SAMSUNG INDIA SMARTPHONES

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This ppt helps out to loacte the samsung smartphone plans in india for the past decade 2004-2014.Hope it helps

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SAMSUNG INDIA SMARTPHONES

  1. 1. SAMSUNG SMARTPHONES INDIA Market Report Analysis SHAMLYN S. FERNANDES ASAD HOOSAIN MBA FROM TO
  2. 2. MARKET STRUCTURE “Markets are judged by performance, not by performance” • OLIGOPOLY MARKET • Only a few sellers of a standardized or differentiated product • Affects the companies price and output • Similar products differ only by the brand and some features. • The differences are proved to the USP for each firm.
  3. 3. FIRMS THAT DOMINATE THE MARKET • Market capitalization of over 50% in the industry. • SAMSUNG • NOKIA • HTC • MOTOROLA • LG • MICROMAX
  4. 4. CONTROL OVER PRICE • Control over price – the firms are price makers. Which means freedom to MAKE or FIX their own price without losing some or most of their profits. • The pricing is not uniform which is why we see that smart phones are sold at a higher price when they are launched a compared to later in the future.
  5. 5. HIGH BARRIER OF ENTRY • Firms require a large amount of capital investment to carry out work such as RESEARCH & DEVELOPMENT, ADVERTISNG, MARKETING AND SO ON. • OLIGOPOLY is characterized by MUTUAL INDEPENDENCE and STRATEGIC BEHAVIOUR. • Each firm anticipates each others moves closely.
  6. 6. CONTESTABLE MARKET • Samsung India chooses to be in contestable market, where there is no/very less collusion chances. • The profits are determined by the firms MARKET SHARE.
  7. 7. PRICE ELASTICITY OF DEMAND • The degree of responsiveness of the quality demanded of a good to changed in price of a good. • A product is known to be elastic if the consumers are sensitive towards changes in price. • Smart phones – ELASTIC DEMAND
  8. 8. CROSS – PRICE ELASTICITY • Measurement of a good demanded got a change in price of another related good. • A survey conducted by O&M was used where the price of non – smartphones decreases by 50% to determine the behavior. • Out of 15 respondents 73% will not consider to switch from a smartphone to a cheaper phone even the price of non smartphone decreases 50%.
  9. 9. INCOME ELASTICITY • Measure of degree of responsiveness of demand to the changes in income. • It indicates that the smartphone is a luxury good. • The demand for smartphones is higher than changes in income. • Consumers will not buy a non-smartphone.
  10. 10. DEMAND & SUPPLY • Report by BGR INDIA about 2 fierce competitors IPHONE 5 AND SAMSUNG S4 case. • To beat iPhone 5 Samsung has to decrease the price of S4 in order to attract customers. • Deadweight loss • Opportunity Cost of both.
  11. 11. CHANGES IN PRICE OF SUBSTITUTES INDIAN MARKET
  12. 12. CHANGES IN PRICE OF SUBSTITUTES INDIAN MARKET 2004 41 million feature phone shipments NOKIA share :- 67.4% SAMSUNG share:- NA 2005 57 million feature phone shipments NOKIA share:- 65.7% Samsung:- NA 2006 66 million feature phone shipments Nokia share:- 61.4% Samsung: NA
  13. 13. 2007 73 million feature phone shipments Nokia share:- 59% Samsung:- NA 2008 85 million feature phone/ smart phone shipments Nokia share:- 55% Samsung: NA APPLE:- NA 2009 93 million feature phone shipments 5 million smartphones Nokia share – 54% Samsung :- NA Apple:- NA 2010 103 million feature phone shipments 6 million smartphones Nokia share:- 41% Samsung :- NA Apple :- NA
  14. 14. 2011 155 million feature phone shipments 12.1 million smartphones Nokia share:- 38.2% Samsung:- 25.3% Apple :- NA 2012 206.4 million feature phone shipments 15.2 million smartphones Nokia share 13.3% Samsung 43.1% SONY 8.2% 2013 261.2 million feature phone shipments 21.4% million smartphones Nokia share:- 7% Samsung:- 38.7% Micromax:- 22.1
  15. 15. FEATURE PHONE AND SMART PHONES
  16. 16. Cont.. • Samsung maintained its leadership followed by Micromax and karbonn. • Remarkable migration from feature phones to smartphones last year, primarily because of the narrowing price gaps between the 2 product categories. • 5 – 6.99 inch tablet screen size smartphones accounted for about 20% of the markets overall in Q4 out of which SAMSUNG has 9.7% of their own. • Samsung has always been experiencing difficulty in boosting supply in the short term because of the pre – order demand being far stronger than expected.
