Marketing Mix Analysis of LG Microwave Oven of Butterfly

Marketing Mix Analysis of LG Microwave Oven of Butterfly

The vital objective of this report is to analysis Marketing Mix Analysis of LG Microwave Oven of Butterfly Marketing Limited. Other objectives of this reports are to understand the marketing functions of the company and find out the efficiency and effectiveness of existing Marketing system. Here also analyze the competitive market share of Microwave oven and identify the marketing problems faced by Butterfly. Finally evaluate the present performance of LG Butterfly in microwave oven in comparison with other major competitors.



The specific objective of the study is given below.

  1. To understand the marketing functions of the company
  2. To find out the efficiency and effectiveness of existing Marketing system.
  3. To analyze the competitive market share of Microwave oven.
  4. To identify the marketing problems faced by Butterfly Marketing Limited in case of Microwave oven.
  5. To evaluate the present performance of LG Butterfly in microwave oven in comparison with other major competitors.


Historical Background of LG Butterfly

Butterfly Marketing Limited is a leading marketing company in the field of electronics home appliances in Bangladesh. Since 1987 Butterfly marketing Ltd. has been continuously making progress surfacing newer grounds and surmounting higher goals. They started their business with only 3 showrooms but now they have 136 showrooms and 80 distributors in Bangladesh.  Butterfly marketing company limited is providing customers with high technology involved electronic home appliances with cash or hire purchase. For long time, business collaboration with LG electronics Inc in 1997. People Republic of Korea, Hansong Enterprise Ltd., Peoples Republic of China Butterfly Marketing Company Ltd. has achieved reputation through offering the quality product.

The origin of Butterfly is in China. In Bangladesh, the company was founded in 12th July 1987, to produce electronic consumer products. It merged with several companies (LG, Kelon ) and added several products in the product line. The establishment of LG was in South Korea in 1958 as Gold star. In November 1959, Korea’s first Radio produced. Then in November 1962 first Telephone set produced. Korea’s   first Refrigerator was Produced at January, 1965, and 1966, first black & white Television was produced. In March 1968, Korea’s first Air conditioner was produced. Korea’s first overseas branch was established in US in September, 1968, In 1978, sales subsidiary was established in USA. The company changed its name from Gold star to LG electronics Inc. in Marsh 1995, The company LG vision was declared in  July 1999 In 75% of its sales (Plasma display ) 60” TV is launched. LG Electronics makes over 75% of its sales overseas. Establishing facilities in 27 countries for manufacturing, sales & marketing, logistics, R & D, design, and customer services, LG has put together a global network of 54 subsidiaries and offices with 50000 global employees. In Butterfly Marketing Ltd, the numbers of employees are about twelve hundred.


Marketing Strategy & Marketing Mix

Marketing Mix

This is a traditional approach to marketing planning which is based on the four Ps:

Product policy:

Product is, in fact, the range of the products (goods or services) that the organization offers to the marketplace. Decisions have to be made about quantities, timing, product variations, associated services, quality, style and even the packaging and branding.

Price policy:

Price is a vitally important decision area because although it is a promotional tool in many respects, it is the main source of income to the organization. If prices are lowered for promotional purposes, the case flow within the company, and its long-term profitability, could be seriously affected. As with products, there is normally a range of prices. These can vary according to the quantities bought, the importance of the customer, and the market segment. pricing can be long-term and short-term. pricing can involve discounts, special offers, allowances, credit, and ‘trade-ins’. It is vitally important to get price decisions right.

Place policy:

A business when planning its marketing will ask a number of questions relating to place i.e. ‘through which outlets should we sell the product? How do we physically move the product to these chosen outlets? How far a field do we wish to operate (locally, nationally, or internationally)? Place, or distribution policy, is a massive, complex decision area.

The Marketing mix gives a plan by which to operate to influence and satisfy the buyer/customers. The four Ps approach is not perfect, and is certainly not intended to cover all the marketing activities, e.g. Marketing research, research, of course, is the provider of information for the decisions in all of the four P areas.


