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Analysis Report of SAMSUNG Branding Case Study

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Updated: Apr 21st, 2019

Introduction

Managers of Samsung appreciate that the company is one of the leading dealers in electronic items globally. At the same time, they acknowledge that the company faces threats. The management has proposed and implemented a number of reforms in their marketing strategy to solve these issues.

Market Segmentation, Targeting and Positioning

Samsung uses market segmentation and related product differentiation strategy to have a commercial advantage. Samsung has directed its managers in North America and Europe to market and sell a new brand of its products. It targets to reach out to the high-income earners, youths, business users, and hobbyists dwelling in the region.

In addition, it has strategic selling points that serve the rich. The rich are highly loyal to the brand. The younger generation, on the other hand, keep trying new products. Samsung had endeavored to meet the needs of these different market segments.

Strategic Marketing Management

Samsung has plans to overcome its internal and external weaknesses. The company also intends to take advantage of its strengths. Samsung has the ability to satisfy the needs of its customers by selling modern digital cameras, computers, and business applications.

It utilizes several retail centers, including its office supply store, to make more profits. Further, Samsung has established a strong presence in British Colombia, where Future Shop meets the needs of several customers. The company has its affiliates in many countries. Samsung Electronics and Samsung Retails are some of these affiliates.

These assets help the group to overcome pressure from Sony, Future Shop, and Best Buy. These dealers have equally modern marketing resources. Sony uses competitive advertising techniques, such as online marketing. Moreover, it has retail shops globally under its name.

Customer Profiling

Samsung divided the consumer electronics market in Canada into four segments, namely, high-income families, business users and hobbyists, and the young generation. The company mainly targets the high-income families.

It also gives attention to the young generation segment. Samsung has been exercising a lot of caution while dealing with this group since they are not brand loyal.

Analyzing Market and Competitive Space

Samsung may continue making profits due to the constant increase in global population. However, the threat of competition from Sonny and behaviors of hobbyists is a concern.

Hobbyists enjoy building their own electronics using off-the shelf components and Sonny has more assets than Samsung. The impact of globalization, however, indicates good prospects for the industry.

Product Development and Service Satisfaction

Samsung heavily invests in research to further its mission. In 1979, it developed the first 256k dynamic random access memory (DRAM) computer chip. By the turn of the millennium, it had already produced digital cameras, liquid crystal display (LCD) computer monitors, among other modern electronic products.

Market Knowledge

Samsung is a leading dealer in electronic products since it employs staffs with advanced knowledge in the field. The utilization market knowledge led to the development of the first 256k dynamic random access memory computer chip.

Brand Global Strategic

Samsung took over the industry with a vision to make a global brand. To realize this goal, it launched a worldwide campaign using the tag “SAMSANG Digital-everyone is invited”.

It has sponsored the Sydney Olympic Games and Olympic games a number of times. Further, the group has been increasing its global advertisement budget by large amounts. In 2001, it increased the budget by 35 percent.

Marketing Challenges in Canada

Samsung had problems deciding on the appropriate allocation for promotional budget when the rebranding exercise began. Park, the marketing manager, discovered that about $15 million had been spent in 2003 in advertisement and promotion. In addition, the spending had been kept constant for five years.

Therefore, Park was of the opinion that there was no need of increasing the budget. At the same time, he was concerned that failure to increase the budget would undermine the rebranding efforts. Park’s concern was justifiable since rebranding is costly.

However, since the exercise does not necessarily result to increase in expenditure, Park needed to consult widely before taking action. The marketing managers who increased funding for promotion were right since their action resulted to increase in sales globally.

Subsequently, there was the problem of determining the best ways of carrying out product distribution. There were some low quality products in the store. Park feared hoarding them due the possibility of making a loss. Senior managers suggested that Samsung should follow the example that had been set by Sony.

This was the sole company in Canada with nationwide retail channel and a website. The ideas would help the company overcome competition pressure from Future Shop retail Shop and Sony. Nevertheless, Samsung needed to plan before taking the step to avoid over risking.

Finally, there was the problem regarding pricing. Research had indicated that the low pricing of Samsung’s items was not contributing positively towards the rebranding efforts. A section of the senior management planned to increase the prices.

Others opposed the plans saying it would hurt the business. The efforts to increase the price were called for since they had improved the brand. This, however, could be done after building the brand successfully.

Steps to building a brand

The first step to building a brand is identifying the reasons to believe. The customer should be able to support the reasons to believe. For example, introducing high quality products in the market and withdrawing low quality products, Samsung gave the customers a reason to believe that an increase in price is justifiable.

The next step is the customers’ touch point. This step involves the management of believes of the customers. It helps the business to convince the customers that it is working to fulfill the promise to deliver quality products.

Samsung employed an effective customer service unit as a customer touch point. It also got opportunities to interact with the customers by sponsoring global events such as Olympics..

The next stage is designing the optional experience. After creating the reason to believe and determine the most crucial customers’ touch points, a marketer requires to know how to express each of the reasons to believe.

Samsung determined different ways of selling their products through global events and sports and by the help of professional customer service. Samsung took care of general customer needs during sports. The support staff managed sensitive touch points.

The final stage of building a brand is aligning the organization to deliver the optional experience consistently. Samsung employed managers at every marketing level to handle this role. In Canada, they gave Park the responsibility. In addition, they contracted external staffs to carryout research and advise the company accordingly.

Market segments

Samsung targeted four market segments in Canada. These are the high-income families, hobbyists, the young generation, and business users. The company invested heavily in the high-income segment. The improved brand image contributed to increase in sales.

The second influencing group is the teens or youths in the 20s. They are knowledgeable and highly interested about digital technology. They are not brand loyal, as they keep experimenting with all brands. Moreover, since a majority of them has low financial strength, they tend to buy smaller electronic items that are less costly.

They avoid purchasing items such as large-screen televisions. The young generation bought products such as hand-held devices and MP3 players in large quantities.

At the same time, business users formed part of the market. Banks for example purchased modern CRT to replace with the traditional bulky ones. Like banks, other business users were purchasing these electronic items depending on the reliability and the ability of the products to satisfy given sets of needs.

Customer support service also influenced their purchasing behavior. Hobbyists are the final segment that Samsung was targeting. This market segment purchases items modestly. They were price sensitive. That made the market to be characterized by extremely low margins. Samsung was right to give priority to high-income earners.

Nevertheless, since its competitors were also focusing on the same segment, it would have increased investment in products targeting the younger generation segment.

Samsung could do this successfully by inventing new models that satisfies the tastes of the youths. The business user segment also would have given Samsung a huge market should it have used more advanced customer care techniques.

Conclusion

Samsung has the potential to remain relevant for many years due to the amount of resources at its disposal. The staff’s understanding of the market is equally important for its success.

However, the management needs to deal decisively with the emerging threat of unhealthy competition.

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IvyPanda. (2019, April 21). Analysis Report of SAMSUNG Branding. Retrieved from https://ivypanda.com/essays/analysis-report-of-samsung-branding-case-study/

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IvyPanda. 2019. "Analysis Report of SAMSUNG Branding." April 21, 2019. https://ivypanda.com/essays/analysis-report-of-samsung-branding-case-study/.

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IvyPanda. (2019) 'Analysis Report of SAMSUNG Branding'. 21 April.

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