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    Samsung Globalmarketingoperations 171118120749

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    Anandita Jain
    Samsung Electronics Company is a South Korean multinational conglomerate company founded in 1938. It has four main business units and is one of the world's largest makers of electronics, mobile phones and semiconductor chips. During the 1997 Asian financial crisis, Samsung responded by dismissing employees, selling assets, heavily investing in chip factories and R&D. This led to strong growth and by 2002 Samsung had a net profit of $5.9 billion and was the 25th most valuable global brand. Samsung utilized strategic marketing approaches including competitive pricing, product innovation, sponsorships and partnerships to build its global brand presence across key regions.

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    Samsung Globalmarketingoperations 171118120749

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    Anandita Jain
    103 views26 pages
    Samsung Electronics Company is a South Korean multinational conglomerate company founded in 1938. It has four main business units and is one of the world's largest makers of electronics, mobile phones and semiconductor chips. During the 1997 Asian financial crisis, Samsung responded by dismissing employees, selling assets, heavily investing in chip factories and R&D. This led to strong growth and by 2002 Samsung had a net profit of $5.9 billion and was the 25th most valuable global brand. Samsung utilized strategic marketing approaches including competitive pricing, product innovation, sponsorships and partnerships to build its global brand presence across key regions.

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    Samsung Electronics Company is a South Korean multinational conglomerate company founded in 1938. It has four main business units and is one of the world's largest makers of electronics, mobile phones and semiconductor chips. During the 1997 Asian financial crisis, Samsung responded by dismissing employees, selling assets, heavily investing in chip factories and R&D. This led to strong growth and by 2002 Samsung had a net profit of $5.9 billion and was the 25th most valuable global brand. Samsung utilized strategic marketing approaches including competitive pricing, product innovation, sponsorships and partnerships to build its global brand presence across key regions.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    103 views26 pages

    Samsung Globalmarketingoperations 171118120749

    Uploaded by

    Anandita Jain
    Samsung Electronics Company is a South Korean multinational conglomerate company founded in 1938. It has four main business units and is one of the world's largest makers of electronics, mobile phones and semiconductor chips. During the 1997 Asian financial crisis, Samsung responded by dismissing employees, selling assets, heavily investing in chip factories and R&D. This led to strong growth and by 2002 Samsung had a net profit of $5.9 billion and was the 25th most valuable global brand. Samsung utilized strategic marketing approaches including competitive pricing, product innovation, sponsorships and partnerships to build its global brand presence across key regions.

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    SAMSUNG Electronics Company :

    Global Marketing Operations

    Presented by
    Mithisar Basumatary
    SAMSUNG
    THE FASTEST GROWING KOREAN
    BRAND
    FOUNDER: LEE BYUNG CHUL

    CURRENT CEO: CHI HUN CHOI (2014 ONWARDS)

    CURRENT CHAIRMAN: LEE KUN HEE

    SUBSIDIARIES: SAMSUNG ELECTRONICS LTD., SAMSUNG HEAVY


    INDUSTRIES, SAMSUNG C&T CORPORATON , SAMSUNG SDS.
    Introduction
    • INDUSTRY: CONGLOMERATE
    • FOUNDED: FOUNDED 1ST MARCH, 1938
    • HEADQUARTER: SEOUL, S. KOREA
    • AREA SERVED :WORLDWIDE
    • REVENUE :US$ 305 BILLION (2014)
    • NET INCOME: US$ 22.1 BILLION (2014)
    • TOTAL ASSETS :US$ 529.5 BILLION (2014)
    • TOTAL EQUITY :US$ 231.2 BILLION (2014)
    • NUMBER OF EMPLOYEES:489,000 (2014)
    INTRODUCTION-PROFILE
    • 1938: Produced agricultural products.
    • 1969: Founded Samsung Electronics Company.
    • 1970: Acquired semiconductor business.
    • 1970s: Focussed on shipbuilding, chemicals &
    textiles.
    • 1980s: Launched home appliances.
    • 2003: Introduced TFT-LCDs for TVs & Montors.
    QUESTIONS OF THE CASE
    1. Financial crisis occurs in Asian market in 1997
    proved negative net profit of 3% with only SEC
    sales were $16 billion. HOW SAMSUNG
    RESPONDED?
    2. RESULTS
    3. MARKETING STRATEGIES IN ITS GLOBAL
    MARKET
    4. RECOMMENDATIONS AGAINST ITS
    COMPETITORS.
    WHAT SAMSUNG DID IMMEDIATELY?
    1. 1997: Dismissed 29,000 employees globally
    2. 1998: Sold $2 Bn worth of its capital assets
    3. 1999-2003: Instead of outsourcing its production to
    external houses, it manufactured in its own
    competence
    4. 1998-2003: Invested $19 Bn in chip factories
    SALES AND PROFIT
    IN Bn
    60
    40
    44.6 SALES
    20 28 NET PROFIT
    0 2.8 5.9
    1999 2002
    5. Digital Product Innovation with investment of $2.45
    Bn annually, involving 17,000 scientists, engineers and
    designers
    6. Employed CDMA in its devices: Code Diversification
    Multiple Access
    7. Digital Convergence: i.e. merging of different
    technologies into one major product. Introduced SPH-
    i-700 Camera Phone and Palm OS-based smart phone
    by 2003 end.
    THE MARKETING ORGANISATION
    • Eric Kim headed the Global Marketing Operations
    (GMO) unit in 1999.
    • GMO coordinated Samsung’s overseas business and
    watched its marketing operations.
    • GMO has the following team:
    1. Marketing strategy team
    2. Regional strategy team
    3. Product strategy team
    1. GMO funds were only use for advertising and other brand franchising activities.
    2. GMO funded 70% of its fund in fashion and 30% on other opportunities.
    3. Invested $400 Mn in 2003
    4 P-STRATEGIES OF SAMSUNG
    1. PRODUCT
    2. PRICING
    3. PROMOTION
    4. PLACING
    MARKET

