Samsung started as a small trading company in 1938 in South Korea and over decades expanded into various industries such as shipbuilding, heavy industry, chemicals, and consumer electronics. It founded its electronics division, Samsung Electronics, in 1969. Through periods of financial crisis, management changes, and global expansion, Samsung grew to become a leading multinational technology company and the world's largest manufacturer of smartphones, memory chips, and televisions. It holds the top global market share for smartphone sales and is consistently highly profitable despite fierce competition from rivals like Apple.

4. 1
Apparel Chemicals
Consumer electronics Electronic components
Medical equipment precision instruments
Semiconductors Ships
Telecommunications Equipment
No.2 in the 2013 Brand Finance Global 500
No.1 in the Electronics, Electrical Equipment
group of 2013 Fortune 500
…
Brief of SAMSUNG

5. Samsung started as a trade firm which
founded by ₩30000
Main business were export the
vegetables and fruits to Peking and
Man-Chou-Li.
Samsung Electronics founded at 1969
Starting: 1938-1969
The financial crisis depressed the
whole Samsung, the debt ratio was
365%.
Samsung sold its secondary firms,
reduced about 50000 staff made the
debt ratio to 148%
Financial crisis:
1997-1999
Owning about 20 kinds of No.1 share
products in global market.
New digital age: 2000~
Started to shipbuilding, chemistry,
heavy industry.
Started to taking on world.
Expanding: 1970-1990
Samsung restarted with New management
and Quality first ideas.
Challenge and opportunities:
1990-1997
(≈HK$220)

6. 1
Apparel Chemicals
Consumer electronics Electronic components
Medical equipment precision instruments
Semiconductors Ships
Telecommunications Equipment
Consumer electronics
No.2 in the 2013 Brand Finance Global 500
No.1 in the Electronics, Electrical Equipment
group of 2013 Fortune 500
…
Brief of SAMSUNG

7. 1
Marketing Analysis
 The performance of whole
smartphone market
 Various possibilities of market
in this field
 As a player, SAMSUNG got a
huge success in Smartphone
Why we choose the Smartphone as our topic?
250,231,700 – 171,652,700 =
78,579,000

8. 1
Marketing Overview
250,231,700 – 171,652,700 =
78,579,000

10. Main players
Manufacturer
Samsung Apple Lenovo Nokia HTC
Google Coolpad ZTE HUAWEI …
Mobile carriers
HK HKBN PCCW HGCH
Wharf
T&T
NWT I-CABLE
Mainland China Telecom China Unicom China Mobile

11. SAMSUNG
1/ Market leader 30.4%
2/ 74 types of new products
 5 more types than NOKIA
 32 more types than Motorola in 2010.
3/ smart phone and 3G.
4/ Mainly Android system
Tizen Limo system future

12. APPLE
1/ NO.1 competitor
2/ Targeting high level consumers
3/ Hunger marketing
4/ ―smartest‖ phone
5/ ios

13. Lenovo
1/ international competitiveness
2/ PC advantages
3/ Low and middle end
4/ Saturation strategy (機海戰術)

14. GOOGLE
1/ 2011 brought Motorola with 12.5 billion
2/ Cooperate with manufacturer
3/ First Nexus in 2010
4/ Competitiveness：Price, Google service
optimization

15. NOKIA
1/ 2012, world's 2nd-largest mobile phone maker with a
global market share of 18.0%.
2/ 2013 Q2 only 3.2% market share lost 40% revenue
3/ 2013.09, Microsoft brought Nokia mobile business
4/ Windows operation system

16. HTC

17. Chinese market

18. COOLPAD
1/ Shenzhen in 1993.
2/ 2nd market share in China.
3/ 9th largest smartphone maker in Q1 2013
4/ 2013 overtaking BlackBerry and Nokia.

19. Fixed Carriers
Fixed Carriers in Hong Kong
Fixed Carriers in Mainland China

21. 1
Brief of Technology
/ Visual(視)
/ Optics(光)
/ Voice(說)
/ Payment(付)
/ Sensor(感).

22. 1
Visual(視)
Overall phone appearance:
 Rounded shapes, more fashion and cute
 Fit to plastic material → why plastic?
Display screen: visual quality
 AMOLED screen
 Resolution
 Pixel density

23. 1
Optics(光)
Camera performance
Indicators:
 Pixel
 Flashlight
 Anti-vibration
 Zoom
Ultra-thin Vs. Camera quality

24. 1
Voice(說)
S Voice
 Voice recognition
 Exclusive in Galaxy & Note

25. 1
Payment(付)
Near field communication (NFC)
 a NFC smartphone can be a
credit card
 Samsung + Visa

26. 1
Sensor(感)
Sensor types: User friendly & intelligent
 gravity
 acceleration
 distance
 fingerprint
 3-axis gyroscope
 electronic compass
 ……

28. Brief of RM
Principles:
High investment
High turnover
High revenue
Direct Revenue:
 Mobile Device Distribution
 Mobile Accessories
Long-term revenue:
 Vertical Integration
 Patent
 Brand Equity

29. 1/ Mobile Device Distribution
Samsung has 49 matching mobile products.
Especially , GALAXY S and GALAXY Note, which achieve
Samsung’s leading place in the market.

