EXCLUSIVE: The reclusive marketing director of LG Australia, David Brand, has spoken out for the first time about the future for LG in Australia and a pending multimillion fine that could be handed out by the Australian Competition and Consumer Commission after the company was caught falsifying the energy efficiency of their appliances.
Speaking at the Sydney launch of LG’s new product range for 2010, which includes LED and 3D TVs as well as new appliances and steam ovens, Brand said that recent research revealed that the LG brand was still strong in Australia.
“We are currently in discussions with the ACCC and yes, we could get a major fine, however, we are encouraged by the support we have got from our selling partners. They are impressed by our quick response and the action we have taken. We have not shied away from our responsibilities and we are making changes in the company.”
When asked whether the LG brand had been tainted by the past actions of the company, who were last year fined $3 million for falsifying claims about their air conditioners, and are now facing a potential $4 million fine for falsifying claims about their refrigerators, Brand said, “Our research shows that there are still a great many consumers out there who view the brand as favourable. You have to accept that when you are selling such a big range as what LG Australia does that problems will occasionally occur. We are not going to shy away from our responsibilities and as such we have offered compensation to people affected.
“With our new appliance range, which is on show today, we have already had an extremely positive response from the channel and I am confident that we will get the same response from consumers.
“During the past few years the LG brand has grown considerably in Australia. This is not a recent occurrence.”
On show at yesterday’s LG event were new French door refrigerators, steam dryers, and steam ovens, along with new steam vacuum products.
Yet despite this, LG’s new PR company, LG One, which is a division of Ogilvy & Mather, failed to issue any press releases for the new appliance range, instead they offered journalists pictures and a spec sheet.
When asked why there were no official press releases for LG’s new appliance range when they had issued extensive press release for the company’s new TV range, an LG One executive Danny Wong said, “These appliance products have not been released yet”.
When asked about LG’s past actions in falsifying information about appliances Wong said “That was last month, we have addressed that issue and moved on. It is not an issue anymore”.
In the past LG Australia has stood accused of driving the brand based on products only and not communicating the actions of the company overall. When asked whether this had had an impact in the highly volatile TV market, where LG has only been able to grab between 9 and 14 percent market share vs arch competitor Samsung, who at times has had 42 percent market share and an average of 32 percent, Brand said, “You have a very good point. In Australia we are driven by our parent company. They tend to focus on product information over the strength of the company overall. This has been our strategy for several years. This could change later this year when we will be making some very big announcements. Our model is more about efficiency and effectiveness and what we will do moving forward is build on our current brand strengths.” he said.
In 2008/2009, LG Australia only managed to make a $13K profit, despite having revenues of over $900M.
