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“MARKETING STRATEGY OF SAMSUNG IN INDIA”

SUBMITTED BY
Pratyush singhal
B.com (Hons.)IIISem

ENROLLMENT NO-A7004615105

Under guidance of:


Faculty Guide
DR. SACHIN SRIVASTAV
PROFESSOR
ABS, LUCKNOW
{SEMINAR PROJECT IN PRTIAL FULFILLMENT OF THE AWARD OF DEGREE
OF BACHELOR OF COMMERCE(HONORS) 2015-18}

AMITY UNIVERSITY UTTAR PRADESH,


LUCKNOW
FACULTY CERTIFICATE

Forwarded here with a term paper report on “MARKETING STRATEGY OF SAMSUNG


IN INDIA” submitted by pratyush singhal Enrolment NO. A7004615105 student of BCOM
(Hons. ) III Sem (2015-18).

This project work is partial fulfillment of the requirement for the degree of Bachelor of
commerce from Amity University Lucknow Campus, Uttar Pradesh.

Dr SACHIN SRIVASTAV

AMITY UNIVERSITY,

LUCKNOW CAMPUS

UTTAR PRADESH
STUDENT’S CERTIFICATE

Certified that this report is prepared based on internship undertaken by me in “MARKETING


STRATEGY OF SAMSUNG IN INDIA , under the guidance of DR. SACHIN
SRIVASTAV in partial fulfillment of the requirement for award of degree of Bachelor of
Commerce (BCOM III SEM) from Amity University, Uttar Pradesh.

Date.______________

(SIGNATURE) (SIGNATURE) (SIGNATURE)


Pratyush singhal Dr SACHIN SRIVASTAV
Student Faculty Guide Director (ABS)
(ABS SCHOOL) (PROFESSOR)
DECLARATION

Title of project report“ MARKETING STRATEGY OF SAMSUNG IN INDIA”

I understand what plagiarism is and am aware of the University’s policy in this regard

I declare that

The work submitted by me in partial fulfillment of the requirement for the award of degree
Bcom(Hons)assessment in this is my own; it has not previously been presented for another
assessment.

I declare that MARKETING STRATEGY OF SAMSUNG IN INDIA” this is my original


work. Wherever work form other source has been used, all debts (for words data, arguments
and ideas) have been appropriately acknowledged and referenced in accordance with the
requirements of NTCC Regulations and Guidelines.

(a) I have not used work previously produced by another student or any other person to
submit it as my own.

(b) I have not permitted, and will not permit, anybody to copy my work with the purpose
of passing it off as his or her own work.

(c) The work conforms to the guidelines for layout, content and style as set out in the
Regulations and Guidelines.
Date: ------------

Name of student- pratyush singhal


Enrollment no. A7004615105
B.com (H) 3rd semester
ACKNOWLEDGEMENT

I would like to express my special thanks of gratitude to my faculty guide Dr. SACHIN
SRIVASTAV well as my area head Prof.R.P.Gupta who gave me the golden opportunity to
do this wonderful project on the topic “The relationship between packaging characteristics
and consumer brand preference” which also helped me in doing a lot of research and I came
to know about so many new things ,I am really thankful to them.

Secondly, I would like to thank my parents and friends who helped me a lot in finalizing this
project within the limited time frame.

MR. Pratyush singhal


TABLE OF CONTENT

Sl.no Content Page no.


1. INTRODUCTION 1

2. COMPANY PROFILE 1-2


LITERATURE REVIEW
3. 2
OBJECTIVES & METHODOLOGY
4. 2-3
Findings
5. 3-16
MARKETING STRATEGY

SAMSUNG SEGMENTING & TARGET


MARKET

SALES PROMOTION TECHNIQUES

SWOT ANALYSIS

PORTERS 5 FORCE MODEL

CHANGES OVER DECADES

6. FINDINGS 17

7. SUGGESTIONS 18

8. Conclusion 19

9. Bibliography 20
INTRODUCTION
Samsung was founded by Lee Byung-chul in 1938 as a trading. Over the next three
decades, the group diversified into areas including food processing, textiles, insurance,
securities and retail. Samsung entered the electronics in the late 1960s and the
construction and shipbuilding industries in the mid-1970s; these areas would drive its
subsequent growth. Following Lee's death in 1987, Samsung was separated into four
business groups – Samsung Group, Shinsegae Group, CJ Group and HansolGroup. Since
1990s, Samsung has increasingly globalized its activities and electronics, particularly
mobile phones and semiconductors, have become its most important source of
income.
Notable Samsung industrial subsidiaries include Samsung Electronics (the world's
largest information technology company measured by 2012 revenues, and 4th in market
value), Samsung Heavy Industries (the world's 2nd-largestshipbuilder measured by
2010 revenues), and Samsung Engineering and Samsung C&T (respectively the world's
13th and 36th-largest construction companies). Other notable subsidiaries
include Samsung Life Insurance (the world's 14th-largest life insurance company),
Samsung Everland(operator of Everland Resort, the oldest theme park in South
Korea) and Cheil Worldwide (the world's 15th-largest advertising agency measured by
2012 revenues).
Samsung has a powerful influence on South Korea's economic development, politics,
media and culture and has been a major driving force behind the "Miracle on the Han
River". Its affiliate companies produce around a fifth of South Korea's total
exports. Samsung's revenue was equal to 17% of South Korea's $1,082 billion GDP.

