Why the Smart Home Revolution Is Here—And What It Means for Brands with LG Electronics, Louis Giagrande

[00:00:00] We're sort of trying to look at AI a bit different. We're calling it affectionate intelligence instead of artificial intelligence because we want it to be as natural as AI can be. To thrive in a rapidly evolving landscape, brands must move at an ever increasing pace. I'm Matt Britton, founder and CEO of Suzy. Join me and key industry leaders as we dive deep into the shifting consumer trends within their industry, why it matters now, and how you can keep up. Welcome to The Speed of Culture.

[00:00:34] We're here live in Las Vegas at the CES Show 2025 and we're thrilled to chat with Louis Giagrande, the CMO of LG Electronics North America. From spearheading digital transformation to launching cutting edge campaigns like Switch for Good and Live Beyond, Louis is at the forefront of innovation and marketing and consumer culture. So great to see you, Louis. Louis Giagrande, The CMO of LG Electronics North America. So I imagine this is not your first CES. Louis Giagrande, The CMO of LG Electronics North America. No, I think it's in the 20s at this point. Yeah. And how has it evolved over time? Well, the reason for coming out here is definitely involved.

[00:01:04] Like there was a point early on where this is where you'd showcase new products to retailers and media. More of a trade show. Yeah, it really was. Yeah. And nowadays it's more of a place to bring ideas and people together. Most of our conversations, obviously, we're retail partners. Even some media happened before we're out here, but this is just a place, almost a celebration of what's coming on in the year ahead. And a lot of great meetings happen here because that's a place where we all convert.

[00:01:31] But you also see, we were mentioning this on the way over here, just the difference in who's has boots and who's, you know, demonstrating. I mean, automotive has become really big part of CES, but you have medias. It really has become a much broader thing. It almost shouldn't be called Consumer Electronics Show in the war. And the timing of which obviously kicking off the year and all the change and all the innovation kind of bubbles up in the fourth quarter. And then everyone's ready to say, okay, we've turned the corner. Yeah. Here's what's next. Yeah.

[00:02:00] What's next for LG Electronics? Where are you focused on heading into 2025? Yeah. So if anyone had heard from a press conference, we've really been focusing on this evolution of LG moving from being a hardware company into what we're calling a smart life solutions company. That's something that was introduced a little over a year ago. And it's something that's going to be part of our future vision for the next 10 years.

[00:02:22] It's a very ambitious endeavor, but we really have to, I mean, most companies have to start thinking beyond hardware anyway if you're going to survive in this next wave. Just because it kind of becomes commoditized and margins get squeezed and it's hard to differentiate. Yeah. But where we have a really nice starting point is just our product portfolio is really broad, right? So if you make really good products and you're touching so many parts of the home and the office and now in mobility, you really have that foundation to build off of this.

[00:02:51] Start introducing how does this all work together? How does it become more of a solution? So I think the simplest way to say it is we have to go from being a good purchase to a great experience for the consumer. Right. And of course, that requires different muscles as an organization. Obviously, if you're just a components company, you just have to be good at manufacturing and supply chain, etc. This involves consumer experience, design, leveraging data, software development, etc. So how has LG evolved in that realm?

[00:03:19] And in that regard, what is the ultimate vision of being a smart life solutions company? Yeah, it's really catering to a consumer. One of our mantras is like innovation for a better life. So how do we bring our innovation to make your life run smoother, be easier? You know, they talk about the kitchen being zero labor. How do we start reducing the challenges or the work that has to happen in the home? But a lot of this is, because it's interesting that we're talking about like catering to consumers' needs.

[00:03:48] A lot of this is also proactively finding what they need before they know they need it. Even though they need it, right? Yeah. So that's like where we're ultimately headed. But you know, right now it's being able to cater to the most immediate needs and tie these all together in a way that makes sense. I mean, we've been talking about smart home for a while. It's not like something that's new and groundbreaking. AI helps a lot with just making it make sense. But why do these products need to talk together? You know, how does it really benefit your life beyond just alerting you when the laundry is done?

[00:04:18] Right. So the setup has been cumbersome. Yeah. And most people are not technically savvy. They're intimidated by it. And I think that we thought voice was going to be the solve. I would argue voice was not out of the gate what we thought it would be. But now with AI, when you talk to ChatGPT, even you talk to Alexa and Siri, it's much better experience now. Much better. Is voice at the center of how you see the consumer interacting with the smart home? Yeah, definitely. I think just AI is at the center, like just making it, figuring out how they work together.

