LG Environmental Opportunities (Ch 4)

LG operates between perfect competition and a competitive oligopoly. That is, there are a number of firms in the various spaces in which they compete but not hundreds of firms. So their products (entertainment, appliances, telephony) are not quite commodities. LG is between being a price searcher and a price taker.

As such, LG’s biggest threat is rivalry. LG therefore needs to constantly engage in product differentiation and innovation in order to avoid its products being commoditized. Differentiation also allows LG to avoid slipping completely into price taking.

So LG’s opportunities lie within their ability to execute on innovative, differentiating strategies. Because LG makes a large variety of products, they find themselves within several industry structures at once. They therefore need to leverage opportunities per industry structure, although the strategies are very similar.

Here is a summary of where LG competes, and how they are approaching the opportunities:

Industry Structure	Products	Opportunity	Example
Emerging	Wearable Technology: Fitness-enabling devices.	First Mover – create new types of product	Heart Rate Earphones These earphones measure heart rate and transmit information to a smart phone
Mature	Home Entertainment	Product Refinement/ Reinvention	Curved Screen TV’s
	Appliances	Product Refinement/ Reinvention	Connected Home Appliances These appliances all connect to the internet so you can control them with a smart phone application (e.g.,you had to run out, leaving something in the oven that needs to be turned off later).
Network	Smart Phones	First Mover	Flexible, Curved Smart Phones You can actually bend this phone!