  17. 17. AD. CAMPAIGN ANALYSIS • Samsung ad is seen on TV every 15 minutes! • IGN.COM says that Samsung advertisements from a ratio of 100, 91 are global based with an estimated budget of nearly $8 billion out of which 9.3% is allotted for expenditure in the Indian market scenario (REUTERS) • They focus on both ‘high end’ and ‘rest of the pack’. • Samsung has cultivated the elite brand image through their advertisements.
  18. 18. • Advertising doesn’t just increase sales but to a point where the consumer listens and demands that brand product only avoiding the rest. • Focuses on broad appeal for innovation, targeting millions in its advertising with messages positioning its devices as offering the latest and greatest features. • Samsung products make news because they have the biggest screens, fastest processors. • 2008 – 09 – Samsung made Aamir Khan their brand ambassador which was very fruitful for the company as their distributions doubled. • Aamir khan was the brand ambassador for 3 years and now Samsung has part-time ambassadors such as Nargis Fakhri.
  19. 19. Cont.. • Samsung has global integrated marketing communication (IMC) for the past 6 years. • Samsung has started a new ad trend with the zero – plan to focus on extending support to the less income generation audience to attract them in buying the top models. • Segmenting in psychological positioning
  20. 20. TWO IMPORTANT ADS • Low – end Samsung product under the galaxy Y series. • Targets the Indian consumers through its middle level product which is the mid galaxy series. • The ad is based on youthful group where they wanted to convey that if you are a Samsung galaxy user then you are by default smarter than the rest. • Galaxy note 3 and Galaxy Gear – the advertisements are in collaboration with Vodafone focusing on its connect with the far reaches of the country. • The ad captures the element of re unions. • S3 was advertised saying that It’s the human companion, made for humans.
  21. 21. ADVERTISING EXPENSES
  22. 22. PRICE - POINT STRATEGY Rupees 6000 – 12000 Focus group – low income The entire galaxy Y series. Ex – DUOS Rupees 12000 – 18000 Focus group – middle income group Products like ACE PLUS HIGH INCOME GROUPS Rs 18000 – 25000 Dominated by most of its tablets Products like galaxy beam, note 1, 2 Above Rs 25000 Can be called as the niche market Products like note 3, s3, s4
  23. 23. PRICE RANGE OF VARIOUS SMARTPHONES IN THE MARKET
  24. 24. POINT-OF-VIEW BIGGEST WINNERS SAMSUNG (2004 -2014)
  25. 25. CAPITAL EXPENDITURE Samsung can produce more production as they are more advanced in technology.
  26. 26. SERVING THE TARGET MARKET 40 million smartphones sold in 2013. Half of the users are younger than 25 years which is the focus group Samsung has been targeting for the past 5 years.
  27. 27. ELITE CIRCLE CHANNEL PROMOTION INITIATIVE Segregating the market first Multiple distributors
  28. 28. PRODUCT DIVERSIFICATION • New strategies and risk takers • Militaristic attitude
  29. 29. GREAT CUSTOMER ACQUISITION COST • Has communicated strong thoughts and substitutes. • In the ‘playing XI’ rather than the ‘substitute’
  30. 30. FLAGSHIP PRODUCT ‘GALAXY’ SERIES Innovative and sustained ace products
  31. 31. HORIZONTAL INTEGRATION More profitable
  32. 32. PRICE POINT STRATEGY The lowest in the elite circle range at around $100 in 2013 and apple is $800, HTC $540, SONY $500
  33. 33. BETTER RECALL Better recall in Tier-2 cities. Cities like Lucknow, Pune and Ahmedabad
  34. 34. SALES PROMOTION AND DISTRIBUTION Marketing strategies and incentives to boost sales. Marketing budget is $ 14 billion. $4 billion spent on marketing 2012.
  35. 35. MARKETING TACTICS Zero plan initiative :- also known as STAY NEW. EMI scheme will 0% interest will be extended to till June 30th 2014 Buyback scheme:- with one time free display replacement
  36. 36. NEGOTIATIONS Samsung in the past 3 – 4 years has acquired companies and their integrative technologies, 2 of them are Tizen and Corning.
  37. 37. RETAIL STRATEGY Micromax cannot compete very well with the well established Samsung.
  38. 38. POINT-OF-VIEW WEAK LINKS AND POINTS
  39. 39. HIGH COST PLACING PRODUCTS Price is quit high for Indian standards
  40. 40. COMPLIMENTARY GALAXY GEAR hasn’t been successful. Grey-market Invasion
  41. 41. NO BRAND AMBASSADOR IN INDIA?! • Aamir khan in 2010 which increased the distribution share of the product in the market. • Its unfair as they are spending millions worldwide having global brand ambassadors such as LIONEL MESSI.
