Samsung Company is a world leader in digital technology innovation. Samsung believes in innovation and continue to look after the new technology to grow their business. I believed that company wanted to build a market in which customers are more loyal to the Samsung brand and trust in the name of Samsung.
“SAMSUNG is dedicated to devel-oping innovative technologies and efficient processes that create new markets, enrich people's lives, and continue to make Samsung a digital leader” http://www.samsung.com/hk_en/images/aboutnew/corporateprofile/title_txt.gif Samsung accomplished its success through the strategy of how to manage creativity, partnership with venders, and talent. Samsung is not only expanding in electronics but also expanding into other industries such as health care, medicine, and biotechnology.
Samsung’s mission and vision will make Samsung a cutting edge company. I would say Samsung is the creator of the future of electronics. Samsung is among the world’s top five electronics brand and has $400 billion in revenue. The mission of the company explain everything
“As stated in its new motto, Samsung Electronics' vision for the new decade is, "Inspire the World, Create the Future."This new vision reflects Samsung Electronics’ commitment to inspiring its communities by leveraging Samsung's three key strengths: "New Technology," "Innovative Products," and "Creative Solutions." -- and to promoting new value for Samsung's core networks -- Industry, Partners, and Employees. Through these efforts, Samsung hopes to contribute to a better world and a richer experience for all” (http://www.samsung.com/us/aboutsamsung/corporateprofile/vision.html)
Micro and macro environment for Samsung globally Porter’s five forces: The Threats of new entrants There is always a potential threat for Samsung that a new company will enter into the market. Most of the companies find outsourcing company in China and label its brand. Only thing they have to do is to formulate a marketing strategy and distribution channel. Today’s global economy is depended on China. China is called world’s factory. Most of the products are manufactured at very low cost in China. Electronic companies like HP, SONY, DeLL, Gateway, Apple, and many others used China’s manufacturing industry. So there is always a threat of new entrants into the electronics market. “MANILA, Philippines - The Philippine electronics industry attracted $2.477 billion in fresh investments in 2011, the highest ever, and the new projects are expected to generate an estimated $5 billion in additional export revenues annually once they go into full commercial operation” (http://www.abs-cbnnews.com/business/02/21/12/electronics-industry-attracts-24b-investment).
The Bargaining Power of Buyers Electronic world is changing everyday and in the market there are many types and many verities to pick one from. Even it’s very difficult for a customer to find the best one with very competing prices to each others. Most of the individuals are price sensitive they can check the prices on line and fine the cheapest price before making any decision. Institutional buyers are more quality sensitive than price. Most of the companies focus on corporate customers. There is a completion in the market. The Bargaining Power of Suppliers
Intel is leading in microprocessors it provided 85% of CPU so the power of suppliers is high because of low number of competitors in the market. Different companies produce different kind of products. Hard disk producers are many in the market. The power of suppliers is quite low because of many competitors in the market. Threats of Substitutes
In the changing technology world, there are many substitutes available to the customers to choose one. Companies like Samsung have to keep the quality and price up to the customer expectation. Samsung should understand the need and demand and desire of each group of customer. Samsung interviewed customers to check the water. The Intensity of Rivalry among Competitors
Samsung group has many competitors in the global electronic world. The brand name competitors of the Samsung are LG, SK, Matsushitsa, Micron, Sony, Apple, Kyobo Life Insurance, Meiji Life Insurance, Sumitomo Life Insurance, Hp, Dell. SWOT analysis of Samsung
Strengths •Electronics Product line and investment in other industries such as life insurance and biotech etc. •Heavy investment into R&D and marketing strategies. Company has more than one dozen R&D centers around the world and its 138000 R&D team members are working hard for the company’s success. •Leader in electronics especially in cell phone and more or less 60 other products. For example DVD, Ac, LCD, and Refrigerators etc. •Supplier of HD, DRAM, SDRAM, Memory Sticks, and semiconductors. •Decision making process of the company.
•Samsung provide better guarantee and service than its competitors.
Weakness •Some of the Samsung products are not user friendly. This factor is keeping Samsung behind in the Global electronics market. For instance there are many draw back in digital camera Samsung S860. First of all the lens of this camera turn off automatically after 30 seconds. •Company invested too much into the R&D but need to spend on marketing. •Competitors spent on advertisement heavily but Samsung can’t explain introduce its products via advertisements. •Need to improve the battery life of many of its products. Opportunities
•Globally the demands for electronics are increasing quickly. In the digital world everyone like to have his or her own cell phone and a laptop. •Need more production according to the market. •Market share can be increased in ASEAN regions, it is increased by 32.7% during the year 2006. •Cell phone market is very big and expanding by the time, this is the industry where Samsung should invest more. •Samsung has the competitive prices. The growing markets like India, China and Brazil are very price sensitive. Threats
•Prices of the electronics are decreasing 10% annually that is a threat to most of the electronic manufacturer in the industry. •Entry of new products every day. •Green products and environmentalists organizations. •Restrictions on usage of lead, cadmium, mercury and flame retardants products. •R&D need to pay attention while developing a new product previously Samsung paid $134 million Inter Digital because Samsung lost a patent dispute. Similarly Ericson filed a lawsuit against Samsung. •Counterfeiting products are the major problem for any company in the world. Duplicate product’s annually revenue is more or less U$500. •It’s always a threat when outsourcing any product to a country like China where law is not well implemented to protect the patent rights.
