International Marketing Strategy PositionsSamsung as a Global Leader in Electronics

F. Ming

Marketing 6000

Dr. Thomas Kohler

F o r o v e r s e v e n t y y e a r s , S a m s u n g h a s b e e n d e d i c a t e d t o m a k i n g a b e t t e r w o r l d t h r o u g h d i v e r s e b u s i n e s s e s

t h a t t o d a y s p a n a d v a n c e d t e c h n o l o g y , s e m i c o n d u c t o r s , s k y s c r a p e r a n d p l a n t c o n s t r u c t i o n , p e t r o c h e m i c a l s , f a s h i o n , m e d i c i n e , f i n a n c e , h o t e l s ,

a n d m o r e . T h e i r f l a g s h i p c o m p a n y , S a m s u n g E l e c t r o n i c s , l e a d s t h e g l o b a l m a r k e t i n h i g h - t e c h

e l e c t r o n i c s m a n u f a c t u r i n g a n d d i g i t a l m e d i a .

T h r o u g h i n n o v a t i v e , r e l i a b l e p r o d u c t s a n d s e r v i c e s , t a l e n t e d p e o p l e ; a r e s p o n s i b l e a p p r o a c h t o b u s i n e s s

a n d g l o b a l c i t i z e n s h i p ; a n d c o l l a b o r a t i o n w i t h o u t p a r t n e r s a n d c u s t o m e r s , S a m s u n g i s t a k i n g t h e w o r l d

i n i m a g i n a t i v e n e w d i r e c t i o n s .

s a m s u n g . c o m

Executive Summary

I n 1 9 6 9 , S a m s u n g E l e c t r o n i c s w a s f o u n d e d i n S o u t h K o r e a . T h e c o m p a n y o r i g i n a l l y m a n u f a c t u r e d c o n s u m e r

e l e c t r o n i c a p p l i a n c e s s u c h a s T V s , c a l c u l a t o r s , r e f r i g e r a t o r s , a i r c o n d i t i o n e r s , a n d w a s h i n g m a c h i n e s .

B y 1 9 8 1 , S a m s u n g h a d p r o d u c e d o v e r 1 0 m i l l i o n b l a c k a n d w h i t e T V s . I n 1 9 8 8 i t m e r g e d w i t h S a m s u n g

S e m i c o n d u c t o r & C o m m u n i c a t i o n s a n d s t a r t e d w h a t w o u l d b e a m o s t p r o f i t a b l e g l o b a l m a r k e t i n g c a m p a i g n b y

s p o n s o r i n g t h e O l y m p i c G a m e s .

F o r t y y e a r s l a t e r , S a m s u n g E l e c t r o n i c s c e l e b r a t e d i t s 4 0 t h a n n i v e r s a r y i n 2 0 0 9 a n d h a s d e v e l o p e d i n n o v a t i v e p r o d u c t s , a d d i n g i n t e r a c t i v e s y s t e m s t o f u r t h e r e n h a n c e

c o n s u m e r e x p e r i e n c e .

E a r l i e r t h i s y e a r I n M a r c h 2 0 1 0 , t o s t a y a h e a d o f i t s c o m p e t i t o r s , S a m s u n g i n t r o d u c e d i t s r e v o l u t i o n a r y l i n e o f t h r e e - d i m e n s i o n a l T V s ( 3 D T V ) a t a N e w Y o r k e v e n t ,

p a r t n e r e d w i t h D r e a m w o r k s a n i m a t i o n .

Marketing Strategy

Over a decade ago, Samsung Electronics was a little known low-end consumer electronics company which products were sold under brand names no one even remembers like Tantusand Yepp, synonymous with ―cheap‖ and OEM*, brand LESS products sold to other companies and resold stamped with brand names at a higher price.

However, this Korean consumer electronics manufacturer realized that the only way to build a better known identity and rival giants such as Sony and Panasonic was to focus on building a more upscale image through better quality, design, and innovation. With that, the company discarded its other brands and put all its resources behind the Samsung name.

