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Lyondell Chemical Company 2 Case Study Solution and Analysis


Lyondell Chemical Company 2 Case Study Help is a well-known global brand in technology industry, founded in 1938 by Lee Byung Chul, in South Korea. Lyondell Chemical Company 2 deals in a great deal of product categories consisting of Semiconductors, Telecom, Digital Media, Digital Appliances and many more other electronic products. Historically, the business's core customers include the Original Devices Manufacturers (OEMs), which used to sell Organization products withtheir own trademark name. Till early 1990s, the core competency of Organization lie in its low rate offerings than its rivals by making existing items at economies of scale. Its customer circle consists of Original Equipment Manufacturers (OEMs), who utilized to sell Lyondell Chemical Company 2 Case Study Help products with their own trademark name. Corp was not simply understood outside Korea. There were also no or little interest in developing the brand worldwide. Marketing spending plan was controlled by production department with a prime focus on offering cheap products.During the 1997 Asian Financial Crisis the company nearly got bankrupt, but with the Vision of Chairman Lee it entirely turn its fortune around and in 2002 was noted the leading 25 most important company worldwide. When Kim was employed as a Chief Marketing Officer in 2000 the business was not even listed. He rearranged Corp as a global brand and informed his divisional supervisors to understand marketing and its significance. Now their goal is to reach the top 10 by 2005.

Issue Statement

Enterprise's transition from an item based to a marketing company is not going as efficiently as planned.Overcoming the reluctance of divisional supervisors to integrate marketing efficiently is still a significant obstacle. Developing a constant brand identity across the entire world and using marketing methods that best fits the local culture is no simple job. The M-net program analysis have been actually valuable in identifying the high and less prospective development locations, but allocation of resources appropriately is not well gotten amongst the supervisors. There is no agreement amongst the hierarchy concerning the best matched future method.
Executive Summary
Situational Analysis

Yun had a quite clear picture in his mind about how Lyondell Chemical Company 2 Case Study Solution can change from a low end to a high end product service provider. He understood that transformation can only be done through placing Organization as a company providing high-end products and this might just be done through high level of marketing.

In spite of having a clear vision about how to develop Organization brand, with a prospective support of its executives, Yun dealt with several marketing challenges in early years of its efforts.

One of the marketing difficulties for Yun was the perceptions of executives about the worth of marketing. They thought about marketing and selling as same tools and believed that quality products do not needed marketing for increasing sales. As their focus towards marketing was rather low in their previous company practices, and the existing marketing requirement was excessive high, the space was too larger and to fill this gap with incorrect understandings about marketing was quite difficult for Yun.

Along with it the product range of the company was increasing with the ripening of new item concepts by the R&D sector of Venture. Yun had a difficulty to carry out marketing preparation and to produce marketing budget plans for existing as well as for brand-new items from the very start, and this would take a huge time.

A substantial shift would be required in existing marketing expenses to build the Company brand name. This would result in increased marketing expenses for Org and could disturb the administration relating to increased expenses, as they were hesitant to marketing expenditures previously and an abrupt big shiftwould make them interrupt.

Internal Analysis
SWOT Analysis

Corporation strengths lie in its substantial product portfolio. Organization has biggest number of patents in the industry with total number of 15499 patents given in United States( USP). Large amount of R&D costs has actually allowed the business to grow its product portfolio at a greater rate than its competitors. Lyondell Chemical Company 2 Case Study Help spent about $13.079 billion on its R&D sector in 2016, which is 7.3% of its total incomes.

Another strength of Lyondell Chemical Company 2 Case Study Solution is its ability to develop innovative products at a continuous rate. It major proves for the innovation and product designing of Org is that the company has gotten a lot of awards for its development and item style.

Unlike Apple and other competitors, Organization is concentrated on producing gadgets which can be easily incorporated with any type of open source Os (OS) and software. This supplies Org an edge over Apple devices.
Porter's 5 Forces Analysis
Company's ability to produce high-end products at low expense of production is likewise one of the significant strength of Organization as it makes it possible for the business to capture more market by supplying quality items with expense control.