Samsung and Business Environment of Canada Study shows that Canadian customers prefer a better quality than price. Customer demands better guarantees and return policies. Canadian population is considered one of the educated nations in the world. Canadians welcome new technologies and love to learn. Sony is the first one who invented color television, and played a leading role in the world of electronics. Most of the Canadians like Sony brand and pay the high price.
Sony is very much dominated the Canadian market, the price is high and products have conventional design. Samsung can penetrate the market with better advance stylish designs and lower price and better guarantees. I believed that will take time to take over the Canadian market. “We’ve been No. 1 in TVs since 2006 in Canada,” Politeski says.
“In Canadian living rooms, there are an awful lot of Samsung TVs. So the brand name — whether it’s on TVs or appliances or mobile phones, any of our product categories — continues to grow momentum, and consumers become more and more interested in it. How do you become No. 1 in any category? Attention to what the customer thinks is most important” (http://business.financialpost.com/2012/05/01/samsung-aims-to-dethrone-apple-in-smartphone-market/).
With Sony Canadians have no other choice if SECA use a right marketing strategy it’s possible that Samsung can win people opinion and market share. SECA should carefully formulate strategy on the target market, segmentation and repositioning the product. SECA can use demographic segmentation and divide market into four groups. Low income families, group of people who are price sensitive.
High income families, group of people who prefer quality over the price. Young generation group, who prefer new innovations and technology advancements. They buy products when it comes first in market and pay the full price. The old generation group those people buy when they need and are very price sensitive. Business user group those people are less price sensitive than quality, customized products and guarantees.
Hobbyists is a group who like to buy new innovations which can satisfy their hobby quest. SECA can differentiate its products from others buy innovating user friendly and cost effective products for everyone. SECA should listen their corporate customers and customize their product according to their needs. “Canadian expansion strategy will be on full display. Following in the footsteps of rivals Sony and Apple, Samsung plans to open several stand-alone retail locations across the country, as the company attempts to strengthen its direct relationship with consumers” (http://business.financialpost.com).
SECA should use 4P’s of marketing to achieve success in Canadian market. Product; brand strength could be achieved by producing better products and user friendly products. It could be done by producing stylish and durable cell phones, brighter and bigger flat screen TV’s, cost effective, energy efficient, durable AC, refrigerators, and other electrical home appliances. Place; Samsung should open its own retail stores across the country.
Currently Samsung use distribution channels those are Best Buy, etc. Samsung should use online and on site distribution channels. Price; There are variance in the Samsung’s prices and discounts which creates confusion in the market. Samsung have to pay attention on the pricing strategy of its products. Promotion; Samsung should invest more in advertisement and promotion in Canada. With the help of advertisements a company conveys its message to the customers.
A right advertisement and promotion would be a key to success in the Canadian market. Canada could be a tough market for Samsung if the company will not redesign its marketing strategy. Canadians are more loyal to SONY brand. To compete the electronic giant like SONY, Samsung should adopt a better strategy that produce a better product, price, placement and promotion. Samsung Corporate and Global Strategy
I agreed more or less with the Samsung’s corporate strategy and global strategy. There are few steps need to take in Samsung’s corporate and global strategy. I will discuss about why I like Samsung’s corporate and global strategy. Business Wire of Boston writes about Samsung that it took the 25% of the market share and was star performing during the first quarter of the year 2012.
I believe that Samsung is doing something right at the corporate and global level the reason why company became the world’s number one had set vendor. “BOSTON--(BUSINESS WIRE)--According to the latest research from Strategy Analytics, global handset shipments grew a modest 3 percent annually to reach 368 million units in the first quarter of 2012. Samsung was the star performer during the quarter, capturing a record 25 percent market share to become the world’s number one handset vendor for the first time ever” (http://www.businesswire.com).
At first Samsung’s business model was to produce more mobile phone in number, they pay less attention to the quality. By the time Samsung decided that company should produce not only quantity but also better quality to compete in the global market.
They accomplished this dream with their vision “Leading the Digital Convergence Revolution”(www.samsung.com). Chairman of the company Mr. Lee played a dynamic role in the success of Samsung. During the revolutionary strategic change in the company he said that we have to change everything only we will keep our children and wives. It sounds funny but the Chairman Lee changed everything in the company. The new strategy strived more on better look and quality than quantity.
The design advisor Tom Hardy helped Mr. Lee’s vision to accomplish. Company’s designers had been sent to different fashion and design companies around the world to have a better perspective about the global design. Samsung took advantage from its design centers around the world and become a global electronics name that consumer trust and like. “If money was the answer to innovation then Samsung Electronics would certainly rank among the best in the world. Samsung spent 10 trillion won ($9 US billion) on research and development in 2011” (http://www.vancouversun.com)
Samsung can produce in house semiconductors, LCD screens, and memory plant. This is the reason why company can independently, cost effectively, and rapidly response to the changing trends of the market. Samsung need to