Professional Documents
Culture Documents
PROJECT REPORT ON
MARKETING STRATEGY OF SAMSUNG
SUBMITTED BY
PINAK VARU
TYBMS B (SEM. VI)
SUBMITTED TO
UNIVERSITY OF MUMBAI
ACADEMIC YEAR 2012-2013
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DECLARATION
I PINAK P VARU, a student of T.Y.BMS Semester VI, during the academic
year 2012-2013 studying at SHRI CHINAI COLLEGE OF COMMERCE AND
ECONOMICS, hereby declare that the work done on the project entitled
MARKETING STRATEGY OF SAMSUNG is true and original to the best
of my knowledge.
DATE:-___________
___________________________
SIGNATURE OF THE STUDENT
CERTIFICATE
I Prof. SHIBU SINGH, hereby certify that PINAK VARU of SHRI CHINAI
COLLEGE OF COMMERCE AND ECONOMICS, of TY BMS has completed
his project on MARKETING STRATEGY OF SAMSUNG during the
academic year 2012-2013. The information submitted is true and original to the
best of his knowledge.
_______________________
SIGNATURE OF PROJECT
GUIDE
_________________________
SIGNATURE OF PRINCIPAL
_______________________
SIGNATURE OF EXTERNAL
EXAMINER
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ACKNOWLEDGEMENT
During the perseverance of this project, I was
supported by different people, whose names if not
mentioned would be inconsiderate on my part. I would
like to extend my sincere gratitude and appreciation to
Prof. SHIBU SINGH who initiated me into the study of
MARKETING STRATEGY OF SAMSUNG.
It was indeed been a great experience working
under her during the course of the project for her
invaluable advice and guidance provided throughout
this project. I also owe my sincere gratitude to Dr. Mrs.
MALINI JOHRI, principal of our college.
I would also like to give my sincere gratitude to all
my college librarian staff because of whom I am able to
complete my dream project.
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INDEX
CONTENT
PG.NO
COVER PAGE
DECLARATION
II
CERTIFICATE
II
ACKNOWLEDGEMENT
III
EXECUTIVE SUMMARY
IV
TABLE OF CONTENT
Chapter
Particulars
No.
Page
No.
1.
INTRODUCTION
5-9
2.
RESEARCH METHODOLOGY
10
3.
COMPANY PROFILE
11-16
4.
ABOUT SAMSUNG
17-46
5.
47-59
6.
PROSPECTS
FINDINGS AND SUGGESTIONS
60-65
7.
CONCLUSION
8.
QUESTIONNAIRE
9.
BIBLOGRAPHY
66
67-68
69
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Chapter 1
INTRODUCTION
1.1 Definition
1.2 Developing Marketing Strategy
1.3 Types of strategies
1.4 Strategic Model
1.5 Real-Life Marketing
INTRODUCTION
1.1 Definition
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Marketing strategy is a process that can allow an organization to concentrate its limited
resources on the greatest opportunities to increase sales and achieve a sustainable
competitive advantage.
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Marketing strategies may differ depending on the unique situation of the individual
business. However there are a number of ways of categorizing some generic strategies. A
brief description of the most common categorizing schemes is presented below:
Leader
Challenger
Follower
Nicher
Innovation strategies - this deals with the firm's rate of the new product
development and business model innovation. It asks whether the company is on
the cutting edge of technology and business innovation. There are three types:
o
Pioneers
Close followers
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Late followers
Growth strategies in this scheme we ask the question, How should the firm
grow? There are a number of different ways of answering that question, but the
most common gives four answers:
Horizontal integration
Vertical integration
Diversification
Intensification
Prospector
Analyzer
Defender
Reactor
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There are many companies especially those in the Consumer Package Goods (CPG)
market that adopt the theory of running their business centered on Consumer, Shopper &
Retailer needs. Their Marketing departments spend quality time looking for "Growth
Opportunities" in their categories by identifying relevant insights (both mindsets and
behaviors) on their target Consumers, Shoppers and retail partners. These Growth
Opportunities emerge from changes in market trends, segment dynamics changing and
also internal brand or operational business challenges. The Marketing team can then
prioritize these Growth Opportunities and begin to develop strategies to exploit the
opportunities that could include new or adapted products, services as well as changes to
the 7Ps.
