International Marketing Plan for Samsung - Case Study Example

International marketing plan: Samsung Name Instructor Subject Date Table of Contents 1.0 Executive Summary 3 1.1 Executive summary of the marketing plan 3 1.2 Introduction 4 1.3 introduction of the company 4 2.0 Vision and mission 5 2.1 The vision 5 2.2 The mission 7 3.0 Environmental analysis 8 3.1 political and legal environment 8 3.2 economic analysis environment 9 3.3 social and cultural environment 9 3.4 technological environment 10 4.0 Competitive Analysis. 10 5.0 customer analysis 10 6.0 SWOT Analysis 11 6.1 Internal SWOT 11 6. 2 External SWOT 14 6.3 implications of SWOT 17 7.0 Goals and Objectives 17 7.1 Broad and specific goals 17 7.2 The broad and specific objectives 17 7.3 Corporate strategy (broad) of your chosen business 18 7.4 Product/service objectives 18 7.5 Financial objectives 18 7.6 Market share objectives 19 7.7 Specification of assumption/s (if any) 19 8.0 Target Market/s 19 8.1 Competitive positioning strategy 19 8.2 Market segment strategy 19 9.0 Marketing mix strategies 20 9.1 Product/service related 20 9.2 Distribution/place 20 9.3 Price 20 9.4 Promotion 21 9.5 Budget for promotion/s 21 9.6 Break-even analysis and justification for the financial budget 21 9.7 People related strategy 22 10.0 Execution and Implementation of the plan 22 10.1 Designing a monitoring mechanism and schedule 22 10.2 Tactics 22 11.0 Major Limitation/s of the report 23 12.0 Concluding Remarks 23 References 24 1.0 Executive Summary 1.1 Executive summary of the marketing plan This report commences by showing the detailed specifics of Samsung, the factors that make it a market leader in the electronics business. These factors include the vision and mission of the company that determines its overall business strategy the company takes. The report explains the vital SWOT and PESTEL factors that contribute to the market of Samsung. This has helped in the development of the marketing plan that is analyzed towards the end of the report, putting into consideration SWOT analysis. The report utilizes graphs and diagrams to clearly stipulate the significant statistics that are necessary for the company and the succeeding international marketing plan. 1.2 Introduction In business, there are a lot of moving parts that work altogether to ensure the success of the company/firm or organization. There are production, distribution, manufacturing, processing, marketing and advertising. The synchronization of all these functions, ensures the company provides the company provides the services and products to its consumers. In order to link the consumer and the products, companies need to establish a marketing plan that works for them. A marketing plan is a formulation of the ideas that are meant to lure and retain the attention of the consumers; the marketing plan works in accordance with the business strategy, and the vision and mission of the company. This report seeks to analyze a marketing plan for Samsung. 1.3 introduction of the company Samsung is one of the leading multinationals in the world, its main business is the manufacturing of electronic products such as smartphones, electronic appliances such as refrigerators, and so forth. The company has so many subsidiaries across the nation which are under the main brand; Samsung. This South Korean company has so much influence over the culture, media and politics of the nation. The company was formed in 938 by a farming family, its initial business was the selling of groceries around the nation however, after the Korean War the company sets out to making a lot of plants within the nation. The company entered into the telecommunication market in the 1980, after the company acquired Gumi-based Hanguk Jeonja Tongsin. Their first products were the switchboard, the facility developed in the making of fax machines and telephones. To this day the company has made up to an estimated 800 million phones (Abo, 2010, p. 36). This success can be attributed towards successful marketing and this is what this paper is going to explore. 2.0 Vision and mission For over seventy years the company has been dedicated I providing the world with world class products ranging from electronic, petrochemicals, skyscrapers fashion, hotels and so forth. The company has achieved this through the investing in people, quality services and a collaboration with the partners. It has ensured that the company culture has been integrated in the minds of their customers, their partners and subsidiaries, in order to achieve this the company has ensured that the people realize the two vital aspects; the vision and mission of the company (Andrews, 2009, p. 53). 2.1 The vision The vision of the company is simple and singular “to lead the digital convergence” Samsung realizes that the world is moving towards the digital era, through globalization and diversity in business. To become a market leader, the company believes in looking for solutions to address the solutions of tomorrows. Through the advancement of technology, there comes an opportunity for growth, for citizens in emerging economies to prosper by tapping into the digital economy and for people to invent new possibilities. This vision has been actualized by the company in a number of ways, first it has led to the invention of state of the art electronics that have provide people with jobs and business opportunities for investment. Samsung motto “inspire the word, create the future” is the footprint that guides their ultimate overall objectives. The company however knows that for a long term goal to be achieved one has to establish and ensure the success of short-term goals. Therefore Samsung has developed a 2020 vision which revolves around three aspects, new technology, innovative products and creative solutions (Conklin, 2006, p. 58). Therefore the company works with its most significant stakeholder in ensuring it promotes the three core aspects. The significant partners includes industry partners and employees. The following is an