Product analysis

A product may be anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need. It includes physical objects, services, persons, places, organizations, and ideas.

Product classifications

Marketers divide products and services into two broad classes based on the types of consumers that use them-consumer products and industrial products.

(a) Consumer products

Consumer products are those that the customer usually buys frequently, immediately, and with a minimum of comparison and buying effort. These products differ in the ways consumers buy them and how they are marketed.

Table: Marketing considerations for consumer products

Types of Consumer product
Marketing considerationsConveniencesShoppingSpeciallyUnsought
Customer buying behaviorFrequent purchase, little planning, little comparison or shopping effort, low customer involvementLess frequent purchase, much planning and shopping effort, comparison of brands on price, quality, styleStrong brand preference and loyalty, special purchase effort, little comparison of brands, low price sensitivityLittle product awareness, knowledge (or if aware, little or even negative interest)
PriceLow priceHigher priceHigh priceVaries
DistributionWidespread distribution, convenient locationsSelective distribution in fewer outletsExclusive distribution in only one or a few outlets per market areaVaries
PromotionMass promotion by the producerAdvertising and personal selling by both producer and resellersMore carefully targeted promotion by both producer and resellerAggressive advertising and personal selling by producer and reseller

(b) Industrial product

Products are those bought by individuals and organizations for further processing or for use in conducting a business.

According the above definitions, Microwave oven should be categorized as a consumer product. As a shopping product, they are less frequently purchased consumer products that customers compare carefully on suitability, quality, price, and style. They spend much time and effort in gathering information and making comparison. They buyers see homogeneous shopping products, such as major appliances, as similar in quality but different enough in price to justify shopping comparisons.


Terms & conditions for Microwave oven-Warranty

Butterfly Marketing Limited guarantees to the customer mentioned as per the details of the unit given for a period of twelve (12) month, commencing from the date of purchase, the repair, if so required at the sole discretion of the company, free of charge any part of microwave oven, provided the company is fully satisfied in its sole discretion about these defects and further provided the mentioned unit is deemed to be still in the possession of and used by the purchaser mentioned.

Types of Microwave oven:

There are three types of microwave oven in LG Butterfly.

  1. Grill microwave oven
  2. Convection microwave oven
  3. Electric oven


Different model and price of LG microwave oven.

Brand nameTypesModelSize (Liter)PriceSale system
LGGrill604A2813490Cash & Installment
LGGrill5644B2713390Cash & Installment
LGConvection808WAR3015990Cash & Installment
LGConvection767W2814990Cash & Installment
LGConvection7645B3019990Cash & Installment
BUTTERFLYConvection900ESL30R2810990Cash & Installment


After sale service

The department does the following thins:

  • Management of after sales service
  • Product service is done by expertise like service engineer and B.S.C engineer.
  • Only own product servicing is done

After sale service is done at free of cost for one year

Table: Opinion about LG Microwave oven and it’s features.

OpinionGoodVery GoodExcellentNo IdeaBad



Consumer Analysis:

Consumers express themselves and communicate with each other through the consumption of goods and services. Understanding how marketing manages its customers represents one half of the analysis. The other half needs to focus on the aims of marketing in respect of its customers. Overriding the commercial aims (for example, increased usage, profit and market share) is that of what marketers are marketing and consumers are consuming. The company that really understands how consumers will respond to different product features, prices, and advertising appeals has a great advantage over its competitors. Consumer purchases are influenced strongly by cultural, social, personal and psychological characteristics. The marketer needs to know what people are involved in thy buying decision and what role each person plays. People might play any of several roles (initiator, influencer, decider, buyer, and user) in a buying decision. Knowing the main buying participants and the roles they play helps the marketer fine-tune the marketing program.

The customer analysis for the product Microwave oven of LG Butterfly Marketing Ltd. has been done through a market survey. And on the basis of that survey customer analysis has been made.

Survey Type: Consumer Survey

Sample size: 120

Income Group: Within Tk.20000-Tk. 40000 and above.

Occupation: Service holder & Business personality.

Social Class: Lower-middle, Middle and upper middle.

