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International Marketing Final Project

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Marketing the XO Computer in South Korea: Cultural Research and Marketing Plan

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International Marketing Final Project

  1. 1. Seorak Mountain, Seoul,Virtual grocery store in subway, “Gangnam Style,” and Samsung Galaxy
  2. 2.  Earliest Pottery: ~8000 BCE  Proto-Three Kingdoms: 238 BCE-108 BCE  Three Kingdoms: 57 BCE-668 CE  Unified Silla and Balhae: 676- 936  Goryeo: 936-1388  Joseon: 1392-1896  The Korean Empire: 1897-1910  JapaneseColonial Rule: 1916- 1945  PostWWII (Separation of North and South Korea): 1945-Present  KoreanWar: 1950-1953 Ancient Korean Art Korean Empire The KoreanWar
  3. 3.  Continent: Asia  Location: Below the 38th parallel on the Korean peninsula  Size: 37,421 square miles, slightly larger than the state of Indiana  Capital: Seoul  Climate: Temperate, Cold winters, Monsoons &Typhoons  Topography: Mountains, River Basins
  4. 4.  Nuclear family  Extended family  Family dynamics  Parental roles  Marriage and courtship  Gender roles Traditional masculine culture
  5. 5.  Crucial component to success  Six days a week until 2012  High speed internet in all schools  Traditionally split by gender  Same curriculum for boys and girls  Literacy rate = 99.8% The most connected schools in the world
  6. 6.  Primary education  English begins in third grade  Secondary education  Academic or vocational school after ninth grade  High school is not mandatory  97% graduation, the highest of any country  Higher education  400 higher education institutions  4,000,000 students  Seoul National University, Korea University andYonsei University Seoul National University Male vs. Female Literacy (‘90-’98)
  7. 7.  Political system  The Republic of Korea  Executive, legislative, and judicial branches  Power of the president is dominant  Relatively stable democracy  Legal system  Civil Code law  Similar to both Germany and US ▪ Combination of European civil law, Anglo-American law, and Chinese classical thought  No jury; a court of one or three judges hears the cases South Korean Supreme Court South Korean Flag
  8. 8.  Religion:  No affiliation-46%  Buddhist-26%  Christian-26%  Confucianist 1%  Language:  Korean ▪ Chinese Characters  English Confucius
  9. 9.  Visual arts  Bold colors, pottery, and calligraphy  Music  Traditional: slow and somber; represents the plight of the working class peasants  Modern: K-pop  Performing arts  Women dance in costume  Men tell the story known  Elaborate costumes and masks, knots, embroidery, and fabric screens  Traditional dress:  Hanbok Traditional performance in Hanbok Calligraphy K-pop
  10. 10. South Korea n Profile
  11. 11. South Korea n Profile US Profile
  12. 12.  Lower-ranking individuals bow first  Bow to each person individually when leaving  It is essential to be introduced by a third party  Business relationships are developed through informal social gatherings  Very broad view of legal documents  Never criticize someone in front of others  South Koreans are very direct- be concise in business dealings  Appointments are required and should be made 3 to 4 weeks in advance  Arrive on time for meetings to show respect to the person you are meeting  Do not remove your jacket unless the most senior South Korean does so
  13. 13.  48,860,500  83% Urban  Seoul ~ 10 million  Homogenous Korean Society Age Distribution 0-14 Year 15-64 65+
  14. 14.  GDP:$1.574 trillion  13th in the world  Personal income per capita: $32,100  Ranked 40th  Income Classes  Upper Class (Chaebol): 1.5%  Middle Class: 53.4%  Lower Class: 45.2% ▪ The lowest 10% consume 2.7%; highest 10% consume 24.2% ▪ Poverty among the old is 45%, 3x the rich nation average
  15. 15.  US-Korea FreeTrade Agreement (KORUS FTA 2012)  Total Exports: $556.6 Billion  Total Imports: $524 Billion  Ranks 16th in BoP  IT & Smartphones  ~1,110 KRW per US Dollar Korean Won (KRW)
  16. 16.  One of the world’s most connected countries  40%+ own a Smartphone (2011) ▪ ~ 52 million  11th in the world in internet usage ▪ Broadband in all homes and schools ▪ Over 39.4 million users in (2009) Internet Cafe
  17. 17.  Television  Radio  Print  Newspapers  Internet  Mobile  Outdoor Seoul City Hall covered with a billboard Mobile AdsTV Network concert sponsored by Google TV & Radio Broadcasting
  18. 18.  Relative advantage  Compatibility  Complexity  Trialability  Observablity
  19. 19.  Acer  Apple  Dell  HP  Hyundai  Samsung  Sony  Toshiba  And more…  Tablets (Galaxy Note, iPad)  E-readers (Kindle, Nook)  Smartphones
  20. 20.  Internet addiction  Hypermarkets  E-commerce  High tech  Move to mobile  Domestic companies have the advantage  Price  Relationship  Relationship-oriented culture Electronics Store in South Korea
  21. 21.  Seniors  11%+ population is over 65 ▪ More women than men ▪ Higher rate of poverty among the elderly  Only 4% 55-64 use internet  Total market ~ 5 million ▪ 1% share = $12.5 million in sales Elderly Korean woman & Jitterbug phone
  22. 22.  Traditional vs. Modern  Young vs. Old
  23. 23. Strengths Weaknesses Opportunities Threats The XO
  24. 24.  Core component  Too childish looking  Eliminate unnecessary features  Packaging component  White, blue, red  Logo/Brand name change  Support services component  Phone-based customer service 24/7 The Imported XO vs.The Domestic Samsung
  25. 25.  Objective  Get seniors to buy product for themselves  Media mix  Newspaper, radio  Senior fair  Direct response advertising  Direct mail  Message  Still the head of the family  My son and grandson may live far away, but I can still be there for them
  26. 26.  Objective  Buy XO for mom, dad, or grandparents to stay connected  Media mix  Digital/Mobile ads  SEO  Direct response  Message  Live guilt free… stay connected to parents from far away  Easy to use system  Respect your elders in a whole new way
  27. 27.  Optimistic Outlook  1% market penetration Year One  10% growth rate  Potential Profit = $1.8 Million inYear 5  Good?  Samsung may be a $400 Billion dollar company by 2020 $0.00 $1,000,000.00 $2,000,000.00 $3,000,000.00 $4,000,000.00 $5,000,000.00 $6,000,000.00 $7,000,000.00 $8,000,000.00 $9,000,000.00 $10,000,000.00 Total Revenue Year 1 Year 2 Year 3 Year 4 Year 5
  28. 28.  Bridge the gap between traditional and modern  Focus on relationships  Make seniors feel special and superior  Keep costs down  Get in and out… fast!

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