By James Wells in Paris
PARIS: LG Electronics has made the ambitious claim that it will become the leading supplier of washing machines by the end of the 2007 calendar year, despite trailing Electrolux and the now merged Whirlpool and Maytag conglomerate.
At a press conference held on Wednesday night in Paris to launch the world’s first steam washing machine, LG Electronics general manager – marketing – washing machines, Don Kwack, claimed the company will move from third position to number one within the next 20 months by concentrating on the premium segment of the market.
“We are chasing two large global companies – one starting with W and one starting with E. We are now number three, but we are very close to number two and some statistics show that we are already in this position,” Kwack said.
Kwack confirmed he is seeking to become market leader in value rather than in units by generating profit from high priced products that deliver key consumer needs through innovation and design.
“We will become number one through our premium marketing strategy by playing in premium price segments. Our competitors are driving entry price points and they are also in every price segment. Our goal is to position LG at the high end of the appliance market. Our masterpiece – the steam washing machine, will take an important role to meet this goal,” Kwack said.
In Europe, the 9kg version of the LG steam washer will retail for 1,599 Euros. This positions the product at the premium end of the market against brands such as Miele and Asko as only three per cent of washing machines are sold over 1200 Euros in Europe, according to GfK data.
According to LG Electronics digital appliance company CEO and President, Young Ha Lee, 2006 will be a dynamic year as consumers see a lot of changes in home appliances.
“Boring bulky home appliances will be memories, as smart and attractive new options come on to the market. Through appliance convergence, colourful design and networked control, we will met the highest consumer standards and exceed all expectations,” he said.
Washing machines represented 20 per cent of LG Electronics’ $US10 billion appliance sales in 2005. Washing machines represent the company’s third largest appliance portfolio behind the $US2.6 billion refrigeration category and the $US3.0 billion air conditioning category.