Lyondell Chemical Company 2 Case Study Help weaknesses are hidden in the company's reliance on outsourcing software application for its gadgets due to company's inability in establishing software application, unlike Sony. Corporation likewise has low profit margins as compare to Apple due to huge difference in the rates of Apple and Business with a much lower distinction in quality. The diverse focus of the business due to a great deal of products in its portfolio, lead to the less efficient production and make the business not able to charge higher prices like Apple. The company is likewise inefficient in handling its patents and frequently deals with the problem of patent offense.


Opportunities for Corporation depend on the growing Smartphone market and the company's efficiency in the market. It can increase its market share and profits from cell phone as the company is rather efficient in smart phone market. Enterprise currently runs in about 80 countries and the business has a chance to increase its geographical expansion by moving towards more emerging markets outside Asia. Org can move towards acquisitions to acquire patents. It would enable the company to increase its item portfolio with an increase in its wealth.


The dynamic industry environment of technology industry posture a severe danger on Corporation's survival and require the company to invest much of its revenues share on R&D in order to survive in the long run. The marketplace saturation in industrialized nations i.e. saturation of mobile business is also a big threat for the company's development in the presence of strong competitors like Apple.

4 P's of Marketing
Swot Analysis

Lyondell Chemical Company 2 Case Study Analysis offers quality items and has a rather abundant portfolio which deals with different sectors. Most of the items are in the leading 3 of their respective industries. LCD and smart phones are the most significant items of Corp, whereas DRAM is likewise not far behind in contrast of them. Following is the product line of Company:

• Laptops.
• Mobile phones.
• A/c unit.
• Personal computers.
• Hard disk drives.
• Washer.
• Fridges.
• Electronic cameras.
• Microwaves.
• Flash memory.


Lyondell Chemical Company 2 Case Study Help utilizes both market competitive and market skimming rates strategies for its variety of items. In competitive prices it changes the price according to the competitors in order to gain benefit, whereas, it utilizes market skimming strategy where the product has an included worth and by offering a couple of products it can reach break-even.


It has among the very best supply chain networks, with retail distributors, their own sole suppliers, E commerce channels like Amazon etc. All its items are timely provided to the selling place/ provided to the customers directly in case of online order.

Vrio Analysis
It wasn't a popular company outside of Korea till 1993. The management effort taken by their CEO has pushed them to market more efficiently outside the borders and now it has actually gone into the league of leading 25 business in the world in just 9 years. This is an amazing accomplishment in spite of the ongoing arguments among the supervisors about embracing marketing practices. It utilizes both offline & online channels of promotion to market their items. Paid item advertisements, social promotion and digital ads are uses to develop awareness about Company items.

Worth Chain Analysis.

It's an analytical structure for determining business activities that add worth or competitive advantage for the business.

Incoming Logistics.

It has one of the most effective and efficient supply chain network and has more than 2700 suppliers throughout different industries around the globe. Nearly 80% of which is based in Asia and the remaining all over the world. For its incoming logistics it owns different logistics companies as it subsidiaries. It cares for its suppliers and produces a harmonious relationship with them and even minimized their payment cycles to enhance this relationship further which includes value to their chain network.


Corp's core proficiency is its mass making it produces 90% of its items in-house. Divided into 3 different departments its operations are particularly IT & Mobile Communications, Device Solutions and Consumer Electronic Devices. It is preserving operation centers worldwide to even more add value to its worth chain network.

Outbound Logistics.

Its outgoing logistics system performance is among the main factors Lyondell Chemical Company 2 Case Study Analysis has the ability to take on Apple. Organization's own Electronic Logitec system plays a significant function in the outgoing logistics operations. It even carries out the tasks of collection of payment, settling insurance coverage claims, etc. on behalf of Company.

Marketing and Sales.

Drawing in target client attention towards the product is done through marketing and sales to communicate with them the value and competitive advantage the product uses. Lyondell Chemical Company 2 Case Study Help marketing budget is continually on the rise considering that they began their rearranging globally and will continue to do so as they are constantly wanting to broaden and invest in high potential development markets. The spending plan is invested in events, print and media ads, public relations etc.

Business put their consumers at the leading and continually strive to provide unmatchable client service standards. By adding a direct support line to contact them 24 hours they have actually even more increased the added value of Enterprise service.


Lyondell Chemical Company 2 Case Study Help has diversified market division, based upon its provision of large range of products to large number of consumers. Company target customer sectors can be divided into 3 categories i.e. Lyondell Chemical Company 2 Case Study Solution IT and Mobile Communications, Corp Consumer Electronics and Corp Gadget options.


