SAMSUNG Keith Brumfield, David Greenfield, Cathrine James MKT 421 June 22, 2015 John Brady Introduction Introducing a new product or service in the marketplace requires a lot of time and resources. Firms must carefully plan and strategize to achieve successful results, which are often measured by net revenue. Samsung, although a well- known brand, is no different from any other firm. Samsung must strategically move through the steps of identifying its target market by way of market segmentation, understand the reasons its customer will purchase the new product, clearly define the product, being sure to appeal to both the logical and emotional needs of the consumer. Samsung must also rely on analyses such as SWOT to identify its current areas of strengths and weaknesses, and Porter’s 5 competitive forces to identify potential areas for competition as well as the industry’s strengths and weaknesses. This paper will address all areas necessary for Samsung to introduce and capitalize on its soon to be released Gear A smart watch. Overview On March 1, 1938, founding chairman Byung-Chull Lee started a business in Daegu, Korea, focused primarily on trade export. Mr. Lee sold dried Korean fish, vegatables and fruit to Manchuria and Beijing. In a little more than a decade, Samsung owned its own flour mills and confectionery machines and its own manufacturing and sales operations. From these humble beginnings, Samsung would ultimately evolve to become the modern global corporation that would still bear the same name today ("Samsung", 2015). By the 1970’s, Samsung started investing heavily in chemical and petrochemical industries. It was at this point Samsung began to dabble in the home electronics market. Samsung started to manufacture its own electronics and exporting for the first time. In the 1980’s, Samsung restructured its business models to become the world’s top five electronics companies. In the 1980’s Samsung expanded its business and technology globally. The 1990’s were a big challenge for Samsung, the market was booming and the technology was changing so fast it was hard to keep up with demand. Samsung changed the way business took care of their customers in the 1990’s. They dedicated themselves to total customer satisfaction and making sure that quality was their main objective. During the late 1990’s financial crisis, Samsung continued to grow. This is mainly due to Samsung’s leadership and network technologies concentration on electronics. This kind of preparation and leadership is what encourages investments and long term customers. In 1998, Samsung developed a completely flat television screen. This technology would eventually revolutionize the television industry. Samsung also makes appliances along with home electronics. In 2004, Samsung produced the first wrinkle-free steam washer. Also in 2004 they became the top ranked mobile phone provider in Russia. S.

1. SAMSUNG
Keith Brumfield, David Greenfield, Cathrine James
MKT 421
June 22, 2015
John Brady
Introduction
Introducing a new product or service in the marketplace
requires a lot of time and resources. Firms must carefully plan
and strategize to achieve successful results, which are often
measured by net revenue. Samsung, although a well- known
brand, is no different from any other firm. Samsung must
strategically move through the steps of identifying its target
market by way of market segmentation, understand the reasons
its customer will purchase the new product, clearly define the
product, being sure to appeal to both the logical and emotional

2. needs of the consumer. Samsung must also rely on analyses
such as SWOT to identify its current areas of strengths and
weaknesses, and Porter’s 5 competitive forces to identify
potential areas for competition as well as the industry’s
strengths and weaknesses. This paper will address all areas
necessary for Samsung to introduce and capitalize on its soon to
be released Gear A smart watch.
Overview
On March 1, 1938, founding chairman Byung-Chull Lee started
a business in Daegu, Korea, focused primarily on trade export.
Mr. Lee sold dried Korean fish, vegatables and fruit to
Manchuria and Beijing. In a little more than a decade, Samsung
owned its own flour mills and confectionery machines and its
own manufacturing and sales operations. From these humble
beginnings, Samsung would ultimately evolve to become the
modern global corporation that would still bear the same name
today ("Samsung", 2015). By the 1970’s, Samsung started
investing heavily in chemical and petrochemical industries. It
was at this point Samsung began to dabble in the home
electronics market. Samsung started to manufacture its own
electronics and exporting for the first time. In the 1980’s,
Samsung restructured its business models to become the world’s
top five electronics companies. In the 1980’s Samsung
expanded its business and technology globally. The 1990’s were
a big challenge for Samsung, the market was booming and the
technology was changing so fast it was hard to keep up with
demand. Samsung changed the way business took care of their
customers in the 1990’s. They dedicated themselves to total
customer satisfaction and making sure that quality was their
main objective. During the late 1990’s financial crisis, Samsung
continued to grow. This is mainly due to Samsung’s leadership
and network technologies concentration on electronics. This
kind of preparation and leadership is what encourages
investments and long term customers. In 1998, Samsung
developed a completely flat television screen. This technology
would eventually revolutionize the television industry. Samsung

