LG Electronics PR Campaign

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LG Electronics PR Campaign Tashia L Bramhan

Transcript of LG Electronics PR Campaign

LG Electronics PR CampaignTashia L Bramhan

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PR Table of Contents1.0 Executive Summary................................................................................................................4

2.0 Company Background............................................................................................................6

2.1 The External Environment..........................................................................................7

2.2 The Industry................................................................................................................8

2.3 The Client....................................................................................................................9

2.4 The Product, Service or Issue...................................................................................10

2.5 Promotions................................................................................................................11

2.6 Market Share.............................................................................................................12

2.7 The Competition.......................................................................................................13

2.7.1 Samsung.....................................................................................................13

2.7.2 Apple..........................................................................................................14

2.7.3 Whirlpool Corporation...............................................................................15

2.8 Resources..................................................................................................................16

2.9 SWOT Analysis........................................................................................................17

2.9.1 Strengths....................................................................................................17

2.9.2 Weaknesses................................................................................................17

2.9.3 Opportunities.............................................................................................17

2.9.4 Threats.......................................................................................................17

2.10 Public Profiles...........................................................................................................18

3.0 Situation Analysis.................................................................................................................19

4.0 Core Problem Statement.......................................................................................................22

5.0 Key Publics...........................................................................................................................24

5.1 Employees.................................................................................................................25

5.2 Retailers....................................................................................................................25

5.3 Consumers.................................................................................................................25

6.0 Primary and Secondary Messages........................................................................................26

6.1 Employees.................................................................................................................27

6.1.1 Primary Message.......................................................................................27

6.1.2 Secondary Messages..................................................................................27

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6.2 Retailers....................................................................................................................28

6.2.1 Primary Message.......................................................................................28

6.2.2 Secondary Messages..................................................................................28

6.3 Consumers.................................................................................................................29

6.3.1 Primary Message.......................................................................................29

6.3.2 Secondary Messages..................................................................................29

7.0 Campaign Goal(s).................................................................................................................30

8.0 Campaign Objectives............................................................................................................32

9.0 Campaign Strategies.............................................................................................................35

9.1 Employees Strategy..................................................................................................36

9.2 Retailers Strategy......................................................................................................36

9.3 Consumers Strategy..................................................................................................36

10.0 Public Relations Tactics........................................................................................................37

10.1 Employees Tactics....................................................................................................38

10.2 Retailers Tactics........................................................................................................38

10.2.1 Press Release.............................................................................................40

10.3 Consumers Tactics....................................................................................................41

11.0 Calendar of PR Activities.....................................................................................................43

12.0 Budget...................................................................................................................................46

13.0 Evaluation Plan.....................................................................................................................48

13.1 Evaluation Criteria & Tools.......................................................................................49

13.2 Objective 1.................................................................................................................49

13.3 Objective 2.................................................................................................................49

13.4 Objective 3.................................................................................................................50

14.0 REFERENCES.....................................................................................................................51

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1.0 Executi

ve Summa

ry

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1.0 Executive Summary

The Company: LG Electronics, Inc. is an electronics, home appliances and mobile

communications company based out of Seoul, S. Korea with 128 locations globally. The

company was founded by Koo In-Hwoi on October 1, 1958. LG Electronics is better known as a

global leader and technology innovator through the various rewards received each year at the

International CES (Consumer Electronics Show). LGE’s vision simplified is “Great Company,

Great People.” (LGE, 2015). The main direct competitor of LG Electronics also in Seoul, S.

Korea is Samsung.

Campaign Key Elements: Outside of increasing brand positioning for the company as they

currently hold the third position globally, this campaign focuses on lack of customer service

standards in the North American region. Many aspects of customer service revision is discussed

as well as various mock testing events before final implementation of completed program.

Company transparency and progressive communications with customers to resolve issues as they

arise and/or before, is most essential in helping brand positioning from third position to second

and/or first position within a 6-month period. Interactive communications with customers will

prove to be beneficial in realizing customer trust in the product range provided as well as the

brand in general. The North American region fares well in maintaining a 7-year lead for mobile

handsets, but continues to fall short in other areas of products. If a product is bad and customer

service is bad, consumers will turn away from the brand as well as pass their experiences on to

others telling them to avoid the brand. This campaign focuses on fixing customer services in

order to reduce the bad publicity received via word-of-mouth measures as posted via social

media platforms.

Total expenditures for this campaign are at a bare minimum of $200,049. Most costs outside of

this amount are internal to resources used within the company because costs are transferred

between departments. The plan ends with evaluation tools and criteria. Various forms of

customer surveys are issued to help with adjusting the plan as needed in an ever-growing world

filled with technology. The usefulness of the company intranet will ensure employee compliance

with training classes taken and results of each type of training. HR is at the core of this campaign

as it will be their responsibility to handle all aspects of campaign research, creation, revisions

and implementation. A separate presentation is included with this campaign to give you an

overview of all aspects of the campaign from beginning to completion.

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2.0 Compan

y Backgro

und

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2.1 The External Environment

LG Electronics, Inc. (LG) is known as a global leader and technology innovator in consumer

electronics, mobile communications and home appliances. LG was founded by Koo In-Hwoi on

October 1, 1958 in Seoul, S. Korea. The initial name GoldStar was later changed to LG

Electronics, Inc. on January 1, 1995. LG currently employs over 83,000 people who work in one

of the many 128 locations worldwide. LG received the Energy Star 2014 Partner of the Year

award and 2014 global sales ended at 55.91 billion USD (59.04 trillion KRW). (1LG, 2015)

Either LG’s ability to function can be controlled by external elements or LG takes control

through various marketing functions. "Some external elements can be manipulated by company

marketing, while others require the organization to make adjustments (Root, III., n.d.)."

Consumers that purchase and/or inquire upon LG products are ones who are considered tech-

savvy as they are always looking for the latest and greatest in innovative products. LG has made

a promise to consumers of "enriching lives through technology innovation (2LG, 2015)."

Other components of government, environment, competition and public opinion can all

intertwine within the marketing function or exist separately. Since LG is a global company,

government regulations play a large role in the marketing aspect for the business. Besides the

basic patent filings and environmental regulations like sustainability and disposal of used and

new appliances and other products, LG deals with taxation policies per country and foreign trade

regulations. Other factors involve social welfare policies, general trade policies, government

leadership, environmental protection laws, ecological issues, population demographics, income

distribution, buying trends, ethnic diversity and lifestyle changes, which can all affect the

viability of the success and/or failure of LG Electronics. The components that can truly be

manipulated by LG marketing and PR tactics are those of public opinion and the general

consumer. The current public perception of the company and brand in general is a mixture of

distrust over specific products to that of appreciation for quality products that breaks boundaries

through innovative features. The negative perception can be fixed and/or negated through

excellent customer service solutions to appease complaints that flow to the company.