Survey Area: Different Location of Dhaka City.

Date of Survey: 1st to 30th of August.

In this case we have gone to the butterfly showrooms (Mohammad pur, stadium market, Kazi Nazrul Islam Avenue, Mirpur, Moghbazar, 756,Shewrapara, Rokya Sarani,Mirpur,Dhaka, 15/4,Mirpur Road, Shaymoli,Dhaka).   for collecting information of consumers . We have collected information from 120 consumers. We have tried our best to cover all levels of customers.


Promotion Activity and Advertisement

Advertising is an evolving business function. It was traditionally used to announce the availability of products in customer, brand building, positioning conveying the USP (Unique Selling Proposition) and so on. In recent years, advertising hag undergone a number of significant changes in both strategy and execution. Most of the consumer product companies have come to the stage where they cannot do business without advertising. It used to be said be that  advertising was the smartest form of communicating without telling the truth. With the cost of  media skyrocketing. and the attention span of the customers shrinking with ad clutter, we cannot blame the advertisers for not giving the entire truth. advertising is a communication tool. In order to be successful. we must develop goals and objectives in  keeping with the communication core of advertising Once we have clearly defined the communication goals, we must then adders the role of advertising within the overall marketing strategy of the firm.

The  advertising campaign

The campaign may be carried out an advertising agency for a large organization. The important starting point is to have clear objectives as to what is to be achieved. The stages in the advertising campaign set out are in a recommended order.

Identify right timing

Timing of the advertising is crucial. Too before the event, and the customers forget; too late and they have bought something else. Seasonal markets need careful timing. A Media Expenditure Plan should be drawn, detailing at what stags of the campaign the money should be spent, and on which media need to be informed first so that stocks will be in the shops when consumers get to hear about it.

Promotion to the consumer: Advertising media

Promotional communication methods consist of advertising sponsorship, branding. Packaging, publicity. Relations. sales promotions and merchandising. They must not offer conflicting messages. Advertising media must be chosen for its ability to reach the right market segments. Perhaps the most significant role that advertising plays is its advertising is its contribution to the creation of brand preference. If the necessary ingredient for advertising is a brand name, then the key to continued successful advertising is a good product. It goes without saying that no amount of advertising will persuade consumers to repeatedly buy a bad product. The Key to successful advertising is to view a product as a bundle of consumer benefits rather than as a physical commodity. Advertising must communicate messages that address major benefits of a product and communicate realistic benefits of consumers. Examples of primary product consideration in establishing advertising goals are:

  1. Brand position within a product category. Products priced at the high end of a category will require different advertising strategies just as advertising for now products will differ from their established competitors.
  2. Product purchase cycle. Obviously. package goods bought on a biweekly cycle. such as groceries will use different advertising approaches than durable goods, such as appliances, which are purchased every 5 ro 10 years.
  3. Product awareness and market position. Product with high market saturation has a much different marketing strategy than others, and it is reflected in both its advertising budget and its creative approach.
  4. Product seasonality. For seasonality, Product is marketed differently.
  5. Short term advertising strategy. Is a particular campaign designed to gain initial consumer trial, encourage higher purchase levels from current customers, or based on the following


Identity the right media

The choice of media is large and rapidly expanding as more TV channels and the new technology of the Internet add to the choice. Selection is therefore critical and must be based in the following:

  • Is the cover to be local, regional or national?
  • Does the overall cost rule out any medium?
  • How many people are reached and at what cost per person?
  • Which social group doses the medium reach?
  • How often con the message is put over- hourly, daily, weekly etc.?
  • Can the message be detailed / how long a life will it have?
  • What is the image/status/prestige of the medium?
  • How important are sound, movement, color, size?
  • Will the results be measurable e.g. Replies to one advertisement?

These are the key questions to be asked when selecting suitable media the lists in the boxes in the diagram have been drawn up in categories in order to help answer this question.


Advertising Pattern of Butterfly Marketing Ltd.

