Competitive Dynamics

CASE STUDY OF SAMSUNG

Prepared By:Jishnu Mohan

INTRODUCTION

• Samsung was founded by Lee Byung-Chull in 1938 as a trading company.

• It is a South Korean Multi- National Company.• Global Market Leader in more than 60

products including DRAM, SDRAM, LCD Displays, etc

• Tagline- “ Inspire the World. Create the Future

TRANSFORMATION

FIRST PRODUCTSPC- 1000

LATEST-CHROMEBOOK 3

SAMSUNG S WIDE RANGE OF PRODUCTS NOW

Growth Engine of Samsung

Marketing Strategy

• Focussed on all the electronics manufacture• Manufactures both components for products

and actual device

Contd..

• Enhanced product portfolio.

• Wide Distribution Channels.

• Adjust preferences for specific market.

• Increased Commitment to emerging markets.

Contd..

• Provide more than extra.

• Pours a lot of money into R&D

STRENGTH

• World’s most successful Electronics Manufacturer.

• Number 1 marketer of mobile phones with 21.4% of world’s largest market share in second quarter of 2015.

• Amazing Research and Design capabilities.

Contd..

• Strong manufacturing and marketing strategies and capabilities.

• Innovative and attractive advertisements.

Weaknesses

• Chinese competitors are catching up to Samsung in smart phone market.

• Apple Products are more advanced and more reliable than Samsung

• Heavily Dependant on Consumer electronics sales in market

Opportunity

• Growing market for smartphones, tablets and other devices especially in developing countries.

• Growing online market from sales channles such as Amazon, Flipkart, etc.

• Research and Development might lead to new technologies.

Threats

• Hasn’t been able to overcome Apple s reputation for reliability

• Declining or stagnating middle class income in North America and USA could reduce customer buying power in those key markets.

• Apple could enter more consumer product areas such as home appliance and camera and compete with Samsung ie. threats from competitors.

Contd..

• Budgeted $40 billion during 2005-10 for Research and Development. This type of huge investment on R&D might back fire when results aren’t obtained.

Product Life Cycle

Samsung s Marketing

• At a mass level, Samsung sponsored 6 Olympics and ran several global ad campaigns

• Had catchy lines like “ The Next Big Thing” to lure customers.

• All the ads were family based and also added some elements of humour.

Questions

1. What are some of Samsung s greatest competitive strengths ?

Ans: Throughout Samsung s existence, the brand

evolved with time resulting in competitive strengths. In the beginning, it focussed on volume and market domination. Then, cut company fat, emphasised product quality and manufacturing flexibility.

Questions

2. Samsung s goal of $400 billion in sales by 2020 would bring it to the same level as Walmart. Is this feasible ?

Ans:Yes. This is definitely feasible. Samsung is currently the

9th largest global brand and the number one in Smartphones, TV’s and memory conductors. This leadership position suggests that they will thrive when expanded into new areas. Moreover, it sells $200Billion now without all these expansions.

Summary• Incredible transformation.• Samsung phones are the growth engine of Samsung.• Brilliant Marketing Strategy.• Strength- No.1 marketer of Mobile Phones and brilliant

R&D.• Weakness- Competitors catching up.• Opportunity- Emerging countries, a big market.• Threats- Apple perceived to be more reliable.• Product Life Cycle.• Good Advertisements

DISCLAIMER

• Created by Jishnu Mohan, SRM University during a marketing internship by Prof. Sameer Mathur, IIM Lucknow