LG OKs Limited Sales On Internet
By Greg Tarr -- TWICE, 9/25/2006
ENGLEWOOD CLIFFS, N.J. — LG Electronics notified dealers that it is relaxing its firm ban on distribution of its products over the Internet — allowing authorized brick-and-mortar dealers to offer select products on the Web.
“The underlying rationale for prohibiting Internet sales was to protect the brand position of a relatively unknown brand during its initial introduction,” Bob Berry, LG sales and channel marketing VP, told dealers in a recent letter announcing the policy change. “Since introduction, the LG brand position has grown, and is now regarded as a tier one brand.”
Effective Sept. 15, the company is “carefully allowing Internet sales of a limited assortment of LG branded consumer electronics.”
The new Internet policy will be limited to “nationally” distributed products, and will not include those models and lines —particularly in TVs — that are reserved for specialty home theater retailers and TV/appliance dealers.
Perry said “all retail dealers may apply for approval to sell 'national' products via the Internet.”
The policy includes the following conditions:
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Dealers must agree to and follow detailed Internet sales requirements;
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Dealers must be specifically authorized and approved for Internet sales;
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Dealers can only sell a model on the Internet if that model is on display in their retail stores; and
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No pure “click” retailers will be authorized — only “click and brick.”
“We will carefully monitor approved Web sites, and LG retains the discretion to withdraw the Internet sales authorization at any time,” Perry said.
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