COMPANY PROFILE
Samsung Electronics commenced its operations in India in December 1995 and is today a
leading provider of Consumer Electronics, IT and Telecom products in the Indian market.
Samsung India is the Regional Headquarters for Samsung’s Southwest Asia operations, which
provides employment to over 45,000 employees with around 11,500 employees being
involved in R&D.
Samsung began operations in India through its manufacturing complex located at Noida (UP),
which today houses facilities for Colour Televisions (including 3D, LED and LCD Televisions),
Mobile Phones, Refrigerators, Washing Machines and Split Air Conditioners categories.
Samsung commenced operations of its second state-of-the-art manufacturing complex at
Sriperumbudur, Tamil Nadu in November 2007. Today, the Sriperumbudur facility
manufactures Colour Televisions, Fully Automatic Front Loading Washing Machines,
Refrigerators and Split Air Conditioners. Samsung India has three R&D Centres in India–two
in NCR and one in Bangalore. While the Noida R&D Centres develops software solutions for
high-end televisions such as Plasma TVs, LCD TVs and Digital Media Products, the other
Centre is engaged in R&D solutions for product hardware. The Bangalore R&D Centre works
on major projects for Samsung Electronics in the area of telecom, wireless terminals and
infrastructure, Networking, SoC (System on Chip) Digital Printing and other
multimedia/digital media as well as application software.
Samsung India is the Market leader in product categories like Mobile Phones, Smart Phones,
Panel TVs, Side By Side Refrigerators, Frost Free Refrigerators, Microwaves and Inverter ACs.
Samsung India has won several awards and recognitions for both its corporate initiatives as
well as its product innovations in Audio Visual, Home Appliance, IT and Telecom Product
categories.
Apart from development of innovative technology, Samsung places great importance on
acting as a responsible corporate citizen in the communities where it operates. Its CSR
programs respond to the social and environmental needs and seek to give back to
communities that support the company. In 2009, Samsung launched the company’s
Corporate Social Responsibility initiative ‘Samsung Hope Project’ with projects in the areas of
education, culture, sports, social welfare and community development. Each programme,
under the Hope Project, uniquely addresses the needs of individual communities while
emphasizing on innovations for development of the community including education,
technology, engineering and IT technical training.
The Company’s CSR initiatives such as Samsung Smart Class and Samsung Technical Schools
have been recognised by several reputed organisations, and the Company has won accolades
from these projects aimed at giving back to the society.

LITERATURE REVIEW

In 2014, we invested KRW 15 trillion in R&D to lead industry innovation as


we continued to expand global R&D centers and recruit top talent. Our New
York and Silicon Valley-based Open Innovation Center extended our reach,
enabling us to secure outside talent and technologies. Those forward-
looking measures fueled remarkable performance and sparked superior
technologies, including mass production of the world’s first 20nm DRAM
and V-NAND with 3-bit technology; the launch of a smartphone with the
world’s first curved display; wearable devices such as Samsung Gear S and
Gear VR; and developing new IoT (Internet of Things) technology based on
automatic ID technology that utilizes diverse sensors. We also reinforced
the foundation of our technology leadership and sustained future growth
by registering 4,952 US patents in 2014, the No. 2 world record. In addition,
we maintained our profile as an innovative company with 36 CES 2015
Innovation Awards and with the No. 3 ranking on the Boston Consulting
Group’s list of The Most Innovative Companies 2014 around the world.
Moreover, we were ranked No. 7 on Interbrand’s The Best 100 Global
Brands 2014, with an estimated brand value of USD 45.5 billion. Fortune
listed Samsung Electronics as No. 13 on its list of the World’s Most Admired
Companies 2014.

