Introduction
Samsung Galaxy Gear Watch is one of the most innovative products that Samsung Corporation has ever produced in the market. According to Butow (56), this Smartwatch was introduced into the market on September 4, 2013 with high expectations that it would be a success.
The product will occupy a special niche that currently has Sony, LG, and Apple as the main players. It offers many applications to the users. Besides telling time, this product also issues updates from phones via Bluetooth, takes photos, initiates calls, counts steps, records voices, and some have the capacity to make or receive calls.
Samsung Galaxy Gear Watch has been introduced into a market where there are other strong competitors with similar products. Some of the companies that produce Smartwatch include Apple, LG, and Sony. This firm will depend on its strong brand to penetrate the market (Boutellier 56). Samsung has been able to develop various marketing strategies in the recent past that has endeared it to its customers. Products of this company are spread across many industries.
Some of the main products from this firm include phones, computers, television sets, music systems, cameras, and watches (Booker 119). The recent introduction of Samsung Galaxy Gear Watch is a demonstration of this innovativeness. This product has not only been considered superior to other existing brands of watches, but also one that offers consumers a lot of value.
However, the firm must be ready to deal with market forces that will affect its normal operations (Stevenson 45). In order to understand these external factors in the market, a situation analysis using PESTEL model would be appropriate.
Situation Analysis
Following the introduction of Samsung Galaxy Gear Watch in the market on September 4, 2013, the management of this firm must understand some of the external forces that will affect its operations. Situation analysis helps in understanding the external environmental factors of a firm.
Understand these factors always make it possible for the management to come up with measures through which negative factors can be controlled while positive factors can be maximize in order to ensure that the firm is successful (Aaker 71). The decision to introduction Samsung Galaxy Gear Watch is a brilliant strategy that can enable this firm to achieve success in this market.
However, the success can only be achieved if the management is able to work within the forces in the external environment of this business. The following are some of the factors that should be considered by this firm to ensure that it remains successful in the market.
Technological Factors
Samsung Galaxy Gear Watch is a product of technological changes and inventions in the market. It is a clear demonstration of the power of the emerging technologies in the electronics market. Emerging technologies are introducing new products and new marketing methods. A firm should be able to understand these forces and define a way of dealing with them. As Henioe (60) says, technology is so dynamic that it forces firms to devise means of identifying changes as soon as they take place in the market.
Ability to understand these changes early enough will always determine success of a firm in this industry. This new product will be affected by technological environment in various ways. Some of the positive technological factors that this new product will benefit from include the ease in advertising using the social media such as Facebook, Tweeter, and YouTube (Schneider 73).
These new means of advertising brought about by the emerging technologies will offer this product a unique marketing platform in the global market. Samsung can use these platforms to pass marketing information across the world. The approach will enable this firm reach a wide market within a very short time, and with limited resources.
According to (Simerson 20) this firm stands to benefit from electronic marketing that has been brought about by technology. Electronic marketing offer this company an opportunity to sell its products to the market without the need to have physical retail stores. When used appropriately, the strategy would reduce the cost of delivering the products to the customers. It is important to appreciate the fact that technology also comes with challenges that must be dealt with by this firm.
In this industry, there is a high rate of copying successful products in the market using sophisticated technological tools (Griffin 48). The marketing team must be able to deal with such new market entrants. Another negative impact that this firm may face due to the emerging technologies is the exposure its products will have to the rival companies such as Apple and Sony. According to Bhattacharjee (73), the exposure will make it easy for these rival firms to determine what makes the product unique in the market.
Legal and Regulatory Factors
The management of Samsung must be very sensitive of the legal environment when introducing Samsung Galaxy Gear Watch. The law will always protect this firm in order to enjoy maximum benefits in the market. The law must also be clear in stating its responsibilities to the government, customers, other firms, and any other stakeholder who may be related to the firm in one way or the other (Roberts 91).
Counterfeit and intellectual property laws will help the firm in fighting companies or unscrupulous business people who may try to copy the technology that was used in developing Samsung Galaxy Gear Watch (Hoffman 89). This law will help the firm to ensure that this product is not counterfeited in any part of the global market.
This will increase the product’s profitability. The law will also define the relationship that this firm will have with its competitors in the market (Clarke 116). It will specify the duration within which the competitors may not use this technology to produce a similar product as a way of making Samsung benefit from its own inventions.
The management of this firm should also understand its responsibilities as presented by the law. Samsung Galaxy Gear Watch should be an original product that does not contravene the set laws and regulations regarding copyright laws. The firm will also be expected to manage its emissions within the legal levels (Homua 71).
