In its early days, Nokia, the inventor of the iconic 3310 mobile phone, tried to conquer the world with rubber boots and bicycle tires. The story of the South Korean conglomerate LG begins in a similar way. LG today symbolizes the slogan “Life’s Good.” Originally, the two letters stood for Lucky Goldstar for a long time. Wait, Goldstar? Some older students may remember it. This brand was for a long time one of the world’s leading suppliers of consumer electronics. But let’s take it one step at a time: in the beginning there was “Lucky Cream,” a face cream.
LG starts out as a cosmetics company
In order to bring his new facial cosmetics to the public, South Korean businessman Koo In-Hwoi founded the company Lucky Chemical Industrial Co. in 1947. The cream, which was supposed to soften the skin on the face, quickly became a bestseller for the family business.
However, from the outset the company searched for a suitable container for this white miracle. At that time, in the early 1950s, the production of plastic containers was experiencing a great advance. Given that creams and plastics are largely composed of the same raw materials, Lucky Chemical decided to manufacture the plastic itself.
In this way, the company not only found a suitable container for its face cream, but also expanded its own product range to include other items such as bathroom ornaments, combs, soap dishes and toothbrushes. With these and other bathroom items, Lucky Chemical did a huge business in the 1950s.
Goldstar: the new star in the firmament
It is the era of the boom years. Radios and televisions, in particular, are enjoying growing demand all over the world. A lot of plastic is also needed to build the new receivers. Lucky Chemical suddenly smells business potential here.
However, the family business is not content with just supplying the plastic for the manufacture of the devices. The company’s managers also hire the necessary technicians and build the new stars of the consumer electronics firmament themselves. Logically, Lucky Chemical chooses the name Goldstar for the new subsidiary.
From the 1960s onwards, the company first concentrated on the production of radio receivers. Later, Goldstar covered the entire consumer electronics sector with televisions, video recorders and video cameras.
At some point, the domestic market was no longer enough. Like many other Asian companies, Goldstar expanded in the 1970s and increasingly conquered the European and US markets.
The birth of LG Electronics
At that time, the South Koreans were still producing their classic plastic products. However, the Goldstar subsidiary already accounted for the majority of the turnover. In addition to hi-fi and video equipment, Goldstar-branded refrigerators, washing machines and vacuum cleaners began to appear in shops.
In order to group these different electronic devices under one roof, the company decided to change its name in 1995. The South Koreans chose the name LG Electronics.
The two letters L and G appeared for the first time in the company’s history. For marketing reasons, the name changed again in 2005. Since then, the company has combined the letters with the slogan “Life’s Good”.
How LG paid a high price for a URL
By the way, L and G have been the subject of an Internet dispute for years. The group operates on the web under the domain www.lg.net, which is not the best solution for being found online. The much better URL www.lg.com belonged for a long time to the then renowned American architecture firm Lockwood Greene.
When the architects sold the domain in 2008, British professional footballer Andy Booth didn’t think twice and bought it. Apparently, the Huddersfield Town player wanted to create a football website with the URL. To make it look credible, the footballer changed the acronym LG to the name “Life Games”.
However, this story seems more likely: Andy Booth knows the profit margin obtained from the sale of certain domains. The footballer has probably been closely following the time LG has been trying to acquire the rights to www.lg.com.
From then on, the URL becomes a very lucrative source of income for Andy Booth. In 2009, LG made the footballer an offer he couldn’t refuse. The media reported “the most expensive domain transaction in history”. As is usual in sport, the transfer fees are not discussed. But what is certain is that a six-figure sum has changed hands with the sale of the domain.
LG’s smartphones are just one episode.
However, LG is probably already paying a similar amount. Worldwide sales have long been in the tens of billions of euros. In addition to consumer electronics products, CD-ROM drives, laptops and computer monitors have also contributed to this enormous success. From the mid-2000s, LG also tried to compete with its domestic rival in the mobile phone sector. At that time, Samsung was not yet in the dominant market position it occupies today.
For a long time, both suppliers competed on an equal footing. However, Samsung managed to conquer the relevant markets much faster than LG thanks to an aggressive product policy and the constant introduction of new smartphone models. For this reason, LG made the decision in 2021 to withdraw from this business.
LG has the future in mind
However, the current LG Group is one of the five largest companies in South Korea and is part of the circle of so-called jaebeols. This is what large family businesses are called in South Korea, which are usually made up of different divisions, or in a nutshell: conglomerates.
What began over 70 years ago as a small family business and a facial cream is today a global business network that supplies products to people in all walks of life. To this day, the company is still family-owned and is currently run by Koo Gwang-mo, a member of the fourth generation.
And the story is far from over. LG reinvents itself time and time again. Today, South Koreans are already looking to the future and focusing on their next businesses: electric mobility and robotics.