30. Channels for distributing
Partnerships : a total of 12 Samsung in HK.
Retailers: such as BROADWAY, FORTRESS SmarTone, i-CABLE etc..
Distributor: KENTECH， SYNERGY
Network operators share: cooperate with 6 main players

31. 2/ Mobile Accessories
Bluetooth Headset
Charger
Battery
Cover, Pouch
Car Kit
Others

32. 4/ Long-term revenue
Vertical Integration
Patents
Brand equity—— intangible assets

34. Hardware Vendor
Software Vendor
Accessory Vendor
OEM
/ODM
MobilePhone
Manufactures
Hardware Vendor
Hardware Vendor
Software Vendor
Software Vendor
Accessory Vendor
Accessory Vendor
Design-
house
Direct
Supply
Distribution
/Agent
Telecom
Operator
E-commerce
Retailer
Customer
ComponentDistributor/Agent
Front-end Logistics Back-end Logistics

35. Smartphone supplier
relationship table
(Samsung smartphone)

37. Ecosystem
Industry
Chain
Upstream
/downstream
industries
Single
product
Ecosystem
A device
group with OS
at the core
Hardware
(with OS),
Cloud

38. Ecosystem

39. Global China
ECO
Cloud
OS
Hardware
Chips
Kernel
Samsung
Apple
HTC
LG
Nokia
華為
聯想
中兴
OPPO
小米
TCL
魅族

40. Android Ecosystem

41. Samsung Vs. Google

42. Samsung Vs. Google
Tizen
Tizen
Phone
Samsung
App store

44. Background
1. Google acquired Motorola/ Microsoft acquired Nokia
2. Two-horse carriage in smartphone market, so IP war is
inevitable for Samsung

45. The Apple-Samsung cases
Who stared?
In mid-April of 2011
It was Apple that firing the
first shot.

46. The Apple-Samsung cases
What does Apple claim Samsung is copying?
1.Design patents: appearance, layout,
feeling and style of Apple’s product.
Trade dress , the elements of a product
design that clearly indicate what brand or
company it came from
―Apple’s black rectangle problem‖

47. The Apple-Samsung cases
2. Utility patents (functionality)
User-Interface effects
 Pitching
 Zooming
 Scrolling

48. The Apple-Samsung cases
What does Samsung claim Apple is copying?
Two Standards patents
FRAND terms (fair, reasonable, and non-discriminatory )
US Patent
7,675,941
Covers e-bit technology associated with the 3GPP standard.
US Patent
7,447,516
Covers using power limiting technology to reduce interference under the 3GPP standard.

49. The Apple-Samsung cases
The other three Samsung patents
 Emailing photos from a camera phone;
 Multitasking with music playing in the
background;
 Switching between a live camera shot
and a photo gallery.

50. The Apple-Samsung cases
Reasons for lawsuits
 Seeking an injunction that would confine the import and sales of
rival’s products into the markets
 For Apple, they seems to seek compensatory and punitive damages
to demonstrate the cost of coping.
Result of Lawsuits
 Apple won
 Samsung owes Apple $930 million

51. The Apple-Samsung cases
Comments and Thoughts
 Little had been done to protect innovators and inventors
 The very concept of design patents should not have been
encoded into the law.
 ―It is his supposition that Apple attacked Samsung in the courts
out of a feeling of betrayal by a partner, more so than a defense
of intellectual property.‖ (Dediu, 2013)

53. Future Trends
Hardware
Mobile terminals will merge, it is
hard to distinguish Tablets, Phones
and Computers, and maybe other
new kinds of products.

54. Future Trends
Software
Hardware market will over saturated,
software market will be a new digital
battleground. Also, digital product will
be old fashion in mobile terminal, smart
is a new concept, and it will occupy the
future market.

56. 1/ Threat of Entry (Low)
Barriers to entry
1. Supply-side economies of scale
2. Demand-side benefits of scale
3. Customer switching costs
4. Capital requirements
5. Incumbency advantages independent
of size.
6. Unequal access to distribution
channels
7. Restrictive government policy.
Expected Retaliation

57. 2/ Exist competition (High)
Finger War + Price War

58. 2/ Exist competition
Finger war
Iphone shipment 28935,000 <Samsung
Operating Profit Ratio 47.4% > Samsung 13%

59. 2/ Exist competition
Price war
OEM OEM
Middle level competition
Price Strategies High-end Strategies

60. 3/ Substitute ( Low)
Tablet
Voice call & text message Vs. OTT Apps
Screen size: tablet is a complement
↓
Low level thread

61. 4/ The bargaining power of suppliers (Low)
Internal supply lines
Powerful ability of supply chain management
 ―Samsung model‖ industrial park
 Rapid response system of supply chain
 Establish a credit relationship with the suppliers.
Competition with Apple

62. 5/ The bargaining power of buyers (Middle)
Individual customer
Low switching cost
High brand identity
Small size
Mobile Phone Operators
High volume

63. Suggestion
Strengths
Fast production
Vertical integration
Aggressive marketing
Innovation and design
Weaknesses
Lack its own OS and software
Main competitors are also largest buyers
Low profit margin
Focus on too many products
Patent infringement

65. SAMSUNG
/Ecology
Advantages
 Marketing strategies
 Multi-line products
 Supply chain
 Vertical integration
Disadvantages
 Innovation bottleneck
 Missed internal targets
 Price and promotion cost