[00:04:46] So voice is a huge part of this. We're sort of trying to look at AI a bit different. We're calling it affectionate intelligence instead of artificial intelligence. Okay. Because we want it to be as natural as AI can be. Right. So you're saying there's voice at the center of it. It is in the sense of we want the conversation to be a real conversation with LG's products and infrastructures. In that sense, yes. But there's a lot that goes on behind the scenes.

[00:05:13] Voice is just the commands and getting the products to execute the commands is the tricky part. Yeah, of course. So, and of course with the smart home, interoperability is huge because not everyone's just going to own LG devices and appliances. No. Yeah, we all have to really start thinking about how to work together and everyone's trying to stake a claim in this moving forward. Yeah. Amazon, Apple, Google, you guys, Samsung, there's a lot of players in the space. Yeah. And we'd almost be remiss if there was one winner, right?

[00:05:41] We need multiple winners to make this all work, people that work together. If it was just one, if it was just Google's platform that worked, that would be a mistake, right? Or if it was just Amazon. So making sure that there's that work. And LG has been really good with partnering with companies to try to find ways to work together. So when it comes to your role as CMO, obviously a big part of your job is packaging all these initiatives up into a story that consumers understand and care about.

[00:06:07] What are your thoughts on how LG is going to be positioned to the consumer as it moves away from just a components company to more of an ecosystem or smart life solutions? Yeah. So a couple of years ago, we started looking forward to what is our future vision and this idea of being a smart life solutions company came forward as our goal. There was a realization that we hadn't done a good enough job speaking to what the brand stands for. Yeah.

[00:06:34] And we're definitely guilty of here's the latest product, this is why the product's good, this is why it's for you. Talk about unique benefits. Yeah. Our brand is being communicated to consumers through our products. Thankfully, we make very good products, positive experiences, but the brand was meaning something different if you're a gaming monitor owner or a $5,000 refrigerator owner or air purifier. So we made a conscious effort in the trades. It was LG launchers, a new brand identity.

[00:07:01] I constantly say that would have been a mistake to do a new identity. What we did is make a commitment to tell the brand story because if you're going to welcome LG into your home to be part of the solution, then you really need to know what the brand stands for and be closer to the brand than just a collection of products. Sure. So when we looked at it and sort of really said, what's our DNA? What do we stand for?

[00:07:25] Obviously, we're the Life's Good Company and that's our slogan, but it's more of what we're seeing is like the DNA of that is this very sort of optimistic, positive approach to the challenges that the company was facing, but also in life in general. And that was a nice organic platform to build off of. And so now that we're asking like, how do we sort of tell these stories and align it to our brand identity? Three core values came out of this exercise of digging in and the sort of like rediscovering ourselves.

[00:07:55] One was uncompromising customer experience, which 10 years ago meant if the product broke, we fix it quickly and get it to you. Now it's like, how do we make the experience positive on a day to day basis? The second one, which I think is probably where we shine the most is called human-based innovation, which is we could do a lot of things. LG is a very creative, innovative company, but where they shine is making innovations that really have direct real consumer benefits, right?

[00:08:24] So could we make gadgets that you'd see in sci-fi movies? Yeah. Of course, but I appreciate things where it's, I'd love to use a dishwasher example because it's the least sexy example I could give. But I think it works well as we were hearing about what was the main pain points of dishwashers is it's loud when it's running and you can't be near, you're raising the TV volume. It wasn't dry when you get the end of it, it took too long to wash.

[00:08:50] And that was the innovation they focused on with dishwashers, one hour wash and dry and quiet operation. So at the end of the day, is it a groundbreaking innovation? Maybe, but what it really is is answering what the consumers need. Right. Yeah. And so I think that's why what makes it good as a marketer is we do have engineers who are looking at what the consumer's needs are mixed telling the story a lot easier. Yeah, for sure. Another thing that consumers, I think are increasingly in demand of is personalization.

[00:09:20] Yeah. And I know that's a big cornerstone of some of your approaches. You have this Thank You platform that really is about AI driven features. And I know some of the features enable the consumer to understand how much food is left in the refrigerator, et cetera. Once we go to the world of AI agents, which we are quickly going towards, do you see a world where the appliances are actually doing the ordering for consumers? And the smart home then could be more of a smart home of agents that can make your life just more efficient in terms of how you spend your time.

[00:09:50] I think it's that could be it. I think what we want to sort of make sure that we're doing is giving consumers the options, you know, like there should be a sliding scale on what you want. This smart home or this connected home to do. Right. In some cases, people might want the most automation and expense-free things possible. And others might want really- They might just want a refrigerator. Yeah. Or like part of our smart appliances is now, like one of the first things we did is proactive customer care.

