LG mobile devices and market position

LG Mobile Company operates in a highly dynamic environment and competitive environment. Demand is sensitive to the general state of the economy. In times of recession, demand falls. The economic outlook is relatively poor for many markets, and this could suppress LG's mobile revenues. The company does not have any significant advantage. In the core Korean market, it has a strong competitor in Samsung. Other key markets are even more competitive. LG's products are average and its pricing also fails to give it a source of competitive advantage. The company's other business lines can, however, help to insulate the company from swings in the mobile market, more than competitors that only operate in mobile devices.

Another threat is represented by the rapid advancement of technology, which forces LG to invest large sums of money into product development. While LG has the capital to make these investments, so does the majority of LG's competitors (Samsung, Apple, HTC, Sony, etc.). These investments reduce the margins on mobile products. Combining with rapidly changing technology is rapidly changing consumer demands, which force the company to constantly invest in innovation and to keep up with the market leaders.

At the level of opportunities, the first of these is innovation. Industry leaders are able to gain market share and can charge more for their products. LG has good innovative capabilities, but again is in the middle of the industry in this aspect. The company lags the industry leaders, but is able to catch up quickly. Geographic diversification is another opportunity, as there are many growing mobile markets in the developing world. However, margins are tight in these countries and there is intense competition as all major competitors have the ability to enter these markets as well.

At the level of internal features, the most important strength is that LG Mobile is within the LG chaebol. This gives the Mobile unit access to the parent company's financial capabilities, including its borrowing capacity and rates. However, major competitors like Samsung and HTC also enjoy the benefits of the chaebol system; Sony enjoys similar advantages in Japan and American firms like Apple have vast resources as well. LG has a strong brand, as do most of its competitors, although the brand enjoys specific advantages in Korea where it has been known for decades. This is an advantage LG has in the domestic market over foreign competitors.

In terms of weaknesses, LG is a latecomer to the mobile industry. This has put LG at a technological disadvantage. Its tablet, for example, underperforms those of competitors in their price range. LG will need to invest more heavily in technological development in order to catch up to competitors in this part of the business. The company will need to improve its hiring and invest more money into research and development in order to close this gap.