John Weinstock, LG

You don't expect much controversy from the sleepy household appliance segment, but here you had LG drawing ire for one of the most un-green campaigns imaginable. At a time when Wal-Mart had executed a dramatic 360 on the issue and used its heft to force vendors to shrink their package sizes and in general become more eco-friendly, LG was running ads advocating the gleeful destruction of aging household appliances. A violence-tinged set of broadcast spots, from BrandBuzz, New York, showed females swapping the old washing machine or dishwasher for a more stylish premium product offered—natch—by LG. One ad showed an elegantly dressed lady shoving her old washing machine off a diving board into a pool. In another, a woman dreamed of tying her current refrigerator to some railroad tracks in front of an oncoming train. Landfills be damned. Let the old make way for the new. Environmentalists weren't amused. "If there were some kind of great energy savings to justify the purchase, that would be one thing," said Robert Weissman, managing director at Commercial Alert, Washington, "but it shouldn't just be a matter of this new unit being cool." The thing is, the new units did look pretty cool. Stainless steel and sleek, they made your old Frigidaire look about as hip as parachute pants.The attention-getting campaign was the work of LG's vp of marketing, John Weinstock, who arrived at the company last year fresh from marketing facial cleaners to teenagers at Johnson & Johnson. "The idea in the campaign is that it was fantasy," said Weinstock, who was noncommittal about the future of the campaign, though he noted brand awareness jumped 20% in the first six months the ads ran.That latest pop came after a strong run for the brand. LG has scored annual sales gains of at least 20% since it first invaded the U.S. appliance segment. Overall, the brand moved from No. 5 to No. 3 in dollar sales of both washers and dryers between 2005 and 2007, and from No. 8 to No. 6 in refrigerator sales, per NPD Group, Port Washington N.Y. In the U.S., the brand also is the top-seller of front-loading washing machines, with a market share of 23.4%, per The Stevenson Company, Louisville, Ky.Moreover, LG, which Weinstock said sells "high-end appliances to average consumers," commands an average price of $892 per washing machine, which is slightly higher than the competition.Designs on the U.S. MarketThat's pretty good for a brand that wasn't even in the category at the beginning of this decade. When LG, a Korean conglomerate known for making everything from cell phones to petrochemicals in its native country, signed BrandBuzz, New York, to handle its appliance business in the U.S. in 2001, LG's appliance unit had a staff of two in its marketing department. Only eight stores carried the products."We were doing everything from hand-delivering dealer kits to creating print ads," said BrandBuzz president Mike Reese. "LG's marketing discipline was not nearly as sophisticated as it is now and we had a much larger role than we have now."LG knew one thing about the segment that rivals didn't, or at least didn't capitalize on: Study after study was coming out by the time Weinstock came on board showing that consumers were obsessed with design not only in clothes and cars, but in other items. It had started with cell phones and was spreading like necrotizing fasciitis to other categories. In appliances, the hot look was stainless steel, which conveyed a certain snob appeal (thanks to prices more than double the norm) and made old appliance designs look downscale by comparison. LG jumped into the fray by offering stainless steel designs (and later, color) at moderate prices."LG has been one of the drivers of this kind of design awareness in appliances," said Kathy Sheehan, svp at GFK Roper Consulting, New York. "They've taken a trend in what consumers are looking for and found this white space in there that most other retailers have not.""These newer, more modern appliances can be extremely important because the No. 1 place to put money into a house is the kitchen," said Jeff Wellman, a real estate broker with Re/Max in Northern Michigan. "Stainless steel appliances really dress up a home."By late 2006, LG had achieved a lot with design and was ready to get serious about its marketing. The company embarked on a national search for the newly created position of vp-marketing in its appliance unit. "The search firm was told to find a person who was a high flyer, an up-and-coming exec, and was told to focus on great marketing companies," said a source familiar with the quest that resulted in Weinstock's hiring.After months of vetting, it came down to 10 finalists from companies that included Coca-Cola, Procter & Gamble and Johnson & Johnson. "It was clear that the best fit was John," the source said.By the NumbersPerhaps that's because Weinstock, to a degree, embodies the company's target consumer. His parents after all were Midwestern small-business owners who ran a florist and gift shop in Kenosha, Wis. But Weinstock's penchant for research may be another reason. His background is in computer consulting, but he migrated to marketing because "I wanted to be in a place where I could impact results."That place was Johnson & Johnson, where he spent 12 years marketing everything from baby products to skin cream. "John was meticulous, very meticulous," said Fritz Grutzner, who was vp-marketing at Johnson & Johnson in the baby care segment in the late '90s. "He knew his numbers better than anybody. He knew sales, market share, everything. That is one of his strengths. In terms of creative, he knows what he wants but he leaves it all to the creative minds at the agency." That meant Weinstock was often poring over data about teenage pores. "I sifted through research, worked with marketing research groups and got a grip on teen trends," he said. "Some of that stuff horrified me, of course. I became sure that I didn't want my daughter coming home with the goth look."At LG, Weinstock's role has been more managerial. So far he has beefed up advertising expenditures and plans to spend $300 million over the next three years as compared to the $22 million the company spent on ads last year, per Nielsen Monitor-Plus. He's also been on a hiring binge, tripling the marketing staff during his tenure."I've spent 10-15% of my time interviewing people in the last year," Weinstock said. "They've been all kinds of people: CPGs, agency people. We need a balance of industry knowledge and fresh perspective, everything from merchandising and trade marketing to pricing and financial people."Reese said Weinstock's imprint has changed the brand for the better. "He brought in a consumer-centric marketing approach," Reese remarked. "It was exactly the kind of change that LG wanted and John is a good example of the type of talent they are bringing in. He brought in a traditional and disciplined approach that they have not had across all divisions."That approach will be tested as the housing correction eases. Weinstock is currently working with developers to get LG products into more new homes. "It's a place we want to be more present in," Weinstock said. No doubt his market research and number crunching will lead the way in LG's approach to the new home market.Roper's Sheehan said that the new home market is built for LG. "There are more young home buyers hitting the market and these are the consumes who have helped drive this drive for individuality," she said. "As more Gen Yers start to form their own households, it's something that will increase. If the real estate market continues to be soft, we will probably see fewer people trading up and willing to spend more on their existing homes."Weinstock's charge is to deliver a message to those up-and-comers, as well as the already-arriveds: LG has the goods and the technology. "I think younger consumers are already aware of LG, at this point, from our other products" he said. Time will tell whether LG will relegate those old rivals in the category to the landfill for good. Photo by Frank Veronsky.

Brand Marketing

John Weinstock, LG

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