[00:10:17] Like we want the products to inform the consumers if the filter is getting clogged, like before it breaks, things like that. Yeah. So I think that's sort of your baseline and then it builds off of like improving experience. We'll be right back with the Speed of Culture after a few words from our sponsors.

[00:10:33] So in terms of the consumer and how they're finding about your products and the way that they're purchasing, what are some of the changes that you've seen in terms of their behaviors that are having you rethink the way that you try to capture their attention in 2025? Yeah. You had brought up commoditization before. So in one of our categories, TV, you're starting to see heavy commoditization on TV. Yeah. So behaviors of shopping behaviors have changed so much because TVs used to be a very highly considered purchase. Right.

[00:11:03] I'm going to get a new TV. I'm going to put it in the living room. I'm going to move the living room to the bedroom. Way to cost drop there. Yeah. And now, you know, the antidote I often say is that you could go to Walmart to get some eggs and walk out with a 55 inch TV. Right. Because it was $200 and you're like, oh, we got that third bedroom that I could just throw this in. So not only is the cost dropping, but the dynamics that trickle down of get the latest TV for the main room and then the older TVs.

[00:11:29] Now you're getting like these cheap TVs you just throw into the various rooms. And even the cheap ones are 4K and they look amazing. Yeah. Like we do very well with our high end OLEDs, we're the market leader in OLED TVs. But the volume that you're seeing is, you know, in the mid to low. So the behaviors have changed. We see now about 40% of consumers are spending less than a day researching a TV because of the price points. So, again, part of this shift is TV is hardware.

[00:11:58] We can't exist just by having the best hardware. So our web OS system, we have 300 free channels now within our TV. Like that fast channels? Yeah. LG channels, you just get your TV connected to the internet and you have 300 channels. You're not paying for it. It's just part of the- Ad supported. Yeah. Ad supported. So you're seeing like our message needs to change from the mid to low. And it's not just the picture quality. Of course, that's always going to be there, but it's like, what else are we providing you beyond the TV, the hardware? Yeah. It's interesting.

[00:12:27] I mean, I've been thinking for a while that the TV is just such a missed opportunity because the same reason why Apple was so successful, because they had the last mile, they had their hardware in people's hands. And because of that, they were able to dictate the entire ecosystem. Yeah. Having your TV in someone's home. Yeah. You can really drive where their eyeballs go. You can drive the- But in order to do that and not have them switch to another input and deal with somebody else's interface, you have to be able to make great software that's easy to use and intuitive.

[00:12:57] Traditionally, companies that manufactured televisions have not done that. Yeah. And you're also seeing now, I think last year was the first time more consumers are accessing connected television through the TV's system as opposed to fire stakes. Yeah. And so that is the trend that's going on. So we've had a head start in really focusing on, I think our webOS interface is very good and it's always test well with reviewers.

[00:13:23] Reviewers, especially high-tech reviewers tend to be early adopters so they might have been more familiar with some of the stick options. Exactly. Early on. You know, we have a good interface. And consumers are valid to not have to plug in it. Yeah. Oh, no. Just turn it on and they want to spend more money and deal with switching inputs and all that stuff. It's a little bit wild west right now with all the different services. I think that'll also sort of converge a bit. It confuses consumers too. They don't know where to find anything.

[00:13:47] Then, especially you have now you have the NFL showing games on Peacock and Amazon Prime and they used to just turn on and watch the game. Yeah. And now for a lot of Americans, they don't really understand how this sort of all out. Yeah. I find it funny that there's actually services out there that people hired to tell them what subscriptions they have. Yeah. Yeah. Because they might have two subscriptions without realizing it. Oh, there's so many. That's the point we've gotten to. We're going to outsource. What am I spending my money on? Yeah. What's the paradox of choice?

[00:14:15] I think the best brands are ones that make consumers' lives easier. Yeah. And they reduce choice. And I think, especially in the world of home entertainment, there's just too much choice. There's too much fragmentation. No one remembers their passwords to anything. And you're starting to see a lot of these streaming services have growth deteriorate and they're getting a lot of churn because consumers just don't know how to access it and it's too much for them to think about. Yeah. Absolutely.

[00:14:38] So in terms of capturing consumers' attention based upon their new media consumption habits, where are you at relative to creating content, leveraging creators, especially with Gen Z, making sure that you can make your brand top of mind? Yeah. So the content conversation is something we have all the time with LG. I'm sure. Because just like what used to be your baseline asset kit has like tripled. You know, like if I'm selling a product now at Best Buy, what we would feel comfortable as our baseline asset kit for any product.