Reinventing itself, Samsung produced a line of first-rate, top quality TVs, cell phones and appliances, to reveal the company's superb technological advancements. The perception of Samsung was no longer the ―cheap brand.‖ By elevating the quality of its products above its competitors, it is now in the ranks of Sony and Panasonic, two Japanese large electronic big names.

Cell phones are now a ―must have‖ and are carried by people all around the world. Years ago people would feel ―naked‖ without wearing their wristwatch, but now it is the cell phone and TVs have moved from just the family room to every room in the house. Head of Samsung’s USA marketing and consumer unit, Peter Weedfald, stated, "We wanted the brand in users' presence 24/7.‖

Today, Samsung Electronics is the most publicly visible quality brand name with consumer products and is the third largest electronics maker in the world behind number one Sony and number two Matsushita—parent company of Panasonic, Quasar, Technics, and JVC.

*original equipment manufactured

Marketing StrategyMake Your Presence Known 24/7

In order to be a powerhouse electronic company, Samsung needed to change its brand image. When Seoul, Korea was host for the 1988 Summer Olympic Games the time was ripe for Samsung to showcase its products by associating its company with this international sporting event.

Samsung became the official sponsor of wireless technology for the Olympic Games, just as Omega was and has been the official timekeeper. With over a thousand athletes from 200 or more countries competing, plus tens of thousands of workers, and hundreds of millions of attendees and viewers, this certainly amplified the company’s image.

In 1999, American-Korean, Erick Kim, ―marketing miracle man,‖ started working with Samsung and eventually became the head of Samsung’s global marketing department. Within a few years, Samsung’s cell phones and flat-panel TVs were consumer favorites because Kim focused on partnering with Best Buy, a top U.S. retailer of electronic goods.

business.goldsea.com

Mass Marketing

Marketers report a number of reasons to sponsor events:

Identify with a particular target market or lifestyle

Increase awareness of company or product name

Create or reinforce perceptions of key brand image

Enhance corporate image

Create experiences and evoke feelings

Express commitment to the community or on social issues

Entertain key clients or reward key employees

Permit merchandising or promotional opportunities

Kotler & Keller

Omega has had a long and close relationship with the Olympic Games as official timekeeper.

Since 1932 the brand has defined sports timekeeping through its accurate timing of 24 Olympic

Games and its sponsorship continues until the year 2020.

omegawatches.com

Marketing Sponsorship

Samsung’s involvement with the Olympic Games began in 1988, when it became a local sponsor for the Seoul 1988 Olympic Summer Games. In 1997, the company then became a member of The Olympic Partner (TOP), Worldwide Olympic Partner in the wireless communications equipment category, continuing its contribution to the Olympic Movement for five consecutive Olympic Games. Through its advanced wireless telecommunication technology and products, Samsung is recognized for providing the Games with crucial, real-time information service in support of the world's largest sporting event. Samsung is proud to carry on its Olympic partnership through the 2016 Olympic Games.

vancouver2010.com

Olympic Sponsors

Social media measurement programs are custom and unique for each company depending on their business objectives. Monitoring brands is a measurement project that is reported to the client. In the above graph, Cymfony, a research company that provides expert marketing analysis tracks the shares of Olympic sponsorship.

cymfony.com

google.com

Samsung Creating Experiences

Luxury C0-Branding

Samsung’s Armani SmartphoneIn the fall of 2009, Samsung Electronics and Giorgio Armani released their premium smartphone. It was designed by the world renowned Italian fashion designer to the rich and famous, Giorgio Armani and Samsung

Features: Samsung Giorgio Armani B7620 Unlocked Windows Mobile Smartphone Quad-Band GSM with Full QWERTY keyboard, Touchscreen, 5MP camera, GPS navigation and Wi-Fi - International Version with No Warranty (Bronze). List price: $999.99Amazon Price: $849.99

A luxury smartphone that looks like a piece of jewelry is very eye catching. One can only imagine Samsung’s next partner—Mercedes Benz of DaimlerAG or maybe even Rolls Royce!