Butterfly’s advertising pattern is the following:

  • Electronic Media (Television)
  • Newspaper
  • Billboard
  • Road sign
  • Purchase of Point

Electronic Media: Butterfly Marketing Ltd. uses B.T.V., Channel I, A.T.N. Bangla, n.T.V for their advertising purpose.

News Paper: Two Major News paper, Ittefaq & Prothom Alo are used for their advertising purpose.


Advertising Agency of Butterfly Marketing Ltd.

Butterfly Marketing Ltd. do their advertising activities through the Nishu advertising agency for specially T.V. media.

Sales Promotion

The techniques of sales promotion are so diverse and widely used that they are part of the promotional programs of virtually every company. Sales promotion is directed to a number different target markets and comes in an array of formats. Despite its many forms, all sales promotion techniques have in common the goal of creating short- term sales. The most frequently used forms of sales promotion are the following

Point- of – purchase advertising

  • Premiums
  • Specially advertising
  • Coupons
  • Sampling
  • Deals
  • Event marketing
  • Sweepstakes and contests
  • Cooperative advertising
  • Trade Shows and exhibits
  • Directories and Yellow Pages
  • Trade incentives


Butterfly’s Sales promotional objectives.

Table. Sakes Promotional objectives of Butterfly

Consumer PromotionTrade and industrial promotion
1.      Matching comp

2.      Increasing amount of purchase.

3.      Combating own corporate purchase and image

4.      Inducing immediate purchase.

5.      Providing distribution sales push.

6.      Stimulating demand push.

7.      Retained established customers.

8.      Reaching specific markets.

9.   Extending effective distribution.

10. Overcoming seasonal patterns.

11. Developing brand awareness.

12. Controlling selling effort.

13. Acquiring marketing intelligence.

14. Inducing consumption of range.

15. Evaluating Media effectiveness.

1.   Extending distribution network.

2.   Meeting competitive activity.

3.   Stimulating showroom/ outlet’s co-


4.   Overcoming seasonal fluctuation

5.   Introducing new product

6.   Opening new accounts.

7.   Increasing average value of order.

8.   Promoting showroom target

9.   Enlisting support from publicity

10. Encouraging advance stock holding.

11. Gaining merchandising support.

12. Purchasing supporting products.

13. Educating for trade.

14. Reclaiming lost or dormant business.

15. Securing media news coverage.


Types of Sales Promotion of Butterfly:

Table : Different types of promotional activities of Butterfly

1.      Consumer incentive

2.      Price reduction

3.      Competition

4.      Personality Promotion

5.   In store and exhibitions demonstration

1.      Trade incentive

2.   Trade exhibition

3.   Showroom promotion

4.   Trade Bouncers

5.      Distribution incentive

6.      Merchandising activities

7.      Competition

8.   Point- of- Sale aids


Channels  distribution of LG Butterfly Microwave oven

“Any sequence of institutions from the producer to the consumer including one or any number of middle men is called channel of distribution”- Mc Carthy.

Producers normally use a number of marketing intermediates for taking their products to users. Marketing intermediaries bear a variety of names such as: sole selling agents, stockiest, Wholesalers, franchised dealers retailers, authorized representatives, brokers/ commission agents and jobbers. All such intermediaries constitute the distribution channel. The depots/ show rooms and other direct outlets of producers also form part of distribution channel.


Role and Importance of distribution Channel’s

Distribution channel’s play a pivoted role in the successful marketing of most products especially consumers products.

Channel Perform a wide variety of functions

The importance of distribution channels can be understood clearly by analyzing the wide verity of function performed by them.

  1. Channels provide distributional efficiency to manufacturers.
  2. Channels supply products in required assortments.
  3. Channels provide salesmanship.
  4. Channels help merchandise the products.
  5. Channels help implement the price mechanism.
  6. Channels look after physical distribution and financing functions.
  7. Channels decision have a vital bearing on decision on other areas of marketing.
  8. Channels act as change agents and generate demand.
  9. Channel levels.
  10. Channel members.
  11. Channel length.


