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Samsung's Product & Marketing Strategy

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A Samsung case which was developed about 1.5 yrs back

Published in: Marketing
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Samsung's Product & Marketing Strategy

  1. 1. The rise of brand Samsung
  2. 2. Current case focus Even though there were a lot factors which worked towards the rise of Samsung, this particular cases focuses on product & marketing strategy This case does not take into account: 1) Business factors 2) Management style / Culture 3) HR strategy 4) Portfolio / pricing strategy 5) Distribution / channel strategy
  3. 3. 3 Interbrand 2012, Best global brands
  4. 4. The rise from manufacturer of low end, cheap knockoffs to becoming the 9th best brand global brand* Source: Interbrand 2012, Best global brands 1934, started as a small trading house selling noodles & dried sea food Diversification in industries & electronic OEM electronic supplier to most major brands Manufacturer of low end, cheap knockoffs 9th Best Global brand
  5. 5. Cornerstones of this rise Product Strategy Marketing Strategy
  6. 6. Cornerstones of this rise Product Strategy • Technological Leadership • Customer Focused Design • Value added, first to market products Marketing Strategy
  7. 7. Cornerstones of this rise Product Strategy Marketing Strategy • Master brand strategy in conjunction with hero ‘sub-brand’ • Advertising agency consolidation for consistency • Premium brand imagery targeted at high life seekers • Strategic Sponsorships • Digital Marketing focus • Advanced marketing expertise & investment effectiveness
  8. 8. PRODUCT STRATEGY
  9. 9. Strategic shifts: from a follower to an industry shaper Product centric innovation Product innovations based on latent consumer needs PAST (Fast Follower) NOW & BEYOND (Industry Shaper) Similar benefits with competition Value added, differentiated, first to market products Focus on mid-market segment More premium range Product
  10. 10. Strategy shifts: from a follower to an industry shaper Product centric innovation Product innovations based on latent consumer needs PAST (Fast Follower) NOW & BEYOND (Industry Shaper) Similar benefits with competition Value added, differentiated, first to market products Focus on mid-market segment More premium range Product
  11. 11. Sensory Premium Samsung’s product strategy essence Product Source: Samsung analyst meet 2005 Technology Leadership “Designing Sensational Technology “ Design Focus
  12. 12. Technological leadership achieved through: Product Massive investments in R&D Partnerships with mayor tech leaders + Technology leadership image leveraged to shift perception from value brand to a premium brand
  13. 13. Investment in R&D Product Massive investments $9billion Record spent by Samsung in 2011 in R&D 1st Company in number of patents submitted in 2011 for mobile in the world. in R&D 2nd Company in US submitting patents in 2011 (just after IBM with almost 5000 patents) (compare to 2.1 by Apple for instance)
  14. 14. Partnerships with Tech-leaders Product Partnerships with mayor tech leaders Yahoo! and Samsung Form Multi-year Partnership to Deliver Interactive TV Strategic marketing and technology alliance with Time Warner for interactive broadcast service Joint development with IBM for 32 nm logic process Partnership list not comprehensive
  15. 15. Customer focused design Product Unique design philosophy: “Create an Emotional Journey” that focuses on the integration of sophisticated style, versatile convenience and emotional reactions from customers to create a more enjoyable and fulfilling user experience
  16. 16. Global ethnographic research to identify unmet needs, which serves a product design brief Product Customer focused design Samsung Design India (Delhi) Samsung's global experts analyze local culture, lifestyles and industry trends, providing critical inputs to the Corporate Design Centre…which conducts global research projects that results in the creation of products that meet every consumer and business needs
  17. 17. Product Winning Product strategy Technological leadership Customer focus design + = First-to-market products reflecting consumers unmet needs (hence able to command premium price) World’s first full voice, gesture & facial control TV World’s first full 10 MP camera phone World’s first full HD 3D LED TV Innovation list not comprehensive 1st
  18. 18. Product Persistent innovation which builds brand image Innovation list not comprehensive
  19. 19. MARKETING STRATEGY
  20. 20. Marketing strategy essence Marketing Master brand strategy in conjunction with hero sub-brand Focus on premium imagery targeting high life seekers Strategic sponsorships Advanced marketing expertise and investment effectiveness
  21. 21. Strategy shifts: from a follower to an industry shaper PAST (Fast Follower) Disparate identity with multiple sub-brands Multiple communication agencies Good reliable brand targeting sensible buyers More mass media focus Gut based marketing decisions Local / Tactical sponsorship decisions Marketing NOW & BEYOND (Industry Shaper) Consistent master brand strategy in conjunction with hero sub-brand Consolidated communication agency Premium brand targeting high life seekers High digital focus Advanced marketing expertise & investment effectiveness Consistent global / local sponsorships of sports / cultural events