image: google.comsmartphone info: amazon.com

Key Products

Samsung Electronics manufactures products in a number of categories:

Semiconductor: DRAM, SDRAM, flash memory

Hard drives

Digital display: LCD displays, LED displays, plasma displays, OLED displays

Home electronics: TVs, DVD players, Blu-ray players, home cinema systems, set-top boxes, projectors

Mobile devices: mobile phones, MP3 players, digital cameras, camcorders,

Computing products: monitors, laptops, UMPCs, CD and DVD Drives, laser printers, fax machines

Home appliances: refrigerators, washing machines, microwaves, ovens, vacuum cleaners, air conditioners.

wikipedia.com

Evolution of the TV

circa 1970s – black and white TV

circa 1980s – color TV

circa 1990s – color projection TV

google.com

Samsung’s 3DTV

Cinema-quality 3D experience 3-Dimensional TVs add new depth and dimension to create larger-than-life experiences. 3D Active Glasses sync up with the 3D TV to produce 3D

images that virtually leap off the screen. Favorite shows can even be transformed to 3D in real time for the ultimate "reality" TV.

samsung.com

Growth

In 2005, Samsung surpassed Japanese rival Sony for the first time to become the world's largest and most popular consumer electronics brand as measured by Interbrand.

In 2006, Business Week rated Samsung as 20th on its list of global brands, 2nd in the electronics industry. Business Week also ranked Samsung as 20th in innovation.

In January 2007, BrandFinance ranked the company as the number 1 global brand in electronics. Samsung Electronics' handset division overtook American rival Motorola, making it the world's second-largest mobile phone maker.

In 2005, Samsung surpassed Japanese rival Sony for the first time to become the world's largest and most popular consumer electronics brand as measured by Interbrand.

In 2009, Samsung overtook Siemens of Germany and Hewlett-Packard of the USA with a revenue of $117.4 billion to take the No.1 spot as the world's largest technology company.

www.wikipedia.com

Samsung held on to the top spot in the broader category of flat-panel TVs, thanks in part to its strength in plasma as well as LCD-based TVs. Samsung's U.S. flat-panel television shipments rose to 6.6 million units in 2009, up 22.6 percent from 5.4 million units in 2008, giving the Korean giant a 18.4 percent market share down from 18.5 percent in 2008.

eetimes.com

Vision 2020

samsung.com

Strategy Analysis

Positioning – is the act of designing the company’s offering and image to occupy a distinctive place in the minds of the target market.

Samsung changed its image, creating an elliptical logo symbolizing the world moving through space and writing ―Samsung‖ in English to expand its global presence.

Targeted certain type of sports-minded consumers on an international level by sponsoring the Olympic Games and other sporting events in various countries.

Targeted consumers attracted to prestige, quality and wealth by partnering with Giorgio Armani.

Strategy Analysis

Competitive advantage is a company’s ability to perform in one or more ways that competitors cannot or will not match.

Samsung manufactures everything from air conditioners to cell phones to hard disk drives to vacuum cleaners. They produce the whole gamut of products related to electronics.

Samsung refrigerators are top of the line and comparable to companies whose main products are kitchen applicances like KitchenAid, Maytag, and Jenn-Air.

Samsung’s newest product is the 3DTV that one revolutionary step above the plasma, LED, and LCD television screens.

Strategy Analysis

Product Life-Cycle – a company’s positioning and differentiation strategy must change as the product, market, and competitors change. Samsung comes out with a new cell phone every few months

that is the latest rave. Samsung’s Galaxy S which is the first smartphone to qualify for point-to-point Wi-Fi communications.

For fashion-minded consumers, the Giorgio Armani –Samsung Slide is the most gorgeous smartphone produced. Its bronze color will match any outfit in any occasion.

Though critics are saying that the 3DTV is just a novelty or fad, to experience viewing it is an unforgettable feeling. Consumers are ready for the 3-D effect after having seen many hit movies in 3-D.

Strategy Analysis

Competition – a good way to start to deal with it is through creatively designed and well-executed marketing programs.