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2.2 The Industry

LG is comprised of four business divisions within the overall scope of the company. These

divisions are Home Entertainment, Mobile Communications, Home Appliances & Air Solutions

and Vehicle Components.

The main products for each division are as follows:

Home Entertainment TVs Audio & Video Monitors PCs & Accessories Commercial Products

Mobile Communications G Series Vu: Series F Series L Series II

Home Appliance & Air Solution Refrigerators Washing Machines Dishwashers Cooking Appliances Vacuum cleaners Built-in appliances Air Conditioners Air Purifiers Dehumidifiers

Vehicle Components In-vehicle infotainment HVAC & motor Vehicle engineering (1LG, 2015)

The main industry that LG falls under is the electronics industry. LG manufactures and sells

consumer electronics worldwide. They are currently headquartered in Seoul, South Korea and

the American division is headquartered in Englewood Cliffs, NJ. There is a separate American

headquarters for the mobile division located in San Diego, CA.

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The vision of LG is to “become a worldwide leader in digital – ensuring customer satisfaction

through innovative products and superior service while aiming to rank among the world’s top

three electronics, information and telecommunications firms. On our way, we hold tight to

philosophy of ‘Great Company, Great People,’ underscoring our belief that only great people can

create a great company. LG strives for greatness in what we’ve identified as our three core

capabilities: Product Leadership, Market Leadership, and People Leadership – each strength a

key part of realizing our growth strategies for ‘fast innovation’ and ‘fast growth’ (3LG, 2015).”

The consolidated financial statement for fiscal year 2013 show the following: sales – 58,140

trillion KRW (52,515 billion USD), operating profit – 1,285 trillion KRW (1,160 billion USD),

net profit – 223 billion KRW (201 million USD) and total shareholder’s equity – 12,689 KRW

trillion (11,461 billion USD), (4LG, 2015). Operating profit margin end at 2.2%, which was the

same for fiscal year 2012 and ROE (return on equity) ended at 1.8%, which was a 56% increase

over 2012, which ended at .8%. (4LG, 2015)

2.3 The Client

At LGs formation, the main target market was the Korean market. As the company expanded to

foreign territories, the target market later changed to the emerging global market. LG has split

their four basic business units to compose two separate headquarter bases. One base deals

specifically with mobile communications and corresponding mobile consumer market while the

second headquarter base deals with the remaining three business units. One economic factor that

affected the growth of LG was in 1997 when the foreign exchange crisis hit the nation. The crisis

started with the collapse of the Thai baht. Some of the causes that created a mass crisis in Asian

nations stemmed from "sustaining a fixed exchange rate when it was no longer suitable, allowing

too many short-term capital flows to accumulate with a high degree of currency speculation and

lacking sufficient risk management system at the national level as well as a regional level

(ADBI, n.d.)." LG was able to overcome the economic downfall by restructuring their business

and workforce. The goal was to strengthen their competiveness and focus more on customer-

oriented researches and developments. (LGE, 2008)

LG started out with 300 employees in 1958 in S. Korea to well over 83,000 employees today

globally. Compared to sales figures given earlier under The Industry, sales in the early years are

as follows: sales revenue; 50 million KRW (1959) 45 thousand USD, exportation revenue; 50

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thousand KRW (1962) 45 USD, capital; 10 million KRW (1958) 9 thousand USD and net

income; 29 million KRW (1962) 26 thousand USD. (LGE, 2008)

LG has a "Management by Principles" policy that is implemented to enforce "doing business in a

transparent and honest manner (5LG, 2015)." This policy is the code of ethics that must be

followed by those employed and/or connected with LG in terms of management practices. This

is also called Jeong-do Management or in simpler terms The LG Way. The first sentence of the

Code of Ethics states: "We, at LG, share and believe in two key corporate principles - 'Creating

value for customers' and 'Respecting human dignity.'(LGE/COE, n.d.)"

In 2014, LG won 35 awards at the International CES (Consumer Electronics Show). The

majority of the awards won were for their television, smartphone and fitness products introduced

for the year. The awards were received from entities present at the show like TechRadar,

Ubergizmo, HD Guru, Popular Science, Reviewed.com, which was the show's Official Editors'

Choice partner and Digital Trends, the Official Digital Home Partner (6LG, 2014).

Outside of the main headquarters in Korea and the U.S., LG also owns subsidiaries in China,

South & Central America, Middle East, Africa, Europe, North America, Asia and CIS. CIS

includes Russia, Ukraine and Latvia.

2.4 The Product, Service or Issue

LG produces and sells electronic products that include mobile phones, televisions, air

conditioners, refrigerators, washing machines, personal computers and the core components of

computers. LG operates segments that are “strategic business divisions providing products and

services. Each business division operates separately according to unique technologies and

marketing strategies (7LG, 2014).”

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The specific divisions and their product and/or service module are as follows:

Divisions

Home Entertainment (HE)

Mobile Communications (MC)

Home Appliance (HA)

Air Conditioning & Energy Solution (AE)

LG Innotek Co., Ltd. And its subsidiaries

(Innotek)

Other Segments

Products

TV, Monitors, PCs, security devices, audio,

video & others

Mobile communications

Refrigerators, washing machines, microwaves,

vacuum cleaners, water purifier & others

Residential air conditioners, commercial air

conditioners & others

Vehicle components, compressor, motor, display

material, lighting, solar & others (7LG, 2014)

2.5 Promotions

LG and the brand logo symbolize "the world, future, youth, humanity and technology (this is

fully representative of the L & G inside a circle) (8LG, 2015)." LG also stands for Life's Good

which is the long-standing tagline. LG has two logos. One is the corporate standard logo and the

other is a third version of the logo, which reflects the alignment of the company to new

positioning. The third version is more readily visible in all marketing aspects along with LG

packaging, retail signs, shopping bags and service vehicles. The standard corporate logo is used

for all business stationery, ID badges and corporate signage.