Lyondell Chemical Company 2 Case Study Solution geographic division is based upon 2 requirements i.e. region and density. Business serves about 80 nations worldwide with its products supplied to Urban as well as Backwoods of the country. The Organization is also growing its worldwide existence and the business's versatility in finding its plants motivates international growth of Company.


The demographic division of Lyondell Chemical Company 2 Case Study Analysis is based upon gender, age, life-cycle phase and occupation. Venture produces products that can be used by both males and females. The target clients for Org IT and mobile communication products have an age variety of 18-65 with majority at a young or recently wed life cycle stage. They are mostly employees, specialists and trainees. Apart from it, Corp Customer Electronics are targeted to a customer section with an age range of 25-65. They are mostly experts and workers. Company Gadget Solutions are targeted at trainees, employees and experts with an age variety of 25-65.


The psychographic division of Lyondell Chemical Company 2 Case Study Analysis s based upon the social class and the lifestyle of the customer. Corporation target customers on the basis of social class are generally upper middle, middle and working class customers, as Corp offer items like cell phones not much cheaper i.e. Motorola along with not much expensive i.e. Apple. It supplies quality products to middle level consumers at a somewhat high cost than others targeting the exact same segment.


Lyondell Chemical Company 2 Case Study Solution bulk target clients have distinct behavioural characteristics. It has clients with an ambitious, trendy and identified personality with moderate level of loyalty towards the brand. Its consumers have some degree of shift towards other renowned brands i.e. Apple. The majority of Organization customers want quality as well as expense control. Due to the fact that of its moderate rates with a degree of quality, they are attracted towards Company.

Quantitative analysis.

Sales of Lyondell Chemical Company 2 Case Study Solution has actually increased remarkably from 16 billion $ in 1997 to 44.6 billion $ in 2002, and the net earnings of.48 billion $ to 5.9 billion $. Digital media is the largest selling classification of Venture with sales of 13.9 billion $, whereas, Telecommunication and Semiconductors sectors both reached 11 billion $ in sales.

Qualitative analysis.

Whereas, the core strength of the business is presently producing but long gone are those days when excellent products were offering themselves. Kim has already started to reinforce the marketing activities of Corporation and really quickly it will become one of its core strength like producing if not better.



Venture runs styles, makes and sell a large portfolio of consumer electronic devices. It runs in an incredibly competitive environment and has actually effectively positioned itself as the maker of quality products. So, the answer is yes.


As, stated earlier that Lyondell Chemical Company 2 Case Study Solution runs in an extremely competitive environment, which implies all the business have similar items. So, the response for rarity is no.


Due to the nature of the industry, it is extremely simple for competitors to comprehend the performance of the products and easily make their own designs. Yes, Org is only behind IBM in signing up new patents yearly, however the advantage is extremely short term in this industry.


Chairman Lee has completely turn-around Organization, from going practically bankrupt throughout the Asian financial crisis of 1997 to the top 25 business worldwide. Definitely yes there appertains company in the business and the results speak for themselves.

External Environmental Analysis

PESTLE Analysis


Being an international brand name spread practically in every nation worldwide, bulk of the environments like U.S.A., Europe, China and so on, are extremely conductive for its operations. It deals with some political pressures in less developed countries where law and order scenario is not excellent. Latin American, African and some Asian nations fall in this classification, where political instability do have an effect on Lyondell Chemical Company 2 Case Study Help operations.


Purchasing power of clients is vital for business like Organization to be successful and grow. Emerging markets like India, middle-eastern nations etc. offer growth opportunities, whereas, due to recession even the consumers of industrialized countries suffer severely. It is really important for the company to keep an eye on the ongoing financial circumstance of the nation before entering the market.


International business need to deal with numerous social and cultural concerns during its operations in a foreign nation. Org has likewise dealt with many issues however have actually adopted to the regional environments of most of the nations remarkably well. It has customized its items, practices, policies and so on accordingly in order to be successful.


With a yearly expense of 2.4 billion dollars in Research & Advancement, and with continuous ingenious item launches, Lyondell Chemical Company 2 Case Study Solution is among the leading innovative business of the world. With a clear objective to be ahead of the rest when it concerns technological improvements, Org has risen to the no 25 of the top effective companies of the world.