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Chapter 2
Research Methodology
Marketing Research
Marketing research is the function, which links the consumer, customer and public
to the marketer through information.
Information used to identified and define marketing opportunities and problems:
generate, refine and evaluate marketing action, monitor marketing performance, and
improve understanding of market as a process.
Marketing strategies of Samsung vary in their specific objectives. They may be
used to correct new customer, to reward loyal customers ad to increase the
repurchase rates of occasional users. Sales promotion usually targets brand switchers
because non-users of other brands do not always notice a promoting..
Sources of Data
In this study the for most data collection instrument used is the questioners method.
The questioner has been designed with both open ended and close ended questions. Apart
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from this, the research instrument consists of primary and secondary data collected for the
study.
Primary Data
Here first hand information is obtained by distributing printed questioners to
the marketing executives of the company. Data was also obtained from the observation
and interviews techniques adopted by the researchers. Moreover, information was
disseminated by the departmental heads.
Secondary Data
Here the information is obtained from the brochure of Samsung group , books,
websites, newsletter, generals, magazines, newspaper, etc.
Chapter 2
COMPANY PROFILE
2.1 The Samsung Philosophy
2.2 Mission of Company
2.3 Values
2.4 Vision 2020
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COMPANY PROFILE
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Change
In todays fast-paced global economy, change is constant and innovation is critical to
a companys survival. As we have done for 70 years, we set our sights on the future,
anticipating market needs and demands so we can steer our company toward longterm success.
Integrity
Operating in an ethical way is the foundation of our business. Everything we do is
guided by a moral compass that ensures fairness, respect for all stakeholders and
complete transparency.
Co-prosperity
A business cannot be successful unless it creates prosperity and opportunity for
others. Samsung is dedicated to being a socially and environmentally responsible
corporate citizen in every community where we operate around the globe.
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As part of this vision, Samsung has mapped out a specific plan of reaching $400
billion in revenue and becoming one of the worlds top five brands by 2020. To this
end, Samsung has also established three strategic approaches in its management:
Creativity, Partnership, and Talent.
Samsung is excited about the future. As we build on our previous accomplishments, we look
forward to exploring new territories, including health, medicine, and biotechnology. Samsung
is committed to being a creative leader in new markets and becoming a truly No. 1 business
going forward.
o NotePC
SPH-M800 Instinct
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o SGH-A867 Eternity
SGH-A877 Impression
o HZ15W
TL320
o Full HD Camcorder
MP3 Player
Microwave
o Refrigerator
o 800MHz Mobile AP
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Chapter 3
SAMSUNG
3.1 Samsung in India
3.2 Samsung the Future
3.3 Effective Advertisement
3.4 SWOT analysis
3.5 Marketing strategy of Samsung
3.6 After sales service
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From its inception as a small export business in Taegu, Korea, Samsung has grown to become
one of the worlds leading electronics companies and a leading global digital technology
brand. In 2009, Samsung made more than 100 trillion won in revenue and 10 trillion won in
operating profit. Its steady ascent in brand value has placed Samsung shoulder to shoulder
with the most trusted global companies.
In 2010, Samsung achieved a remarkable 60 per cent growth rate here, reporting a sales
turnover of $3.5 billion, contributing to the companys $135.8 billion in global revenues,
perhaps the most successful in Samsungs history. As the current number 1 provider of LED
and LCD TVs, Samsung is challenging the lead position in vital categories such as mobile
phones and consumer durables etc., to emerge as a $10 billion player by 2013 in India.
Samsungs strategy hinges on growing and developing the market to increase its play across
segments and to emerge as the technological leader as well as the consumers' most preferred
brand. In this context the company has made strong investments in enhancing its
manufacturing presence with $325 million so far and plans to invest an additional Rs. 350
crore by 2015. The company is aiming a 40 per cent growth this year with profits of $4.9
billion.