LG promotions and marketing are created and implemented geographically with respect to

subsidiary location. For example in Australia, a current promotion alerts consumers if they

purchase an LG G3 at select retailers over the summer, they will receive a free bonus gift. You

are not told what the gift may be, but are instructed to visit your local LG dealer to find out the

deals on cellular phone handsets as well as learning about the bonus gift. (LGAU, 2015) In this

manner, LG is getting consumers to specific stores as well as pushing sales for the LG G3

product. In the U.S., the major promotion that is occurring is a contest. LG has collaborated with

NCAA® Final Four® to offer consumers a chance to win 2016 tickets to the games. The grand

prize consists of two tickets to each of the semi-finals and finals games along with hotel

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accommodations and round-trip airfare. There are also first through third prizes that consist of an

LG washer and dryer set, an LG 55" LG UHD TV or an LG mobile phone, which LG reserves

the right to choose the model to present to the winner. The underlying promotion within the

actual contest is convincing consumers that they need LG products for all their game day

viewing needs and/or gatherings. "Do Game Day Right. With great deals on innovative TVs that

put you in the middle of the action, plus sleek appliances that let you store and cook your

favorite game-day foods to perfection, LG makes it easier than ever to kick back, relax and enjoy

the game. If you are a person on the go, do not worry – we have not forgotten about you. To help

you keep up with the scores and the biggest plays of the tournament, we are even offering great

deals on your favorite mobile devices, including the latest tablets and smartphones, so you can

cheer on your favorite teams from virtually anywhere. (9LG, 2015)" This contest may or may not

assist with boosting sales in the divisions of mobile communications, home appliances and home

electronics. In viewing past press releases, there are different news related to the NCAA & LG

with hosting recycling events and celebrity sponsored cooking events.

Each press release is very specific in announcing awards earned collaborations with other entities

for environmental issues and product changes or innovations recently created. LG establishes

their brand to stay in the forefront of the minds of consumers. This type of brand positioning

works for LG yet there is room for improvement as will be explained later.

2.6 Market ShareNorth America - Smartphone market share

In the 3rd quarter of fiscal year 2014, it has been reported that LG held the highest ever market

share over past years in North America. In the 3rd quarter, market share for North America was

recorded at 16.3 percent for smartphones. This placed LG securely in 3rd place behind Apple

and Samsung respectively. The previous year, LG's market share stood at 7.4 percent for

smartphones. The boost in market share resulted from the introduction of the LG G3 model. "LG

sold 16.8 million smartphones in the third quarter, breaking the previous quarter's record of 14.5

million. It posted 461.3 billion KRW (420 million USD) operating profit in the third-quarter, a

111.8 percent increase from 2013 (Cho, 2014)."

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S. Korea - Smartphone market share

In July of 2014, LG was reported to have 29 percent of the smartphone market. For the months

of January to April 2014, LG was consistently within the 10 percent range, but once the

introduction of the LG G3 smartphone was made, that percentage rose greatly. LG's main

competitor in S. Korea for smartphones is Samsung, which has held their positioning at a little

over 60 percent but is starting to see a decline in shares. (ZDNet, 2014) Actual sales figures were

not included in the report.

Washing machines - global market share

For seven straight years, LG has been able to maintain the number 1 position in market shares for

washing machines. At the end of 2014, the market share for LG ended at 12.4 percent. In

comparison, their front-loading washing machines finished at 14.7 percent in total washers sold

in the U.S. The success of LG washers stem from the innovative features installed on the

machines. Such as, "LG's 6 motion technology has a touch as delicate as hand washing, helping

to reduce wrinkles and damage to clothes (Clarkson, 2015)." LG's washing machines are seen

and perceived as reliable and durable as well as being highly innovative in technology and

machine design.

2.7 The Competition

LG's biggest competitors in globally are Samsung, Apple, and Whirlpool.

2.7.1 Samsung

Just like LG, Samsung started in Seoul, S. Korea. Lee Byung-Chul founded

the company in 1938. Samsung is currently ranked as a top 10 global brand and is recognized as

an industry leader in technology. Samsung operates three core business divisions: Consumer

electronics (CE), Information technology & mobile communications (IM) and Device solutions

(DS). Headquarters are based in Korea and they operate 158 subsidiaries globally, which

includes nine regional headquarters for the CE & IM divisions and five regional headquarters for

DS (Samsung, 2014). Total revenue at the end of the 3rd quarter was recorded as 153,476 billion

KRW (138.9 million USD). The top four selling products for Samsung are mobile, CTV,

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memory and DP. All of the major products showed decline in sales as compared to 3rd quarter

2013 results. The regions that represented a large percentage of sales in highest sales order, was

Americas, Asia & Africa, China, Europe and Korea for total sales of 1,041,763 KRW unit base

of 100 million. (Samsung, 2014)

They have listed their sales strategy within the report as:

Expand market leadership based on smart devices Provide differentiated value to customers through brand, products and service Strengthen operational capabilities for customer/market Enhance sales capabilities (Samsung, 2014)

2.7.2 Apple

Apple was founded in 1976 by Steve Jobs and Steven Wozniak at the introduction of

the Apple I in California, U.S.A. Apple started seeing success in computer sales in 1977 with the

introduction of Apple II, which was the first personal computer to come in plastic case, and

included color graphics. Today the company "designs, manufactures, markets mobile

communication and media devices, personal computers, and portable digital music players, and

sells a variety of related software, services, networking solutions, and third-party digital content

and applications (Apple, 2014) The Apple products includes those of iPhone®, iPad®, Mac®,

AppleTV®, iTunes® and iCloud® just to name a few. Apple makes sales to consumers,

education, enterprise and government consumers and small & mid-sized businesses. Apple

operates on a geographic basis. Therefore, geographic segments compared product division like

other competitors divides their business. Each segment operates in a manner to provide products

and services that are similar to the parent operation but adheres to country policies and/or

regulations as far as what can be fully offered. Apple employs a total of 92,600 full-time

employees and 4,400 full-time temporary and/or contracted employees.

Sales at the end of fiscal year 2014 were $182,795 (dollar amounts are listed in millions). Net

income was $39,510 (million) and total assets were $231,839 (million). Total shareholders'

equity ended at $111,547 (million). Net sales rose by 7% over the previous 2013 fiscal year. The

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largest revenue from net sales stemmed from the iPhone and the iPad respectively. The operating

segments that showed the greatest net sales were the Americas with $65,232 (million) and

Europe with $40,929 (million).