illustration of how Samsung’s vision is spread out. Fig. 1 source: (Samsung 2012, p. 32) The company targets towards becoming one of the top five leading brands in the world. To achieve this the company has designated $400 billion. The company is motivated and exited in exploring new markets such as medicine, health and biotechnology. As mentioned earlier the company integrates the vision of its main stakeholders with their vision (Hart-Davis, 2012, p. 200). This is as showed below. Fig. 2 source: (Samsung 2012, p. 33) 2.2 The mission Everything the company engages in is motivated by their mission; that is becoming the best e-digital company in the world. This can be shown as illustrated below: Fig. 3 source: (Samsung 2012, p. 34) The digital aspect of the company majors in creating the technological products and services that lead any industry they are involved in. this means that the mission of the company targets in getting the most market share across the globe in their eleconic deveices. The company as illustrated above is the centre of all this; and it works towards strengthening the organization structure if the company. An effective organizational structure is vital in ensuring that the company functions run smoothely at all times. Samsung fosters a repsonsible, technological leader which is commited to its market, consumer needs and services. 3.0 Environmental analysis Fig. 4. shows how the pestel analiysis impacts a business organization Source: (Datamonitor, 2012, p. 25) 3.1 political and legal environment Due to the diverse expansion of the company it is vital to note that Samsung complies with the legal requirements of most of the nations it sets shop in. this is because, if this was not the case, the company would close down due to the legal irregularities. The political atmosphere of South Korea favors the ventures of Samsung since this is the largest company in the nation, the taxes gained form this company facilitates a lot of development projects in the nation (Arnell, Kettmann, & Stewart, 2010, p. 67). As stipulated earlier, Samsung has a lot of influence over the political scene in the nation and this is a positive impact to its political requirements. 3.2 economic analysis environment Following the economic recession that occurred in 2008, most of the nations that were in trade with the US have not yet recovered from the implications of the economic down turn, this therefore reduces the purchasing power of the people in these particular economies. For instance in the US where unemployment has been on the rise, consumers do not have a high purchasing ability. This case is reflected in other anions as well, however, in Canada the purchasing power of the people increased by 3.8% in 2011. Patents wars with competing companies have also negatively impacted, Samsung’s financial ability, for instance, the recent case where the company lost to apple. 3.3 social and cultural environment The advancement in technology has shaped the way business is conducted in the world, this has had similar impacts in the social lives of people. Especially the adoption of smartphones, by 2011 there were 63.1 million smartphones subscribers in the US alone, a rate that has overly increased not only in the US but also in the world over (EBSCO Publishing, 2010). The need for smartphones has been influenced by the increased use of social media platforms. Some of the benefits that accrue to Samsung is the determination of the next features to include in their smartphone that give them an edge over their customers, this is determined form observation of the market trends. 3.4 technological environment Smartphones require cellular infrastructure that support their systems, in nations like the US and Canada most of the infrastructure is developed and carries out all the functions of the gadget easily. In other markets most of the population is concentrated in urban areas which are developed and are able to facilitate the functions of the gadgets. As for device like televisions, the company has been lucky since the infrastructure in most of their market is already enhanced. 4.0 Competitive Analysis. Samsung Mobile is a registered brand name that has made an impact in the smartphone and tablet market. The presence of rival firms creates a competitive environment that has prompted the company to set up a robust marketing strategy that deals with increased competition. Competition is subject to both local competing brands and foreign competing brands. Samsung faces local competition from LG that also presents itself as an international rival. The company faces competition in foreign markets from Apple, Htc, Sony, Nokia, Blackberry and Motorolla. Apple Inc. is Samsung’s fiercest rival with the two companies competing for global dominance in the smartphone and tablet industry. This rivalry is exhibited with the release of yearly flagship devices. Since 2010 the two companies have released their respective iPhone and Galaxy series of smartphones that have aggressively competed for market share. Apple had enjoyed a commanding lead over Samsung form 2010 to 2011. 5.0 customer analysis The average consumer of Samsung products is the informed middle class guy with a good eye for technology. This ranges from the youthful to the elderly consumer across the globe. The most consumers are in developing and emerging economies while the developed nations mostly consumer apple products, for instance iPhone. Some of Samsung’s products though require a consumer who is involved in the development of technological products, which is semiconductors and microprocessors, these are purchased by other companies such as Dell, Apple, and so forth. It is important to note that the market for Samsung’s’ products is vast across the globe and generates the most revenue as compared to any other consumer base in the world (Quelch, Samsŏng Chŏnja., & Harvard University., 2014, pp.75-79). 