Butterfly’s Channel of Distribution:

Company must decide on the best way to store, handle, and move their products so that they are available to customers in the right assortments, at the right time, and in the right place. Logistic effectiveness will have a major impact on both customer satisfaction and company costs. A poor distribution system can destroy an otherwise good marketing effort. Butterfly Marketing Ltd. is maintaining the following distribution channel under the direct supervision of logistic department through authority to maintain the product property and to reach the final consumers.


Physical Distribution:

Physical distribution looks after physical handling of goods, and assures maximum customer service. It airs at offering delivery of right goods at the right time and places to customers. Physical distribution activities cover.

  1. Order processing
  2. Handling of goods.
  3. Inventory and
  4. Customer service.

All middle men in distribution perform these functions and they assure putting the product with in an arms length of customer desire and demand.


Price analysis 

The price prevailing in the market at any given time and determined by the forces of demand and supply is the market price. Market price is important because price changes send signals to producers which tells them whether they should produce more or less of their good or service. If the price of a product is raising this is a sign that producers need to supply more.

Producers will respond to this signal because, in general, higher rives lead to higher rewards for producers (profit) and so they have an incentive to work harder and increase production. Filling pries, on the other hand,. hand generally lead to falling profits and this is the way that the market signals to producers that they should produce less.

The influence of price on demand: The price of a good or service is obviously one of the main factors that influence how much we buy of it. The factors that cause the level of demand to change are explained below. The general rule is:

An increase in demand leads to arise in price

A decrease in demand leads to a fall in price

Changes in income: Most people gain an income from working in the form of wages and salaries. However, people con gain an income from a number of other sources. They might be from employment, savings, retirement pension, state benefits, property ownership, share ownership or business. It is cleat that the greater the level of people’s income the greater the level of demand. It also follows from this that higher the level of demand the higher the market price. Obviously this logic can also be applied the other way around- lower incomes lead to lower demand and lower price.

The price and availability of credit: The price of some goods and service that people wish to buy can often be so high that they find it difficult to afford them out of one month’s income.

The influence of price on supply: The price of a good or service is obviously one of the main factors that influence how much we buy of it. The general rule is that:

The higher the price of a good or service the more businesses will want to produce

The lower the price of a good or service the less businesses will want to produce

The factors that cause the level of supply to change. to change. and hence the market price of goods and services to alter, are explained below.

An increase in supply leads to a fall in price

A decrease in supply leads to a rise a in rise in price

Changes in the cost of production: A rise in business costs will often lead to a fall in profit levels and so firms will lose some of their incentive to produce. It the majority of firms in the industry are affected in the same way then there will be a fall in supply. Similarly a fall in business costs tends to increase profit levels and they have an incentive to produce more. If most firms in the industry respond in the same way then there will be an increase in supply.


Factors to consider when setting prices

Before setting price, the company must decide on its strategy for the product. If the company has selected its target market and positioning carefully, then its marketing-mix strategy, including price, will be fairly straightforward. At the same time, the company may seek additional objectives. The clearer a firm is about its objectives, the easier it is to set price. Price is only one of the marketing- mix tools that a company uses to achieve its marketing objectives. Price decisions must be coordinated with product design, distribution, and promotion decisions to from a consistent and effective marketing program.

Pricing of Microwave oven:

In case of the product Microwave oven, Butterfly Marketing Ltd. has adopted the following price on the basis of following formula.

Selling price = Landed cost (LC) + Administrative cost + Transportation cost + Warehousing cost + VAT + Profit margin.


Different brand, different size and different price:

Brand nameSize (Liter)TypesPrice


Different model and price of LG microwave oven.

Brand nameTypesModelSize (Liter)PriceSale system
LGGrill604A2813490Cash & Installment
LGGrill5644B2713390Cash & Installment
LGConvection808WAR3015990Cash & Installment
LGConvection767W2814990Cash & Installment
LGConvection7645B3019990Cash & Installment
BUTTERFLYConvection900ESL30R2810990Cash & Installment


Market analysis of the industry

To ensure that our analysis is consistent, it is very important to define the ‘industry’ we are dealing with. An ‘industry’ is defined as a group of organizations or business units producing close substitutes. For the convenience of our analysis, the industry can be defined in both wide and narrow.