Each country has their own laws and policies, being an international business Organization need to strictly follow those laws in their jurisdictions. Failure to do so, will lead to major legal effects. So, it has to study or hire a regional law expert prior to beginning its operations in a specific country.


With the increasing awareness among consumers about the ethical & environmental violations of companies, Organization needs to guarantee that it follows all the safety guidelines. Ecological damages, ethical misbehaviors are not appropriate and in some nations the consequences can be really extreme. On the other hand it has to do some Corporate Social Duty practices to show the locals that it appreciates their environment and individuals.

Porter's Five Forces

Hazard of Replacement

Danger of replacement for Business's each product category is quite significant. Running in an extremely dynamic industry lead the company to deal with a high danger of alternative. Factors for high risk of substitution for Lyondell Chemical Company 2 Case Study Analysis Mobile phone include the existence of high number of providers and Market saturation in developed nations, which make the cost of changing for customers practically no. Substitution hazards for Organization visual display screen lie in the changing lifestyle of clients. Consumers can switch to watching visuals at home towards outside activities. In addition to it, Organization printing options products are threatened by the increasing tourist attraction of customers towards cloud storage.

Rivalry Amongst Existing Companies:

The rivaly among Enterprise and its close competitors is intense. The major reason behind this is the method of market saturation in different number of item classifications, forcing Venture to introduce more innovative features in existing items and new ingenious items to maintain its development. Other factor for the extreme competition among the rivals is the little product distinction among the products. The popular players in the innovation industry are quite knowledgeable about the significance of R&D costs for their survival and are running into a race of marketing and R&D spending, to record the market. The significant rivals for Lyondell Chemical Company 2 Case Study Solution samrtphones consist of Apple, Motorola, LG, Nokia, Huawei, OPPO and so on. High competitors rivalry results in the fluctuating market shares which can be seen in Exhibition F.

Bargaining Power of Suppliers:

Lyondell Chemical Company 2 Case Study Help has a huge supply chain including about 2700 suppliers throughout the world.( Enterprise Sustainability Report, 2016) Provider's bargaining power for Corp is low as Business runs economies of scale and its orders are of prospective size and worth. These substantial orders enable Organization to work out costs with its suppliers. However, due to incapability of Lyondell Chemical Company 2 Case Study Solution to build its own software application, it has to outsource its software advancement to Google, which becomes a possible provider of software application for Organization, resulting in high bargaining power of Google. Although, in the majority of cases Corp has a power to work out rates, however it supply significant rates to its providers to develop a strong supply chain and to have strong relationships with its suppliers.

Bargaining Power of Buyers:

Bargaining power of purchasers for various number of item categories of Venture is extreme. One of the aspect causing the intense bargaining power is the availability of large number of rivals in almost each item classification i.e. competitors of Org Smartphone, with an extremely little distinction. The high schedule of suppliers of Smartphones with minimum distinction, make the switching cost for buyers practically no, thus increasing the bargaining power of buyers. Market saturation in most of the item categories likewise make the bargaining power of purchasers more intense in for Lyondell Chemical Company 2 Case Study Analysis. In spite of igh bargaining power Organization is quite efficient in offering its items at a higher price than much of its competitors, due to high-end quality item and a fair brand name image.

Danger of New Entrants:

Hazard of brand-new entrants for Lyondell Chemical Company 2 Case Study Help is quite low. Along with it, requirement of huge expertise and research study and advancement expenditures for survival in the industry likewise make brand-new entrants unwilling to go into in the market. Market saturation is likewise one of the barrier of entry in technology market.

Competitive Analysis

Corp's high product diversification provides it differentiation from its rivals. It is among the three leading brands by market share. Unlikely to its close competitors consisting of Sony, Intel and Nokia, who focus majority on a single product category with Sony focusing on customer electronics, Nokia on mobile phone and Intel on chips, Company had a big R&D spending on all of its item categories which allow the company to make potential income from sales of almost all of its items. (See Exhibit) However, due to the wide product range the business faces high variety of competitors.

The company ranks first in 4 product categories i.e. DRAM Chips, LCD Displays, Big Screen TVs and Microwave ovens, in terms of international market share, among 8 various product categories. Venture was the worldwide leader in making DRAM, SRAM and NAND flash chips. Corporation profits from chips was less than Intel but its incomes from chips was growing faster than Intel and has actually grown close to the earnings levels of Intel, as offered in the case Display 2.