6.0 SWOT Analysis SWOT analysis revolves around the idea of the strengths, the weaknesses the opportunities and threats a company faces. These factors may affect the internal processes or the external processes of a company. 6.1 Internal SWOT Strengths Hardware integration with many open source OS and software- Samsung is focused on making most of its products in a manner that is compatible with most of the OS and hardware needs of the customers. This gives the company an edge over is main rival apple, this is especially so in android market which is gaining popularity in most nations as compared to the rival which is concentrated in the high end market. Excellence in engineering and producing hardware parts and consumer electronics- Samsung’s efficiency in the production, design and distribution of its products have helped the company become a leader in market share in the television and phones industry. Innovation and design-According to the US patent assignees the company won the award for best design and most patents. This proved to their consumers that they have the best devices out there, the competitors were also informed of the efficiency of the company in making their products. Low production cost- the company focuses on setting up its plants in low costs nations, this increases their profitability margins thereby allowing them to pay their employees a decent pay altogether. Weaknesses Patent infringement – the company has been accused of violating other companies’ patents and utilizing them in their products. This lowers their market stability and is not effective for their overall company image. Too low profit margin – despite the company’s wide range in terms of revenues, Samsung has not been able to achieve wide profitability margins. This is due to the products that do not fair quite well in the market. Such as semiconductors (EBSCO Publishing, 2010 p. 83). Others like smartphones though achieve great profitability that is sunk in by the low performing products. Lack its own OS and software – the company does not possess any software that may encourage brand loyalty form its consumers as is the case for Apple (Trim, 2007, p. 32). This makes them dependent on Google’s android platform when it comes to smartphones, despite the fact that they do not pay for it, consumers are aware of this. Focus on too many products – the company is involved in four major industries. This deprives them the concentration necessary for focusing on a single market as is the case for most of its competitors, for instance Apple when it comes to smartphones, and LG when it comes to televisions. Fig. 5. source: (Datamonitor, 2012, p. 34) Opportunities Obtaining patents through acquisitions- part of their success is due to the large number of patents they own. Through more aggressive research and development, the company can ensure that they achieve better patents that would yield money through licensing. Threats Rapid technological change- there is an increased pressure on technological companies to release newer more advanced products every day. This is because the company that is left behind fails and risks losing funds that were utilized in the project. Breached patents- due to the large number of patents that Samsung possesses it is difficult to clearly assess which of these patents are being used by companies that have not paid to have the right of using them. 6. 2 External SWOT Strengths Focus on environment- the company focuses on the making of gadget that are environmentally friendly, for instance their latest release of gadget that are free form PVC and BFRs (phones and mp3). The company has been awarded for the developing of recycling programs. Such efforts give them an edge against their competitors. Largest share in mobile phones and second place in smartphones sales in the world – by achieving a large market share in the world the company is able to gain bargaining power over its competitors. In the areas where the company has done so is in the televisions and smartphone industries (Gralla, 2011, p. 147). Weaknesses Main competitors are also largest buyers- conflicts of interest for Samsung exist since most of its buyers are also its major competitors. For instance, Sony, dell, apple and others purchase some of their products form the company. However, the firm cannot use it bargaining power over these corporations since they form a large part of the company’s revenue and doing so may deter them from accessing services form the company and getting complementary products (Hammerich, & Lewis, 2013, p. 50). Opportunities Growing India’s smartphone market – since India is one of the least penetrated Asian market, Samsung has a strong presence in the nation and can use this opportunity to increase its sales and market share in that market. Fig. 6. source: (Datamonitor, 2012, p. 98) Growing mobile advertising industry – Samsung has the opportunity to capitalize on this chance and generate revenue (Viardot, 2014, p. 67). This is lucrative to them since the company boasts of a larger market share as compared to other smartphones. Growing demand for quality application processors – since it is a leader in the making of processors, Samsung can take advantage of this necessity in the market and make more revenue. Growth of tablets market – studies show that this market is expected to rise in double digit. This could be advantageous to the company due to their galaxy tablet that has capitalized their market. It has also set up a situation where the market is aware of the company’s quality products. Threats Saturated smartphone markets in developed countries – in developed nations there is a high number of smartphone companies that means the prices of these gadgets is not likely to go up at a high level. Declining margins on hardware production- being the second largest semiconductor manufacturer in the World is good for this technological company (Quelch, Samsŏng Chŏnja., & Harvard University., 2014, 84). However, this is where its profit margin are very thin, thus making its whole business model weak to a level of sustainability. Apple’s iTV launch- the