They already have over 20 per cent market share in the net book category and are looking at
doubling it in the NotePC segment this year. Based on their balanced portfolio across our
consumer electronics and mobile and IT portfolios, they are looking at achieving a 40 per
cent sales growth over our sales of US$ 3.5 billion achieved last in 2010.Samsung is looking
to ramp up its India presence with increased manufacturing capacity, larger retail reach and
40-45 new models this year. Samsung entered the market with about 10 per cent market share
last year and ended the year at 22 per cent in terms of value. Samsung is looking at a similar
growth this year aided by our strategy to give consumers a choice in terms of new innovative
products.
On the R&D front, Samsung has a strong R&D presence 18 R&D Centers, including two
dedicated R&D units in India, employing over 44000 people globally and investing over 8
per cent of global sales in R&D processes to foster innovation. Samsung has a key
commitment to spur R&D activities in India and in many cases India serves as the lab for
innovation of products and services for other global markets.
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Samsung has inked pact with as many has 890 application development companies to grab a
40 per cent of the fast growing Smartphone market in India.
Advertising
-Evoked
Positive
Affective
Response
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behaviour of the society, which leads to a great level of social and cultural change
among the people in general.
The next level is the stage of getting dis-satisfaction by the consumers on the use of
the product, on persuasion by the advertisement. This will lead to consumer resistance
to the product. The dissatisfaction at this state means that the quality or the contents of
the utility value of the product might not have reached the height expectations created
by the advertisement. If the product or service at this stage is able to satisfy at least a
section of the people, then it can service higher and thus will serve as forbidding
factor. As far as the attitude formation is concerned, this stage can be considered as a
formative stage. But if the product fails to reach, not even a section of the society in
total, it will lead to the product withering away from the market in course of time.
The third situation leads to a stage, when the viewers understanding that the
advertisement misguides them or giving a wrong information deliberately. Under this
situation the viewer loses confidence on the advertiser, producer and the seller. This
leads to a negative attitude on the marketing of the products of the company in
general. The defects are to be brought to the knowledge of the producer to give a
chance for him to correct the mistakes, if it is so. When there is no proper response for
this complaint, then it leads to earning discredit from the customers.
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Learning more about the product, the producer and the advertiser.
If not satisfied with the product discrepancy regarding the quality and the
characteristics of the product are to be taken to the knowledge of the producer and the
advertiser.
o Strength
o Weakness
o Opportunity
o Threat
Strength
Accessory to necessary
Air-conditioner are no longer perceived to be a item of luxury
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3.5.1 Background
3.5.2 Current Scenario
3.5.3 Demand/Supply
3.5.4 Consumer Durable: Urban and rural India
3.5.5 Success Factor for Consumer Durable Industry
3.5.6 Consumer Outlook
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3.5.1 Background
Prior to liberalization, the consumer durable sector in India was restricted to a handful
of domestic players like Godrej, Alwyn, Kelvinator, Voltas. Together, they control
nearly 90% of the market. They were first superseded by the players like Videocon in
the early 1990, who invested in brand building and in enhancing distribution and
service channels. Then with the liberalization came aspect of foreign players from LG
Electronics to Sony to Aiwa.
Rs.23000cr consumer durable industry can be divided in to two types, consumer
electronics and consumer utilities. Consumer electronics is basically is entertained
system like Television, VCRs, and Audio System and Home theater systems.
Consumer utilities are other household appliances like Refrigerator, Washing
Machine, Air-Conditioners, food processors, and vacuum cleaner. On most third
world countries, consumer durables like Refrigerator and Television are most popular.
Out of this, the television segment is undoubtedly the largest segment. Products in the
white good segments come next to the CTVs in the purchasing hierarchy of the
Indian consumer.
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Over the years demand of consumer durables has increased with rising income levels,
durable double income families, changing lifestyle, availability of credit, increasing
consumer awareness and introduction of new model. Products like Air-Conditioner
are no longer perceived as luxury product, while TV draws its share from both Urban
and Rural refrigerator and washing machine are still inclined towards Urban.
3.5.3 Demand/Supply
Supply growth is high across all the segments. But the organized sector has gained
substantial market share from the unorganized segment in recent years. However,
there are fewer players in segments like dishwashers and vacuum cleaners.