3. also makes appliances along with home electronics. In 2004,
Samsung produced the first wrinkle-free steam washer. Also in
2004 they became the top ranked mobile phone provider in
Russia. Samsung has also developed the world’s first-ever
speech recognition phone. Samsung has been a global leader in
the research and development for flat screen LCD
manufacturing since 2004. Samsung has been recognized
globally as an industry leader in technology and now ranks as a
top 10 global brand ("Samsung", 2015).
Product Description
It seems that 2015 is going to be the year of the smart watch. In
this modern day of technology, it seems that having a smart
phone, smart car and a smart home isn’t going to be enough. A
smart phone that can be used literally at your fingertips is the
next new thing. Samsung Gear A smart watch will have a round
face and the rim of the watch will actually rotate so you can
scroll through the options and apps on the watch. The watch
will be synched to your Samsung phone and can control certain
aspects of your phone via your watch. The Samsung Gear A
smart watch will be geo tracked and perform as a fully
functional navigation system such as the ones used on smart
phones and vehicle navigation systems. Samsung also has
introduced a new app for their smart watches. Being how they
are geo tracked, they can be used in case of emergencies. The
Gear A smart phone has a “911” option that will send
emergency services to your location depending on the nature of
your emergency. Many cell phones are broken or misplaced
during a car accident or a fall and cannot be accessed to call
911. Having your smart phone on your wrist will ensure you
have access to emergency services immediately after an
incident.
SWOT Analysis
A SWOT analysis is a strategic balance sheet of an
organization; that is the strengths of the organization, the
weaknesses of the organization, the opportunities facing the
organization, and the threats facing the organization. It is one of

4. the cornerstone analytical tools to help an organization develop
a preferred future. It is one of the time tested tools that has the
capacity to enable an organization to understand itself ("Swot
Analysis", 2010). Every major corporation has what’s called a
SWOT analysis ran every year in order to give the organization
a better understanding on where they stand in the current
market. Samsung’s SWOT begins with the “strengths”. One of
Samsung’s biggest advantages is that they are very advanced.
They have invested heavily in technology and research. They
are globally known for their technologically advanced products.
Samsung invest not only in technology but also in human
resources. They believe that a happy customer is a returning
customer. They listen to what the customers not only want but
what they don’t like as well. Making improvements off what
customers have complained about previous products is why
Samsung has so many loyal customers.
Every corporation has its strengths, but they also have their
weaknesses. Samsung’s weakness is that they don’t always have
a new product to introduce to the market. Samsung seems to
wait for their competitors to introduce a new product then they
spin off of that product and make it their own. Samsung also
sets their prices very low and in return customers perceive this
as low quality products. Samsung has also developed a
reputation as not being very user friendly. In a market of smart
phones that not everyone has caught onto yet, this could be a
hurdle for them to get over.
Product variation is a great opportunity for Samsung. Samsung
needs to introduce new products that are unique and provide the
customer with variety. Along with making a variety of different
products, Samsung needs to focus on making them more user
friendly and kill two birds with one stone.
Unfortunately, Samsung has many threats in the electronic
industry. This is a very popular and in demand market so of
course there are going to be a lot of corporation wanting in on
the market. Just a few examples of threats to Samsung would be
Sony, 3G, Nokia, and LG just to name a few in the

5. telecommunications industry. The telecommunications industry
is literally growing in leaps and bounds by the day. Samsung
needs to increase its advertisements to at least its competitors
mark. Samsung need for excessive advertisement could lead
existing customers to defect to other companies from viewing
their advertisements ("Samsung Swot", 2014).
Porter’s Five
Porter’s 5 forces of competition was founded by Michael
E. Porter. The model allows firms to determine the strengths
and weaknesses of a given industry by simply identifying and
analyzing its competitive forces. The five forces are as follows:
Competitive rivalry
The Samsung Gear A watch faces a great or intense competition
from companies like Apple and Sony who have produced some
other smart watches. Samsung has a great amount of resources
at their disposal and thus the performance of this watch will
gain a large market share for the upcoming model. They own the
patent for this round smart watch and thus none other will be
produced on the same design.
Competitive rivalry
Bargaining power of suppliers
Threat of substitute products
Bargaining power of suppliers
Threat of new entrants