launch of I-TV by apple was a big blow to the sales of Samsung TV. Despite the fact that these two companies are arch rivals when it comes to smartphones, they now have to compete for the TV market. Samsung being a lead company here makes its market threatened. Studies have shown that the I-TV is the next big thing, thus worsening the case for Samsung. Fig. 6. source: (Samsung 2012, p. 56) Shows the market share of televiosn sales in the world. Price wars- as stated earlier the company has low profit margins and it is already selling some of its products at reduced rates (Gralla, 2011, p. 187). Other companies could follow suit and engage in price wars thus risking to reduce the profit margin to zero. 6.3 implications of SWOT The SWOT analysis shown above is essential for the company since it shows the internal and external attributes that enhance or reduce the potential of the company. In this instance, the SWOT for Samsung is more lenient to its progress than downfall, this means that the company will be expected to do well in the succeeding years if the Strengths are enhanced, opportunities pursued, threats eliminated and weaknesses eliminated. 7.0 Goals and Objectives 7.1 Broad and specific goals As according to their company vision and mission the company is dedicated to making the best digital products that are commercially affordable to all their customers. The company wishes to competitively eliminate most of its competitor’s in order to maintain and gain most market share across the globe. Some of its specific goals revolve around the emerging markets like India, where they are a market follower. Due to its environmental awareness the company targets to cut greenhouse emissions by 50% by 2050. This is a move towards sustainable way of doing business that is also beneficial to the environment. 7.2 The broad and specific objectives Unlike the broad and specific goal, the objectives that are of vital necessity to the company include its intention to increase its profit margin. This will be carried out by enhancing the sectors of its business that are not performing well, for instance the semiconductors business, that has been reducing the profitability from smartphones. Increasing the production of microprocessors is also a significant objectives due to the increase expected in the making of tablets across the globe. 7.3 Corporate strategy (broad) of your chosen business A company this large has to come up with an integrated corporate strategy that looks at all the areas of trade it engages in. like its mission, the company recognizes the key pillars of its business in the corporate strategy; that is people, excellence, change, integrity and co-prosperity. When all these are combined, the company becomes devoted in making superior products and services that contribute to making a better society. Currently, the company is targeting on acquiring bigger market share, while still maintaining the quality of its devices through innovation and creativity. 7.4 Product/service objectives Due to the change that is happening in the world at a fast rate, Samsung is dedicated to research and development that has ensured their market receives some of the best gadget available (Cleveland: Datamonitor & Business Source Complete, 2012, p.564 ). In order to achieve this the company has to ensure it has unyielding passion for excellence, this is what makes it easier for them to produce top quality services and products since the realization that people require best services and products to reach their full potential is vital. 7.5 Financial objectives Samsung owns a wide variety of patents that are infringed by other companies without the realization of Samsung. In order for them to increase their financial potential the company is set to increase its monitoring of firms that infringe these rights. This will increase its revenues as well as contribute to the increasing of its profitability (Hart-Davis, 2012, p. 273). Other financial objectives include the decreasing of loss from the sale of semiconductors while at the same time increasing the revenues generated from smartphones, tablets and tapping into the Indian market. 7.6 Market share objectives Like the stipulation made above, the company has been involved in efforts of tapping into the Indian market. This is because India has both the large population and the availability of an emerging consumer economy. The research had development that the company is focusing on is the targeted towards such efforts. Samsung also focuses on creating its own OS and software in order to encourage customer loyalty which is what its main competitor in the smartphone industry, Apple has done. 7.7 Specification of assumption/s (if any) Samsung does not engage in assumptions, its ventures are well researched, analyzed by a team of experts in order to limit the chances of failure. This is what has made such products as TVs and smartphones successful. 8.0 Target Market/s 8.1 Competitive positioning strategy Samsung has in the previous strategized in engaging in the developed markets that have ensured that they get the high consumers who contribute to their success due to the purchasing of high end gadgets. However due to the saturation that has befallen these markets, Samsung targets on positioning itself in emerging economies like Asia, southern America and Africa, where the number of middle class is increasing. 8.2 Market segment strategy A rising middle class means that the level of education in this category is increasing, therefore the opportunities for business in the given nations are also rising. Samsung realizes this is why most of its new products in terms of tables and smartphones are designed to suit the modern day business personality, the corporate and the fun loving social person. This diversified market segmentation will allow the company capitalize on all sectors of the emerging economy. 