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version.
o The ability of the company to introduce newer products and newer product
features The capability of the company to service its products 'The discount
schemes and consumer finance facility available
o The market positioning of the product
o The cost competitiveness and pricing strategy of the company
o The financial strength of the players
machines.
In the next 7 million households, penetration of color TVs is 69 percent, 58
Rural India too is set to see an increase in the number of high-income households. An
additional 4.6 million high-income households and 13 million middle-income
households by 2011 to 2012 will take the number of rural households from 122.8
million to 139 million. This constitutes a huge opportunity for marketers - 60 million
households or 300 million consumers with the capacity to buy consumer appliances
and other products is an attractive market for any global player. And it seems that
global appliance players who have established brands in the Indian market are likely
to benefit from this great big push towards consumerism.
Indian consumer durables industry is going through a consolidation phase with MNC
companies going in for strategies to increase market share. Certain success factors for
this industry are identified follows:
1. Technology: Rising competition has resulted in major competitors introducing
technologically superior products at competitive prices. This means the technology
input is gaining more and more importance. In this regard, the large MNC players
score over their Indian counterparts as they can always source technology from their
parents. On the other hand, Indian companies rely on the outside sources for their
technology requirements
2. Knowledge of the local market: Indian consumer durables market is different
from other markets. Hence understanding these peculiarities is important for the longterm survival. For example, Samsung launched the 'Super Horn" brand after it
discovered that Indian consumers prefer loud noise. Indian companies are better
placed in this regard as they know the market pretty well.
3. Strong distribution network: Tough competition means that a proper mindshare
of the consumer has to be maintained and the product has to be made visible. Volumes
in this business are narrow and profitability comes from volumes. To achieve
volumes, deep penetration of the market is necessary. Indian companies score a point
here as being in the market for a longer time; they have developed strong distribution
channels.
4. Good brand image: Perception of a particular brand plays an important role in
purchase decision. A typical Indian consumer looks for value for money when he
makes purchase of white goods, as the price involved is significant and unlike
developed markets, Indians do not have the buy, use and throw mindset. Hence,
consumer also looks for reliability of the product. All this is conveyed through strong
brand awareness.
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The major players in the consumer durables industry, operating in different sectors
such as air conditioners, washing machines, refrigerators & television include:
Blue Star Ltd., Mirc Electronics Ltd., Whirlpool of India Ltd., Philips (India) Ltd.,
BPL Ltd., Sony Corporation Ltd., Samsung India Ltd., LG Electronics India Ltd.,
Videocon International Ltd.
Positioning
Many multinational companies adopt a less developed countries mindset, assuming
that these markets are at an earlier stage of the same development path followed by
the developed countries. To take the example of the automobile industry, Ford and
GM launched their outdated models like Ford Ikon and Opel Astra in the Indian
market. When these models did not sell well, the companies changed course and
decided to launch newer models in India. In the case of Samsung, the company from
the very beginning launched its whole range of high technology products, which
included CTVs, audio and video products, information technology products, mobile
phones and home appliances in India. It introduced products such as the Bio range in
CTVs, high-powered Woofer series of colour televisions in 21-inch and 29-inch
conventional and 21-inch flat TV segments. And not to forget the lateset DNie
television.
By positioning itself on the technology platform, Samsung was able to differentiate
itself from its competitors. Differentiation today is the key for a brand to be preferred
by the consumers, when there are so many other brands within the same product
category. Without differentiation, its loyal customer base cannot be created or
sustained. But to be a true differentiator, a company must provide features that are
meaningful to customers. Which is what exactly Samsung has been doing.
Products
Samsungs product range in India includes CTVs, video products, information technology
products, mobile phones and home appliances. Its product range covers all the categories
in the consumers electronics and home appliances. According, to the analysts wide
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product range of Samsung is one of the main reasons for its success in the Indian market.
