Affordable Alternative
The average price of LG Electronics’ smartphones is less than half the price of Samsung Electronics'.
According to data from telecommunication industry sources on Sept. 17, the average sales price of 17 models of LG Electronics’ smartphones that SK Telecom is selling stood at 175,341 won (US$150), with a calling plan of some 60,000 won (US$51) per month.
The figure is less than the average selling price of 30 models of Samsung Electronics’ smartphones at 414,357 won (US$355). It means that the average sales price (ASP) of LG Electronics’ smartphones is lower.
This is because LG Electronics lowered the factory price of its premium smartphone G4 to some 600,000 won (US$514) in Aug., four months after the launch. It also recently offered the G Pro 2 and other products, which are 15 months old, as “free phones.”
LG Electronics has pursued a low price strategy that lowers the factory prices of smartphones and increases mobile handset subsidies after a series of poor sales in the mobile division. The subsidies include an excess of manufacturers.
On the other hand, Samsung Electronics has steadily launched low-end distribution models such as the Galaxy J5 and the Galaxy A8, and high-end lines, including the Galaxy S6 and the Galaxy Note 5, at the same time, showing a relatively high sales cost per unit on average.
The situation is similar in other mobile carriers. The average sales price of 14 models of LG Electronics smartphones, for which KT provides official subsidies, stood at 168,436 won (US$144). The figure is only 44 percent of the average sales price of 45 models of Samsung Electronics at 379,924 won (US$325).
Moreover, LG U+ sells 24 models of LG Electronics’ smartphones, which is the highest number among the three mobile carriers, and the average price of them was only 143,538 won (US$123). The figure is less than half the price of 30 Samsung Electronics smartphones at 307,077 won (US$263).