  42. 42. LESS COLLABRATION • Haven’t focused on regional market. • The competition has indulged in collaborations with Micromax, Lenovo and even iPhone 5S (with Airtel and Aircel)
  43. 43. FOCUS ON NEW MARKET DEVELOPMENT Samsung has the tendency to go after new avenues rather than sticking to its contained markets and building it.
  44. 44. PROBLEM WITH THE AVERAGE SELLING PRICE • Brought down their average selling price • Constant fluctuations in the market where Samsung is not able to cope up.
  45. 45. LACK OF DEMAND • Criticism for high pricing. • Substitutes like Micromax and karbonn are available at low prices.
  46. 46. SHELF LIFE SUSTAINANCE • Extended shelf life. Eg- S2 • Industry average is 1 year, Samsung has 2 yrs. • Samsung S4 experienced price drop of nearly 30%.
  47. 47. LOCAL AGGRESSIVENESS • Chinese players like GIONEE and XIALOU. • Local players.
  48. 48. APPLE’S AGGRESSIVENESS • Have launched a buy and try scheme. • Samsung was caught off guard with Apples aggressiveness in India.
  49. 49. INSTABLE LEADERSHIP • Samsung India has 3 different country heads for smartphone business importantly in 3 ½ years between November 2009 and March 2013! • No country head for over 6 months!
  50. 50. CUT – THROAT PRICE WARS • Due to competitors • Local players • Micromax and karbonn
  51. 51. OPERATING SYSTEM • Problems regarding Samsung's OS. • Leads to many bugs and glitches disturbing many preferences.
  52. 52. CANNABILISM New products introduced where these products are already established.
  53. 53. HIGH CAPITAL EXPENSES Declining prices on smartphones creates a pressure on profit margins for components that go into mobile devices such as memory chips, display panels and so on.
  54. 54. SAMSUNGS BIGGEST COMPETITORS
  55. 55. TOP SELLING PHONES IN INDIA (2004 – 14) 2004 Nokia 2600 Motorola RAZR Nokia 6010 2005 Nokia 1110 Motorola C139 Nokia N 70, 72, 73 2006 Nokia 1600 Nokia 6070 Nokia 7360 2007 Nokia 1200 Nokia N95 Nokia 5130 2008 Apple IPhone 3G Nokia 1680 Nokia 2330 2004 Nokia 2600 Motorola RAZR Nokia 6010 2005 Nokia 1110 Motorola C139 Nokia N 70, 72, 73 2006 Nokia 1600 Nokia 6070 Nokia 7360 2007 Nokia 1200 Nokia N95 Nokia 5130 2008 Apple IPhone 3G Nokia 1680 Nokia 2330
  56. 56. 2009 Apple IPhone 3GS Nokia 2700 Nokia 6303 Samsung STAR 2010 Nokia 5230 Apple IPHONE 4 Samsung galaxy S 2011 Apple iPhone 4S Samsung galaxy s2 Samsung galaxy Y 2012 Samsung galaxy s3 Apple iPhone 5 2013 Apple iPhone 5s Samsung galaxy s4
  57. 57. TOP SELLING SMARTPHONE BRANDS IN INDIA (2013)
  58. 58. CONCLUSION • Samsung equation can be summed as :- AFFORDABILITY GROWTH INCOME GROWTH BEHAVIOUR ATTITUDE • Samsung sold more than 12 million galaxy smartphones. • Samsung is quit profitable in the smartphone division which is their biggest cash flow with more than 2/3rd profits (FORBES).
  59. 59. • End of 2013, MICROMAX was the 2nd largest smartphone player with a rough 16% market share, according to IDC less than half of Samsung 38%. • Highly-focused King-lomerate! • Consumption comfort. • Product diversification .
  60. 60. “THERE’S A STORM COMING IN…” -Sarah Connors.
  61. 61. SOURCES 1. POSITIONING – The battle of minds by TROUT & RIES. 2. www.bgr.in 3. REUTERS 4. THE FINANCIAL TIMES 5. ECONOMIC TIMES 6. WWW.WORDPRESS.COM 7. Mc Connell, Brue, Flynn & Grant, 2012 8. Muhd Iqbal., 2013 9. IDC India 10. Bloomberg 11. FORBES India 12. Winning the story wars – Jonah Sachs and so on…
  62. 62. RESPONSIBILITIES Shamlyn S. Fernandes – Head Editing, Developer. Asad Hoosain – Head Data Compilation, Research and Interpretation.

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