samsung marketing analysis
TRANSCRIPT
Samsung MarketingGhasem AzadMarketing Management
KHU, April 2017
FIFA World Cup2002
Final Match
2-0
2002FIFA World Cup Champions
Brazil
Who is the REAL winner?
Ronaldo
Oliver Kahn
Cafú
Luiz Felipe Scolari
The Real Champions
What happened after World Cup?
• Sustainable Development in both countries
• $ 3.2B of net profit
• Cultural exchange and cultural development
• Improve quality of residents’ life
• New international image of the host community
• Enlarge the industry of Korean products
Korean Improvement
Automotive Industry
Korean Improvement
Electronics Industry
0
100
200
300
400
500
600
700
800
900T
ho
usa
nd
s
Korean Automotive Industry Improvement speed
Hyundai all models U.S. sale since 1985
Huge marketing on FIFA world cup
• Founded on 1938, 79 years old
• Entered the electronics industry in the late 1960s
• World’s 2nd. Largest IT company* (2016)
• World’s 7th most valuable brand (2016)
• “Fortune 500” Global Rank: 13 (2015)
• World's #1 manufacturer of mobile phones since 2011
• World's largest television manufacturer since 2006
• Comprised of more than 78 different companies
*: World’s ranking based on net revenue by Fortune 500
Samsung Electronics in numbers*
319,000Employees
*: Numbers are according to 2015 reports of Samsung Electronics
$ 177BRevenues
$ 16.5BProfits
$ 206.6BNet Asset Value
Others87%
Samsung13%
Samsungvs.
Korea GDP*
*: Korea GDP extracted from World Bank Data is USD 1377.8B
Samsung and advertisement
#1Biggest Marketing Budget in History
(USD 14,000,000,000 for 2013)
Samsung and advertisement
#13World’s Top Advertising Budget for 2016
(USD 3.3bn)
About Samsung
Lee Byung-chulFounder(Died on 1987)
About
Samsung Electronics
Dr. Kwon Oh-hyunVice Chairman & CEO(since 2012)
About
Samsung Electronics
Lee Kun-heeChairman(since 2010)
Tablets
Wearable Tech
TVs
Cell Phones
Home Appliances
Memory & Storage
Home Theater & Audio
Computing
Security & Monitoring
Smart Home
Management ideology at a glance
Management Ideology
Values:
Philosophy
To devote our human resource and technologyto create superior products and services
thereby contributing to a better global society
Management Ideology
• We comply with laws and ethical standards
• We maintain a clean organizational culture
• We respect customers, shareholders, and employees
• We care for the environment, safety, and health
• We are a socially responsible corporate citizen
Principles
Advertisements & Sponsorship
• Samsung realized that success lies in brand visibility
• Sponsorship increased brand awareness, very well!
• Samsung own many professional & amateur teams.
• Samsung is a sponsorship of many national teams.
• Team Korea
• Team USA
• Team GB
• Team Singapore
• Italia Team
• Sweden Olympic Team
• Belgium Olympic Team
• Australia Olympic Team
• Jordan Olympic Team
• Hong Kong Olympic Team
• Brazil national football team
• England national football team
• Austria national football team
• Olympic Games
• Paralympic Games
• Youth Olympic Games
• IAAF World Championships in Athletics
• FIVB Volleyball Men's World Championship
• FIVB Volleyball World League
• AFC Asian Cup
And many other competition, organization, teams and …
Rio 2016The Olympic Partners (TOP)
TOP totally paid $1.022bn to International Olympic Committee (IOC) for sponsoring!
Samsung war against Apple!
1.Series of ongoing lawsuits between Apple Inc. and Samsung Electronics.
2.Samsung’s anti-Apple marketing campaign!
Advertisement against Apple!Commercial Ad for Galaxy S2
Advertisement against Apple!Commercial Ad for Galaxy Note 3
Advertisement against Apple!
Commercial Ad for Galaxy S3
Samsung vs. AppleMarketing Mix Analysis
Marketing Mix
Overview
#1
• Apple has continued to expand its products
• Apple products started with “Mac”.
• Main product lines: Mac, iPad, iPhone, Watch, TV, Music.
• Product variety but not such a product range
• Samsung is comprised of more than 78 different companies.
• Main product lines: Galaxy, Gear, TV , Home Appliances,...
• Product variety and product range to address all needs.
• Many more expanded products than Apple!
#2
• Apple uses a premium pricing strategy.
• Apple’s pricing involves relatively high prices.
• The pricing helps maintain the high-end image of products.
• But Apple products attract a smaller market share.
• Just middle and upper classes can buy Apple products!
• Samsung uses various pricing because of its different categories
• Samsung usually use competitive pricing strategy.
• Skimming pricing cause a high value in the start before others!
• Competitive pricing use for products that face more competition.
#3
• Apple uses a selective distribution strategy.
• Mostly in the following places:
• Apple Stores.
• Online Apple Store & App Store (also on Amazon & eBay)
• Authorized retailers such as: Walmart, Target, Best Buy.
• Samsung uses a intense distribution concept.
• 3 Main Segments:
• Sales
• Service dealers
• Modern retail & distributors
• Sales and service dealers also open exclusive Samsung showrooms
#4
• Apple emphasizes the premium image and quality of products.
• Apple’s promotion includes the following elements:
• Advertising (on Apple.com, App Stores and other firms)
• Personal Selling (such as Apple Store employees who provide the product)
• Sales Promotion (such as exchange offer and modified payment plans)
• Public Relations (such as Apple events)
• Samsung believes that success lies in brand visibility (Huge ads).
• Samsung’s promotion include the following elements:
• Advertising (on Samsung.com, stores, IT news sites, Instagram, etc.)
• Personal Selling (Help the visitors to make a purchase by employees)
• Sales Promotion (Reduction the price by time, modified payment plans)
Brief Comparison
• High price vs. Reasonable price.
• Better design vs. Wide range and variety
• Global network vs. Availability
• Fixed Price vs. Flexible in pricing
• High-end materials vs. High volume
• Higher brand image vs. More promotional activities
• Patent war vs. Price war
Galaxy Note 7 Issue
August 19th.
Officially Released
September 2nd.
Suspended sales by Samsung
September 15th.
Formal U.S. recall was announced
October 10th.
Worldwide recall & ceased productionafter reporting fire on replacement phones
January 23th.Reporting the results of researchBatteries had suffered from a manufacturing defect in weldingprocess
Galaxy Note 7 Fail
Consequences
33%Samsung’s Operating Profits down!
in comparison to the previous quarter
Galaxy Note 7 Fail
Consequences
$17 bn.Estimating the lost revenue*
Because of production & recall
*: Predicted by Credit Suisse analysts
Galaxy Note 7 Fail
Consequences
HurtRecall effect on Samsung’s brand
Cause company lose its market share
We are sincerely sorry!
“First of all, I deeply apologize to all of our customers, carriers, retail, and distribution partners.”
DJ Koh., Head of mobile division
• Described about:
• What happened
• Our investigation
• Why it won’t happen again
• “Committed to Quality” as main title
• 96% of Galaxy Note 7s have been returned
• Exchange Program Choices:
• Exchange with another Samsung smartphone
• Obtain a refund at point of purchase
• Eliminates Note 7 ability to work as mobile phone!*
Note 7 Issue Page
*: Because of a released update for customer’s safety!
Maybe Sweet
“Galaxy S8”Will Make You Forget About Galaxy Note 7!
Huge Ads & MarketingBecause of an important product
• Advertisement on Internet
• SWOT Analysis
• Patent Fight
• Social Networks
• Korean Brand
• Financial Situation
• Samsung in Iran
Remaining Issues