2.7.3 Whirlpool Corporation

Whirlpool Corporation is the world's leading global manufacturer of

home appliances. They have operations in more than 170 countries and their focus is on

consumer needs, which stimulate their overall growth. They have over 100,000 employees

globally with 22,000 of that number in the U.S. alone. They also operate 70 manufacturing and

technology research centers. Whirlpool is the owner of the following known brands: Whirlpool,

Jenn-Air, KitchenAid, Amana and Maytag. They also market several other major brands that are

known in their respective countries. The Whirlpool vision is to have "the best branded consumer

products…in every home around the world (Whirlpool, 2015)."

Whirlpool started as Upton Machine Company in St. Joseph, Michigan in 1911. Lou Upton and

his uncle Emory and brother Fred started the company. They started with the production of

motor-driven wringer washers. Upon first introduction of the washing machines, a problem

occurred but Mr. Upton quickly rectified the situation, which enabled the company to gain a

larger customer base. Demand became greater and later in 1929, the company corroborated with

Nineteen Hundred Washer Company based out of New York. The company later introduced

ironers to their product line and eventually produced the first fully-automatic washer and electric

dryer. The company's name changed to its' current name of Whirlpool Corporation in 1949 to

symbolize their signature brand. (Whirlpool, 2015)

Whirlpool's financials follows a standard calendar year for their operations. At year end of

December 31, 2014 reported net sales was at $19,872 (billion). Operating profit was $1.1 billion

and net earnings were $692 million. Total assets are at $20 billion and total shareholders' equity

ended at $5.7 billion.

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2.8 Resources

To understand the value LG places on their customers, it has been stated that they put in strives

to provide "the best value by reliably supplying products in demand from the customers'

perspective, listening to their feedback and assisting with fast, accurate, and unique service ( 2LG,

2015)." Communications with customers are made through various social media platforms as

well as directly through LG's own newsroom website. LG collaborates with local research

organizations that help them analyze lifestyles of customers by region. This collaboration occurs

to better product development based on customer needs.

Prosumer marketing communications is a tool that LG uses to have more customer input

involvement during the development stage of products. For example, a TROMMIZ program had

the participation of 15 homemaker bloggers. These bloggers played the role of liaison between

LGE and its consumers by giving feedback on the usage of the TROMM washing machine. The

bloggers also assisted with product planning and provided valuable online suggestions during the

development stage of the product. (2LG, 2015)

Another resource LG uses for marketing communications with their customers is through

organized events that are announced through press releases and social media platforms. One

such event is the yearly recycling program held in North America where consumers are

encouraged to recycle their old mobile phones to various schools. The schools in turn compete to

win a monetary prize from LG for collecting the most waste in the form of mobile phones. This

type of event is putting into the mind of consumers that LG is a socially responsible company.

Also creating a positive perception of the LG brand, which in turn generates revenue through

new and/or existing customers.

One last resource as previously mentioned to gain and build customer trust is the use of digital

marketing communication. Through the utilization of social media to coincide with digital media

trends, LG focuses on reaching out to their customers and building relationships by

accommodating customers in the various digital channels. Consumers are able to more readily

participate in various campaigns, be a part of loyalty programs and even view videos associated

with the LG brand.

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2.9 SWOT Analysis

2.9.1 Strengths

LG has been able to maintain the #1 position in market shares for washing machines on a global level for 7 years.

Known as a global leader and technology innovator in consumer electronics, mobile communications and home appliances.

Return on equity increased by 56% over a 1-year period. 2014 winner of 35 awards at the International Consumer Electronics Show Held highest market share ever for the company in the North America market for mobile

handsets at the end of the 3rd qtr. for FY2014 Consistently introduces innovative products to the market based on consumer needs

and/or wants that fits trending lifestyles

2.9.2 Weaknesses

Lackluster customer service as posted on various consumer platforms in regards to refrigerators purchased in the U.S.

Unknown future economic conditions that can affect business overall in terms of sales and revenue

Changes in tax laws geographically Foreign exchange rate policies and changes in exportation regulations Consumerism - consumers have less disposable income to cover household needs Market saturation of products and price wars of sector specific products between

competitors

2.9.3 Opportunities

Strengthen customer trust by increasing training efforts for employees to provide better customer service when complaints are made

Increase presence and/or change current company perception by being more responsive to customers

Increase market share of smartphones sold in the U.S., currently in 3rd place behind Samsung and Apple

To make better placement of home appliance stance globally and particularly in the U.S. by testing and/or re-testing appliances such as refrigerators to ensure that not only are they fully functional but there are no cosmetic and/or internal defects

Products that have been tested and been successful in the Korean/Asian market, start introducing to other regional markets, thus increasing market share and brand positioning

2.9.4 Threats

Political policies Global and/or local economic conditions - recession or depression Tax law changes Foreign exchange rate Decrease in consumerism - consumers having less disposable income

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Market saturation of products by competitors Competitors creating more innovative products which increases their market share

2.10 Public Profiles

Consumers concerned with the environment: located in the Palisades (Englewood Cliffs) area of New Jersey where current U.S. headquarters are located. Concerned with headquarter remodeling that will taint the current skyline (tree-line view) of the Palisades (Englewood Cliffs) if tower rises above trees. Influentials are EPA (Environmental Protection Agency), the National Park Service and mayors of the 6 nearby communities.

JPMorgan: recently downgraded LG from Overweight to Neutral in terms of stock valuation. Shareholders are the secondary public as JPMorgan decision and lower value of stock may cause shareholders to sell their shares of stock and/or potential shareholders may be more cautious in purchasing. The forecast for stock valuation is bleak as stated by JPMorgan. (JPM, 2015) This either will benefit LG in the purchase of more shares of stocks at the lower price or will hurt them if shareholders decide to sell off their stocks because of the prospective forecast made on future valuation.

LG employees: lack sufficient training. Work-life balance is considered non-existent as stated by current and past employees. Some employees feel segregation and/or career lacking progression to grow. Influentials consist of upper/middle management and Human Resource department. HR policies and how they handle employee concerns causes chaos among employees who feel they are not receiving and/or do not have the necessary tools to be successful. Peers within a department may influence feelings or conversations in favor of or against the company or department in which they operate. Uses of social media to voice complaints can be damaging to the image of the company.

Various consumer complaints posted on platforms like Consumer Reports and BBB (Better Business Bureau). Influentials are disgruntled consumers who own various LG products. Complaints range from defective products to poor customer service.