Governments across the world have specific level of emission that a firm is permitted to operate within, per day, week, or in a year. Samsung has the responsibility of operating within these limits when producing this new watch.
It is also important for this company to ensure that its operations do not contravene regulatory measures put by individual countries where it has subsidiary branches. Such regulatory laws defining taxation it should pay, and any other responsibility that may be assigned to it should be observed to enhance prosperity of the firm (Clarke 116).
Social and Cultural Factors
According to Jorgensen (39), the changing tastes and lifestyle in the society have a strong impact in defining buyer behavior in the market. Lifestyle is always defined by cultural practices in a given community. A firm must understand cultural practices of a given community in order to devise appropriate marketing approach that can be used.
Understanding the social and cultural environment would help a firm develop an appropriate marketing program that would be suitable in specific regions of operations. Samsung has a global market coverage. The marketing strategy that is successful in the United States or Europe may not work in Saudi Arabia or South Africa. The management of this firm must understand each market, determine cultural practices, and come up with the most appropriate method of communicating to this market about Samsung Galaxy Gear Watch.
The world is turning into a global village due to developments brought about by technology cultural practices still vary to great extents. As such, Samsung must treat each market as a unique entity that must be targeted with unique marketing approaches. This way, it would be easy to introduce this product into the global market successfully. Lifestyle and values may affect the success of this product in the market. Most of those who will be buying these watches will be attracted to some of the new features it offers besides just telling time (Rama 82).
Economic Factors
The management of this firm should understand the economic environment in order to achieve the desired success. The level of economy would always determine the purchasing power of the market in a particular country. The United States has remained the most attractive market for firms in various sectors because of the purchasing power of its people.
When introducing Samsung Galaxy Gear Watch, the management of this firm must determine the capacity of the market to buy this product. It is important to note that this product is categorized as ostentatious good. It is meant to offer some status to its users (Ruskin-Brown 67). For this reason, members of higher social class would be the target market for this product. In determining the market entry strategy and expansion, it would be appropriate to target the markets with the highest population falling under this category.
Most of the electronic firms have always preferred the United States as the market to introduce their product first. This firm can then move to the European markets. Selected markets in Asia such as Japan and China can also be given priority when selecting the appropriate market to be targeted with this product (Shanker 115). Expansion can then be extended to other Asian countries and Africa, especially when the product life cycle of Samsung Galaxy Gear Watch approaches maturity.
Most of the major economies around the world have fully recovered from the 2009 economic recession (Srinivasan 128). The United States, China, Japan, and various European countries have experienced increased economic growth over the last two years. This means that the purchasing power of people in this region is also high. Samsung should take advantage of this and increase its market coverage in these regions.
Some of the economic issues that this firm should focus on are employment in specific regions, inflation, and disposable income. Employment will always determine the purchasing power of the market. Inflation devalues the currency, making the product appear expensive. This would reduce sales of the product. Disposable income would determine the amount people would be willing to spend on this new product.
Competitive Factors
Samsung Galaxy Gear Watch is going to face serious competition in the market from others players following its introduction into the market on September 4, 2013. Some of the industry giants have large market shares in this industry, and command loyalty in the global market (Wenderoth 78).
Top brands such as Apple, Sony, and LG have also been actively engaged in marketing their Smartwatch in a market that is very competitive. Samsung will be trying to eat into the market share of these large firms in the global market. This may not be easy because these competitors are watching every move made by Samsung with this new product. The competition in the market is already intense, and the introduction of Samsung Galaxy Gear Watch would only make it stiffer.
The kind of competition in this industry can be described as perfect competitive market. This is confirmed by the entry of various firms into the industry without any restrictions, including Samsung with its new Samsung Galaxy Gear Watch. In the recent times, there have been major market entries especially that made by Samsung with this new Samsung Galaxy Gear Watch. Market exits have been rare in this industry because it is a relatively new industry (Wenderoth 131).
Conclusion
The introduction of Samsung Galaxy Gear Watch into the market on September 4, 2013 has stiffen competition in this industry, especially given that Apple, Sony, and LG also have similar products in the market. The marketing team employs appropriate marketing strategies in the global market.
To do this, the management would need to understand the external environment that would affect introduction of this product into the market. Technological, legal, social, economic, and competitive environmental factors should be analyzed in order to determine the ability of Samsung Galaxy Gear Watch to be successful in the market.
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