Blue Ocean Strategy - Hello LG, Prada calling!

Blue Ocean Strategy - Hello LG, Prada calling!

Untapped value is often hidden in complementary products and services. The key is to define the total solution buyers seek when they choose a product or service. (Blue Ocean Strategy, p. 65)

In the movie The Devil Wears Prada, Miranda Priestly says that fashion is inevitably created by a handful of select individuals, and then trickles down to the masses. Similarly, the team at LG understands that design and fashion ultimately affect lifestyles, and, thus, drive profits.

And, judging by the initial splash made over the LG Prada phone, they also understand that people are willing to pay premium prices for goods or services associated with a lifestyle sector they aspire to (indications are that the phone will start at an eye-popping $500+).

“We are creating a new market," says Chang Ma, a vice-president with LG's mobile communications unit. "Design has become a good enough factor for consumers to choose their phones."

LG is a very committed practitioner of Blue Ocean strategy and their most recent success with design in the mobile telephone sector was with its candy bar-like ‘Chocolate’ Phone. Prized for its simple, elegant design giving way to workhorse-like digital features, the Chocolate has become the best-selling model LG has ever introduced. In fact it turned LG's money-losing mobile phone business around, posting an operating profit of $148.2 million in the second half of 2006.

Be sure to stay tuned as we continue to chart the waters of LG’s Blue Ocean Strategy successes. We invite you to share your stories of companies having a significant impact through lifestyle enrichment. Share your story with us!