Expert product evaluators. Self-influenced. Concerned with performance, durability, innovativeness and other aspects to issue awards and/or professional reviews to appease consumer concerns and/or inquiries. Consists of specialists of specific products.

3.0 Situatio

n Analysis

3.0 Situation Analysis

LG Electronics, Inc. (LG) vision states: "LG Electronics continues to pursue its 21st century

vision of becoming a worldwide leader in digital—ensuring customer satisfaction through

innovative products and superior service while aiming to rank among the world’s top three

electronics, information, and telecommunications firms by 2010.

On our way, we hold tight to a philosophy of “Great Company, Great People,” underscoring our

belief that only great people can create a great company.

LG strives for greatness in what we’ve identified as our three core capabilities: Product

Leadership, Market Leadership, and People Leadership—each strength a key part of realizing

our growth strategies for “fast innovation” and “fast growth”. (LGE, 2015)"

Various consumer, reporting outlets have shown that part of the LG vision, "ensuring customer

satisfaction through…superior service", has not held true in all instances. One major reporting

portal is the BBB (Better Business Bureau). Through this portal, consumers are able to make any

complaints or concerns and then BBB will present that information to the business in question.

Businesses have the opportunity to respond to consumers with some sort of resolution or request

for additional information if needed. All of the responses made by LG in general have all started

in a scripted, generic manner. LG responses are impersonal which causes many consumers to

reject the response given as not being resolved. Customers are also purchasing LG items that

have limited warranties for defects that are only applicable to the first year of owning and

registering the product. There are, however instances of products being defective cosmetically

and/or parts of products not working correctly. Complaints are about technicians that inspect and

try to fix products and/or parts not readily available for repair. Many consumers have waited for

weeks to have either product replaced or repaired. Calls are made to customer service but with

little satisfaction being made to the consumer.

All areas of customer service in the North American sector need to be revised and implemented

to conform to changing consumer needs and cultural differences per region. Employees need

reiteration of the LG Electronics vision on a yearly basis. Mandatory ethics training classes along

with courses in customer service is available to employees. Training can occur at workstations

(employees desk via data feed) if at corporate locations and/or off-site training facilities.

Training is conducted yearly as consumer behaviorism and company perception continuously

changes. Knowing how to handle various issues that may arise is key to the success of LG

earning the #1 spot globally for consumer market share in electronics as well as the #1 position

for telecommunications and information. Carrying out these entities of employee training and

constant internal employee communications between departments will help alleviate or lessen

the amount of negative consumer perception. Taking steps to communicate more effectively and

positively with consumers will re-position the company brand to assist with realizing the full LG

vision. Taking more steps to communicate internally over various aspects of the company goals

and visions along with product development, researches and even issues that have arisen will

educate employees so they know how to handle and respect their customers in an ethical and

non-generic manner.

4.0 Core Problem Stateme

nt

4.0 Core Problem Statement

Consumers of the North American region are not receiving superior customer service as stated in

the LG Vision, which causes retail sales associates and past consumers are alerting others to

avoid purchasing LG products.

5.0 Key Publics

5.0 Key Publics

The key publics for this campaign are very specific in terms of establishing and providing

superior customer service as stated within the LG Electronics vision statement. Three key publics

have been chosen for this campaign. They have been selected based on how they relate to the

overall scheme of customer service and being able to provide informative information in both

directions.

5.1 Employees

Employees are the most important entity for a business. “An ongoing public relations program is

necessary to maintain employee good will as well as to uphold the company’s image and

reputation among its employees (RFB, 2015).” Employees are crucial as they represent both

customers to the company as well as brand ambassadors in upholding company image (vision).

5.2 Retailers

Retailers are the decision makers of carrying specific brands exclusively or concurrently with

other competitors. With the right persuasion, they are able to assist with product promotion and

brand positioning.

5.3 Consumers

Consumers, as with any business that sells products or provide service, are of the utmost

importance. In public relations, the opportunity is given to be able to educate consumers on a

specific cause and create a negative or positive response towards said cause. PR professionals

can also manipulate consumer thinking or behavior via company image created from public

relations efforts.

6.0 Primary

& Seconda

ry Messag

es

6.1 Employees

Specific employees within the organization of LG Electronics are composed of customer service

representatives, field service technicians & support, management and sales representatives

(whether in retail or business-to-business). These employees have direct interactions with

consumers and other businesses as well as knowing first-hand about specific products and

services offered by the company. Management drives the flow of internal communications, as

they are the leaders of various departments. It is a requirement within the code of ethics that

employees are to be treated fairly and to have a respect for human dignity. The employees are

endeavored to keep customers happy by offering customer service that complies with the

company vision. Open communication is encouraged and being cooperative with colleagues of

different departments is the basis of business sharing within LG Electronics. Well-trained

employees in the area of customer services and field services can boost the LG brand through

various measures of product knowledge and crisis aversion. To make the employees feel more

empowered in their communications with customers, they must feel like they have been given all

the necessary tools for effective customer service. These tools come in the form of yearly

trainings on new and/or updated customer service practices as well as constant internal

communications of interdepartmental information sharing. Interdepartmental information sharing

can range from products ideas and progresses to concerns of possible or current product or

service shortfalls. Recalls, how to handle the flood of calls, social media postings and emails in

question of recalls will place the customer service representative in a front line position of public

perception of the company.

6.1.1 Primary Message

Our employees are committed to you first. Your satisfaction is our satisfaction and that is what

makes us a family.

6.1.2 Secondary Messages

Employees are well trained in all aspects of customer related services in order to serve

you better. LG's vision states, "Great people can create a great company, (LGE, 2015)."

We take pride in our products and we take pride in serving you respectfully and properly.

Human dignity is given for both our employees and our customers.

There is no such thing as no in our vocabulary within reason, because we want your

loyalty and your respect. There are times when we may have to say no. If we feel a

product cannot be fixed in a timely manner, there will always an alternative. We are

willing and capable of working with you in order to alleviate any misconceptions or

concerns in our products as well in the quality of the services we provide.