Wide Definition :

Base on the available information, the industry can be defined as “Consumer durable Electronics Goods” industry.

Narrow Definition: 

For the critical analysis, the industry can be defined as “Microwave oven” industry.

Major participants of the Industry: 

The companies who are performing well and have maximum market share of the industry are as follows:

Global brand:

  1. LG-Butterfly
  2. Sharp
  3. Whirlpool
  4. Panasonic


Major participants of the Industry: 

Non brand:

  1. Butterfly
  2. Golanz
  3. Superaristion
  4. Konka
  5. Walton
  6. Nova
  7. Noka .

Table : Market Share Analysis of Industry for global brand : (Sales Volume)

For the Year 2007

Company NameMarket Share %



I recommend the following steps:

  • Price can be reduced to attract the customers mostly.
  • More advertising campaign should be taken to attract the customs.
  • Number of showrooms should be increased.
  • Credit facilities could give to the dealer in some cases.
  • Prices should not be more frequently.
  • Set up a control R & D department to make R & D activities more cost effective & fruitful.
  • Should have in house advertising agency.
  • After sales services facilities should be prompt & with care.
  • Strengthen channel of distribution.
  • Can diversify in other domestic products to gain economics of scale.
  • Become more aggressive to cover wide area.
  • Setting up a strong brand image.
  • Can Improve promotional activities (consumer promotion, trade promotion).

Implementation plan

Managers at all levels are involved in implementing a strategy. Of course top level managers should take the initiatives to carry out the plan with the help of middle level and lower level managers. Then the whole task should be divided into several parts. Procurement manager is needed to play a major role here. He should have the capability to negotiate with the supplier in order to lower the input price. They can also setup a central R & D department to make R & D activities more cost effective and fruitful. The R & D team has also something to do in implementation. The manager in charge of R & D should persuade his subordinates to come up with innovative ideas and give operational efficiency to lower the price.

The manager of marketing department will be responsible in implementing the plan. He should explore creative ideas to attract the customers. The advertising and promotional activities should be exceptional to influence the consumers to buy Butterfly products.

Contingency plan

There is always uncertainty in this world. The strategies taken to accelerate a company’s growth may go in vain. Therefore the company should have some backup strategy. Since the average income of Asian consumers is low, many people may be reluctant to buy Butterfly’s products. For this, Butterfly can introduce an economic version of its product line, which will be affordable for the low-income consumers. Not only for Asia, can it produce this economic version for any low income-earning people all over the world.

International market is unforeseeable; the government may not act in accordance with the terms and conditions. In this case they can seek cooperation from the govt. to put pressure on the host government so that they comply with the international norms, rules and regulations. Local people who have strong influence on the govt. should be convinced by parent company so they act in favor of them. All these strategies may not produce the desired result, so insurance should always be there to cover up this loss before entering any new country.




From the study of Competitive market analyze of microwave oven, it can be concluded that functions followed by Butterfly marketing company Ltd. is comparatively good. Since consumer demand is changed instantly, the company should take the advance strategies and policies to grab the market. In this regard integrated marketing can be helpful. Rivalry is likely to increase; its Butterfly’s strategic move to global market has been successful. The life cycle stages of the products of Butterfly are mostly in mature stage. All the big companies in the market are acquiring small companies and as the product range-is-quite large they enjoy Economies of Scale. Customers are very brand loyal some rivals have good distribution channels. As buyers’ preferences are changing it is inducing the industry to change. An intense competition is going on in the market of home appliance between the brand and non-brand product. The increasing demand for non-brand product is due to lower price rather than others.

Customers are not very well-known about LG/Butterfly product like due to the drawback of advertisement. Advertisement is one of the key issues of sales growth through which Konka. Nova and some other non-brand are doing very well in sales. Konka and Walton are most demanding in the gray market because of lower price, nice getup and for guarantor period. The demand of Microwave oven is increasing day by day which is a positive sign for LG. Price is the first choice of the customer for purchasing Microwave oven in the gray market but brand loyalty and quality are not ignorable.