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With reference to Samsung’s situations, outline the various stages of the assist in identifying target market opportunities of Samsung’s cell phone product range .

Case Study Samsung

Before the Korean electronics giant Samsung entered the 1998 Asian economic crisis, it was widely

regarded as a supplier of cheap imitations of superior Japanese products. At the time, the focus of its

business was on memory chips and low margin items such as microwave ovens and cheap TV’s,

which were mainly sold through discount stores. Following a major restructuring of its strategy and

operations, it has turned itself into the fastest growing player in the global electronics industry, with

sales of approaching US$305 billion expected for 2013. With recent net income estimated at $22.3

billion, it has become the most profitable new technology company ahead of Microsoft, IBM and Intel.

Employing approximately 489,000 people in 90 countries, the company consists of five main

consumer –related business units, the details of which are shown below;

Digital

Appliance

 Washing

machines

 Air

conditioners

 Microwave

ovens

 Refrigerators

 Vacuum

cleaners

Samsung Electronics Ltd has built up its position through rationalisation and diversification of its

activities, together with strong marketing and innovative product design. It is now recognized as the

world’s leading consumer electronics’ company ahead of the Japanese Matsushita, which produces

JVC, Panasonic and Technics brands, and Sony which markets a range of products under the parent

brand name. From its strong position as a manufacturer of essential electronic components, Samsung

has built a reputation as a major consumer brand in a range of different product categories. The

company is the market leader in the microchip and TFT-LCD screen sectors and is the world’s largest

producer of colour TVs, monitors and VCRs. It is also now the second largest producer of mobile

handsets having overtaken Nokia and now Apple.

Samsung has used its success in the cell phone market to drive its brand performance, which can be

attributed to a strategy of delivering innovative products at premium prices. According to their chief,

Eric Kim, much of their achievement has stemmed from identifying at an early stage that the cell

phone was changing ‘from a utility item to a fashion statement’. This led them into the camera phone

market and they became the first producer to equip a cell phone with an MP3 player. They are

currently launching a mobile TV phone as well as talking phones that can read mail Short Message

Service(SMS) messages to listeners. In addition they are using their powerful chip technology to drive

cell phones that act as a personal entertainment module, which can hold 10,000 songs and over 10

hours of video film and play 3-D video games. Such innovation has been at the heart of the Samsung

brand, whose ‘coolness’ factor received a big boost when one of its futurist phones was featured in

Digital

Media

TVs and

monitors

VCRs

DVDs

Camcorders

Printers

Laptops

LCDs Semiconductors Telecommunications

Large LCD &

TFT screens

Memory chips

Digital processors

Flash cards

DVD and CD

drives

Networks

Mobile phone handsets

PDA phones

Wireless network

systems

Integrated access

platforms

3BUS747 Assignment 1 – 2014-15 Tri 3

the follow up instalments of the Sci-fi movie The Matrix; consequently its handsets are priced up to

40% higher than most of its rivals.

The change in direction of the company over the last decade is based on the relisation that there was

more money to be made from innovating and setting the pace than from producing only me-too

products. To do this has not only been able to draw upon its extensive manufacturing and R&D

capability (20,000 researchers in 15 laboratories worldwide) but has also worked closely with strategic

partners including competitors as well as customers in establishing new industry standards. The

approach which has proved so successful in their cell phone business is now regarded as the basis

for further growth in all customer sectors, with a particular emphasis on the use of wireless technology

in the home.

Supporting all its developments has been the extensive use of marketing to communicate with

customers and build a brand which is increasingly recognized as a world-leader. However, in order to

achieve its ambition of becoming and remaining number one in the consumer electronics market, it

plans to invest even more in research, development and design (up to US$6 billion) and at the same

time review its brand positioning.

The above case material has been taken from Samsung’s official website and other various sources and may not be a

true reflection of Samsung actual position today. It use is for academic assessment purposes only

Task

Write a report 2000 words long that:

1 Discuss how the PESTLE forces have influenced changes in the design,

use and application of products in the electronics environment.

2 Explains the concept of positioning and how this analytical approach can

3 With reference to Samsung’s situations, outline the various stages of the

assist in identifying target market opportunities of Samsung’s cell phone

product range .

Product Life Cycle and critically evaluate how each stage might impact on

the company’s marketing decision-making process.

communications tools when developing a communications campaign.

4 Explains the factors that influence the choice of the various marketing

Note: Approximate length of each question 500 words.

Guidelines

a) Consider the changes in terms of the types of products offered today, how the products are

used, what they represent to the people who use them, how important they have become in

their everyday lives. Now discuss the impact of the PESTLE factors/drivers in bringing about

these changes.

b) Two part question; the first of which expects you to discuss the concept of positioning

generally, the second relates to how an understanding of positioning can help marketers

explore target market opportunities in relation to Samsung’s cell phone range of products.

Students should different perceptual maps for illustration.

4BUS747 Assignment 1 – 2014-15 Tri 3

c) Again a two part question, the first expects candidates to discuss the concept of Product Life

Cycle for the Samsung’s product portfolio and the second discuss how this concept affect

strategy planning

d) This question expects the candidate to explore the various promotional techniques/tools

available to Samsung and to discuss the factors that influence their choice when developing a

marketing communications campaign. Remember Samsung will sell to both B2C and B2B

market segments.

Report format required presented as; To; From; Subject; Date. Headings and sub-headings can

be used to separate out individual answers to the 4 questions.


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