6.2 Retailers

Retailers that carry our products range from stand-alone big box stores to stores located within

the vicinity of a mall and/or shopping district area. Our retailers hold exclusive contracts to carry

our range of products and have the wherewithal to promote our brand in order to boost store

sales. Specifically parties within the retail system are the buyers and executives who make the

decisions of choosing brands that will bring business to their store location. A brand that is

chosen for specific retail stores assists with brand positioning for the manufacturer of products to

be sold. Retail location plays a role in what products are to be sold along with customer needs

and/or wants shown for a region. Depending on area of retail establishment along with target

market specified, retailers can be convinced to carry high-end luxury items to mid-range items in

terms of price associated and expected quality of product type. "Retailers must decide on three

major product variables: product assortment, services mix, and store atmosphere. The retailer's

product assortment should match target shoppers' expectations (ZB, 2013)."

6.2.1 Primary Message

The LG brand can be found at a store near you. Expect what you want, where you want. LG is

committed to being everywhere within our customers’ reach.

6.2.2 Secondary Messages

Brand positioning is important to LG in order to fulfill the vision of "becoming a

worldwide leader in digital - ensuring customer satisfaction through innovative products

and superior service (LGE, 2015)." Without the assistance of retailers carrying the brand

in direct competition with Samsung and other major brands, LG would not be able to

rank themselves as one of the top three brand of electronics, information and

telecommunications.

LG continues to make strives being great in customer service, product innovation and

relationship building with their customers and other businesses.

6.3 Consumers

The consumers of LG consist of individuals who are always looking for the latest and greatest in

innovative products. The North American market can help LG become a global brand that is

highly recognized for service and quality of products sold in the region. LG has to be shown as a

brand and company that the North American consumers can trust. Through various social media

platforms, consumers now have a way to be even more vocal and present their concerns,

complaints and/or good tidings to a wider audience of current and potential consumers of the

brand. With how fast the World Wide Web can provide a consumer with information at their

fingertips, they are expecting companies to be just as fast in responding to any information that is

posted and/or sent directly to the company. Earning the trust of consumers and giving them a

perception of superior customer service falls in line with the vision statement that addresses

superior service.

6.3.1 Primary Message

The customer deserves the best in product quality along with superior customer service. You are

our voice in terms of brand recognition and positioning against our competitors. You also expect

us to stay true to our vision and to respect your time so that the money you spend is an

investment into your well-being with quality goods for your home and your family.

6.3.2 Secondary Messages

We listen to our consumers in providing innovative products of the highest quality. Care

is taken in determining new functions in our products and tested to ensure standards are

met and exceeded.

Our customers always come first and that type of service starts with qualified employees

to assist in every aspect of the consumer decision in purchasing our products. A

consumer should never have to hear the word "no" unless a situation is beyond our

control and the only way to resolve and/or overcome a potential backlash is to use every

method to make our customer happy.

A happy customer will look beyond any flaws and keep coming back to us for their

products because they know that we stand behind our products by providing the best in

customer service needs.

Our customers are our family; therefore, you are always treated with the utmost respect

as we listen carefully and create resolutions that fit your needs.

7.0 Campai

gn Goal(s)

7.0 Campaign Goals

1. Establish North American customer relationships to increase brand positioning to the #2

spot.

2. Realign North American public perception of LG Electronics in terms of customer

service standards.

8.0 Campai

gn Objectiv

es

8.0 Campaign Objectives

Establish/revise customer service training program updated on a yearly basis to coincide

with research related to consumer behaviorism. The program will be implemented in the

North American region within 4 months of the start of the campaign. Consumers change

their shopping behaviors and platforms of communication, as often as technological

updates. Not only do employees need to participate in the training program each year, but

also they need to have an awareness of circumstances surrounding any actions they take

that can harm the company image. Miscommunications and/or unresolved issues result in

a disgruntled consumer. The program shall be a 24-hour training taken over the course of

3 days. Employees that are specifically in customer service via telecommunications,

digital platforms or in-person communications will be required to take an additional 16-

hour supplemental training course. This is to ensure employee reiteration of company

overall vision and goals as well as ensuring that employees adhere to the standard of

providing superior customer service to all.

Increase consumer trust in the LG brand by 5% in a 3-month period. LG will reach out to

past consumers and ask them to participate in a mock testing environment, whether it is

online, via telephone or in person. The consumer will be offered a $100 gift card

incentive for their participation. Consumer has direction to revive a past personal

experience of reaching out to customer service representatives and posing a compliant

and/or concern with products purchased. The employee(s) approached, will not know that

a test (mock) is occurring. Consumers will give feedback on how a customer service

representative alleviated the situation at hand. Consumers will keep informed that

measures are being taken from their suggestions in improving the LG customer service

standards. In this manner, LG is rebuilding trust by showing that they do care about their

customers and not just about selling products.

Increase brand positioning and market share to #2 in a 6-month period in all three areas

of telecommunications, electronics and information. (Currently in #3 position in most

areas.) Once consumer trust is re-established through means of employee trainings and

consumer based mock testing of services, LG will be able to reposition themselves, thus

selling more products. Consumers now feel that they have a voice that is heard and will

not have a problem in making future purchases. Company transparency is an important

factor of re-building trust; therefore, LG will need to show that every effort is being made

in training employees correctly in the area of customer service. When there is an issue

with a product, steps will be taken to alert consumers immediately as well as ensuring

enough measures are taken for a quick and reasonable resolution. There will be no more

lag times in waiting for a live customer service representative, as there will be more

customer service reps staffed to monitor web platforms as well as being available for all

telecommunications.

9.0 Campai

gn Strategi

es

9.0 Campaign Strategies

Strategies by definition tell what LG Electronics set out to do in order to accomplish all of their

PR objectives. They define the approach of planning to achieve the objectives along with stating

in a general fashion how the objective will be reached. Strategies are a long-term device that

does not undergo frequent changes. Strategies fall in line with the overall brand/company vision

and goal. With strategies in place, LG Electronics will be able to define KPIs (Key Performance

Indicators) necessary to track the overall stability, financial outlook, credibility and other

measures that executives use in order to determine the next direction of brand positioning and/or

other focus for company success.

9.1 Employees Strategy

Employees in the North American division, acknowledge training completion via proof of

certificate and testing results to show knowledge of superior customer service. Results are

recorded via intranet and/or at on-site training facility in Roswell, GA.

9.2 Retailers Strategy

Increase awareness of LGE brand and strength in customer service via extensive usage of social

media and free press releases.

9.3 Consumers Strategy

Promote LGE as a family company that cares for both their employees and their customers in

order to create a cohesive relationship that is trusting and responsible.

