Samsung Electronics and LG Electronics are targeting end-of-the-year busy season for TVs. They are going to lower their prices so that consumers can purchase their premium TV products and increase their productions in order to respond to demands for Black Friday. It is expected that they will both have positive performance from their TV businesses during fourth quarter.
According to industries on the 1st, Samsung Electronics and LG Electronics have started to lower prices of their products with North American markets at the center. Best Buy, which is the biggest home appliance retail store in the U.S., is selling Samsung Electronics’ 55-inch QLED TV at $1,599, which is $400 discount from its original price. Range of discount is bigger for large-screen TVs. 75-inch QLED TV is currently being sold at $3,499, which is $1,000 discount from its original price at $4,499.
LG Electronics is also giving huge discount of their TVs. 55-inch OLED TV (OLED55C7P) can be purchased at $1,799, which is $1,200 discount from its original price at $2,999. LG Electronics is giving up to $5,000 in discount for its large-screen OLED TVs.
Situation is also similar on Amazon. Samsung Electronics’ 49-inch QLED TV, which is usually sold at $1,299, is currently being sold at $997. It is rare that QLED TV, which is part of premium TV products, is sold under $1,000 even though this one does not have a large screen.
“We discuss with TV manufacturers such as Samsung Electronics and LG Electronics when we decide on prices of TVs for online and offline sales.” said a representative of an industry. “This indicates that these manufacturers are officially working on marketing and giving huge discounts in order to prepare end-of-the-year busy season.”
Busy season for TVs starts in November for North American markets as number of demands for home appliances including TVs increase rapidly during Thanksgiving weekend (19th) and Black Friday (24th).
Traditionally, TV manufacturers go after markets by greatly lowering prices of their products during this time. Not only manufacturers can maximize sales volume of their TVs during fourth quarter but they can also sell everything on stock before releasing their new models in the following year. Busy season continues until Christmas (25th) and Boxing Day (26th).
Samsung Electronics sold 10 million TVs during third quarter and is expecting that its fourth quarter’s sales volume will be at least 30% higher than that of third quarter. This indicates that it will be able to sell at least 3 million more TVs and it is also expecting an increase in output of its TVs. According to a market research company called IHS, it is estimating that LG Electronics shipped out about 6.7 million TVs during third quarter and it is estimating that LG Electronics will ship out more than 7.68 million TVs during fourth quarter. LG Electronics is going to respond to increased demands by increasing its output with its strategic product OLED TV at the center and it is also going to reinforce its promotion and marketing.
It is expected that this upcoming busy season will contribute positively for fourth quarter performance of Samsung Electronics and LG Electronics. Samsung Electronics’ CE (Consumer Electronics) Business Area, which is responsible for TV business, made $395 million (440 billion KRW) in operating profit during third quarter. LG Electronics’ HE (Home Entertainment) Business Headquarters made $411 million (458 billion KRW) in operating profit during same time. This is the first time LG Electronics’ HE Business Headquarters made more than $359 million (400 billion KRW) in quarterly operating profit. There is a possibility that they will be able to make their biggest quarterly operating profit during this fourth quarter.
One of their tasks is to keep its distance from foreign competitors that are also looking to sell their products at low prices during upcoming busy season. According to an American consumer media called Consumer Reports, TV manufacturers such as Sharp, Toshiba, and Visio are also preparing to greatly lower prices of their products for Black Friday. Consumer Reports is predicting that there will be 55-inch 4K TV that will cost around $250.
“Samsung Electronics and LG Electronics will be able to differentiate themselves from other TV manufacturers as they are going after busy season with their premium products.” said a representative of an industry. “Their clear advantage is that consumers will be able to purchase their premium products at reasonable prices.”
Staff Reporter Kwon, Dongjoon | dkwon@etnews.com