Samsung marketing Essay
With a CAGR of 10 %, global market value for computing electronics application sector is anticipated to be worth US$436.7 billion by 2018. On a global scale, Asia-Pacific accounts for more than 35% of the market share. While US accounts for the largest share of the global market value on a country basis, India and China surpasses the US in terms of growth rate anticipated in the near future. Among the application sectors, Computer Peripherals account for the largest share of the entire market, driving a CAGR of 9.1% during the analysis period 2011-2018. Super Computers see as the fastest growing application with a forecast CAGR of approximately 14.2% by 2018, Video Games are most demanding application on personal computers based on the recent advancements and innovation technologies in gaming industry.
Primarily supported by application sector :- Analog & Digital TV, Tablet, Digital cameras & Camcorder, Personal Computers and Video/Audio Equipment- the consumer electronics market to witness a value ofUS$1.6 trillion by 2018. Geographical analysis shows the highest Compounded Annual Growth Rate(CAGR) of 17.6% is foreseen from Asia-Pacific region during the analysis period 2011-2018. The Middle East is not way behind with a CAGR of 17%, followed by Africa at 16.9%. Japan forecasts to drive with a growth rate of 13.9%.
Among the sectors, Analog & Digital TV accounts for nearly 32.3% of the overall Market share followed by Personal Computers at 25.5% holding the second position. Global market for Consumer Electronics especially in Tablet will record strong hold over the next 5 years driven by raising demand in fast – growth market in Asian and other emerging countries. Major companies are located in Japan, South Korea and Taiwan region and are dominating the consumer Electronics Industry Growth.
Increase in the incomes and spending power of individuals, the consumer electronic market has witnessed a boom in sales, in the past few years. The key factor for this market growth is increasing demand for LCD TVs and LED TVs. The digital technology also has been witnessed rapid growth in the recent years. The consumer electronics products segmented into semiconductor industry, consumer automotive electronics, home entertainment sector, and communications segment. The consumer electronics products include mobile phones, LCD TVs, LED TVs, smartphones, digital TV, PDAs, DVD players, DTV, portable media players, HDTV, video games, home-theater systems, microwaves, printers and others. Currently, the U.S. market is dominating the market with largest market share of global consumer electronics market, followed by Asia region, particularly, China.
Moreover, digital TV forecasted to grow rapidly in India and China. Beside, the digital TV demand projected to grow, with Asia-Pacific and Europe holding largest number of DTV homes. The HDTV will also likely to grow in North America market in the next few years. With the increasing competition, more companies are looking to bring innovative products and technologies in the market. The global consumer electronics market is expected double digit growth in the coming years.
The consumer electronics market research aims at providing a complete account of the above mentioned sectors. It also provides detailed information on industry size and in-depth view of the industry’s key competitors. The consumer electronics market research makes a careful study of all the past reports and makes estimates based on them. Further, it studies the global outlook in the consumer electronics market.
The consumer electronics industry has been witnessing a phenomenal growth globally over the past few years. This growth can be attributed to the revolutionary technological developments taking place in the consumer electronics industry. The revolution brought by the digital technology has enabled the consumer electronics sector to profit from the growing interaction of digital applications, such as camcorders, DVD player/recorder, still camera, computer monitor, LCD TV, Mobile phones, etc. According to Consumer Electronics Market Forecast report, the global consumer electronics market is forecasted to grow at a CAGR of around 5% during 2009-2012. Also, during the same period, the global consumer electronics shipment will grow at a CAGR of around 5%.
Various factors driving the future growth. On the regional front, we found that the American region, mainly US, is driving the global consumer electronics industry, closely followed by Europe. In future, Asia Pacific region will constitute the major portion of the consumer electronics industry, mainly due to the increase in demand from the developed countries in the region. Also, the American region along with the European region will see a decline in their market shares because the markets there have attained saturation and only the advent of new technology will boost the demand. India’s consumer electronics devices market, defined as the addressable market for computing devices, mobile handsets and AV products, is projected at around US$28.6bn in 2010.