Going forward, we anticipate lingering uncertainty in the world economy


owing to an increase in US interest rates, economic recession in the
Eurozone and financial risks in emerging countries because of the sharp
drop in crude oil prices. Competition in the electronics industry will turn
ever more fierce as growth continues to slow in our key product markets.
Nevertheless, we are prepared. Our experienced sound management and
unrivaled challenging spirit will enable us to effectively respond to the fast-
changing business environment. First, we will strengthen our
competitiveness and profit structures in existing business areas. In our
core areas, including memory chips, TVs and mobile phones, we will hone
our competitive advantages as we focus on developing premium products
and strengthening technology leadership. Our top ranking in the Memory
Business is fully supported by our superior technology. In TVs, we will
highlight our premium brand power with a central focus on SUHD TVs. In
the Mobile Communications Business, we will lead the premium market
with the Galaxy S6 and Galaxy S6 edge, while also launching differentiated
products for mid- and low-priced markets. That strategy will not only
maintain our dominance in advanced markets but also fuel growth in
emerging and low-priced markets. In addition, we will

OBJECTIVES AND METHODOLOGY


OBJECTIVE
 Primary objective
 To find the past sale growth and demand analysis
 Secondary Objective
 Market structure analysis
 SWOT analysis
 Competitor analysis
 Performance evaluation
Methodology
In this project we have followed descriptive method of study.
Research instrument
Here project analysis is made by collecting secondary data from different
websites, journals, etc.
 Secondary data’s are pre published and research data’s collected
from different websites, journals, newspapers, company research
papers.

 These documents and data’s are very useful for the theoretical,
conceptual and organizational background analysis.

 Detailed analysis of data’s is made by plotting different graphs and


tables which can be easily understandable.

 Then by observing these graphs we have made our conclusions and


recommendations.
Samsung Marketing Strategy

Samsung has a vast product portfolio and its presence is in several different
product categories. The brand image driver for Samsung are the Samsung
Smartphone’s such as the Samsung note series or the Samsung galaxy series.
Overall, Samsung is present in the following product categories.

Products in the marketing mix of Samsung:-

1) Tablets
2) Televisions – LEDs, LCDs. Plasma TV, SMART TV, HDTV etc
3) Cameras and Camcorders
4) Refrigerators
5) Air conditioners
6) Washing machine
7) Microwave ovens
8) IT – Laptops, printers and accessories) Mobile phones – Smart phones,
normal phones

The benefit of Samsung in terms of its product is that there is a trust on all
Samsung products because of the way Samsung products have performed in the
last few years. Problems with the products has been negligible. And with its
Smart phones, Samsung has achieved a status symbol for its customers. At the
same time, Samsung is known for its service and people know that Samsung
gives a very fast service for any of its product. Thus in the marketing mix of
Samsung, the product portfolio is one of the strongest point for Samsung.

Price in the marketing mix of Samsung – Because of its presence in


different product categories, Samsung uses various pricing strategies. We can
divide the pricing strategies and match it with the products that it is used for.
Skimming price – Samsung’s smart phones are one of the best in the market and
are the market leader in terms of the features and USP’s that they provide. The
recent Samsung Note 3 + Gear is another entrant in the market which is catching
peoples eyes. Thus Samsung uses Skimming price for these products wherein it
tries to get a high value in the start before competitors catch up. Once the model
is old or any competitor has launched a similar product, Samsung immediately
drops the price. Competitive pricing – For products other than smart phones,
Samsung uses competitive pricing. Televisions, air conditioners, refrigerators
and other products have competition in the form of Panasonic or LG. Samsung is
known to be a great brand but it is not greater than LG for home appliances. In
fact LG beats Samsung where home appliances are concerned. Similarly in
Washing machines – Whirlpool, and in Cameras – Cannon, are the brands which
are to be beaten. Thus in various categories, Samsung keeps competitive pricing
so as to beat the competitor. Samsung as a brand hardly uses penetrative pricing
because it doesn’t enter late in the market. In fact, it is present in most consumer
durable segments in the market.

Place in the marketing mix of Samsung – Samsung is present through


various channels in the market. It works on the channel marketing concept
wherein there are three segments. Sales and service dealers, Modern retail and
Distributors. The sales and service dealers handle key accounts for Samsung and
are involved in corporate sales. These dealers may also open exclusive Samsung
showrooms. The Modern retail segment includes large retailers like Croma,
Hypercity, Vijay sales, Vivek’s and any others who are present in the modern
electronic retail chain. Samsung being such a branded product, the retailers are
bound to keep Samsung as an alternative for their customers.
The distribution network is the most interesting in the case of Samsung. In
several cities, Samsung has a single distributor through whom they distribute
throughout a territory. For example – In Mumbai, Samsung has SSK distributors
who are distributors for all Samsung products. This distributor has a huge
investment in Samsung and both, the distributor and the company, go hand in
hand for the sale of Samsung’s products. Thus all material of Samsung will be
sold to a single distributor who in turn will sell it forward to retailers.