    DOMESTIC INTERNATIONAL
    1. PRODUCT STRATEGY
    I. In 1970, Samsung made cheap 12 inch
    television sets under Sanyo label.
    II. High investment in research and technology.
    III. In 2005 Samsung spent about 9% of revenue,
    amounting to $5 billion.
    IV. In 2002, it introduced coloured screen phones
    in US
    V. It was the first company to manufacture 57
    inch LCD screens
    2. PRICING STRATEGY-
    I. Competitive pricing: Samsung Elec. used this
    policy for products like TVs, ACs, Refrigerators
    against the models of LG and Panasonic.
    II. Between 1998 and 2003, it invested $19
    Billion for manufacturing chips, like NAND,
    etc.
    III. In 2003, it invested $17 Billion in TFT-LCDs

    1. Skimming pricing strategy was used by Samsung Electronics for smart phones.
    2. It didn’t consider vertical integration and investment in manufacturing, and R&D not as Fixed
    Costs, but rather flexible.
    3. PROMOTIONAL STRATEGY:
    I. Product Placements.

    II. Sponsorships, eg Sydney Olympics 2000, 2002


    Winter Olympics in Salt Lake City, 2004 Summer
    Games, Athens, 2006 Winter Games, Torino, 2008
    Summer Games, Beijing.

    I. Media Advertising.

    II. Internet Advertising.


    POMOTIONAL STRATEGY:
    Positioning is the act of designing the company’s
    offering and image to occupy a distinctive place in
    the minds of target market.
    I. The Korean Company changed its logo, by
    symbolizing the world moving through space and
    writing “Samsung” in English to reach global
    market.
    II. By partnering , it targeted customers looking for
    prestige, quality and wealth.
    4. PLACING STRATEGY
    I. EUROPE: Samsung was stronger in the southern
    countries of the Europe like Spain, Italy. In North,
    people were loyal to German brands. They explored
    B2B opportunities in the enterprise space.
    II. ASIA: Asian markets include Russia, China, India
    and South-East Asia. They launched in Russia with
    their market needs in late 1980s. Chinese market
    estimated 5 Mn customers in 2002 with telephone
    services. It opened its manufacturing plant in China
    and R&D in India in 2003.

    EXHIBIT: Results indicated that Samsung brand was at different degrees of development in
    different countries.
    III. US electronics market was popular with Sony. So
    Samsung partnered with chains like Walmart, Target,
    Best Buy, and Circuit City, etc as the top 10 chains
    accounted 60% of electronic sales.
    ELECTRONICS MARKET SHARE 2002

    7%
    8%

    S. KOREA
    15% AMERICA
    EUROPE
    ASIA
    70%
    DOMESTIC
    • SAMSUNG had over 50% of the market share
    in South Korea (70% in 2002).
    • Being a mountainous state, S. Korea proved a
    good market for wireless services. So it
    invested huge fortune on wireless
    technologies, Chip-sets, etc.
    Result
    • By 2002 Samsung recorded net profit of $5.9
    billion.
    • Samsung’s sales grew by 51% as against 4% of
    Motorola and Nokia’s at less than 4% in 2002

    • Ranked in 25th position in world’s most valuable


    brands in 2002 (34th position in 1997)

    • Fastest growing brand in the top 100 valuable


    brands
    Results
    Results
    M-NET recommendations
    1. SEC was overspending about 45% of its current
    budget in N. America and Russia as they did not
    have high market potential. So 35% should have
    been done!
    2. Europe and China had huge market potential. But
    only 31% was invested. 42% should be done!
    3. Again it was investing more on mobile phones,
    vacuum cleaners, ACs, and NOT on DVD players, TV,
    PCs or refrigerators.
    OUR RECOMMENDATIONS FOR 2002
    1. Like Sony’s PlayStation, Samsung should build
    gaming appliances.
    2. Samsung should tap the youth market, like
    Sony and Nokia,
    3. Samsung should develop proprietary
    software like Sony, on music, movies, etc.
    4. Like Nokia and Motorola, Samsung should
    invest on low-end cell phones also.

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