LG vs Daikin

Group 5
Kejas Shah (49)
Mayank Chheda (07)
Pankaj Jagtap (20)
Basic Info.
LG Daikin
Head Quarter South Korea Japan
Founded 1958 1924
Founder Koo In-hwoi Akira Yamada
Tag Line Life is Good Rethink Climate Improve Life
Financial Info.
Values in $-Bn LG Daikin
Revenue 54.3 20.61
Profit 1.65 2.28
Profit Margin 3.04% 11.06%
Air-Conditioning
Revenue 16.95 18.46
Profit 1.31 2.01
Profit Margin 7.73% 10.89%
Major Milestone
LG Daikin
1958 Establishes Gold Star (Now LG Electronics) 2000 Entered India’s market in a Joint Venture (JV)
with Usha Shriram Group.
1966 Produces Korea's first TV 2004 Converted to Daikin India, a wholly owned
subsidiary of Daikin Industries Ltd., Japan
1965 Produces Korea's first refrigerator 2009 Commenced production at the manufacturing
plant in Neemrana, Rajasthan
1978 Achieves USD 100 Million in exports 2016 Opened a R&D Centre at Neemrana, Rajasthan
1995 Rebrands Company as LG Electronics 2017 Opened the second production facility at
Neemrana, Rajasthan
2008 Develops world`s first LTE mobile modem chip
2009 Becomes the second-largest LCD TV brand
worldwide
2014 Introduces world’s first 4K OLED TV and webOS
smart TV, Introduces the G3 smartphone with Quad
HD display
Major Milestone
LG
Developed World’s First 88-inch 8K OLED Display &
Worlds first 65-inch UHD Rollable OLED Display
Daikin
ally – The PROSHOP offers a total service from design
and installation to after-sales services
Business results achieve another record high; sales
break through the ¥2 trillion mark for the first time
Corporate Strategy

LG Daikin

Business Diversification Electronics (Ac & Home Air-Conditioning

Appliences) Chemicals
Display Oil Hydraulics
Telecom (Smart Phone) Defence
Chemicals (Batteries)
LG Life Science (Pharma)
Solar Energy (Solar Panel)
Corporate Strategy : Daikin
Values in $-Bn FY2018 Result FY2019 Plan FY2021 Targets
Investment Plan 3.24
R&D investment 1.98
Net Sales 20.61 22.31 26.09
Operating Income 2.28 2.43 3.13
Operating Income Margin 11.06% 10.90% 12.00%

Corporate Strategy : LG
Values in $-Bn FY2018 Result FY2019 Plan FY2021 Targets
Investment Plan 2
R&D investment 1.17
Net Sales 54.3 58.1 66.5
Operating Income 1.65 1.76 2.02
Operating Income Margin 3.04% 3.04% 3.04%
Industry Attractiveness & Competitive Advantage
LG
Innovation • Himalaya Cool Technology to get the déjà vu of
Himalayas
• Monsoon Comfort to Combat High Humidity
• 2-in-1 AC: Cooling and Heating
• 4D Cooling with 30 feet Airflow for Uniform Cooling
• Double Protection Filter to Annihilate Harmful Bacteria
and Fungi
• Mosquito Away Technology to Repel Mosquitoes
• Gold Fin Heat Exchanger with Auto Clean Functionality
• Multi-Flow Condenser and Rotary Compressor
• DualCool Inverter Technology with Variable Tonnage for
Optimized Cooling
Durability Durable - if used Springily
Acceptance House Hold
Daikin
• Stabilizer-free Operation to Protect from Aftereffects of
Powercut
• Inverter Compressor for Optimized Cooling
• 2-in-1 AC: Cooling and Heating
• 3D Coanda Airflow for an Unobtrusive Cooling
• Power Chill Mode assisted with Dual Flap Flattening for
Faster Cooling
• Streamer Discharge Technology with Smell-proof
Operations
• Copper Condenser with Anti-corrosive Fin
Highly Durable, Maintenance free Machines
Corporate & Offices
Swot for Daikin
Strengths Weaknesses
• Heat pump technology • Sales skewed towards main products (air
• Inverter technology conditioners)
• Refrigerant control technology
• Sales and service network
• Development and production closest to market
Opportunities Threats
• Global cooperation on climate change (Paris • Changes in de facto standards for air conditioning
Agreement)
• Setting of sustainable development goals (UN SDGs)
Swot for LG
Strengths Weaknesses

• Effective localization of product offerings for growth markets like • Brand lacks influence in the opinionated segment of early adopters
India, Brazil, China especially in the social media environment
• Brand offers sound rational appeal – good product features and • Brand has limited market share compared to market leaders
good value for money
• Good after sales service and wide distribution network
• Sponsorship of sports and entertainment events enhances visibility
Opportunities Threats

• Fast growth of home appliances, electronics goods market in • Price war with close Korean competitors like Samsung can disrupt
emerging economies growth in price sensitive markets
• Convert improved brand image and awareness in to market share • Highly competitive industry dynamics
• Stagnant urban demand
• Instances of false green claims can erode brand value and
consumer trust
Current Challenges
LG Daikin
Due to inefficient Supply Chain LG is unable to capture Non-Availability of Window Ac
Market Share although company comes with
innovative products
Low Investment on Marketing Low Investment on Marketing
Porter Five Forces Analysis on LG & Daikin
• Competitive Rivalry – High
• Threat of New Entrants – Medium
• Bargaining Power of Suppliers – Low
• Bargaining Power of Buyers – High
• Threat of Substitutes – Low
Recommendation for LG
• The LG must improve its price strategy and promotion strategy.
• The LG announces the core capability and environment development
product to develop in a certain level. This makes LG a wide brand image of
the product.
• LG offer innovative technological products to customer. But still there is
some lacking into the marketing mix like pricing strategy and promotion
strategy to reach the customer.
• LG must improve its pricing strategy like to cut the cost of the existing
product by the way of minimizing its process.
• There is a many competitor has arise for LG product. So the technology has
concerned it should increase to implement in timely manner. This will
increase to capture a more market in future.
Recommendation for Daikin
• The first and most important thing which Daikin needs to do is to, it was
found in customer survey that still 64% of people surveyed were not aware
of Daikin, even dealers who are in consumer durable business from more
than past 20 years are not aware of Daikin.
• Daikin needs to increase awareness and visibility.
• Need to create a value for money brand image which can give good
product quality at affordable prices.
• Service arrangements need to be strengthen.
• Most of the products are not attractive, looks simple and not represents
the brand quality, mostly in AC segment even the logo on AC are not
attractive as compare to others.
Thank you