Promotions in the marketing mix of Samsung – Samsung uses multiple


forms of promotions. Samsung as a company believes in pulling the customer to
themselves through advertising but at the same time uses strong tactics to push
the product to the customer through sales promotions. Thus on one hand,
Samsung uses various marketing vehicles across the year covering festive season
as well as non festive time. On the other hand, it gives many offers and discounts
to its trade partners to motivate them to sell Samsung above competition. With
such a strategy, Samsung’s brand is on the rise so that both, the pull as well as
push strategy is working simultaneously in Samsung.
The marketing mix of Samsung is a lesson to marketers in several points. First,
Business will grow if you have multiple products at once as all of these products
can become revenue drivers for your company. Second, Pull strategy, though
expensive, is far more beneficial in the long time.
Advertising
Print and media advertising is one of the core elements of the marketing mix
extensively utilized by Samsung Electronics. The most noteworthy media
advertising campaigns include live commercials for Samsung Galaxy S 3 device
on popular Jimmy Kimmel Live show in June 2012 and on Late Night With Jimmy
Fallon on July and August of the same year. Moreover, partnership with Fox
channel in the US to run four 30-second advertising clips during the National
Football League, college football and World Series games in 2012 have been
praised as efficient marketing campaigns.Samsung print advertising in popular
newspapers, magazines and journals have previously included direct attacks on
its major competitors, notably Apple. For example, a print ad campaign titled ‘It
doesn’t take a genius’ is a clever play of words on Apple’s emphasize on genius
branding. The print ad compares major functionalities of iPhone5 and Galaxy S III
and illustrating the superiority of Samsung’s product on several fronts.

Viral marketing is also extensively used by Samsung as one of the most effective
advertising methods. For example, the latest 60-second viral marketing video
titled “Anticipation” is a successful attempt to associate Samsung Galaxy S6 with
excitement and a sense of achievement and recognition.

Sales Promotion
Samsung uses sales promotions as a marketing tool more extensively compared
to the majority of its competitors. It has been estimated that the company had
spent about USD 4.6 billion on sales promotions during 2013 alone globally, that
included USD 888 million sales promotions budget on its home market in South
Korea. It is important to clarify that this budget is separate from the marketing
budget illustrated in Figure 3 above. Moreover, Samsung official website
contains sales promotions announcements on mobile phones, accessories,
cameras, back to school offers, as well as, bundle offers

Samsung Electronics Report contains more detailed analysis of Samsung


marketing strategy covering issues of public relations, events and experiences
and direct selling. The report also comprises application of SWOT, PESTEL,
Porter’s Five Forces and Value-Chain Analyses on Samsung, along with analysis
of company’s approach towards Corporate Social Responsibility (CSR).
BRAND POSITIONING
Samsung, once known to be the low-quality service provider of all time is now
one of the leading mobile companies of the world. Having said that, we can see
how it all comes down to proper brand positioning and innovation, which takes a
brand to its zenith.
After having its share of booms and slumps, Samsung came up with new ideas to
be more customer-focused and creative in order to establish a strong brand
image in the global market. Rather than making normal or usual handset devices,
they started to produce smartphones to catch up with their competitors. Their
main strategy was to provide the best quality products in order to meet their
customers’ expectation.

They have been constantly redesigning and introducing new series of products,
e.g. – Galaxy Series. Currently they are working on designing the lightest and
slimmest phone of the world,along with an amazing powerful performance to
gain an edge over their competitors. Samsung doesn’t have any particular
tagline/slogan for the company as a whole; they prefer to use unique taglines for
each and every product. They tend to promote and position their mobile
phones/note/tab at all the 3 different levels of positioning. Two promo links have
been provided below of their Galaxy Note 4 and Galaxy S6, which specifies all the
product attributes, values and benefits that customers might look out for, before
they choose to buy it. Samsung doesn’t target any specific segment of the market,
but mostly seem to serve the high-end people of the society, for e.g. – business
people, young adults.

Samsung Segmenting and Targeting Markets

Geographic Segmentation
Samsung geographic segmentation is world wide, they sell their phones in 61
different countries. They make slight variations in languages and applications but
the physical appearance of their phones is universal.

Demographic Segmentation
 Age Segmentation : Their target age segmentation is teens,young adults
and adults in early and mid 30's.
 Income Segmentation : Their target income segmentation is middle class
and high class income.
 Ethnic Segmentation : Since Samsung sells world wide, they don't have a
specific ethic segmentation.
 Family Life Cycle Segmentation : Their target family life cycle is young
single, young married or divorced with or without children.
 Gender Segmentation : Smartphones are not gender specific but since
women shop more than men I would assume they have more women buying
their phones than men.

Psycho graphic Segmentation


Samsung psycho graphic segmentation includes individuals from teens to mid
30's who like new technology, tech savvy and can afford to buy it.

Benefit Segmentation
When Samsung customers buy their phones the benefit they expect from it is
simple appearance, new and updated features and reasonably priced.