9.0 Marketing mix strategies 9.1 Product/service related The company over the years has gained a lot of customer loyalty in the different categories it has been involved in. people the world over believe in the quality of the service a gadget from Samsung provides them. This sets the distinction from other competitors, and this is essential in the generation of revenue and market share stability. The facilitation of this marketing mixing has been enhanced by the distribution, pricing, promotions and so forth. 9.2 Distribution/place Samsung has various locations in the world where distribution of their products takes place. It is vital to note that Samsung utilizes nations that provide low cost of labor to produce its products. These nations manufacture the gadgets and then Samsung distributes the products across the globe. However, major cities in the world have their own terminals where the distribution is carried out. Minimizing the cost of doing business is a factor the company has always considered. 9.3 Price Samsung utilizes two methods in order to maintain their competitive edge using pricing. 1. Pricing skimiing- this is where the company launches a new higly priced deveidce that competitors have not acquired yet. Once the competition gets a similar device the company lowers its price and avails the product to all the people in a market. 2. Competitive pricing- in areas where the company is not a market leader, it poses a relatively competitive price that consumers can opt for, other than the leading brand. For instance it competes with LG in home appliances. 9.4 Promotion The company uses push and pull strategy across the year in order to retain the attention of the customers. This is so because, they are involved in aggressive marketing while at the same time they offer discounts on products. During the festivities Samsung offers promotional gifts to its customers while off festive seasons it majors on pushing their products to people, thereby creating a synchronized pull and pull marketing strategy. 9.5 Budget for promotion/s Specific figures for the promotional activities the company engages in cannot be really found however, estimates show that the company utilizes north of a billion US dollars in their advertisements in a year. This makes it a large amount as compared to other companies involved in the same industries as Samsung. For instance the recent advertisement for galaxy 3, which was set across the globe and featured soccer players must have cost the company quite a large amount. 9.6 Break-even analysis and justification for the financial budget Due to the variety of products the company is involved in production, it is difficult to clearly estimate the exact breakeven point for the whole company. However, the region of safety for some products such as smartphones and tablets is higher than others like semiconductors. The combination of the well performing products and the low performing ones brings about a mix where the company region of safety is minimized, this is the reason why the profits may be at un expected lows. 9.7 People related strategy Samsung has always put the needs of people as a critical area that needs addressing at all points. This is evidenced by their dedication to the production of devices of supreme quality that suit the needs of all customers (Cyhn, 2008, p. 78). Their vision and mission also clearly stipulates this, this means that regardless of the business strategy the company may adopt at a given time in the course of doing business, people will be key in it. The people involved here include the consumers, employees, shareholders and management. 10.0 Execution and Implementation of the plan 10.1 Designing a monitoring mechanism and schedule According to the SWOT and the PESTEL analysis, Samsung opportunities lie in emerging markets, in the sale of products that are performing well and those that are expected to rise. Therefore the marketing strategy I would adopt for Samsung would be categorical in the marketing of these products to these markets. Such markets require the use of low prices such since the market is middle classes (working class). The products should not only major in sophistication but also in functionality since this is what working class people go for. 10.2 Tactics The tactics of marketing would be the use of mainstream media as well as the use of social media. This is because the two mediums complement each other, it is also necessary since most of the working class people are engage in watching of television (Hellström, & Kramler, 2012, p. 183). In addition the social aspect of environmental analysis showed that social trends are moving towards interaction online which would be a vital tool in marketing. Viral marketing can also come in handy when marketing, this does not mean that the basic push and pull would be eliminated, these three forms would facilitate it. 11.0 Major Limitation/s of the report The major limitation to this report is that for Samsung to carry out this campaign it requires a lot of finances that will ensure the process is carried out conclusively till the end (Rowley, & Bae, 2008, p. 73). According to the SWOT; weaknesses, the company has been struggling, to keep its profits stable since they are at an all-time low, this means that if the business venture fails the company would face a rough economic downturn that might even bankrupt the company. 12.0 Concluding Remarks This paper has shown all the sides of Samsung Corporation, it has elaborated Samsung’s SWOT analysis and PESTEL scenarios that are key in finding the situation in which the company is going through; this means economically, politically and also globally. This report has identified the marketing strategy that would work efficiently for the company as well as for its stakeholders. The proposed marketing plan is bound to work and apply efficiently for Samsung when it becomes actualized. References Abo, T. (2010). Competing Chinese and foreign firms in swelling Chinese economy: Competition strategies for Japanese, Western and Asian firms. Berlin: Lit. Andrews, D. 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