LG OKs Limited Sales On Internet

By Greg Tarr On Sep 25 2006 - 6:00am

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:

• Dealers must agree to and follow detailed Internet sales requirements;

• Dealers must be specifically authorized and approved for Internet sales;

• Dealers can only sell a model on the Internet if that model is on display in their retail stores; and

• 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.