: Its original Viewty, launched in November of 2007, has now sold seven million units. The new Viewty Smart builds on the heritage of its predecessor, but with significantly upgraded features and a focus on making photography easier and more enjoyable.
LG-Cookie was designed to allow more people to experience a taste of touch technology at an attractive price, but with advanced features usually found exclusively in premium full touchscreen handsets. More than 2.8 million gourmets have had a taste of LG Cookie worldwide since its debut October 2008.
To meet customers’ needs, LG makes a commitment to strategic partnerships with companies and experts including Dolby Laboratories, Mr. Mark Levinson, DivX, Schneider-Kreuznach, and more. LG has been able to have such successful collaborations with its partners because both parties believe so strongly in creating new and better features for customers through constant innovation.
Convergence
LG’s Convergence phones bring together features and functions from multiple devices into a single device. These phones are designed for people who have to stay organized, productive and connected while on the go. In this category are Smartphones, MIDs, mini-notebooks and Messaging phones. This year LG expects to roll out more than 10 smartphones, many of which will be powered by the Windows Mobile operating system.
The first such handset will be the LG-GM730, a fully equipped smartphone that also delivers a high-end multimedia experience. The combination of Windows Mobile and the S-Class UI enables a fast and easy smartphone experience with minimized menu architecture and finger-friendly touchscreen navigation. Users also can experience the latest smartphone features as well as multimedia features such as its 5MP camera, MP3 Player and games, all in a slim design. In line with an increase in smartphone demand, LG plans to launch several new models. The LG-GW550 provides basic yet important features that greatly help keep busy people organized and on time. The LG-GW550 features Instant Push E-mail or direct access to conference calls, etc. The phone will be available in Asia and CIS in the second half of this year.
LG will also continue to reinforce its industry-leading messaging phone line with new models like the LG-GW525, offering enhanced messaging and social network functions and a compact design.
Style
LG has made quite a name in style phones, aimed at trendsetters who see phones as a way to express their personalities and convey social status. The phones in this category focus on design but also come packed with the latest features and technology. LG’s best known style phones are probably those in its bestselling Black Label Series, as well as the PRADA Phone by LG, which now comes with the wearable PRADA Link accessory. LG also recently released the world’s first transparent phone, the LG-GD900 Crystal, and showcased the world’s first market-ready 3G Touch Watch Phone (LG-GD910) at the Mobile World Congress 2009 in Barcelona, Spain.
By remaining true to its design philosophy of design that satisfies customers and earns their trust, LG has gained a reputation as a design innovator. LG develops products that not only use new innovative materials, but appeal to customers’ desire for personal expression. Each product offers color variations to complement anyone’s personal style.
Simple Connect
LG’s Simple Connect phones are built around making core features like voice calls and text messaging incredibly easy to use. Though they may be streamlined, these phones still pack a multimedia punch with features like cameras and MP3 players. They also adopt many of the same signature design elements from LG’s higher-end models.
At the front of the pack in this category are the LG-GM200, LG-GB230, LG-GB106 and LG-GB110, which offer a wide range of features. These phone feature built-in FM radios and speakers, allowing people to listen to the radio without having to connect headphones. This feature is especially popular in some parts of Asia.