Usage- Rate Segmentation


The smartphones market has a lot of heavy users because of the convenience of
it, you can call, text, send pictures, play games, listen to music and surf the web
all from a smartphone. Samsung as a large percentage of heavy users who buys
all of their latest phones and with mobile service company offering upgrade plans
it makes it easier to get the newest phones.There are people who goes from one
smartphone brand like Apple to Samsung because they tired of it or they want to
try another smartphone.
Samsung Innovation Strategy
Everyone has heard about the company named Samsung and the reason why
they have heard of it is because of its innovation strategies. Innovation strategy
at Samsung can be described as the way that made them a leading manufacturer
in electronic industry as they keep the competitors at bay. In the present
business environment, businesses of whatever size must face and defeat
challenges which is posed by accelerated globalization and technological
changes. It is not just innovative strategy that matters, but innovations that
embed on themselves some strategies that are truly game changing.

The game changing innovation of Samsung encapsulates business models,


business processes and manner of positioning themselves vis a vis their
competitor. This is what has made them survive all these years.

It is a fact that there is a link between innovation and the economy of a country,
the culture of its peoples and those businesses running on it. South Korea, where
Samsung originated, is not rich when it comes to natural resources

Branding Strategy of Samsung

In the present day, the accomplishment of a business depends not just on the
product quality rather on how efficiently and effectively the value of the product
is presented to the clients at the last part. When it comes to this aspect, Samsung
Company has taken big steps in its development, whether financially or
operationally.

In order to improve the product value of the company, the following are some of
the branding strategy of Samsung that other business owner must kept in mind:
• Establishing identity on the product
• Cost involved in the repositioning of the product
• Reaction from opponents or competitors
• Techniques adopted in costing
• Research and development

When it comes to cost efficiency, it was taken care of which the rules adopted by
company were not “cost prohibitive”

• Also it was observed that company strengths leverage has lead in acceptable
dividends and which it leads to “focused hard works.”

• Keeping a proper channel connection causes the results of sales to be relatively


strong. The incremental sale also yields a strong return.

• To put the company as a technology leader in the business world.

Result of Branding Strategy Samsung Adopted

Past few years, Samsung Company adopted a lot of measures in order to make its
existence felt worldwide. Some of them include:

Sponsoring
One such significant instance was when Samsung sponsored the 1998 Seoul
Olympics. Samsung had made an agreement together with the International
Olympic Association.The business executives anticipated that through
sponsoring special and worldwide events and by means of embracing different
marketing methods as well as investments, the product of value of the company
would be improved. Because of this the value of the product of the Company
escalated by almost 200 percent, obtaining $8.3 billion in 2002 from 3.1 billion
dollar in the year 1999. Valued through Interbrand Incorporation.The different
measures obtain by the company didn’t go in waste because Samsung was listed
amidst the topmost products, the product being evaluated by the Interbrand
Incorporation. Among the non Japanese products, Samsung Company was the
only company from Asia.

Samsung focussing on its online sales strategy for the Indian market

Samsung has been facing fierce competition in the Indian smartphone segment
from the likes of Xiaomi, Motorola, OnePlus, and ASUS, and some Indian brands,
which are focussing on online sales. Now, Samsung has revealed that the
company is focussing on and fine tuning its online sales strategy in the country.
The company is also focussing on sales from the rural market, which has
contributed significantly to sales.
According to sources within the company, the South Korean smartphone giant is
looking to tap into the booming e-commerce market in India, and the
company has even a separate team at its headquarters to plan online sales
strategy. The company had to face revolt from offline retailers after online
retailers started providing huge discounts and price cuts on Samsung devices.

When asked about the company’s plan to tap into the e-commerce segment,
Rushi Suri, Samsung India Director-Product Marketing Consumer Electronics,
said, “For us the consumer is the key. Where the consumer would want us, we
would be there and would be offering right kind of products at right price. In case
of (consumer) electronics, the clear understanding with the management is
where the consumer would want us, we would be there.”

In terms of Samsung’s strategy to drive overall sales, it is focussing on ‘Made for


India’ products that have the right set of features for the right prices. The
company recently announced, which have good value-for-money factor along
with features such as 4G LTE and Ultra Data Saving mode that Indian consumers
are demanding these days. However, the company’s official declined to comment
on the percentage of sales that the company is attracting from the online
channels