6. Bargaining power of suppliers
The Samsung Gear A watch will be affordable on the wholesale
customers at a low price and also favorable price on the
consumer end. The brand is worth its cost since it will be build
with a software that can hold many apps. The rotating bezel will
help to scroll through the various apps on it and can control
some features on your phone.
Bargaining power of customers
The bargaining power will be low since the product will be
produced in limited quantity and thus it will not flood the
market. This helps the device to remain on the same cost that it
was introduced in and thus making the sale very clear. The
company supplies a low quantity of numbers of the device so as
to maintain its planned cost from the sellers.
Threat of new entrants
Samsung have invested in a lot of capital in branding this
watch and thus it will be difficult for existing companies to
produce it. They have also hidden a lot of details on how the
watch will be and patented it so no one can steal the design.
Threat of substitute products
Only the Apple Company has come up with a watch that is
closer to this watch but Samsung have added new apps to be
used. The watch is bound to run on the NFC technology which
helps to facilitate its mobile payments.
Segmentation and Target Market Criteria
Prior to determining a target market, it is necessary to
break down a market, moving from mass or all customer needs
to specific or homogeneous, to become clear on whom exactly
the firm is aiming to assist. This is done by way of market
segmentation. Market segmentation, which according to
“Business Dictionary” (2015), is “the process of defining and

7. subdiving a large homogenous market into clearly identifiable
segments having similar needs, wants, or demand
characteristics. Its objective is to design a marketing mix that
precisely matches the expectations of customers in the targeted
segment.” There are various criteria for segmenting. “Good
market segments meet the following criteria: homogeneous or
similar, heterogeneous or different, substantial, which means
the segment should be large enough to turn a profit and
operational, which means the group dimension should aide in
identifying customers and deciding on marketing mix variables
(Perreault, Cannon & McCarthy, 2014, Chapter 4).
In an effort to achieve successful results we too will use
segmenting to narrow the larger group down to a specific target
market. Criteria such as those mentioned above, homogeneous,
heterogeneous, substantial and operational, will be used.
However, in addition we will use accessible, and actionable
criteria. Knowing how the target market will be accessed, in
person, via email, or mailers, is an important factor, as the
necessary method may or may not be feasible from a finance
and marketing standpoint. Actionable criteria will reveal
whether or not a group has data that supports “a marketing
position or sales approach that have outcomes that are easily
quantified (Perreault, Cannon & McCarthy, 2014, Chapter 4).
Clearly defined market segmentation criteria not only
ensure that customers are more likely to identify and purchase
the product that is right for them; it also minimizes wastage of
resources, reducing the time spent marketing the wrong
products to the wrong customers (“Mba&company”,2015).
In addition to selecting criteria for market segmentation, a
firm must also use criteria such as geographic, demographic,
psychographic and behavioral factors, to select its target
market. Geographic limits the market search to a specific region
or location. Demographic considers factors such as age, gender,
income, family size, education, income, ethnicity and social
class. Psychographic involves a person’s daily living patterns as
shown in their activities, interest and opinions. Behavioral

8. factors focus on why people or consumers buy the way they do
with the understanding that need is the greatest determinant.
Depending on the group our product may not be considered
a need. Due to same we must be careful to target those who
believe they cannot live without this newest and hottest gadget.
Due to price the large size of the watch’s face, it will more than
likely appeal those in a certain income bracket and to men more
so than women. We understand that our customer will probably
reside in a larger city and have the need to gain access to
information immediately due to a busy lifestyle. In addition,
another customer may be retired with children and
grandchildren in other cities. The ability to communicate or
receive pictures while vacationing will be attractive.
To reach our desired target market we will view
demographics such as age, gender, income, social class,
education and occupation. We will view specific activities,
interest and prior buying patterns. We will also view behavior
factors in an effort to identify those who purchase new gadgets
as soon as they become available.
Target Market Description
Our ideal customer is a male, age 20 – 65 years of age,
who loves gadgets but loves convenience even more. He is
either a student, a working professional who has the need to
access information quickly or he is a regular vacationing
grandfather who often connects with and sends/receives pictures
to/from family members and friends. He, or his parent, in the
case of the student, has an income of $70,000.00 plus per year
and enjoys getting together with friends to talk about new
“toys” or upcoming gadgets. The ideal customer is enamored by
technology and believes every item was created to make his life
more manageable and balanced without reducing professional
and social output.
Causes to Buy
When firms clearly understand why people buy they have
an opportunity to sell more. Most may believe that people buy