10.0 Public

Relations

Tactics

10.0 Public Relations Tactics

The tactics of LG Electronics define how the strategy is implemented. Tactics are the planning

portion that reaches a common goal (objective) in order to garner interest by respected parties for

business/brand future and current success. In a general perspective, tactics are the blueprint

necessary to implement a strategy based on an objective.

10.1 Employees Tactics

Conduct research over a 2-week period of various CS training programs and take aspects

that relate to the company vision to create a solid and effective program.

Have HR professionals within LG create and test training program over a 3-week period.

The program is created from prior research conducted. The mock testing will occur with

randomly selected employees over a 1-week period. After testing period, HR will take

results from first draft of program and take suggestions from testing participants in order

to fix any bugs and/or inconsistencies within the program. A second testing is conducted,

this time with different randomly selected employees and consumers given an incentive

to participate. Final views and adjustments are made accordingly. A final mock testing

will be conducted, among executive employees.

To accommodate various employee schedules, the training program will rollout at various

corporate and satellite locations to ensure that all employees go through the initial

training once. New employees will be required to take the training within 2 months of

hiring date. Front line employees that consist of customer service representatives and

field technicians will be required to take the training on a yearly basis, while the

remaining employees will take a shortened version of the training on yearly a basis as

updates to the training program are made to coincide with changing general

consumerism.

10.2 Retailers Tactics

Customer care is shown through ensuring that employees have all the tools necessary to

assist customers with any needs or concerns. It will be shown that communication efforts

with customers are not generic and/or scripted.

A press release is issued to clarify the steps taken to revamp the training program given to

employees in terms of customer care. The news release will give a detailed explanation

on the creation of the new training program. A mini in-house training video will be

released to show examples of the changes and some outcomes of the testing process. This

will draw more attention to the LG brand as well as showing transparency ahead of future

situations. We are showing consumers that there is more to LG than electronics by

showing what the employees go through in order to serve them.

Not many people are aware of LG's press release/newsroom website; therefore, more

emphasis will be placed on using social media to draw more consumers to the website.

This will be accomplished by placing appropriate communications and videos from the

original site to social platforms like Instagram, Twitter, Facebook and even LinkedIn.

LinkedIn will focus more on research and business related video placement while the

remaining sites will appeal to the general consumer of introducing new products and

product function in video format.

10.2.1 Press Release

Contact: Tashia L. BramhanPhone: 803-123-1234E-mail: [email protected] RELEASEFOR IMMEDIATE RELEASE

LG ELECTRONICS, NORTH AMERICAN DIVISION HAS MADE A GRAND REVISION OF THEIR CUSTOMER SERVICE TRAINING PROGRAM

ROSWELL, GA – May 1, 2015—LG Electronics (LGE) Executive HR representatives have made strides in revising their past customer service training standards. The team has researched, created and tested the revised program at great lengths. In order to ensure customer service standards met the needs of their North American consumers, LGE invited 400 customers to participate in various forms of mock testing of the new program. Each customer that participated was given the choice of either an Amazon gift card or Visa gift card valued at $100 USD.

The implementation of the program was given to all employees located in the North American region of all LGE operations. After successful completion, the program was then implemented to the remaining LGE regions. The program consists of a 24-hour intensive training taken over a period of 3 days. The best in customer service practices was borrowed and/or bought from various entities and combined into one conclusive program for the LGE brand. LGE made sure to obtain rights for ideas that were borrowed and bought others to become the new sole owner of said program. LGE values their customers and realized in order to remain competitive against Samsung, Apple and Whirlpool; they needed to place themselves in a position to offer something that was far better and more reliable than their competitors were. A brief demonstration of the full program is offered online through the social media platform of YouTube. Search for LGE 2015 Training Program.

Why is this a big deal for LGE? Well, for the North American region, many consumers started posting thousands of complaints about customer service and LGE products on platforms like BBB (Better Business Bureau) and Facebook. Even though an effort was made to respond, the time in which our customers received a response fell short of expectations. With this injunction, a review of the LGE vision was re-visited and executives made the determination that a change was needed in order to fulfill the LGE vision. Part of the vision statement is to provide superior customer service. The North American region fell short in this very aspect, therefore creating a need for a major overhaul in company transparency and substantiated customer service standards.

Now LGE can be back in the forefront of consumerism and avoid potential backlash because of new practices in place that are of benefit to customers. For example, LGE has collaborated with more local contractors who have also had to take the customer service training as part of their contracts with LGE. In this manner, LGE can now offer JIT service to appease consumer needs.

ABOUT LG ELECTRONICS

LG Electronics, Inc. is a global leader and technology innovator in consumer electronics, mobile communications and home appliances. Founded by Koo In-Hwoi on October 1, 1958 in Seoul, S. Korea,

LGE employs over 83,000 people. LG received the Energy Star 2014 Partner of the Year award and 2014 global sales ended at 55.91 billion USD (59.04 trillion KRW). (1LG, 2015)

For more information, contact Tashia L. Bramhan, at [email protected]

10.3 Consumers Tactics

Create a basis of complete customer care by showing the strength and capabilities of the

North American employees through various means of training programs. Create an

environment of customer comes first that is not scripted or generic in consumer

communications responses.

As part of the employee training program, establish the "Never say No to customers'"

rule. Whenever a customer calls in with an issue over a purchased product, employees are

instructed to respond in a respectful and caring manner. This means that the word "No"

should never be used unless a fix is unreasonable and therefore replacement of product

and/or refund and product removal is necessary as the final resort.

The customer will be shown that all measures of resolution have been taken in one phone

call with maximum of two phone calls when repair work is involved. A collaboration

with reputable repair services will be in place in order to respond in a timelier manner.

There will be a JIT (Just in time) service in place that allows customers to acknowledge

when they are available to accept in-home services if needed, and to get a field technician

and/or contracted service members to the home in a shorter period.

Recruit and train more than enough employees to cover front line communications,

especially in adverse situations that may or may not occur. In this manner, customers will

no longer have extended wait times on automated telecommunications systems, as they

will be able to reach a human respondent within 1-4 minutes max. The e-commerce site

offers instant availability to customers; therefore, the telecommunications system is due

for a major overhaul in order to be compliant with the company vision of superior

customer service. The North American region currently houses the largest number of

complaints. Therefore, recruiting and training more front line employees along with

departmental cross training will benefit the overall bottom line for the business.

