ALKHOBAR, 20 March 2007 — LG’s black and red signature colors were much in evidence at the opening of the newest LG Boutique at Alrashid Mall last Tuesday. The boutique is a joint effort between LG Electronics and Jamal Al-Jassim Electronics, one of LG’s partners in Saudi Arabia. This is the second LG Boutique in the Kingdom. The first is located at Al-Faisaliah Center in Riyadh.
“The LG Boutique is a venue where young people can go to see all of LG Electronic’s premium IT products,” said Jamal Al-Jassim, CEO of J. Al-Jassim Company. “This is a long-term investment for us. The site was chosen since Alrashid Mall is known as a place that attracts high-end consumers. The mall is already home to many of the best brands and we hope to capitalize on that positioning.”
According to LG, the goal of the LG Boutiques is to offer attractive outlets to view all the newly launched LG products in one location. Initially, the LG Boutique at Alrashid Mall will focus on IT products, including a full line-up of premium notebooks in the piano black design concept along with the Fantasy series LCD monitors. LG’s DLP projectors and flash drives are also available. The new Super Multi Blue which is compatible with both Blu-ray and HD-DVD formats is expected to be available at the boutique next week. A new LG navigation system that fits any vehicle will also be arriving at the Boutique soon. Consumers of all ages are invited to come and experience the products, hands on, at the LG Boutique.
“I want to emphasize that this boutique is not about selling LG products, although the products on display are also for sale,” said Al-Jassim. “We really are targeting young people to come in and touch and try the equipment. The boutique is about helping people become familiar with information technology and the LG brand. Staff at the LG Boutique are there to answer questions and demonstrate the products. People can feel comfortable experiencing the product as there is no pressure to buy and consumers are encouraged to come visit the boutique again and again to see what’s new.
LG is one of the newest notebook brands in the market and the company admits that it is trying high-profile marketing schemes to attract attention and increase product awareness.
“LG has about 10 percent of the market share in the Kingdom’s notebook computer segment,” said Simon Lee, GM, LG Electronics, Saudi Arabia. “We started marketing our own brand of notebooks almost three years ago and globally we control less than 10 percent of the notebook market. However in South Korea, we are positioned second in the market. LG is not exactly new to the notebook segment though. Previously there was the LG IBM Personal Computers Company (LGIBM) which had been in existence since 1997. The portion of that venture which created personal computers was merged into LG Electronics some three years back and LG notebooks have come on to the scene since that time.”
Even though LG is late in joining the notebook business, the company believes that its notebooks can succeed if they are positioned as a premium brand.
“Our market share is still small but we are making inroads at the top of the market where we compete against Sony and Toshiba,” Lee explained. “LG notebooks utilize our own superior technologies and our engineers and technologists have created designs for the young generation that are both attractive and high performance. We have our own LCD panel factory, which is No. 1 globally, so we can adapt the LCD technology to suit our notebooks ideally. We were in the semiconductor business even before Samsung. The truth is that LG has all the technologies it takes to produce the best notebooks, our only handicap was coming to the market late. Actually, maybe that isn’t a handicap at all, since it has given us the opportunity to study all available market research and launch superior products.”
Lee was clear in stating that LG has no interest in creating notebooks for the low-end commodity segment of the PC business. In Saudi Arabia, LG has also learned to rely heavily on its partners in promoting brand awareness for its new IT products.
“We have very strong partners in the Kingdom such as J. Al-Jassim Electronics which was established in Saudi Arabia more than 20 years ago and has a Kingdomwide network through PC-NET. We also have educated our channel very well to understand how the features of LG Notebooks compare positively to the features in other notebooks. It really takes brand, plus marketing, plus partners and distributors to move forward in the Saudi market,” Lee observed. “We also have a strong reputation in the Kingdom as people are already familiar with our monitors, in which we have 56 percent market share, and our DVD drives and optical storage devices.”
With the opening of the LG Boutique in Alrashid Mall it might be thought that LG is only interested in reaching out to the consumer segment of the market. Lee emphasized that this isn’t the case at all.
“The Saudi business segment is an area where we are starting to show significant growth, and it is important to us too. We are using our partners to reach out to small and medium-sized businesses in the Kingdom,” said Lee “National Commercial Bank is one success story for us in Saudi Arabia. We won’t be getting involved in providing cheap, low-end notebooks to enterprises. That’s a fact. Most vendors have different products for the business and the consumer segment. LG hasn’t gone with this strategy. We believe it is better to offer excellent technology coupled with excellent service in all the notebooks we offer and we are increasingly discovering that for many small and medium-sized companies, this is a highly desirable combination.”
