Samsung

-Multinational Corporation

Submitted To:

Qudrat-E-Elahi Asif

Dept. Of Marketing and International Business

North South University

Submitted By:

Name Id

Ekram Islam 1431107630

Ashraf Ali Parvez 1430979630

Md. Tuhin Talukdar 1430869030

Md. Arif Kamal 1430595030

Md. Radwan Hossain 1430416630

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Group 6

Contents:

(a) Executive Summery

(b) Current Situation Analysis

(c) Companys’ Marketing Objectives

(d) Swot Analysis

(e) Marketing Strategy

(f) Action, plan and program

(g) Conclusion

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Executive Summery

This paper examines Samsung Electronics successful marketing strategy in the mobile phone business. It

examines its early efforts at developing a competitive product in the domestic market, its globalization

strategies, and some of the key challenges it faces today. The paper provide insights into how a late-comer to an

industry can overcome certain disadvantages and successfully position itself as a widely respected and

successful brand.

This report will focus solely on the Samsung mobile-phone industry, given that the global market, both

in terms of the major players involved and the types of mobile devices that are sold in global market.

The smartphone industry consists of all companies that manufacture and sell smartphones to consumers.

This industry is a massive, fast paced environment where products are constantly updating and changing. It is

characterized by quickly evolving technology and designs, short product life cycles, aggressive pricing, rapid

imitation of product and technological advancements, and highly price-sensitive consumers between the ages of

18-49.

The areas of opportunity include cloud computing, personal health management, the creation of less

expensive devices and the development of new operating systems. The major threats in the market include rapid

technological changes, the decline of the new user market base, a wide variety of imitations and substations and

numerous barriers to entry. While there are numerous barriers to entry, the rapid growth of the market provides

opportunities for companies that have sufficient capital and thriving innovation to enter the market

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Current Situation Analysis

Company Overview

Samsung is a South Korean multinational Conglomerate headquartered in Samsung Town, Seoul, South

Korea. It was founded in 1983 as trading company by Lee Byung-chul. Samsung entered the electronics

industry in the late 1960s which is now the world's largest information technology company (measured by 2014

revenues, and 4th in market value). Samsung was consistently successful in satisfying customers by providing

innovative products (Apparel, chemicals, consumer electronics, electronic components, medical equipment,

precision instruments, semiconductors, ships, telecommunications equipment) and stunning services

(Advertising, construction, entertainment, financial services, hospitality, information and communications

technology services, medical services, retail).

Samsung Electronics Co. Has 5 Major goals.

1. To be one of the top three electronics companies in the world in quantity .

2. Have double sales revenue.

3. To have market share.

4. To identify eight growth engines for Samsung's business.

5. To "Inspire the World, Create the Future."

Current market analysis

Samsung Electronics (Mobile Division) operates in one of the most competitive markets of the world.

According to the US Federal Communication Commission 67 new Smartphone devices are introduced every

year. Samsung traditionally had a conservative image that focused on low-price products for the lower end of

the market. With low prices it was able to compete in the lower-market whereas in the upper market it had

lesser penetration. To penetrate the upper-market Samsung had to give up their lower-market position and focus

on innovation and perceiving a higher brand value. The following is the STP Analysis of Samsung Mobiles.

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Geographic Segmentation

Region-

Samsung has divided the Asian market into different geographical regions such as northern, eastern and

southern areas

City-

Samsung is targeting different countries of Asia differently by dividing as different markets such as Indian

Market, China market.

Demographic Segmentaton

Age-

Age factor is not really involved in Samsung segmentation but its most users are adults enthusiastic people

Family size-

Samsung Products are offered for all family sizes

Gender-

Samsung home theater system is equally beneficial for male and female

Income-

Samsung Products are offered with varying features to different peoples based upon their income level i.e. low

(upto $ 1500) lower middle ($.1500-3000) middle ($3000-5000) upper middle ($ 5000-7000) and high (above$

7000)

Occupation-

Samsung has divided the consumer into different categories based upon their occupation i.e. businessman, self

employed, students and teachers

Education-

Samsung is also keen to know about the education level of its target market i.e. illiterate, school 5 to 15, under

graduate, graduate and postgraduate

Psychographic Segmentation

Lifestyle-

Samsung is also classifying customers on different levels based on different lifestyle of the people i.e. culture

oriented, sports oriented, outdoor oriented

Personality-

customers are differentiated on the varying level of personality such as compulsive ambitious Behavioral

Segmentation : Benefits : Consumer are also targeted differently based upon the benefits that are seeking in

Samsung electronics i.e., some people may want good quality , some may want low services and some want

good

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services.

TARGETING

After segmenting the market based on the different groups and classes, the targets need to be chosen. Samsung

mobiles have the following target customers:

Trendy young people.

Professionals.

Large businesses.

The common cellular phone users.

Organizations such as: services to public safety, the government, and both utility and manufacturing

enterprises.

Institutional sales for colleges.

— Target is not only number driven but also about acquiring and retaining customers.