[00:15:07] And keep in mind, I got 1,400 product pages on my LG account. A lot of accessories, but hundreds of real products. Like products, you know, used to be alright with a few images, a video, and just the content needs. So the expectations from consumers, what we want to communicate to consumers. So we're really forced to get into this content factory mentality of pumping out, you know, sort of a real robust baseline asset kit. And so we've, of course, explored AI options. Yeah.

[00:15:36] You know, bringing in micro-influencers to do videos, not for their audience, but for their ability to do efficient content for us and things like that. The storytelling easier ways. Yeah. Right. And just, you know, get a fresh perspective. I mean, we're very good at doing the professional product demo video. And then you see somebody with a phone do a product video, you know, like that's just as good. That's how you consume it. Yeah, they're probably like in five minutes. And that's probably used to consuming, right? Yeah. They're on TikTok all day.

[00:16:02] They want to consume your product content the same way they're consuming all other content. Yes. So I think that you're still growing in that phase. But again, it's a little overwhelming when you're thinking about all the content you've got to create. And then it's all about differentiating, making sure you're clearly communicating. No one's reading anymore. No one has the patience for a video that's beyond 30 seconds. Yeah. So it's really, you have to fine tune your ability to communicate. You sure did. Yeah.

[00:16:26] So shifting gears here and just talking about you and your journey as CMO LG, how are you spending your time every day? What's the pie chart of your day look like and what success look for you in 2025? Yeah. So we launch hundreds and hundreds of products, you know, every year, right? So a lot of what we do in the marketing is preparing for launch, working with our retail partners. We're, you know, getting ready content creations, huge part. We've introduced a lot more brand activity these days.

[00:16:54] So it's a lot of what you would expect. I think there's always the organizational elements. We brought up before that it's going to be a big change to get to the point where we're moving from hardware to solution-based. There's a lot of conversations or thoughts about how do I restructure my org to cater to be more solutions oriented, right? A good example is when the older model, most of your communications are being done in transactional point, you know, like showing your product, selling your product.

[00:17:22] If we were going to be a solutions-based company, we have to learn how to talk and communicate in not only transactional phase, but in the mid to late ownership phase. Of course. What am I saying to somebody who's owned a product for five years? I don't want to be saying- What's the customer journey? Yeah. Right. And I want to be saying, buy the next product. I mean, there'll be that hopefully at some point. So that's- Life cycle marketing. Yeah. And then obviously the first party data you're collecting on the consumer and how each consumer is different in terms of what they're looking for and the other portfolio products they have. Yeah.

[00:17:52] And so, you know, most companies, most manufacturers in our industry are, there's a TV marketing guy and he's just focused on launching TV. So we've started to introduce more like an ownership experience team, right? So being dedicated to not just onboarding somebody with a product, but like helping them out through the life cycle. That team has to be closely connected to customer service. The customer service integration and with marketing is a huge topic right now for us.

[00:18:18] Like how do we, how do we make sure we're speaking and the experience that somebody has with a customer service agent is going to have more impact on their view of the brand than two years of advertising, right? So how do we make sure that message and communication and that experience is positive? So the short answer is a lot of thinking beyond the daily grind is how to evolve into being more a solutions company. What does that mean organizationally? What does that mean communication-wise? Yeah. A lot of change management. Understanding where the future's headed. Awesome.

[00:18:48] Well, to wrap it up here, I'd love to know if there's a mantra that drives your professional journey. If that comes to mind. When we did a, you know, we worked with TBWA on a brand manifesto that online in one of the first videos that said dive in smile first. And I just thought that was such a simple four word articulation of really the brand essence. You know, it's like, I like to equate it to for sports fans out there.

[00:19:14] It's like, you know, being a relief pitcher with the game on the line and runners on base. And at that moment, being able to sort of like embrace it with a smile. Yeah. The pressures of privilege is a kid, right? Yeah, exactly. And just, you know, not that it takes away from the moment, but being able to sort of step into that moment with a smile, with optimism and positivity that things will work out. And if not, we'll figure it out. So solution-oriented is probably the main mantra. Love that. Yeah. Well, wishing you nothing but optimism and positivity in 2025 for LG.

[00:19:44] Obviously, you're at the heart of a big transformation in the company. Yeah. And I'll continue to watch from afar in terms of the work that you guys are doing. So really appreciate you taking the time. Yeah. Thanks for having me. Absolutely. On behalf of Susan Adweek-Kean, thanks again to Luis Diagrande, the chief marketing officer of LG Electronics North America for joining us today here live at CES in Las Vegas. Be sure to subscribe, rate, and review the Speed of Culture podcast on your favorite podcast platform. Until next time, see you soon, everyone. Take care.

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