LG Electronics puts focus on customers to drive growth

LG Electronics Inc., transitioning into a smart life solution platform company from a simple white goods manufacturer, will enhance its customer-centric approach to take another leap forward after enjoying a stellar 2023.

According to the electronics industry on Sunday, the South Korean electronics giant will review about 300 of its executives’ performance in meeting customer expectations and innovating customer experiences starting this year.

Customers include not only general consumers but also company affiliates and executives' business partners inside and outside the company.  

This is the first time for a Korean conglomerate to evaluate executives’ performance in a customer satisfaction metric, underscoring LG Electronics’ bid to become a life solution platform company that can win over customers and deepen loyalty with innovative customer experiences under the direction of its chief.

Last summer, LG Electronics Chief Executive Cho Joo-wan unveiled the company’s bold vision to achieve 100 trillion won ($75 billion) in annual sales by 2030, nearly doubling last year's figure by transforming into a smart life solution provider that connects an array of consumer experiences.

He urged its employees to reinvent the way the company works and communicates for “a brand-new LG.”

CUSTOMERS COME FIRST

The CEO, also known in the West by his English name William Cho, has been advocating the importance of customer experiences in innovation since he took the helm of the company at the end of 2021.

“CEO Cho strongly believes that the company will be able to achieve its Vision 2030 with strong customer-centric management,” said an official at LG Electronics.

Cho has been urging executives and rank-and-file employees to think outside the box, beyond a manufacturer-focused mindset.

The company’s executives are encouraged to reach out to consumers in person to better hear their demands and understand their needs. They are expected to actively participate in sales, delivery and after-sales as well as maintenance services through various events this year.

LG Electronics has already developed a tool to measure customer satisfaction levels to score its executives’ performance.

The executives will also be evaluated for their achievements in developing measures to innovate customer experiences.

The company official said the customer satisfaction score will be one of the key performance evaluation metrics for executives.

A customer-centric approach is a business strategy that puts customers first when making decisions in delivering products, services and experiences to create customer satisfaction, loyalty and advocacy.

STELLAR APPLIANCE SALES

LG Electronics reaped 84.23 trillion won in sales on a consolidated basis in 2023, posting record annual sales for three years in a row thanks to robust sales of home appliances and vehicle components, the company announced earlier last month.

Its home appliance and air solution (H&A) division saw another record-setting year with more than 30 trillion won in revenue, boosted by robust sales of a suite of high-end consumer goods sold under the LG Objet Collection brand.

Thanks to the brisk sales, LG Electronics has consolidated its lead over Whirlpool Corp. as the world’s top home appliances maker.

LG Electronics is betting on artificial intelligence, the Internet of Things and other state-of-the-art technology to remain competitive in the home appliance market.

Write to Jeong-Soo Hwang at hjs@hankyung.com

Sookyung Seo edited this article.