POSITIONING

Positioning is about the customer perception about the brand as being different from the other brands on

specific dimension including product attributes.

The strategies adopted by Samsung to position itself in the Mobile Phone market are as follows:

(i) It focuses more on the real margin which comes from mid-to-high-end segments.

(ii) Samsung Concept Store.

(iii) Market making & category creation in small towns.

(iv) Wider Care Network.

(v) Access to Samsung care line.

(vi) Pioneering in the 3G segment of mobile phones.

(vii) Branded itself as a synonym for quality.

(viii) Created a Unique Brand Image for itself as a high end value driven brand.

Customer needs, Factors and Purchasing Decisions

Samsung Company created a bridge between the customers and technology to full- fill customer needs.

Opening new possibilities in communication, Samsung has launched its products, a global

communication device that works across all over the world. Phones, tabs of Samsung allows users to

interact with friends and family. Samsung mobile allow users calling, taking photos, sharing text,

images, hand-written notes and watch video instantly, Listen to music and many more.

MAJOR FACTORS INFLUENCING BUYER BEHAVIOUR:

Consumer behaviour is an attempt to understand & predict human actions in the buying role. Consumer

behaviour is defined as “all psychological, social & physical behaviour of potential customers as they

become aware of, evaluate, purchase, consume, & tell others about product & services”. Consumer

behaviour includes communication, purchasing & consumption behaviour. Consumer behaviour

includes both consumer & business buyer behaviour.

Cultural Factor

Social Factor

Personal Factor

Psychological Factor.

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Culture Factor: Cultural factors comprise of set of values and ideologies of a particular community or

group of individuals. As in USA mostly people prefer smart phones while in developing countries like

INDIA, Bangladesh and SOUTH AFRICA their people prefer simple mobile phones.

Social Factor: The facts and experiences that influence individuals' personality, attitudes and lifestyle .

If a teenager purchase a mobile he would prefer more of entertainments & games,

while an official corporate will prefer more on presentation and professional mobiles.

For Example: Somebody wanted to purchase a mobile so he went to the nearby store and purchased a

samsung mobile because his friends and colleague were using same mobile and they were satisfied by it.

Psychological Factors: Mostly people are attracted towards advertise of samsung smart mobiles and

are motivated to purchase the same. Some people purchase samsung smart phones to overshow their

beliefs and attitude towards their companions. If a person is using a mobile of samsung company he is

mostly aware about feature of the samsung mobile he will force other consumer to buy a same brand of

mobile. .

Personal Factors: Consumption of samsung mobile is also affected by the stages of family life cycle

like bachelor stage, newly married couple, young & old couple and independent children uses different

samsung phone according to their uses.

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Product

Samsung is one of the world’s leading manufacturers of semiconductors, information technology

products, digital media, and telecommunication infrastructure systems. They manufacture different

innovative products including IT business products, printers, professional displays, telecommunication

devices, set top boxes and solar modules.

Place

Samsung is headquartered in Seoul, Republic of Korea. It has operational locations in Korea, the United

States, Europe, Asia, Africa, and China. With its network of subsidiaries and affiliates, it operates in

more than 72 countries worldwide with 197 offices (Pederson, Samsung Electronics Co., Ltd, 2010).

Price

The prices after contracts are; Galaxy S 6 retails for $199.99. Galaxy Note 3 retails for $299.99. These

all depend on the services and features that are provided. This retail prices depends upon multiple

variable and promotional incentives.

Promotion

The company uses all five elements of promotion; Advertising, Public Relations, Sales Promotions,

Direct Marketing and Personal Selling.

Distribution

Along with the launch of new products, Samsung also consolidated its distribution system. Samsung

had 18 state- level distribution offices and a direct dealer interface. The direct dealer interface helped the

company get quick feedback from dealers, and enabled it to launch products according to consumer

needs.

Competitors and Market share

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Company’s marketing objectives

Samsung mobiles objective was to built image and brand to suit consumer’s taste& preference also

benefiting their wants & needs. Moreover, they also aim to make technological advancements and class

leading innovations to provide an image of premium look and feel throughout their product offerings. Here ,

are some objectives that need to be considered: Maintain positively controlled growth and development.

Generate marketing programs that aims to pentrate other markets. Maintained the increased brand

awareness through promotions and sponsorships. Develop stratiges that will address customer feedback on

their product.

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SWOT Analysis

Strength: Samsung has become a world known band over 200 countries. Samsung enjoys the widest range

of product portfolio which includes mobile phone, tablet, tv, pc’s, Laptop, printer and other accessories.

Well diversified and differentiated product line to meet changing customer needs. Design with an attractive

styling that interests the customers as the result of the development of Samsung new product team of

product designers.

Opportunity: Samsung has product variation that’s why they can easily capture the customer. They launch

creative products with new technology, innovative products and creative solutions. Samsung new products

are available get customer because they have more stores to supply the new products. Different types of

mobiles are available in market at affordable price. They offer additional services to return existing

customer and attract new one.