9. what they need instead of what they want but Torok (2015)
asserts that “our emotions trigger us to buy.” He warns people
to not “make the mistake of thinking people buy what they
need…Needs are driven by logic while wants are driven by
emotions.” (We buy what we want). This belief is supported by
Perreault, Cannon and McCarthy (2014) who says “everybody is
motivated by needs and wants…When a need is not satisfied, it
may lead to a drive…A drive is a stimulus that encourages
action to reduce a need.”(Chapter 5)
There are various needs that will cause a person to take
action. Some of these needs are physiological, which involve
biological concerns such as self -preservation, food, rest, sleep
or liquid; psychological, which involve concerns such as self-
identification, power, personal fulfillment, and pride; social,
which involve concerns such as love, status, and esteem;
desirous, which involve concerns such as respect, status, and
sociability.
Our target market will be buy for the same reason other
people buy, to fulfill a need or a want. It is one’s own logic
that will drive him or her to purchase. For instance, logical
drivers consist of supportive thinking such as the ability to
replace for several gadgets with one, saves time, allows for
better organization and cost effective. However, as noted above,
the true reason for purchasing will be an emotional one such as
the excitement of owning a new gadget, status, fun and
recognition. Of course each purchase will vary from one
individual to the next.
Positioning Statement
To everybody who lives in the 21st century or those who are
trying to simply catch up, the Samsung Gear A watch aka Orbis,
allows you to do so. Sometimes carrying your cell phone is not
an option, or say you accidently leave it at home. Well fear not,
when you have the Samsung Gear A smart watch, you will still
be able to go about your daily business, as we know life doesn’t
slow down. The Gear A smartt watch is going to have multiple
functionalities, from being able to function as a key to your car

10. all the way to being a remote control for your television. It will
have Bluetooth capabilities and also connect to Wi-Fi. You will
be able to talk on it and or send messages from it. It will even
monitor your heart rate. The Gear A has a round face and is
sleek enough to wear with any style. Watches like the Apple
Watch, Motorola Moto 360, and the LG G Watch R will try to
keep up with Samsung. With Samsung you will get what you
expect and then some.
Conclusion
Samsung believes the Gear-A smart watch will be a cut
above the rest. Offering features such as the first round face,
the first item of its kind with a mobile payment system and
emergency service features, the competitors will have the work
cut out for them. Offering a product with great attractive
features without completing the necessary leg work prior to a
launch will potentially lead to lost revenue. Samsung will need
to perform as though it is a new firm entering a new market.
This means studying the buyers, identifying its target market,
and using various strategizing resources such as SWOT and
Porter’s 5 competitive forces model, understanding what will
drive the buyers to purchase. Should Samsung do its homework
it should see huge profits on its newest product, the Gear A
smart watch.
References
Business Dictionary. (2015). Retrieved from
http://www.businessdictionary.com/definition/market-
segmentation.html
MBA&Company. (2015). Retrieved from
http://www.mbaco.com/resources/marketing/market-
segmentation-five-essential-criteria
Perreault, W.D., Cannon, J.P., & McCarthy, E.J. (2014). Basic
Marketing (19th ed.). Retrieved from The University of

11. Phoenix eBook Collection database.
Samsung SWOT. (2014). Retrieved from
http://www.freeswotanalysis.com/telecommunication-
companies-swot-analysis/10.html
SWOT analysis. (2010). Retrieved from
http://www.ryerson.ca/~kjensen/strategic_planning/swot.ht
ml
Samsung. (2015). Retrieved from
http://www.samsung.com/in/aboutsamsung/
Torok, G. (2015). Articles for business professionals. Retrieved
from
http://www.torok.com/articles/marketing/5EmotionalTrigg
ers.html