  22. 22. Strategy shifts: from a follower to an industry shaper PAST (Fast Follower) Disparate identity with multiple sub-brands Multiple communication agencies Good reliable brand targeting sensible buyers More mass media focus Gut based marketing decisions Local / Tactical sponsorship decisions Marketing NOW & BEYOND (Industry Shaper) Consistent master brand strategy in conjunction with hero sub-brand Consolidated communication agency Premium brand targeting high life seekers High digital focus Advanced marketing expertise & investment effectiveness Consistent global / local sponsorships of sports / cultural events
  23. 23. Consistent master brand strategy for efficiency Marketing from to With global expansion and increase in product portfolio, Samsung shifted to a master brand strategy to brining in marketing efficiency In conjunction with “Samsung” master brand they started marketing “Galaxy”, their hero sub-brand which infuses the master brand with a lot of youthful feel, premium & innovate traits
  24. 24. Consolidation of advertising duties for consistency Marketing To bring in consistency across communication, brand look & feel, the advertising duties were first consolidated with Draft FCB Later during the course of the years, the advertising duties were consolidated with Samsung’s own agency ‘Cheil’
  25. 25. Premium brand targeting high life seekers Marketing Samsung’s product technological leadership and customer focused design was coupled with: Increased visibility & exclusive retail space for customer to experience products Alliances with global premium brands
  26. 26. Marketing Premium brand targeting high life seekers Partnership with global premium brands 2005 Bang & Olufsen joint venture to produce one of the most expensive mobile ever 2005 Jasper Morrisson partnership to raise the brand’s design profile 2008 Adidas partnership to compete against Nike-Apple 2007-10 Giorgio Armani Partnership to appeal to the luxury labels fans
  27. 27. Marketing Premium brand targeting high life seekers Visibility in premium locations Airports were chosen as key destination to dominate so that it imparts a premium feel to the brand Beijing & Taipei Hanovre Toronto World in Your Hand“ themed Landmark Statues started in 2002 and extended to 22 international airports in the world. Mobile charging stations and free Internet access to build affinity with travelers Premium exclusive stores in airports , helped the brand to build its reputation and image Since 2002 Since 2008 Since 2008
  28. 28. Marketing Premium brand targeting high life seekers Premium exclusive stores Realizing the importance of customer experience with their products, Samsung operated exclusive show rooms where customers could see, touch, and experience its latest products Premium exclusive Samsung experience stores across US, Russia, Australia, Brazil, China, Chile and India
  29. 29. Focus on digital marketing Marketing 0 People working in social-media for Samsung in 2009 +300 People working in 2012 for the social-media team (in-house or outsourced in agencies) 30% Target for the 2013 marketing budget spent online. Understanding the reduced role of traditional mass media and that its core TA, the 25- 45 y.o, early adopters & style conscious segments use the net for researching & shopping, Samsung started focusing on the digital medium
  30. 30. Ensure that it demonstrates Samsung’s regional sentiments Strategic Sponsorships Ensure good global reach & audience affinity Marketing Global Strategic Sponsorship decision based on 2 important criteria: If it is a Global sponsorship If it is a Local sponsorship Sports / Soccer key choice
  31. 31. Strategic Sponsorships Marketing All sponsorships investments had to deliver on 2 specific business goals: Strengthen & leverage channel relationships Contribute to sales by connecting sponsorship event with sales programs
  32. 32. Strategic Sponsorships, examples Marketing Sports/ Global & Local Exclusive sponsor for the Wireless Communications Equipment category since 1998 at the Olympics” Official Chelsea’s shirt sponsor since 2005, and that agreement lasts at least until 2015” Sochi 2014 OlympicWinter Games in Russia Arts / Culture Cultural / Art sponsorship the brands maintains a human personality Entertainment Headline sponsor of Take That’s 2010 Tour Cause Marketing Philanthropic Initiative Announced to Reinforce How Samsung is Dedicated to Helping Children Live, Learn, and Thrive.
  33. 33. Advanced marketing & investment effectiveness Marketing Moving away from gut based decisions, Samsung ensured that: Investment decisions were based on it ability to generate ROI Ensure overall corporate profitability rather than just volume / country profitability Ensure adequate support for category which has potential but which were small currently
  34. 34. Advanced marketing & investment effectiveness Marketing Samsung, M-Net ensures an analytical approach to marketing “M-Net”, an intranet based software which helps take marketing decisions based on data Data includes per capita spending by country, category penetration, category growth, brand share of competition, media clutter & cost, category profitability, competition metric etc…
  35. 35. Key take-aways Product strategy • Achieve Technological Leadership • Alliance with tech leaders • Customer focus design philosophy • Introduce first to market, innovative, differentiated products • Premium brand experience Marketing strategy • Master brand strategy in conjunction with hero sub-brand • Consolidation of advertising duties with single agency • Premium brand image building • Partnership with premium brands • Visibility in premium locations • Exclusive experience stores • Focus on digital marketing • Advanced marketing & investment effectiveness • Strategic sponsorships
  36. 36. Thank You Subash Franklin + 91 976990 5404 subashfranklin@gmail.com

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