Cell Phone market sells US$ 37.9 billion and LG invests to be leader
DCI 03/13/2009
Even though the mobile telephone market has put into the market nearly R$ 69.4 billion (US$ 37.0 billion) last year, representing 2.39% of the Gross Domestic Product of the Country (GDP), according to a survey made by the Getúlio Vargas Foundation (FGV), the world financial crisis and the low sales of cell phones during Christmas have already started to impact the Brazilian telecommunications sector. A proof of that is that the cell phone industry registered a 63.8% fall in the production of mobile phone handsets in the beginning of the year, a fact that does not seem to intimidate the South Korean industry of electric and electronic devices L.G. that estimates it will gain nearly 30% of the Brazilian market of cell phones, overcoming the Finnish leader Nokia. Today, LG has 23% of the Brazilian market of cell phones, according to a survey of the GFK Indicator consulting firm. The company that sold US$ 2.8 billion in Brazil last year (nearly R$ 6.4 billion), bets that, with the launching of a varied mix of products and greater investments in marketing, it will be possible to overcome the confidence crisis felt by the consumer and reach the same level of growth of 2008, which was of 12% in relation to 2007, when it sold US$ 2.6 billion (nearly R$ 5.7 billion). "This year we will invest more in marketing than we did in 2008, when we used nearly 3.5% of our income for such kind of action", explained Eduardo Toni, LG Marketing Officer. The investment of the company in marketing last year is equivalent to nearly US$ 95 million or R$ 220 million. Carlos Mello, Director of cell phone area of the company, affirms the situation in the cell phone market should go back to normal at the end of the first quarter, since the operators are still getting rid of their stocks from Christmas. "This first quarter is only for adjustments. From April on, with the launchings, the situation must start getting back to normal", explains the executive, who intends to achieve, this year, the same amount of cell phones sold in 2008, of 12 million handsets. In order to do so, the company must strengthen its marketing and communication strategy in the points of sales.