Reasons LG Smartphone Division’s Exit Has been Long Anticipated

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LG Electronics has hang its boots on smartphone manufacturing and sale after the division after failing to settle on a buyer, making the smartphone pioneer first major brand to take an exit. The company has recorded over five years of losses now clocking $4.5 billion.

The closure comes after 26years of operation being the third largest smartphone while at its peak after Apple and Samsung. The smartphone division only accounts for 7% of the company’s revenue and has only 2% global share.  its closure was long anticipated following shortcomings both in the market and manufacturing part, here are core reasons why LG smartphones had to leave.

Software and Hardware Mishaps

Early to the market and one of the most innovative smartphone manufacturers, LG took the market by storm after unveiling high technology phones and unique at that. The company however dropped the ball and began derailing software and hardware updates. LG lacked consistency and effectiveness in both software and hardware updates giving brands like Samsung and Apple an upper hand in the market.

Lack of ready hardware parts

Hardware malfunctions and faults have for a long time suffered lack of ready parts in local markets making it hard for repairs and enhancements. For instance, changing your smartphone’s keyboard could take weeks to even months in the name of ‘delayed shipping’. Over time, the reluctancy then drove consumers to other brands with available solutions sinking its globe share further.

Lack of customer confidence

In Kenya for instance, LG smartphone shops were scarcely distributed leaving LG smartphone owners with few options to consult and access solutions from. Beyond smartphones, winning customer confidence is vital and providing customer service is important for after sale queries.

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Poor Marketing

LG’s marketing on home living and office equipment is adequate if not excellent, compared to that of its smart gadgets. The LG smartphone division did not do justice to its product on the ground hence unrecognition to many and therefore lacking appeal to potential consumers. The Chinese manufacturers on the other hand have painted cities with advertisement from high end to middle and even feature phones, acquiring a big name and popularity over time.

Sidelined markets

The LG smartphone division chose to overlook other markets such as the African market in launches and gadget promotions compared to other divisions in the company and major smartphone manufacturers. Devices hailed in other markets are hard to find in Kenyan shops. Dealers are unable to keep up with distribution leaving most of them no option but to shut them out while stocking. Sellers have also raised alarm on the slow sales due to inadequate marketing and lack of popularity.

Following the exit, the company will be moving the division’s employees to LG Electronics business and affiliates in its South Korean head quarter. Other employees will be subjected to decisions made on a local level. The company is said to be retaining its 4G and 5G core technology patents as well as core R&D personnel.

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