LG Electronics to boost direct-to-customer business to attract young consumers

[Photo by Park Hyung-ki]

LG Electronics Inc. has recently undergone a reorganization, intensifying its efforts in the direct-to-customer (D2C) business, with an aim to reduce intermediary retail costs, increase profitability, and secure loyal customers.

According to sources on Wednesday, LG Electronics has centralized its previously dispersed online D2C business units under the newly formed “D2C Business Group.” The group will oversee online platform development, operations, and online marketing.

The unit is currently headed by Vice President Chung Soon-ho. Prior to joining LG Electronics in August 2021, Chung spent 17 years at Nike, where he was responsible for the online business. After joining LG Electronics, he led online sales for the Home Appliance and Air Solution (H&A) division.

This restructuring aligns with the strategic vision of LG Electronics CEO Cho Joo-wan, who stated at the shareholder meeting in March that the company would focus on nurturing its online D2C business.

LG Electronics has already taken steps to target young consumers by selling home appliances online earlier this year. Notably, the “brid.zzz,” a product designed to improve sleep quality, was released in July and is available in the company’s online brand shop.

The company has also introduced “UP Appliance 2.0,” a feature that allows continuous post-purchase updates through a mobile app, which was initially exclusively available for sale in the online brand shop for two months. Products like the all-in-one washing and drying machine “Trom WashTower Compact” and “Stanby ME” were also sold on the official website before their offline store launches.

Previously, these products were typically available in LG Electronics’ Best Shops and other offline retail locations, but the company has expanded its online presence recently.

In January, LG Electronics opened an online-only shopping mall for its beauty appliance brand, Pra.L. This strategy focuses on online marketing, considering the trend of word-of-mouth marketing leading to actual product purchases. LG Electronics plans to expand its online shopping mall to include skincare and cosmetics alongside Pra.L starting in the first half of next year.