Assignment: Pricing and Lg Essay

Submitted By hollydee47
Words: 2205
Pages: 9


STUDENT ID: 26013428
LG (formerly Lucky Goldstar) Electronics Inc. was first established in 1952 and based in South Korea. Around fifty years later, LG became exposed to international competition and its brand name is now known across the world. This large firm produces a wide range of electronics, chemical and telecom products. Late last year LG released the Curved OLED Smart TV, which is claimed to set new and higher standards for televisions. This modern, pencil-thin 55-inch screen was originally $11,999AUD but reduced to $5,999AUD in April 2014 and was highly rated by users. This product features the use of OLED; organic light-emitting diodes, the substance that allows LG to significantly reduce the weight and thickness of their TVs.
LG sees the OLED as “the future of televisions”(LG halves Curved OLED TV price in six months. URL:; hence the target market for this good would be a large set of buyers because LG would want a majority of people to have access to it and experience this new OLED technology.

The price of the 55-inch smart TV at launch was $11,999, indicating that LG believes this is a high-end product and those in a better off financial situation are willing and able to purchase this good. However, the price has been reduced by $4,000 in January and again another $2000 in April to $5,999 – only half the original price.
This dramatic change in price increases the range of their target consumers, as more people are able to afford this smart TV. The age of consumers would mainly vary between 25-60; those who are employed and earn a stable income of $80,000 (before tax). To earn an income of that figure, the consumer would at least have some high school education.

Education, income and occupation levels from the demographics segment can be used to indicate the consumer’s socio-economic status.
LG’s curved TV has a sleek and stylish exterior, featuring a frameless, curved screen and see-through speakers. Such contemporary design would look best in an apartment or a modern home, suggesting consumers live in a modern-day environment. Buyers could also be attracted to its simplicity and the uniqueness of the design.

To most users, watching television would be a part of their daily lifestyle; hence the usage rate would be high. However, a high definition television is a luxury good, hence it is rare for a consumer to frequently purchase a new television.
People would not purchase a new television on a regular occasion, since the price would be, to most people, a large proportion of their income. Furthermore, consumers would be doing more research and comparisons to other competing products in order to make an informed decision.
Since this product features a new production method (OLED), people would be excited or have a positive attitude towards product.

LG sells to retailers worldwide, which means that most countries would be able to purchase this product in store or online.
This product is modern and would look best in an apartment, meaning that most buyers would be based in metropolis or suburban regions.


The LG Curved OLED Smart TV comes with many different features such as video streaming, social networking, TV applications, cinema 3D setting and wireless Internet connection, providing consumers with hours of entertainment in their own home. All of this is packaged into an ultra-thin, lightweight 55-inch television screen. LG’s philosophy is presented in their slogan “Life’s Good”, they believe that the goods they produce “will improve and enrich everyday living”. (LG Brand Identity. URL: As technology continues to develop, firms in this industry must be up-to-date in order to