Case
Teaching Notes
Supplementary Resources
Abstract
Entering an emerging economy can provide many opportunities as well as challenges. The external forces, in particular cultural and demographic, are quite different compared to those of a developed economy or the multinational company’s home market. MNEs typically use strategies such as product development, adaptation, and standardization to tackle competition in emerging economies. LG mapped its “go to market capabilities” and product strengths and crafted its strategies for growth in India along these lines. The three product level strategies (core product, product attributes, and support services) are investigated in detail.
This case was prepared for inclusion in Sage Business Cases primarily as a basis for classroom discussion or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within your university, and cannot be forwarded outside the university or used for other commercial purposes.
2024 Sage Publications, Inc. All Rights Reserved
Resources
Table I: LG No.1 Brand: Indian CTV Market
2000 | 2001 | 2002 | 2003 | 2004 | 2005 | |
LG | 8 | 9.2 | 14.3 | 18.7 | 23.8 | 26.5 |
Samsung | 8.9 | 10.2 | 12.1 | 16.2 | 16.2 | 16 |
Sony | 5.3 | 4.9 | 5.4 | 5.2 | 7.5 | 9.9 |
Onida | 12.8 | 11.4 | 12.3 | 12 | 11.6 | 11.1 |
Videocon | 9.9 | 9.7 | 7.5 | 8.6 | 8 | 7.7 |
BPL | 15.3 | 16 | 12.8 | 5.9 | 2.2 | 0.9 |
Others | 39.8 | 38.6 | 35.6 | 33.4 | 30.7 | 27.9 |
Table II: Market Share in %
Refrigerator | 2002 | 2003 | 2004 | 2005 |
LG | 15.0 | 21.4 | 27.3 | 29.7 |
Whirlpool | 28.4 | 25.0 | 21.5 | 23.7 |
Samsung | 5.9 | 8.6 | 11.8 | 14.2 |
Godrej | 19.2 | 19.4 | 19.5 | 15.2 |
Videocon | 6.6 | 6.4 | 5.2 | 4.9 |
Direct cool | 2002 | 2003 | 2004 | 2005 |
Whirlpool | 29.4 | 26.5 | 23.0 | 25.7 |
LG | 10.8 | 16.5 | 23.2 | 27.2 |
Godrej | 20.9 | 20.6 | 20.4 | 16.3 |
Samsung | 4.0 | 6.5 | 9.2 | 11.1 |
Videocon | 7.1 | 7.6 | 6.9 | 6.8 |
Frost free | 2002 | 2003 | 2004 | 2005 |
LG | 29.6 | 36.0 | 36.4 | 33.5 |
Samsung | 12.2 | 14.9 | 17.7 | 19.0 |
Whirlpool | 25.0 | 20.6 | 18.1 | 20.5 |
Godrej | 13.3 | 15.8 | 17.3 | 13.4 |
Electrolux | 5.1 | 6.2 | 6.5 | 6.6 |
Air conditioner | 2005 |
LG | 36.4 |
Samsung | 15.5 |
Voltas | 9.1 |
Onida | 4.5 |
Videocon | 6.5 |
Split air conditioner | 2005 |
LG | 36.6 |
Samsung | 12.1 |
Voltas | 9.3 |
Onida | 7.2 |
Videocon | 7.6 |
Window air conditioner | 2005 |
LG | 36.3 |
Samsung | 18.4 |
Voltas | 8.9 |
Onida | 5.6 |
Videocon | 6.2 |
Washing machine | 2002 | 2003 | 2004 | 2005 |
LG | 18.7 | 25.1 | 33.2 | 34.7 |
Whirlpool | 23.0 | 16.9 | 14.4 | 14.5 |
Samsung | 10.7 | 14.6 | 13.8 | 14.9 |
Godrej | 14.9 | 13.2 | 10.2 | 9.4 |
Videocon | 8.1 | 9.8 | 11.1 | 9.5 |
Microwave | 2002 | 2003 | 2004 | 2005 |
LG | 33.1 | 34.6 | 40.6 | 40.1 |
Samsung | 28.0 | 30.8 | 22.7 | 21.5 |
Kenstar | 12.3 | 8.7 | 10.3 | 7.9 |
IFB | 3.3 | 6.9 | 10.7 | 7.4 |
Onida | - | - | 0.0 | 3.4 |
Colour television | 2002 | 2003 | 2004 | 2005 |
LG | 14.3 | 18.7 | 23.8 | 26.5 |
Samsung | 12.1 | 16.2 | 16.2 | 16.0 |
Sony | 5.4 | 5.2 | 7.5 | 9.9 |
Onida | 12.3 | 12.0 | 11.6 | 11.1 |
Videocon | 7.5 | 8.6 | 8.0 | 7.7 |
Table III: LG Internal Channel Analysis 2005, 2006, 2007
Table IV: Rural Demand—Consumer Durables (% of All India)
1995–96 | 2001–02 (Estimates) | |
Consumer Durables | ||
Scooters | 33.1 | 39.4 |
Motorcycles | 47.3 | 39.8 |
Mopeds | 52.7 | 58.2 |
Cars/Jeeps | 2.1 | 8.0 |
Automotives | 37.9 | 36.0 |
Television | 54.0 | 54.5 |
White goods | 23.8 | 23.9 |
Fans | 50.0 | 56.9 |
Low cost items | 58.1 | 60.1 |
Table V: Share of Second Hand Goods in 2001–02 (Estimates) (% of Total Purchase)
Urban | Rural | |
Scooters | 11.2 | 16.3 |
Motorcycles | 4.5 | 12.5 |
Colour TV | 1.8 | 3.0 |
Refrigerators | 4.0 | 2.3 |
Washing Machines | 1.4 | 5.6 |
Table VI A: Excise Duty on Consumer Durable Items: Trends
Excise Duties on CDs Items | |||||||||
FY | 1997 | 1998 | 1999 | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 |
CTVs | 20% | 18% | 16% | 16% | 16% | 16% | 16% | 16% | |
B&WTVs | Nil | Nil | Nil | Nil | Nil | 4% | 8% | 8% | 16% |
AGs | 40% | 30% | 30% | 24% | 16% | 16% | 16% | 16% | 16% |
(+6% SED) | (+16% SED) | (+16% SED) | (+16% SED) | (+8% SED) | (+8% SED) | ||||
Refrigerators | 20% | 18% | 18% | 16% | 16% | 16% | 16% | 16% | 16% |
Washing Machines | 20% | 18% | 18% | 16% | 16% (+16% SED) | 16% | 16% | 16% | 16% |
Complied by INGRES
Union Budget for FY2005 has imposed a 2% education cess on customs duties.
Table VII B: Custom Duty on Consumer Durable Items: Trends
Customs Duties on CDs Items | ||||||||
FY | 1997 | 1998 | 1999 | 2000 | 2001 | 2002 | 2003 | 2004 |
CTVs | 50% | 40% | 40% | 40% | 35% | 35% | 30% | 25% |
B&WTVs | 50% | 40% | 40% | 40% | 35% | 35% | 30% | 25% |
CPTs | 30% | 30% | 30% | 35% | 35% | 35% | 30% | 25% |
ACs | 50% | 40% | 40% | 40% | 35% | 35% | 30% | 25% |
Refrigerators | 50% | 40% | 40% | 40% | 35% | 35% | 30% | 25% |
Complied by INGRES
Union Budget for FY2005 has imposed a 2% education cess on customs duties.
This case was prepared for inclusion in Sage Business Cases primarily as a basis for classroom discussion or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within your university, and cannot be forwarded outside the university or used for other commercial purposes.
2024 Sage Publications, Inc. All Rights Reserved