In addition to the chips Venture mobile market was likewise growing at a high rate than its rivals i.e. Motorola and Nokia. Venture's cell phone's sales growth was 51% as compare to Motorola with only 4% and Nokia with zero sales development. The significant reson behind Enterprise's high growth despite of higher prices than Nokia and Motorola was the company's high-end quality mobile phone.

Corporation was likewise profiting from increasing market share of high end LCDs as given in case Exhibit 3. The major reason, making the company make it possible for to avail the opportunity is its mass production at low cost. Sony was the biggest competitor for Lyondell Chemical Company 2 Case Study Analysis in LCD market, however, it had actually likewise begun joint endeavor with Org in 2003 for LCD making, minimizing the competitors for Corporation.

Porter's Competitive Method

Low Expense Leadership strategy of porter is totally executed by Venture the method they achieve economies of scale by strengthening their core proficiencies of production. They always bring something innovative and brand-new whether it's a service or an item.


Alternative Service 1

The Chief Marketing Officer (CMO) of Lyondell Chemical Company 2 Case Study Solution would produce a new brand image by targeting the more youthful generation of the specific country. As, especially smart phones of Corporation are popular amongst the younger demographic.


1. It is the best method to construct Customer Lifetime Value (CLV) by developing a long-lasting relationship with clients. Construct commitment through delivering value and reap the benefits for long-term, as research has showed it is much cheaper to keep present clients than to bring in new ones.
2. Another pro of this alternative is that word of mouth spread faster among more youthful people and which in turn will bring in brand-new clients for my products.


1. Old customers who were connected with Venture before may not like this brand-new image the business is attempting to represent.
2 It will sustain further expenditures to reposition some items and it might not even bring success as the trends change really quickly among the younger demographic.

Alternative service 2.

Enterprise has made making its core proficiency for the most part of their service and due to which its managers are not scared to totally get out of their comfort zone. It would be done by organizing training workshops throughout which value of marketing will be taught and numbers will be provided. Failure to get the passing scores will get benched. Marketing environment should be produced internally initially as genuine marketing starts inside the corporation.


1. Its pro will be that all the marketing approach fans will come out and likewise the opposite ones.


2. Its con can produce an extremely unhealthy environment in the work environment, as individuals often withstand modification due to the fact that they fear it.

Recognize the best alternative

First option is the very best as it plainly has more pros because as soon as a Consumer Lifetime Value is built the company will make money from it till that client is alive and has purchasing power as well. Plus, our target consumers are the younger generation which are bound to live longer than the present aging people. However, Org's primary goal is to create loyalty among its customers and make them redeemed it from them and even purchase their different products also.

Execution Strategy

• Targeting younger generation through social marketing, producing a relate to them like Pepsi finish with music. And set the expectations possible and realistic.
• A team including finest marketing and sales specialists must be put together, and both views must be taken into consideration prior to protecting the resources needed to carry out the plan.
• Thorough interaction of the plan should be done as it is really crucial for everybody to be on the same page to make it work.
• Tasks and timelines should be construct and interacted appropriately to each person responsible.
• The manager must utilize a dashboard which reveals the progress of all the jobs which have been done or about to be done and by whom.
• The manager ought to keep track of and keep a consistent check on the total and private efficiency.
Since any brand-new trend or policy might come in due to which all the things currently planned have actually to be adjusted, • Everyone need to be ready to adjust midway. It's better to have contingency strategies already prepared.
• At the end of the project the supervisor must interact the results and if successful ought to commemorate with the group.


This modification the spending plan allotment of lots of managers and different countries were dissatisfied and argued but the analysis done by the program was accurate and showed figures like North America and Russia development potential warranted a 35% allowance while they were getting 45%. It truly helped to fairly distribute the resources and capture more consumers by spending more on ads on the high development capacity regions of the world.

Its constant investment in R&D and innovative practices have actually moved them to new heights however for them its' only the start and they want to be among the leading 3 brands in the world. Their marketing efforts should be directed towards more youthful demographic amid the internal arguments about marketing and ought to produce Client Lifetime Worth as it will not just provide them advantages now but will continue to gain it till the client lifetime. As the expense of maintaining the consumer is much cheaper than bring in a brand-new one.