The present report would be covering very important aspect of an organisation which is LG Electronics Inc. which is the most renounced multinational electronics South Korean company. The company is also having its variety of range of mobile communication or smartphones running into the market. In this we would be including overview of company like what they are doing, with the competitive advantage like what they are doing to achieve the goal. Above this we would also be using two of the analysis tools like that of Porter's five force and PESTLE analysis to know more about the firm. Then towards the end we are going to recommend about what company could try to maintain their competitive advantage over the coming next 2-5 years.

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Company Overview

History Of LG Electronics Inc.

LG Electronics Inc. is the multinational company which is vested in South Korea but having its presence in all around the world. LG is having its four major business units namely home appliance and air solutions, vehicle components, home entertainment and mobile communication. Initially in year 1958 company was founded as Gold star by Koo In-Hwoi and then after the Korean war it was incorporated as LG Group which at that time was only producing home appliance and consumer electronics (LG Electronics Company Analysis, 2018). It started to produce the 1st radio and other electronic products then in 1995 Lak-Hui Chemical and LG cable was founded which then finally changed their name as LG Electronic. Then after this the company earned a revenue of about $100 million which was first time in it s history in year 1978 and then company witnessed the effect of globalisation by establishing their first overseas production house in USA. In the year 1995 LG Electronics produced its first mobile handset which was of CDMA digital mobile then supplied the Ameritech and GTE within USA. Now they are producing very much wide range of smartphone, tablet devices, rolly keyboard and smart watches.

Market Share And Changes Observed

LG Electronic Inc. in the present time is having second largest TV manufacture company in year 2013 and is also playing very significant role in the world of electronic market in global consumer industry. In the year 2006 LG group was having the market share of about 14% and was in the Top 100 global brands. Then from the year 2010 the company entered into the world of smartphones since then LG is having its growth by introducing many smartphone devices which in same year manufactured the worlds first 84 inches ultra HD TV in the retail sector (Gerpott, Rams and Schindler, 2001). 2014 the company global sale of about $55.91 billion while the sale of 2017 was about 55.7 millions.

Competitive Advantage

Marketing Of Company

Marketing is the most important strategies which company need to adopt so that they could be having their reach within more market area and the base of customer could be increased (Prasad and Sahoo, 2011). As LG group is multinational company which is having its presence all around the world so their marketing strategies should be very good and different from others in same market. LG is delivering most innovative and digital products like that of home appliances, vehicle components, home entertainment and mobile communication. They are having different range of products and service which are available into the market that are attracting customers so they are doing their promotion all around the world. However, the way they are promoting their products are different in each country due to distinction into view and culture of people who are living in the nations of world.

It is also having many competitors in market as they are having the segmentation of 4 types but the most common competitors would be including Samsung, Sony and Panasonic. The whole group is relying onto its trust and loyalty which customers are offering to them by their effective communication tools and techniques. In the year 2003 they sponsored the Cricket World Cup which increased their marketing base and customers on the same hand (Aydin, Özer and Arasil, 2005). The goal of company is that to make lives of their customer easier, better and richer with the use of smart technology so that they are able to put smile on the face of customers.

Analysis Tools

Porter's Five Force

LG is having more than 119 local subsidiaries all around the world by employing about 82000+ people from all around it was having its revenue of $55.91 billion.

Competitive Rivalry (High)

LG is having very tough competitions like that of Samsung, Panasonic and Apple making it very high competitive rivalry then also the market share of company in the year 2009 was about 26.4%. There is very high demand of electronic products like that of TV, refrigerator, smartphone and washing machines which all company is been providing to their customers from about 59 years (Porter's five force of LG, 2018). LG is having no product differentiation but there is very high influence of technology within this industry which is leading to high price competition.

Threat Of New Entrants (Medium)

There is always urge of new and latest technology within this market which would not be allowing new market entrants to enter the market and then grab down the higher number of customers which are already loyal to their existing products and company. Other than this there are many other threats which is not allowing them to enter like that of huge investment of capital and access to distribution channels. There is also very strong government regulations and safety measures which would be known to as the barriers into this industry. Then also there are many other companies which have successfully entered into market like that of Ecostar and Changhong Ruba so the threat of new entrants in market and industry is medium.

Bargaining Power Of Suppliers (Low)

Majority of the shareholders of LG are their big suppliers into the market so that they could be having better relationships with them. There are many types of suppliers into market like that of the electronic parts and equipments which they need to supply so that they could be manufacturing their products (Jin and Von Zedtwitz, 2008). LG mostly is purchasing the equipments and other parts of the products into bulk bases which is not allowing the suppliers to bargain with company making the bargaining power of supplier low.

Bargaining Power Of Buyers (High)

As there are number of competitors of company which are selling same type and same portfolio of products to their customers so all customers are having number of options to choose from. There is also lack of product differentiation which is making customers advantage to buy any products from so many companies. In recent time there is rivalry between the companies to provide products to customers with maximum features and longest warranty as well this is also leading to increase the power of


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