SWOT ANALYSIS
Samsung Electronics Co. Limited (OTC: SSNLF) is actually the consumer
electronics subsidiary of the Samsung Group, a conglomerate based in Suwon,
South Korea. Outside of Korea, Samsung is best known as the world’s largest
manufacturer of mobile phones and smartphones, including the highly popular
and successful Galaxy.
It is also the world’s largest manufacturer of televisions and LCD panels. Thanks
to its manufacturing and marketing expertise, Samsung is regarded as the
world’s second largest consumer electronics company. Only its American
rival, Apple Inc. (NASDAQ: AAPL), reported larger revenues.
Unfortunately, it is difficult to determine exactly what Samsung’s are because it is
based in Korea and not covered by U.S. corporate reporting laws. Samsung did
report an estimated TTM revenue of $42.35 billion for the second quarter of
2015. That figure is based on sales of 48 trillion Korean won.
Strengths
 Samsung is the world’s most successful electronics manufacturer. It is the
world’s largest manufacturer of television sets, liquid crystal display (LCD)
panels, mobile phones and smartphones.
 Samsung is the world’s number one marketer of mobile phones with 21.4%
of the world’s largest market share in the second quarter of 2015. Apple is
number two with 13.9%[2]
 Samsung has impressive research and design capabilities. It was able to
create and roll out Samsung Pay, a payment app with similar capabilities to
Apple Pay, in less than a year. Samsung has been able to replicate many of
the capabilities of both Apple Inc.’s phones and Google Inc.’s Android
operating system for mobile devices.
 Samsung has strong manufacturing and marketing capabilities.
 Samsung has long-standing relationships with retailers in the United States
and Europe that provide a steady sales channel for its products.

Weaknesses
 Samsung has not been able to match Apple Inc.’s marketing capabilities for
smartphones. Its share of the U.S. smartphone market fell by 2.3% between
2014 and 2015. In contrast, Apple’s share price grew by 34.9%.
 Some Chinese competitors are catching up to Samsung in the smartphone
market. Between 2014 and 2015 Huawei’s share grew by 48.1%, and
Xiaomi’s share grew by 29.4%.
 Samsung is heavily dependent upon consumer electronics sales in markets
with limited potential for growth, such as the United States and Europe, for
much of its revenue.
 Samsung’s devices use the Google Android open source operating system.
Many consumers seem to view Android as an inferior product to Apple’s
iOS. The public has not been as accepting of Android as the tech community
has.
 Some consumers view Apple products as more advanced and dependable
than Samsung products.
 Samsung’s marketing efforts are not as sophisticated as Apple’s.

Opportunities
 Growing market for smartphones, tablets and other mobile devices,
especially in developing regions such as Africa and India, where consumers
are unfamiliar with PCs. Sales of tablets finally overtook sales of traditional
personal computers in 2015.
 Increased demand for tablet and smartphone-based solutions such as
Samsung Pay
 New technologies such as wearable tech
 Growing middle class in developing world will increase market for
consumer electronics.
 Growing online market from sales channels such as Amazon.com

Threats:
 Apple has emerged as the dominant smartphone and tablet brand in some
markets, such as the United States. Samsung has not been able to overcome
Apple’s reputation for reliability.
 Apple’s reputation for quality, reliability and sophistication seems to be
growing.
 The Google Android operating system, which Galaxy devices depend upon,
is not as popular with average people as iOS is.
 Declining or stagnating middle-class incomes in North America and the
United States could reduce consumer buying power in those key markets
for Samsung.
 Chinese manufacturers such as Huawei and Xiaomi could emerge as serious
rivals to Samsung. These companies’ share of the critical mobile device
market is growing while Samsung’s is falling.
 Apple could enter more consumer products areas such as home appliances
and cameras and directly compete with Samsung in those markets.
Samsung maintains impressive research, design and manufacturing capabilities,
but it appears to have lost its edge in marketing. This company may need to
revamp its smartphone marketing and perhaps design efforts in order to
maintain market share in critical arenas like the U.S.

PORTERS 5 FORCES ANALYSIS


Introduction

Porter’s Five Forces methodology is used in this article to analyze the business
strategies of white goods makers like Samsung. This tool is a handy method to
assess how each of the market drivers impact the companies like Samsung and
then based on the analysis, suitable business strategies can be devised. Further,
companies like Samsung are known to study the markets they want to approach
thoroughly and deeply before they make a move and it is in this perspective that
this analysis is undertaken.
Industry Rivalry

This element is especially significant for Samsung as the other White Goods
multinationals like LG, Nokia, and Motorola not to mention Apple are engaged in
fierce competitive rivalry. Indeed, Samsung cannot take its position in the market
for granted as all these and other domestic white goods players operate in a
market where margins are tight and the competition is intense. Apart from this,
Samsung faces the equivalent of the “Cola Wars” (the legendary fight for
dominance between Coke and Pepsi) in emerging markets like India where
Samsung has to contend and compete with a multitude of players domestic and
global. This has made the impact of this dimension especially strong for Samsung.
Barriers to Entry and Exit

