Samsung Electronics: Global

SAMSUNG
ELECTRONICS: Global
Marketing Operations
Group 4:
Alok Gupta
Modak Priy
Satendar Tokas
Sudeep Kumar Kundu
Vineet Dixit
1
INTRODUCTION
1938 : Samsung conglomerate was founded and produced agricultural
products
1969 : Samsung Electronics Co.( SEC) was founded as a low cost

manufacturer of black and white televisions.
1970: Samsung acquired semiconductor business thereby setting a stage for

future growth in Electronics.
1980: Samsung became a more comprehensive electronics company

– Started producing commodity products like TVs , VCRs and
Microwave Ovens.
– Sold their products to OEMs.
– The mission at this time was to pay emphasis on “Manufacturing
Quality and Technical Leadership”.
2
1993 : Samsung started its first imitative of building a Brand Name as a
long term goal towards profitability by introducing the “New
Management Initiative”.
– Major focus: To revamp the initial image of the company from “a
cheap OEM” to “a high value added product provider” focussing
on Innovation, Premium Product and Brand Value.
2002 : The company recorded net profits of $5.9 billion on sales of $44.6
billion.
2003 : The company was one of the most widely held stocks among all
emerging market companies.
Mission And Objective:

“The companies mission at this point of time was to become one of the top
10 global brands by 2005 contemplating the companies transformation from
an Also-run into a Blockbuster Brand.”
3
Products ( in 2003)
Home Multimedia Mobile Multimedia
Personal Multimedia Core Components
4
Question 1
What are the ingredients of SEC’s corporate turnaround strategy? What is the implication for
marketing?
Answer 1
Ingredients of SEC’s corporate turnaround strategy :
VERTICAL INTEGRATION :
-Manufacturing as a core competency
-To make the plants competitive by forcing them to compete with outside companies for
internal business
-To cut the cost to its minimum
-Flexible plant locations and R&D facility
-To avoid the commoditization trap SEC customized the production of its memory chips
which resulted in the increase of its average prices 17% above industry levels
HARDWARE FOCUS:
-Developing no proprietary software and content (music, movies and video games) unlike its
rivals Apple and Sony
-Major focus was on hardware and collaboration with the content providers.
PRODUCT BREADTH:
-Samsung’s product diversification differentiated the company from its competitors.
5
Product Range
4.8 11
3.8
13.9 11
Semiconductor Telecommunications
Digital Media Digital Appliances
Other
6
DIGITAL PRODUCT INNOVATION :
- Transition from Analog to Digital technology
- New innovative products
- Setting new standards for quality performance and award-winning design
-Propelled “Sashimi Theory” where new fresh technological products are sold at higher
prices but decline later
DIGITAL CONVERGENCE :
- Merging of different technologies into one major product
- Multiple technologies linked by one major network
IMPLICATIONS FOR MARKETING

Market Segmentation-Samsung segmented its products to all ranges from middle
segment to higher classes with a goal to reach the target in all product lines
Product Differentiation- Samsung launched wide range of new innovative products
catering to its varied segments
Technology Competence- Samsung focussed on Digital technology as its core
competence.
7
Question 2
How strong is the Samsung brand? Can Samsung pass Sony and become a top ten
global brand?
Answer 2
Samsung brand was at different stages of development in different country market :
COUNTRY WISE SPECIFICATION
USA : Here the Brand was at a turning point stage where Awareness and Brand
Loyalty were still below those of the first tier brands like Sony .
Consumers viewed the brand as a Reliable, Upcoming and Credible w.r.t.
Sony that had an image of being an Established and a Matured Brand.
Europe : Brand was stronger in Southern part as compared to Northern part .

Europeans were loyal towards their own Brands and fragmentation of retail
distribution made the situation more worse for Samsung to generate
profitability.
Russia : Samsung had an image of being “Peoples Brand” but the motive of building
a product innovator and market leader was still a distance away.
8
China : Brand image of Samsung in China was into a transition phase heading
towards the advanced stage. Samsung had captured one third of the Chinese
market but profit margins were slim.
India : India was an upcoming market opportunity with immense potential in value
added reselling of software products. The company became a major
supplier of Software products and had a Brand recognition better than Intel
and Microsoft.
9
FCBs STUDY : STRENGTH AND
WEEKNESS OF SAMSUNG BRAND
COUNTRY STRENGTH WEAKNESS
China Delights Me Perfect fit
USA Price Based ,Cell phone Perfect fit ,delights me

category
UK follows the leader Perfect fit ,delights me
Hong Kong follows the leader Perfect fit ,delights me
Germany Follow the Leader Perfect fit, delights me
Brazil Reliant, delights me and Perfect fit

caring
10
PRODUCT CATEGORY WISE POSITION OF SAMSUNG
Category Global Market Samsung Rank Competitors
Share
Big Screen TVs 32% 1 Sony(25%),
Mitsubishi(25%)
Cell Phones 10% 3 Nokia(36%),Motorola(15
%)
Flash Memory 14% 2 Intel(27%),Toshiba
(11%)
LCD Display 18% 1 LGPhillips(17%)
MP3 Player 13% 3 Sonicblue(18%),

