Samsung Building a Global Brand

Group 7 - Members Veron M987Z210 Yoseph M987Z213 Bee M987Z220 Ken M Duy M987Z218 Moon M987Z241

Background  Samsung Electronics was established in 1969 in Suwon, South Korea.  It was the largest South Korean company and become flagship of-Samsung group.

 Focuses on four core markets: Background

 Start out in 1970 making cheap 12-inch television sets under the Sanyo label.  Samsung Electronics morphed into: innovative company. Number one position in the global chip market. Pioneering the development of digital devices.

Background Mid 1990s: Cost driven  Low-cost products  Me-too products - very low prices From 1996: ”Change everything except your spouse and children”  Why? What? How?

Issues came What happened with Samsung in 1996?

Issues came Because of low cost strategy: 1. Capacity > Demand 2. Sales and profits decreased 3. Down-market image Crisis in 1997 Losing $170 million/month

Solutions How to overcome the issues?

Marketing Strategies Establish a unique competitive position and design by doing: a. Technical innovation and R&D b. New product development and design. c. Build samsung brand

A. Technical Innovation R & D  Control its own technical destiny, not just copy others.  By focusing on core technologies such as: semiconductors, large area LCDs, display driver, and mobile telephony.  Spends higher % of revenue on R&D. (employs nearly 27,000 researcher)

B. New Product Development and Design  Involves a team of product designers (collaborate with firm’s engineers, manufacturing people, marketer, and market researchers).

C. Build the Samsung Brand (1)  Build customer awareness.  Be sponsor of game

Build customer awareness

C. Build the Samsung Brand (2)  Ensure availability of products.  By reorganizing the firm’s distribution channels like Best buy, Circuit city.  Service customer after sale.  Build image of Samsung brand

Build image of Samsung brand a. Brand orientation Samsung hired new manager Eric Kim to handle marketing stuff, the first thing Eric Kim do was giving all the advertisement to FBC, Fact Based Communications (FBC) is a European-based media, in order to unify style.

Build image of Samsung brand b. Focus on PDP (Plasma Display Panel) and cell phone people use them everyday

The Results  The global value increased>200% from  Overtaken Sony as the most valuable consumer electronic brand.  Sales grew to>$57 billion in  Operating income was $8 billion.

Interbrand, Billion

SWOT ANALYSIS SAMSUNG Helpful To achieve the objectives Harmful To achieve the objectives Internal factors Strength Brand leader in selling cheap products No.1 in global memory chip market Weaknesses Low profit Low image Low satisfaction in product External factors Opportunities Stay in technological developing industry Cooperate with many distribution channels such as Wal Mart Threats New competitors Cost of raw materials Economic Crisis

SWOT ANALYSIS SAMSUNG – after 1997 Helpful To achieving the objective Harmful To achieving the objective Internal factors Strength Brand leader in selling high-Quality products ex: LCD High Profit Good Image Satisfaction in product Weaknesses Spend huge money on Technical Innovation, R&D, New Product Development and Design and Brand Building Risk in failure in development of new product External factors Opportunities Stay in technological developing industry Cooperate with many distribution channels ex: Best Buy and Internet. Threats New competitors Cost of raw materials Economic Crisis

1. Are marketing decisions important? Yes, because: a. Marketing helps company selling its products and makes the products become well-known. b. Marketing will increase sales and profit. Answer the question

2. Does marketing create value for customers and shareholders? Yes if the marketing strategies is successful: a. Marketing will help company to know what the customer needs. b. To let customer know about company’s products.

c. If marketing is successful, the sales and profit will increase. At the same time the shareholders will get more dividend from such profit. Answer the question

3. What constitutes effective marketing practice? Internal: Leader from CEO, Sales department, Marketing department, R&D department, budget, etc. External: Economic condition, culture, people, etc. Answer the question

4. Who does what in marketing and how much does it cost? The leader, sales department, marketing department, supplier, etc. It will cost according to products, budget, and customer.

Answer the question 5. What decisions go into the development of the strategic marketing programs for a particular good or service and how can those decisions be summarized in an action plan? - The decisions depend on the objectives of the company, customer orientations, profit orientations, budget, etc.

Answer the question Those decisions can be summarized by doing a good strategic planning as follows: a. Do situation analysis b. Make a marketing plan

Q & A XIE XIE 謝謝