The White Goods industry is characterized by high barriers to entry and low
barriers to exit especially where global conglomerates like Samsung are
concerned. Indeed, it is often very difficult to enter emerging markets because a
host of factors have to be taken into consideration such as setting up the
distribution network and the supply chain. However, global conglomerates can
exit the emerging markets easily as all it takes is to handover and sell the
business to a domestic or a foreign player in the case of declining or falling sales.
This means that Samsung has entered many emerging markets through a step-
by-step approach and has also exited the markets that have been found to be
unprofitable. This is the reason why white goods multinationals like Samsung
often do their due diligence before entering emerging markets.
Power of Buyers

The power of buyers for white goods makers like Samsung is somewhat of a
mixed bag where though the buyers have a multitude of options to choose from
and at the same time have to stick with the product since they cannot just dump
the product, as it is a high value item. Further, the buyers would have to
necessarily approach the companies for after sales service and for spare parts. Of
course, this does not mean that the buyers are at the mercy of the companies. Far
from that, they do have power over the companies, as most emerging market
consumers are known to be finicky when deciding on the product to buy and
explore all the options before reaching a decision. This means that both the
buyers and the companies need each other just like the suppliers and the
companies, as we shall discuss next.
Power of Suppliers

In many markets in which Samsung operates, there are many suppliers who are
willing to offer their services at a discount since the ancillary sectors are very
deep. However, this does not mean that the companies can exert undue force
over the suppliers as once the supply chain is established; it takes a lot to undo it
and build a new supply chain afresh. This is the reason why white goods makers
like Samsung invariably study the markets before setting up shop and also take
the help of consultancies in arriving at their decision.
Threat of Substitutes

This element is indeed high as the markets for white goods are flooded with
many substitutes and given the fact that consumer durables are often longer
term purchases, companies like Samsung have to be careful in deciding on the
appropriate marketing strategy. This is also the reason why many multinationals
like Samsung often adopt differential pricing so as to attract consumers from
across the income pyramid to wean them away from cheaper substitutes.
Further, this element also means that many emerging market consumers are yet
to deepen their dependence on white goods and instead, prefer to the traditional
forms of housework wherein they rely less on gadgets and appliances. However,
this is rapidly changing as more women enter the workforce in these markets
making it necessary for them to use gadgets and appliances.
Stakeholders

This is an added element for analysis as the increasing concern over social and
environmentally conscious business practices means that companies like
Samsung have to be careful in how they do business as well as project themselves
to the consumers. For instance, white goods makers are known to decide after
due deliberation on everything from choosing their brand ambassadors to
publicizing their CSR (Corporate Social Responsibility) initiatives.

CHANGES OVER DECADES

In 2000, Samsung opened a computer programming laboratory in Warsaw, Poland.


Its work began with set-top-box technology before moving into digital TV and
smartphones. As of 2011, the Warsaw base is Samsung's most
important R&D center in Europe, forecast to be recruiting 400 new-hires per
year by the end of 2013.
The prominent Samsung sign in Times Square, New York City
In 2010, Samsung announced a ten-year growth strategy centered around five
businesses.
In December 2011, Samsung Electronics sold its hard disk drive business
to Seagate.
In first quarter of 2012, Samsung Electronics became the world's largest mobile
phone maker by unit sales, overtaking Nokia, which had been the market leader
since 1998. On 21 Augusts’ edition of the Samsung confirmed plans to spend 3 to
4 billion dollars converting half of its Austin chip manufacturing plant to a more
profitable chip. The conversion should start in early 2013 with production on
line by the end of 2013. On 14 March 2013, Samsung unveiled the Galaxy S4.
On August 24, 2012, nine American jurors ruled that Samsung had to
pay Apple $1.05 billion in damages for violating six of its patents
on smartphone technology. The award was still less than the $2.5 billion
requested by Apple. The decision also ruled that Apple did not violate five
Samsung patents cited in the case. Samsung decried the decision saying that the
move could harm innovation in the sector. It also followed a South Korean ruling
stating that both companies were guilty of infringing on each other's intellectual
property. In first trading after the ruling, Samsung shares on the Kospi index fell
7.7%, the largest fall since 24 October 2008, to 1,177,000 Korean won. Apple then
sought to ban the sales of eight Samsung phones (Galaxy S 4G, Galaxy S2 AT&T,
Galaxy S2 Skyrocket, Galaxy S2 T-Mobile, Galaxy S2 Epic 4G, Galaxy S Showcase,
Droid Charge and Galaxy Prevail) in the United States which has been denied by
the court.
On September 4, 2012, Samsung announced that it plans to examine all of its
Chinese suppliers for possible violations of labour policies. The company said it
will carry out audits of 250 Chinese companies that are its exclusive suppliers to
see if children under the age of 16 are being used in their factories.
In 2013, a New Zealand news outlet reported a number of Samsung washing
machines spontaneously catching on fire. The corporation is expected to spend
$14 billion on advertising and marketing in 2013, with publicity appearing in TV
and cinema ads, on billboards and at sports and arts events. In November 2013,
the corporation was valued at $227 billion.
In May 2014, Samsung announced it will be shutting down its streaming service
on 1 July 2014, also meaning the end of the Samsung Music Hub app that
typically comes installed on its Android phones.
On September 3, 2014, Samsung announced Gear VR, a virtual reality device in
collaboration with Oculus VR and developed for the Galaxy Note 4
In October 2014, Samsung announced a $14.7 billion investment to build a chip
plant in South Korea. Construction will begin next year with production
beginning in 2017. The company has not yet decided the type of chips to be
produced.
In October 2014, Samsung also announced it would invest 633 billion South
Korean won ($560 million USD) in the construction of a new 700,000 square
metre production complex in Vietnam.
Samsung plans to launch a new set of services beginning early 2015. The goal of
this new suite of business offerings, dubbed Samsung 360 Services, is to become
a help desk of sorts for businesses IT departments. The customizable services
range from technical support to security solutions for having a Samsung
employee embedded in a client's business as an on-site support manager or
technology consultant.
On December 2, 2014, Samsung announced it will sell Fiber Optics to U.S.
speciality glass manufacturer Corning Inc.
Samsung Electronics Inc. is expanding in Silicon Valley with a $300 million
facility in San Jose, California. The 10-story complex will include 1.1 million
square feet of floor space, a clean room for semiconductors and a "fitness center
in the sky". The facility will be split between semiconductor research and
development and other sales and marketing functions. It will serve as the North
America headquarters for semiconductor operations.
In 2015, Samsung has been granted more U.S. patents than any other company -
including IBM, Google, Sony, Microsoft and Apple. The company received 7,679
utility patents through Dec. 11.
FINDINGS
Following Are The Findings Of the Study On The Topic MARKETING STRATEGIES OF