Apple(17%)
DRAM Chip 32% 1 Micron(17%)
DVD Player 11% 3 Toshiba(15%),

Sony(14%)
Microwave Oven 25% 1 LG(22%), Galanz(19%)
11
SONY VS SAMSUNG:COUNTRY WISE COMPARISON
BRAZIL CHINA GERMANY
ATTRIBUTE SAMSUN SONY ATTRIBUTE SAMSUN SONY ATTRIBUTE SAMSUN SONY
G G G
Perfect Fit 95 127 Perfect Fit 109 131 Perfect Fit 35 137
Delights Me 102 92 Delights Me 150 153 Delights Me 96 94
Caring 103 94 Caring 79 73 Caring 43 59
Reliant 127 48 Reliant 86 132 Reliant 91 123
Follow the 100 109 Follow the 67 64 Follow the 220 91

Leader Leader Leader
Price Based 86 81 Price Based 98 131 Price Based 29 110
Non-Committal 101 79 Non-Committal 131 64 Non-Committal 150 89
Exhibit 14 A, B, C 12
13
CONCLUSION
From the above Exhibits and the Business Week ranking it can be
concluded that
– There is an opportunity for Samsung to increase its brand name and beat
Sony.
– But to become a Top 10 global brand in the next two years still much more
has to be done.
14
Question 3 As Chief Marketing Officer, what are Kim’s role and responsibilities? How
has he built his influence?
Answer 3
Kim’s Roles & Responsibilities :
– To build the Global Corporate Brand image for Samsung across 200 country
markets and SEC’s 17 product-focussed business units
– To educate the respective Divisional Managers on the role of marketing and the
value of developing and communicating superior solutions for the target
customers
– To make all the people in the company understand the essence of the Samsung
brand by the use of three words – WOW , SIMPLE & INCLUSIVE
15
Kim’s Achievements :
(1) Marketing Organization:
– Kim headed the corporate Global Marketing Operations (GMO) which

developed a corporate marketing program for Samsung brand outside Korea.
There were three major teams in the GMO - Marketing Strategy Team, Regional
Strategy Team and Product Strategy Team each with different responsibilities
– In 2001, under Kim’s leadership, the GMO implemented the initiative to
consolidate SEC advertising with a single global agency, Foote, Cone &
Belding(FCB) to deliver a consistent brand message worldwide.
(2) Allocation of Marketing Resources –
– GMO recommended to priorities and allocate funds by country and by product

category .
– Developed a computer program M-Net to help determine where funds could
reap the highest returns
16
(3) Market Driven Change ( MDC ) –
– MDC has put greater focus on customer insight into the new product development
process.
– MDC initiative revealed that the Samsung brand lacked stature
– With FCB’s help, a new umbrella campaign was launched in 2002 – “DigitAll –
Everyone’s Invited” which generated tremendous brand visibility for Samsung
17
18

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SAMSUNG

1969 : Samsung Electronics Co.( SEC) was founded as a low cost

1970: Samsung acquired semiconductor business thereby setting a stage for

1980: Samsung became a more comprehensive electronics company

Mission And Objective:

Personal Multimedia Core Components

IMPLICATIONS FOR MARKETING

COUNTRY WISE SPECIFICATION

Europe : Brand was stronger in Southern part as compared to Northern part .

China Delights Me Perfect fit

USA Price Based ,Cell phone Perfect fit ,delights me

Hong Kong follows the leader Perfect fit ,delights me

Germany Follow the Leader Perfect fit, delights me

Brazil Reliant, delights me and Perfect fit

MP3 Player 13% 3 Sonicblue(18%),

DVD Player 11% 3 Toshiba(15%),

Delights Me 102 92 Delights Me 150 153 Delights Me 96 94

Caring 103 94 Caring 79 73 Caring 43 59

Reliant 127 48 Reliant 86 132 Reliant 91 123

Follow the 100 109 Follow the 67 64 Follow the 220 91

Price Based 86 81 Price Based 98 131 Price Based 29 110

Non-Committal 101 79 Non-Committal 131 64 Non-Committal 150 89

(1) Marketing Organization:

– Kim headed the corporate Global Marketing Operations (GMO) which

(2) Allocation of Marketing Resources –

– GMO recommended to priorities and allocate funds by country and by product

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