This is expected to increase to US$45.7bn by 2014, driven by rising incomes and growing affordability. Growth in some product categories dipped in 2009, but the market recovered strongly during the festive sales season that ran until Diwali, with many retailers reporting 20-40% growth. Spending on consumer electronics devices is projected to grow at an overall CAGR of 12% through 2014, with the key segments including touch-screen mobiles, for LCD TV sets, set-top boxes and notebook computers. Much of the growth will be driven by growing demand from India’s rural population.
STRATEGIC OBJECTIVES OF SAMSUNG ELECTRONICS
Market segmentation has three levels including
1.Strategic Segmentation-vision, strategic intent and product benefits
2.Managerial Segmentation-resource allocation, alignment and planning
3.Operational Segmentation-Marketing programs such as advertising, sales and distributions. Segmentation in the market-driven strategy process is segments, value opportunities, new market space, matching value requirements with capabilities, market targeting and strategic positioning.
Activities of market segmentation are:
1.Defining the market to be segmented.
2.Identifying market segments
3.Forming market segments
4.Finer segmentation strategies
5.Selecting the segmentation strategy
The firm uses mainly lifestyle and demographic variables in segmenting their market . The firm should however lay more emphasis on the changing
lifestyles of the young generation and cater for their ever changing needs. In order to regain market share, the company can segment the market into rural and urban people. The rural targets will help increase the market share. The urban should comprise mainly the people aged 15-30. This ought to be their main segment in order to compete favorably with brands in the same market segment. This target group of people focuses mainly on music, leisure and has the flair for hip gadgets in the market. Levels of segmentation
Samsung is targeting the customer market by dividing it into diferent segments and offering each segment different product based on their common characteristics
Bases for Segmenting Consumer Markets
The consumer market for samsung products has been divided using four schemes of segmentation variables i.e geographic, demographic, psychographic and behavioural
Region- Samsung has divided the Asian market into different geographical regions such as northern, eastern and southern areas City- Samsung is targeting different countries of Asia differently by dividing as different markets such as Indian Market, China market.
Age- age factor is not really involved in Samsung segmentation but its most users are adults enthusiastic people Family size- Samsung Products are offered for all family sizes Gender- Samsung home theater system is equally beneficial for male and female Income- Samsung Products are offered with varying features to different peoples based upon their income level i.e. low (upto $ 1500) lower middle ($.1500-3000) middle ($3000-5000) upper middle ($ 5000-7000) and high (above$ 7000) Occupation- Samsung has divided the consumer into different categories based upon their occupation i.e. businessman, self employed, students and teachers Education- Samsung is also keen to know about the education level of its target market i.e. illiterate, school 5 to 15, under graduate, graduate and postgraduate
Lifestyle- Samsung is also classifying customers on different levels based on different lifestyle of the people i.e. culture oriented, sports oriented, outdoor oriented Personality- customers are differentiated on the varying level of personality such as compulsive ambitious
Benefits : Consumer are also targeted differently based upon the benefits that are seeking in Samsung electronics i.e., some people may want good quality , some may want low services and some want good services. User Status : Samsung is keen to know user status of its target consumer in order to better offer its product and therefore they are divided into ex-user, potential user, first time user and regular user. Loyality Status : Tarhet market of Samsung may contain people with different loyality status and therefore Samsung is targeting these customer differently based on their loyality i.e., hard core loyals, split loyals, shifting loyals, switchers.
The market targeting options include a single segment, selective segments, or extensive segments. When segments are not clearly defined, product specialization or product variety strategies can be used. Market targeting decisions need to take into account product-market life cycle stage. In emerging market stage risk and uncertainty is too high, in growth stage benefits from prior experience but it is more intense than emerging stage, and in mature stage multiple targeting strategies can be done such as product variety or product specialization. Samsung target the upper middle class professionals. This usually has busy schedules and hence need to communicate with their colleagues and families.
The secondary target are the high school college and graduate who need devoices which are multifunctional and portable. The secondary target includes medium size corporations and they aim to help managers and employees have crucial data access on the go. Thus the company has two main segments and this is called multi segments targeting. The company should however enhance target group to incorporate more teen activities that are
the main target of main competitors.
