The global home appliance market has entered a lull. The COVID-19 boom has vanished, and growth in key items such as refrigerators, washers, and air conditioners has slowed. Even for LG Electronics, the No. 1 player in appliances, it has become difficult to spur purchases with spec races or quality promotions alone. LG Electronics' answer was "variety content."
In Aug. last year, LG Electronics teamed up with Amazon Prime, an online video (OTT) platform in the United States, to produce its own reality show "House of Survival." The program placed contestants in a home without appliances to maximize inconvenience, and awarded one LG appliance at a time when they cleared missions. By contrasting the problems that arise without appliances and scenes of immediate improvement after introducing products, it explained "why appliances are necessary." Right after release, the program topped viewing time in the reality genre on LG Channels in the United States, becoming a hit.
The content tackled head-on the challenge facing LG Electronics. With the question of "why replace" becoming critical for consumers who already own appliances, it was designed to let them experience everyday inconveniences, time savings, and stress reduction that are hard to convey in ads. By foregrounding tangible necessity over feature descriptions, it aimed to reawaken replacement demand in the North American market.
In Korea, it fully sponsored the Netflix cooking variety show "Culinary Class Wars Season 2," which will be released soon. Chefs will use LG ovens, cooktops, and refrigerators in real cooking processes, and scenes showing problems solved by product features during cooking are set to be introduced. LG Electronics participated in Season 1 with production support (PPL), but in Season 2 it expanded its role as an official sponsor. Dozens of products from the premium LG Signature and Objet Collection lineups will be placed throughout the set, promising real-use promotional effects.
Facing stalled growth in its appliance business, LG Electronics is accelerating restructuring of its TV business and expansion of its ad platform. As it became harder to secure revenue through TV sales alone due to low-cost offensives from Chinese makers, it is nurturing its webOS-based FAST (free ad-supported TV) service "LG Channels" as a global growth pillar. As of Mar. this year, global viewing time for LG Channels rose more than 40% on-year, and the number of channels expanded to 4,000. The service has grown to 36 countries, and cooperation with global content corporations such as NBCUniversal, BBC Studios, and Sony has been strengthened.
The MS Business Division in charge of the TV business posted an operating loss of 191.7 billion won in the second quarter alone. Revenue (4.2934 trillion won) fell 13.5% from a year earlier. In contrast, webOS platform revenue topped 1 trillion won last year, emerging as a new cash cow. LG Electronics announced plans to integrate display-based businesses not only in TVs, but also laptops, monitors, and commercial displays to expand advertising and content revenue. In-house content production like "House of Survival" aligns with this platform strategy.
Industry watchers said LG Electronics is shifting from a simple appliance seller to a new business model that combines content and an advertising platform. In a period of appliance stagnation, explaining "why appliances are necessary" through content and growing an ad platform instead of relying on TV sales shows its intent to revamp its business structure.
While the reach of the content and its purchase conversion impact remain to be proven, one trend seems clear. LG Electronics is moving away from listing product features and toward staging the experiences that appliances change. Attention is on whether these attempts can shake up the stagnant global appliance market.