What's wrong with LG? Trying to understand why the company's sales are falling

LG is probably the most dubious player in the smartphone market. Everyone knows that Koreans produce not only telephones, but other household appliances as well. That is why the company is able to compensate for the poor results of the mobile division with sales in other industries. However, how long can this last? After all, we all remember the fate HTC, which for many years in a row tried to get out of this pit of bad sales and make our business profitable. She certainly did not succeed, and the Taiwanese decided to switch to virtual reality, releasing their helmet HTC Vive. Will LG have the same fate? Let's figure out what is happening with the company and what the future holds for it.

What's wrong with LG?  Trying to understand why the company's sales are falling

What's wrong with the mobile unit LG?

It’s worth starting with the results of the Koreans in 2019. Surprisingly, they turned out to be good. LG managed to get $ 53 billion in 2019, while operating profit was 2.07 billion, which is 10% lower compared to 2018, but the company explains this by additional investments in marketing and development of future technologies. She managed to get the most profit from the LG Home Applience division. But let's take a look at the mobile unit.

Not everything is so rosy here. Not so long ago LG refused to sell its phones in China due to too high competition. According to the most recent sales results for 2019, not much has changed. A report from LG said the mobile division lost more than $ 850 million in 2019, while LG claims the losses were due to poor sales of mid-range phones in North America. The mobile division LG earned $ 1.1 billion in Q4 2019, which is not so good considering that it managed to get $ 1.41 billion a year earlier. For all of 2019, the mobile division LG received $ 5 billion in revenue, but lost $ 853.4 million in profit. In 2020, the company plans to focus on selling 5G smartphones in the premium and mid-budget segment. I propose to discuss this in Telegram.

What's wrong with LG?  Trying to understand why the company's sales are falling

LG G7 ThinQ

Let's consider why smartphone sales LG are falling. To do this, just go to the official website of the company in Russia and see what devices it offers us and at what cost. If you search the Internet for the modern flagship LG G8 ThinQ, you simply won't find it. And it is also not presented on the official website. The most recent models that can be bought in Russia are LG G7 Fit, LG G7 ThinQ, LG Q7 Plus, LG Q7, and See also LG V30 Plus. Even on the e-catalog, you cannot buy the LG V40 ThinQ and LG G8 ThinQ, let alone other models.

Probably the reason for the lack of modern flagships of the company in Russia is their lack of popularity and weak sales. Why LG sell a phone that is poorly sold – and this is logical. Meanwhile, LG G7 looks relevant due to rather thin frames and an interesting price. For example, on the e-catalog LG G7 Fit can be bought for 20,000 rubles, LG G7 will cost 40,000 rubles. This is not to say that this is too much, but it should be borne in mind that we are talking about last year's flagship on the Snapdragon 845 processor (LG G7 ThinQ), so when it comes to any sales of phones from companies in Russia, you should understand that the assortment is rather scarce and does not offer the user modern solutions. In this case, of course, there is no reason to expect anything good in terms of sales.

Just look at the Chinese manufacturers that release new mid-range phones every month. And they sell well due to the fact that they offer modern software, new design and a nice price. This is the strategy that LG should follow. Now we are seeing a dying company whose future, at least in terms of mobile device sales, is in question. It's interesting what our readers think about this, because surely many of you still own devices LG, and even I am not very pleased to realize that the once successful mobile division of Koreans looks ridiculous today against the background of Chinese competitors.

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