Samsung knew who their competitors were: Sony and Panasonic, the two Japanese electronic kings. With emerging competitors, they had to stay one-step ahead of the game.

By analyzing their competitors in the electronics market, Samsung put more into research and development to produce high quality and eye-catching television sets and major home appliances, appealing to the consumer’s senses through functionality and looks.

Strategy Analysis

Market-Challenger Strategy – Challengers set high aspirations.

Samsung may not be the industry leader for all their products, with the exception of the cell phone and the TV, but they continue to try and edge out its competitors with innovative products.

Samsung seems to attack the market leader head on, matching, if not surpassing its opponent’s product, advertising, price, and distribution. More people buy Samsung TVs than Sony because of the price difference. Samsung’s 3DTV is ―a technological leader that's packed with almost every imaginable cutting-edge advancement.‖ (consumersearch.com)

Analysis

More than a decade ago my uncle bought the cheapest VHS recorder/player on the market—it was a Samsung. At that time it was considered the ―poor man’s Sony.‖ He told me that it lasted longer than any other brand he bought . My uncle was retired and TV was his hobby, his passion, his life. It’s unfortunate he didn’t live long enough to experience Samsung’s LED TV and now its innovative 3DTV.

Samsung has positioned itself as one of the world’s most recognized leaders not only in cell phones, but in TVs and appliances. The digital age is here and Samsung is taking every opportunity to advance in this technology to be a competitive force.

Their unwavering commitment to being the world's best and pledge to be ―better than Sony‖ has given them the No.1 global market share for more than a dozen of their innovative products. It’s marketing strategy proved successful by sponsoring the Olympic Games and other sporting events, as well as partnering with electronics giant, Best Buy and haute couture designer, Giorgio Armani.

As we end the first decade of the 21st century, Samsung has created a revolutionary mode of entertainment that consumers will be able to experience in their own homes—3D television. Samsung Electronics has proven that its name synonymous with quality and progress.

Samsung TimelineA Decade at a Glance

samsung.com

Bibliography

―Best Global Brands, The‖, BusinessWeek/Interbrand rank the companies that best built their images -- and made them stick, Bloomberg Business Week.

http://www.businessweek.com/magazine/content/05_31/b3945098.htm Guaraldi, Vince, Charlie Brown Theme, Peanuts, 1964 Kotler, Philip and Keller, Kevin Lane, Marketing Management, Managing Mass Communications, p521 Osawa, Juro, Japan Realtime.

http://blogs.wsj.com/japanrealtime/2010/11/02/japan-no-longer-home-for-panasonic/?KEYWORDS=samsung ―Supply Glut Can't Derail Samsung‖, WSJ Online.

http://online.wsj.com/article/SB10001424052702303390704575575870793175254.html Samsung Values & Philosophies.

http://www.samsung.com/my/aboutsamsung/corporateprofile/valuesphilosophy.html Samsung Digital Timeline.

http://www.samsung.com/us/aboutsamsung/corporateprofile/history.html "Sony Vows Comeback Against Samsung, LG". The Korea Times.

http://koreatimes.co.kr/www/news/nation/2009/09/123_51434.html. ―Supply Glut Can't Derail Samsung‖, WSJ Online.

http://online.wsj.com/article/SB10001424052702303390704575575870793175254.html?KEYWORDS=samsung "Top 100 Global Brands Scoreboard". Business Week.

http://bwnt.businessweek.com/intera tive_reports/top_brands/index.asp. ―VISA 42% Share of Olympic Sponsor Discussion? NOT!‖, Cymfony.

http://blog.cymfony.com/2008/08/visa-42-share-o.html ―Vizio takes lead in U.S. LCD-TV Sales‖, EE Times News and Analysis.

http://www.eetimes.com/electronics-news/4087889/Vizio-takes-lead-in-U-S-LCD-TV-sales Worldwide Olympic Partners, Vancouver 2010.

http://www.vancouver2010.com/more-2010-information/about-vanoc/sponsors-and-partners/vancouver-2010-sponsors/worldwide-olympic-partners/