SAMSUNG

With the passage of time use of sophisticated software tools- ERP, Trend

Data, Qualitative field inputs will increase and as a result forecasting would

be better.

One major finding is that, while branding differentiates the image of the

product, the distribution will determine its success to a large extent.

Rural markets would be the cornerstones of all MARKETING strategies in the

near future and this difficult markets will only be cracked by companies that

form partnerships across their value and supply chains.

SAMSUNG companies are now realising that change will come faster and

harsher than ever before, so why not change before change is thrust upon.

Therefore, Distribution has suddenly emerged from the background of the

business to the very forefront.

Last but definitely not the least with all attention now being centred on

Supply chain and logistics specifically in marketing sector, this could well

turn out to be the business to be in.


SUGGESTION
Looking ahead in 2015, Samsung is committed to social responsibility
contributions, with a focus on education, job training and improving
healthcare. Designed for corporate citizenship, our programs support local
issues around the world. We are also leading the way in a range of green
management and environmental activities, such as producing green
products and workplaces and working to reduce greenhouse gas emissions.
We strive to maintain safe environments in which our employees can work
healthfully and live happily. As always, we support our partners worldwide
and promote their success by forging win-win partnerships for shared and
sustainable growth. For the past 46 years, Samsung Electronics has grown
rapidly by surmounting many crises and difficulties. As we pursue our
dream of making a better and brighter world for everyone, we will embrace
and overcome new challenges. Today’s complex business environment is
pushing us to redouble efforts and increase innovation. We will steadily
realize our dream by relying on our wisdom to overcome crisis, our
courage to blaze new trails and our passion to serve our customers. We are
grateful for your unwavering support and encouragement as we create the
imaginative opportunities that will open doors to the future realize
significant growth in sales and profits in our developing businesses, such as
Digital Appliances, Printing Solutions, Networks, Health & Medical
Equipment, System LSI and LED.
CONCLUSION

Samsung India ltd. Is a leading Electronic company in India and from last
five consecutive years has shown accelerated growth in electronic
portfolio. Customers in India are also spending more in electronics as their
standard of living is growing. Samsung has placed itself successfully in the
position of market leader in electronic products. Though there was some
downfall in sales and profit of the company in the beginning of this decade
but after that Samsung has shown considerable rise in both sales and profit.
The future of the company is also looking bright as electronic market in
India is still expanding and so we can safely conclude that Samsung will be
able to secure its number one position in electronic product.

Samsung has also started project , that has provided it direct reach to rural
market. This may be considered a revolutionary step since the urban
market is reaching its saturation level and there is a huge scope exploring
rural market. This will also be helpful not only increasing its market share
but also fight competition
BIBLIOGRAPHY

In order to make this project we have taken the help of the following
websites & books:

 www.wikipedia.com
 www.oppapers.com
 www.samsung.co.in
 www.scribd.com

Besides it various books are also consulted to prepare project report.

AUTHOR’S NAME BOOKS


AshishBenerjee Principle of economics

H.L. AhujaModern Microeconomics


Theory and Application

C.K.KothariResearch Methodology