To regain the trust of past consumers who experienced poor customer service, through

the company, some random customers will be selected to participate in mock training

efforts. This testing will be part of the training program created in the first year to ensure

customer service responses and solutions are realized more effectively. This will also

alert past consumers that every effort is being made to change past negatives in to a

positive. The consensus is that once customers realize that LG truly cares about their

customers, customer loyalty and trust will be earned.

11.0 Calendar of PR Activitie

s

11.0 Calendar of PR Activities

The calendar and budget for LG Electronics is based upon current and future needs for the

overall success of LGE. Most costs represent little to no costs because of training systems and/or

facilities that are already in place for LGE. The entire plan and budget references the North

American division only as this is the main area of focus to improve upon customer service

standards and concerns. For LGE there is a training academy located in Roswell, GA. This

facility opened on December 11, 2008. The area of focus for training at this facility is engineers,

contractors and technicians. The time has come, because of recent customer complaints within

the North American division, to revise current training standards to include those of the customer

service sector within LGE. The beginning and ongoing process of this training project will be

conducted and implemented by the HR team in North America. Therefore, costs associated with

the training program are internal. Employees within 100 miles of the Roswell, GA training

facility will attend classes at the center. All others will access training courses via intranet

resources.

Upon successful reviews via mock testing and initial North American implementation, the

training will then be available to the remaining divisions of LG Electronics to create a new

standard of customer service training globally. We have found it is more cost effective to keep

training in-house instead of outsourcing, as it is less expensive. HR employees and researchers

within the LGE family already receive salaried pay, therefore, extra monies within the budget are

not necessary to conduct the research needed as well as revising and/or adding to the training

program in place for customer service needs.

A revised, training program for customer service is necessary because of the constant complaints

by North American consumers. Customer service training is only given to those employees hired

specifically for customer service but with the overage of complaints, the training is needed by all

employees. Compliance of customer service standards is necessary for all departments within

LGE along with interdepartmental communication. Having all employees cross-trained on

customer service, assists with company image and employee/employer responsibility to the

customer.

Following is a matrix of the current training offerings and employees related to trainings taken.

Current LGE training roadmap (LGE, 2015).

12.0 Budget

12.0 Budget

For comparison purposes, the cost to train approximately 83,000 employees utilizing a training

platform like Quality Training Portal would amount to $4, 067,000 USD. The cost per every 250

employees through QTP is $12,250 USD (QTP, n.d.). To assist in the efforts made by HR, the

cost per employee will be $25. This cost is transferrable internally as it would already be part of

departmental budgets for the fiscal year. The HR cost center would receive all training costs per

employee from other LGE departments. The estimated cost transferrable to HR is $2,150,000,

which also accounts for estimated 3,000 new hires globally.

From the 2014 Final Separate Financial Statement, 4th Quarter, the total for Selling & Marketing

Expenses was 9,505 Billion KRW (8,734 Million USD). Total estimated costs for plan

implementation is $200,049 USD. These costs include $40,000 USD in $100 USD gift

certificates used as an incentive to garner customer participation during the mock testing process

of customer service training and $8,000 USD per 50 jobs posted on Careerbuilder.com. Postings

via LinkedIn are free with Premium membership, which LGE already owns. Press releases, store

visitations, research and revisions are all aspects of the plan that can be obtained with no cost to

LGE.

From the $8.7 million USD spent in the previous year for marketing purposes, this PR plan

would only account for 2-3% of overall marketing budget.

13.0 Evaluation Plan

13.1 Evaluation Criteria and Tools

The objectives for LG Electronics have benchmarks that can be used to properly utilize tools

needed for campaign evaluation and progress. The customer service and training issue involves

the North American sector, therefore the benchmark for these two entities are from the Asian

sector. The Asian sector experiences the company vision of providing superior customer service.

With customer service, sales numbers provide a key look into the success of campaigns. A

benchmark of 2 years of sales in the Asian market versus the North American market is needed

from the first half of each fiscal year. We will evaluate the first half of the fiscal year in the

North American sector, to determine whether the training and customer service campaigns have

made a difference in sales versus prior years in their own sector and then compare those numbers

to that of the Asian sector. In order to utilize sales figures correctly, a measure of increase and/or

decrease in sales from previous years is necessary. For example, in year 2014, the North

American sector showed an increase of sales in the 1st month of the year at 2% over year 2013. In

year 2015, after campaign introduction, sales increased at 3.5%, therefore an increase of 1.5%

occurred over the previous 2015 sales figures.

13.2 Objective 1

Criteria

Training program recreated to adhere to today's consumer and public needs taken by all

employees no later than March 30th on a yearly basis or upon 1st month of employ with the

organization.

Tools

Copies of certificate of completion digitally recorded in employee database in order to ensure

100% participation. Yearly notices sent to employees to remind of training course as well as

signed copy of employee understanding of definition of company vision and current and past

goals. Intranet database will automatically record employees training progress as well as send

yearly reminders when updates are made to the program.

13.3 Objective 2

Criteria

Consumer trust in LG brand increases 5% by March 31st.

Tools

Before campaign, mock trial of new customer service standards will be tested and revised as

needed after consumer survey. Survey is sent through three platforms: email, text message and

standard mail. This is conducted on a yearly basis as employee training is conducted and revised

yearly. Social media tools to count number of posts and/or views on Facebook for LG

Electronics USA and Twitter. Each post/comment online will be tallied and categorized into

positive, negative or neutral points. The previous year comments will be tallied in the same

manner to have a benchmark. Throughout the campaign, a survey will be given via email link

each week to gauge what is working for or against LG. Randomly, chosen respondents will only

be given 4 days to complete the survey in order to have the time needed to evaluate and revise if

necessary. It will also give the research team valuable information needed to assist in other areas

of the company as far as product updates and other customer service concerns.

13.4 Objective 3

Criteria

Brand positioning and market share increased to #2 over all sectors/divisions by July 1st.

Tools

Random phone and email surveys will be given to current customers and potential customers

who sign up for notifications of promotions and sales. Statistical analysis provided by a company

like Brand Tool Box will provide information on brand assessment and positioning. One of the

analyses provided is derived importance analysis. This is an analysis that is "performed to

determine which brand attributes are most highly correlated with the overall impression of and

satisfaction with the organization (BTB, n.d.)." Another essential analysis is the factor analysis.

This analysis defines "how the brand attributes are grouped together (BTB, n.d.)." There is as

final analysis conducted that gives insight on brand ranking and helps LG determine the best

route in gaining brand positioning.

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