Weakness:

#1. Average prices of product seem to be a low quality products.

#2. Not proactive introducing a new product.

#3. Differences between cultural and language which lead the group into conflicts.

#4. Haviely investing into development of newer markets and not focusing on any one of core

competencies.

Threats: legal war between Samsung and it’s competitors such as Apple. The technology changes rapidly

that impact on products quality.

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Marketing Strategy

A big company must have some strategy and implementation of strategy is the core in which an organization

should develop, utilize, and amalgamate organizational structure, control systems, and culture that lead to

competitive advantage and a better performance. Samsung has a totally different strategy from others, and it's

working great. Just a few years ago Samsung was struggling to catch up in the Smartphone market. Now it

makes more of them than anybody else and has Apple on the back foot, in addition to being the world's largest

technology company by revenue. The heavily hyped launch of its flagship Galaxy S6 Smartphone is the latest

step as it tries to overtake Apple, and they've gone all out with a massive screen and impressive new

features. Here are some of the core pillars of Samsung's strategy. Samsung is better than anybody else at

learning from its competitors. "A market reader is sort of the classic fast follower," as explain by Barry

Jaruzelski, senior partner at Booz&Co and the co-author of the Global Innovation 1000. "It doesn't mean

they ignore their customers, but they're very attuned to what competitors are doing and what other people are

bringing to market first and observing what seems to be gaining traction, then very rapidly coming up with their

own version of that innovation. Apple has a huge cash pile, but Samsung seems to be more willing and able to

put their money to use. Samsung's research spend is 5.7 percent of its revenue, compared to 2.4 percent for

Apple. Samsung is a diverse business with chips, displays, and other technology. This pays dividends, allowing

it to compete on price and increasingly, offer features Apple hasn't gotten too.

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Atcion, plan and program

Developing a unique brand community

If a company in the smartphone industry can successfully create its own “ecosystem” of products, that company

can combat the threats of rapid technological changes and the large amount of imitations and substitutions, as

well as the decline in the new user market base. If switching costs are high, it’ll be harder for the competition to

enter the market and gain a user base. To do this, a company would need to develop its own app store, its own

operating system, and have a product line that exclusive to its brand, so they all work with each other but not

with other company’s products.

If a company is looking to enter the smartphone market, this strategy will give it a competitive

advantage if deployed correctly. The company would have to be innovative in marketing and design in order to

convince consumers to substitute their current smartphone for a new one.

However, this will take some time, probably five to 10 years at minimum, for an existing company in

the market (such as Samsung) because they would have to change their brand identity and product portfolio

slowly, as to not upset their current customers.

Produce cheaper Smart-Phones

The new user market is expected to decrease because the smartphone industry is close to saturation. However,

there are two distinct segments that haven’t entered the market yet: (1) those with low income (those who make

under $50,000 annually) and less educated (a high school diploma or less); (2) those who are 65 and older. This

creates the opportunity for companies in the industry, or for companies looking to enter the industry, to develop

two new smartphone products.

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Conclusion

With the ever growing threats in the smartphone industry, companies must learn to predict and adapt to their

consumers and their environments in order to remain a competitive force in this market. As a team, we have

learned that in order for Samsung and the smartphone industry to grow and succeed together, they must focus

on the users of their technology and cater to their constantly evolving wants and needs. In order to be

successful, companies will need to engage in strategic business planning and be proactive in adapting to the

consumer. One way this can be achieved is by developing a unique brand community.

Competitive companies will engage in research and development to innovate and create the latest

cutting-edge operating systems, application stores, and their own unique software.

They must take their current innovations, and simplify them, to develop products that have similar

features and benefits, at a fraction of the price to consumers. Research and development along with innovation

are clearly necessary to companies that have the desire to continue being a staple in the smartphone industry.

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References:

1. Principles of Marketing, Phili kotlar and Gary Armstrong. (2013 Edition)

2. http://en.wikipedia.org/wiki/Samsung

3. http://www.samsung.com/in/business/

4. http://www.samsung.com/in/business/business-products/mobile-devices/

5. http://markets.ft.com/research/Markets/Tearsheets/Summary?s=SSNLF:PNK

6. http://www.forbes.com/fdc/welcome_mjx.shtml

7. http://www.vanityfair.com/news/business/2014/06/apple-samsung-smartphone-patent-war

8. http://www.marketing91.com/marketing-mix-of-samsung/

9. http://www.samsung.com/uk/news/global/samsung- launches-new-distribution-scheme-for-

uk-independents

10. http://samsungmobileb2b.com/partner/seap/Distributor_Program.do

11. http://www.answers.com/Q/What_distribution_channel_Samsung_use

12. http://www.idealessaywriters.com/sample/samsung-marketing-analysis/

13. http://www.ukessays.com/essays/marketing/strategic-analysis-and-marketing-strategy-for-

samsung-marketing-essay.php

14. http://www.marketing91.com/swot-analysis-samsung/