The concept to position the brand may be based on the functions provided by the product, the experience it offers or symbol it conveys. Developing positioning strategy requires integrating the product, price, value chain, and promotion strategy to focus them on the market target. The positioning strategy matches the firm’s capabilities with the buyer’s preferences. The positioning strategy that the company uses to market its new products is the positioning of the new product as a convenient value added device which can be used for professional and personal use by young professionals. There is also focus on convenience as it incorporates other features such as music, internet access, and laptops. This positioning strategy enhances sony products as professional and hip.
Samsung electronics produces consumer electronics in five categories , they are TV’s and video /audio players , mobile phones, computers , cameras , home appliances . We have discussed the points of parity and points of differentiation of Samsung with its competitors TV/Video/audio players – Samsung has become the company with the highest sales of TV’s . They were the first to introduce 3D Led TV’s .They have always had a head to head competition with Sony in the TV segment. In the past few years Samsung has managed to become the leading producers of TV. Their possession of Samsung chip has also enabled them to come up with innovative products like the smart TV in response to Sony’s internet TV.
They have been successful in integrating technology with electronics thus becoming the market leaders. they also have the advantage of manufacturing their TV’S in their own factory while Sony outsources the manufacturing Points of parity –Both sony and Samsung give importance to innovation and picture quality. Both had a tough competition introducing slim/ultraslim Tv’s .sony introduced internet TV , while Samsung introduced smart TV . Samsung also introduced 3D LED tv Overall positioning:- better quality and design , innovative features value for money , integral part of family
Home appliances:- Samsung has a variety of products under home appliances category . They include air conditioners, microwave oven , refridgerators ,washing machine , vacuum cleaners , etc . In india Samsung has tough competition from another south Korean company LG. Points of parity:- There are a lot of pop’s between Samsung and LG . Both concentrated on innovation and brought new technologies. LG bought innovation in the form of side by side door fridge , automatic doors for fridge ,health guard in AC , tallest cooler in fridge .while Samsung imtroduced innovation like s series compressor in AC,Digital inverted compressor that keeps food fresh for 7 days ,uniform cooling , FRUNCH – new sound of freshness , bubble generator in washing machine ,biosleep :-ac sets temperature according to body temperature.Both concentrated on healthy lifestyle.LG ‘s tag line itself is life’s good . while Samsung concentrates on keeping food fresh , pure air from ac , protection of soft clothes and other product benefits .
Overall positioning:- healthy living , innovative product features , energy efficient hence cost saving Cameras:-Samsung is not a very big player in cameras segment buut still its a popular brand . it has got tough competition from canon and sony. Cameras segment include handy cam , digital cameras . Points of parity:- Product features and innovation like super zoom , 270 degree wide angle shots in sony . better picture quality in canon . dual view and multi view cameras from Samsung
Mobile phones:-samsung is one of the highest sellers of smart phones .it has a tough competition with apple . There is a tough competition between apple’s iphone and samsung’s galaxy . In india Samsung has tough competition with nokia . it has also raced ahead of nokia .They used the possession of their own chip to their advantage and bought about lot of innovation Laptops:- Samsung is an emerging player in laptops . Though it has its own chip , it uses intel chip in its laptop to be on par with the competitors . it has competition from dell and hp Points of parity :- The major points of parity is performance and style . Overall positioning :- samsung laptops have a better version of the consumers basic expectations from a laptop Overall brand positioning of samsung
All samsung products focus a lot on product benefits and features . They want to provide a variety of benefits and features from a single product Most important feature is the integration and use of technology in delivering the necessary value Innovation is also a key criteria .
All samsung products focus on value for money . one of their positioning is that of getting more than what you pay for . They also position themselves as better providers of the points of parity than their competitors
POSITIONING STATEMENT OF SAMSUNG
For every person who wants to get the maximum value for the price that they pay . The samsung electronics is an electronics firm that provides electronic goods that satisfy all your explicit and implicit needs more than your expectations . Unlike other electronic firms , our products are innovative , at the same time provides maximum value . on the whole its affordable luxury