LG Electronics Inc.: Making Waves in the North American Market for Washing Machines

The LG brand was launched in the US in 2002 with the ambition to build it up as a premium brand. The case outlines LG's strategy in the washing machine category from 2002-2005, during which a series of successful launches has established LG as a strong player. The case presents extensive customer data and information on potential product features for a new washing machine and raises several questions: Which segment should LG serve? What features should the new machine contain? How should it be priced? How should it be marketed? The questions need to be addressed in light of LG's desire to be a premium brand. The case can be used with UG, MBA or executive audiences.

The objective of this case is to highlight how a clear understanding of customer segments and their needs, and designing innovative products around these needs, leads to developing a profitable business based on the ability to charge a premium price. Such an approach helps to build a strong brand that results in customer pull, which can help penetrate even the most powerful of distributors. The case also highlights that to do this successfully it requires the various facets of the organization be aligned around the customer.