Design innovation: LG`s formula for success

Say goodbye to iPhone look-alikes.
LG Electronics, seeking to set a new design trend in touchscreen phones, has launched a new handset with a distinctive screen aspect ratio of 21:9. The New Chocolate phone is the world`s first handset with the 21:9 cinema format, which the company said is ideal for watching movies and browsing the Web.

Design boosts brand image

The upcoming phone is the latest innovation in LG`s phone design, which has helped the company shrug off its past image as a manufacturer of cheap phones and develop a premium brand.
Its enhanced brand image has helped boost its sales, with the Korean company overtaking once-mighty rivals Sony Ericsson and Motorola late last year, becoming the world`s No. 3 maker of handsets.
LG has strived to surprise consumers by introducing iconic products with unconventional design.
Company officials said the New Chocolate phone also addresses the needs of consumers who want to enjoy high-resolution movies on the move. The new phone allows users to view movies in full screen, without the black bars seen in a traditional 16:9 screen aspect ratio phone.
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Landmark Chocolate phone

The New Chocolate phone is a sequel to the company`s hugely-popular Chocolate Phone launched in 2005. The latest model is also the fourth edition of LG`s premium Black Label series, which have greatly contributed to the company`s efforts to build a premium brand.
The Chocolate Phone, the first model of the Black Label series, gave a fresh growth momentum to the company`s then slowing handset business. The Chocolate slider phone gained huge popularity, thanks to its simple, yet stylish design; it featured a shiny black casing and touch keypad, the world`s first for mobile phones.
Its sales reached more than 20 million units so far, making the phone one of LG`s best-selling phones. At the time of its launch, LG`s handset business was suffering from losses. However, the Chocolate phone has helped turn around LG`s ailing handset business.
The Shine, the Chocolate phone`s successor, also sports a stylish, full-metal body, and its sales passed 13 million units. LG`s third model of its Black Label Series, Secret Phone, features a classic and enduring design, and its sales stood at 2 million units.

Design-, consumer-focused products

In 2007, LG reclaimed its design leadership by launching the world`s first full touchscreen handset, The Prada Phone. Jointly developed with Italian designer brand Prada, it posted sales of more than 1 million units despite its hefty price tag. The Prada 2 was also rolled out last year.
LG`s wearable Watch Phone, which was released in Europe early this month, has also created buzz among the media and tech-lovers. The phone is the world`s first touchscreen watch phone which features video calling and other 3G capabilities.
In Korea, LG`s design-focused phones include the clamshell phone Lollipop, which has 220 light-emitting diodes on its front that allows the phone to display up to 22 different emoticons. The phone`s sales reached nearly 500,000 units since its launch in March this year.

Design management

LG Electronics` focus on design is in line with its parent LG Group`s design-oriented management. Since declaring "design management" in 2006, Koo Bon-moo, chairman of LG Group, the country`s No. 4 conglomerate, has put a great importance on design, increasing investments and personnel in the area.
Last year, LG Group spent 100 billion won on design management, up from 88 billion won in 2007 and 78 billion won in 2006. The number of designers also rose from 640 in 2007 to 700 last year.
"LG should lead design trends," Koo said in a meeting with the group`s top executives in May.
LG`s Design Management Center has recently moved to the electronics giant`s research and development center, to help create synergies between design and R&D.

Design innovation drives growth

Its design- and customer-oriented management greatly contributed to the company`s fast rise in the global market.
The company beat Sony Ericsson and Motorola last year to become the third-largest player in the mobile phone market.
In the second quarter, LG solidified its No. 3 position with its handset shipments jumping 32 percent quarter-on-quarter and 8 percent year-on-year to a record 29.8 million units. This came even as the global handset market slumped 6.1 percent during the May to July period as the economic downturn dented consumer sentiment, according to market research firm Gartner. It achieved a 10.7 percent market share, up 0.8 percentage points from the previous quarter. Ahn Skott, president of LG`s mobile communications unit, recently said the company would be able to achieve its annual market share target of 10 percent. By 2012, LG aims to overtake its chief rival Samsung Electronics as the No.2 handset vendor.
(hjjin@heraldcorp.com)

By Jin Hyun-joo