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Assignment No. 3

Samsung transformed from a provider of commodity electronics to a global marketer of premium products like TVs, cameras, appliances, semiconductors, and phones. Samsung focused on innovation, releasing innovative phones and being the first with an MP3 player phone and Blu-ray player. Samsung cut costs, emphasized quality, and flexibility to get products to market in 6 months. Samsung invested heavily in innovation and memory chips, which became an important revenue source and made them the largest chip maker. Samsung aggressively marketed their brand, outspending rivals, sponsoring Olympics, and global ad campaigns. Samsung is now the global leader in TVs, memory chips, and number two in phones.

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51 views

Assignment No. 3

Samsung transformed from a provider of commodity electronics to a global marketer of premium products like TVs, cameras, appliances, semiconductors, and phones. Samsung focused on innovation, releasing innovative phones and being the first with an MP3 player phone and Blu-ray player. Samsung cut costs, emphasized quality, and flexibility to get products to market in 6 months. Samsung invested heavily in innovation and memory chips, which became an important revenue source and made them the largest chip maker. Samsung aggressively marketed their brand, outspending rivals, sponsoring Olympics, and global ad campaigns. Samsung is now the global leader in TVs, memory chips, and number two in phones.

Uploaded by

Mahpara Yaqub
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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Assignment No.

Case Study
Korean consumer electronics giant Samsung has made a remarkable transformation, from
a provider of value priced commodity products to a global marketer of premium-priced
Samsung-branded consumer electronics such as flat-screen TVs, digital cameras, digital
appliances, semiconductors, and cell phones. Samsung’s high-end cell phones have been a
growth engine for the company, which has also released a steady stream of innovations,
popularizing the PDA phone, the first cell phone with an MP3 player, and the first Blu-ray
disc player.

Samsung initially focused on volume and market domination rather than profitability.
However, during the Asian financial crisis of the late 1990s, when other Korean firms
collapsed beneath a mountain of debt, Samsung took a different approach. It cut costs and
reemphasized product quality and manufacturing flexibility, which allowed its consumer
electronics to go from project phase to store shelves within six months. Samsung invested
heavily in innovation and focused intently on its memory-chip business, which established
an important cash cow and rapidly made the company the largest chip maker in the world.
Samsung introduce a wide range of electronic products under its strong brand umbrella.
Samsung’s success has been driven not only by successful product innovation, but also by
aggressive brand building from 1998 to 2009, the company spent over $7 billion in
marketing, sponsored six Olympics, and ran several global ad campaigns themed “Imagine,”
“Quietly Brilliant,” and “YOU,” all which included brand messages such as “technology,”
“design,” and “sensation” (human). In 2005, Samsung surpassed Sony in the Inter-brand
brand ranking for the first time and continues to outperform Sony today. Today, Samsung
is the global leader in flat-panel TVs and memory chips, and the number two player in
mobile phones. Unlike rival firms, Samsung has become a global leader by making both
components for electronics products and the actual devices sold to consumers and without
acquiring major competitors. It has more than doubled its employees from a decade ago.
With record sales in 2008, the company’s CEO, announced the firm hopes to hit much
higher revenues in coming years. To accomplish this aggressive goal, Samsung will explore
areas like health care and home energy products.

i. What is the Samsung’s strategy to deal with competitors? What are some of Samsung’s
greatest competitive strengths?

ii. Where Samsung stands in terms of product life-cycle stage? Which strategies would you
recommend to Samsung?

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