The wide range products are as follows: -
Home appliance
Microwave Ove
Refrigerator
Air Conditioner
Washing Machine
DVD Player
Camcorder
Audio
Home Theater
Digital Audio Player
Digital Still Camera
Mobile Phones
Note PC
HDD
Monitors
Samsung by launching innovative products and using proprietary technology was able to
gain market share. Samsung has therefore set up Samsung India Software Centre (SISC)
and Samsung India Software operations unit (SISO) for software development at Noida
and Bangalore respectively. While the Samsung India Software Centre in developing
software solutions in Samsungs global software requirements for hi-end television like
Plasma and LCD TVs. SISO is working on major projects for Samsung Electronics in the
area of telecom: wireless terminals and infrastructure, Networking, SoC (System on Chip)
Digital Printing and other multimedia/digital media as well as application software. In
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addition to working on global R&D projects, SISO is also helping Samsung Indias
CDMA business by focusing on product customization for the Indian market.
Samsung's
Competitors
M/S
Year
global M/S
DRAM
40.4%
NAND Flash
40.4%
Large-size LCD Panel 26.0%
Hynix
Toshiba
LG Display
19.8%
33.1%
25.9%
Q3 2010
Q2 2010
Q3 2010
(revenue)
Active-Matrix OLED
Lithium-ion battery
LCD Monitor
Hard disk drive
LG Display, AUO
Sanyo
Dell
Seagate
1~3%
19.4%
12.8%
31%
2010
Q1 2010
2009
Q4 2009
Technology
LG Electronics
14.8%
Q3 2009
Nokia
Sony
23.4%
17.4%
Q3 2010
2010
Television
97%
18.7%
18.0%
9%
sets 17.2%
21.0%
11.8%
Refrigerator
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Washing Machine
Torando Pulsator
SUPER DRY: -Samsung introduced India's first Semi Automatic Washing machine
with a SUPER DRY Feature. The SUPER DRY Feature provides a 10 minute Spin
Dry Timer, which gives you the power to ensure that your clothes get the BEST
POSSIBLE DRYING. SUPER DRY is great value; especially for the Monsoon and
winter months, when clothes don't dry easily. This powerful feature is available on the
latest models launched recently - WT9300, WT9200, and WT7800. While all other
brands will provide the standard 5 minutes Spin Dry Timer, these models give you
EXTRA DRYING for full 10 minutes.
I-CONTROL SYSTEM:- The Samsung Washing technology is designed to put you in
control of the washing process, and the machine action. Samsung Washing Machines
are packed with an array of incredible features that come together to make the I control system. These include the ECO Wash - that saves water and detergent,
Child Lock - To limit small children with tampering settings and getting hurt, Auto
Restart - that saves you the bother of restarting the washing machine each time the
power fails, Memory backup- enables the washing machine to remember
programmed wash cycles and settings, Delay Start- To enable you to time the
washing machine with your water supply and other chores and Fuzzy Logic - that
makes the washing machine intelligent to adjust automatically to wash loads, water
and detergent levels etc. These 6 amazing technologies come together to put you in
total control and command of the washing machine and the wash process
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Air conditioners
Turbo power: {BRINGS INSTANT RELIEF FROM HEAT}
The Turbo function makes the AC operate under full power for 30 minutes,
irrespective of the set temperature, which leads to quick change of the room
temperature, instantly bringing the air-conditioning comfort in the room. Turbo
operates faster than the conventional system. The new compact range of Samsung
Window ACs not only occupies lesser window space but also is more aesthetically
appealing.
Quick power optimizer: {ENSURES LOW ELECTRICITY BILLS}
The Samsung Split Air conditioners 5-Step Heat Exchangers have 122% larger
surface area. Samsung Window Air conditioners are equipped with a 3-row cooling
coil and L bent condenser coil that provide a larger surface area helping the refrigerant
to dissipate heat faster. This results in faster chilling and lesser strain on the
compressor resulting in lower electricity bills.
Micro Oven
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Bio Ceramic Technology: Only Samsung Microwave Ovens come with a unique Bio
Ceramic Enamel coating. Bio ceramic enamel produces less oxidation, which helps
retain essential vitamins while cooking. The ceramic enamel retains 2.5 times more
heat than stainless steel, leading to faster cooking.
High scratch resistance: Bio Ceramic Enamels durability and protective qualities
make it far more scratch resistant than other microwave interiors. When scratched
with equal force, the roughness of the ceramic enamel surface increases only 7.5%
compared to 106% for the stainless steel.
Higher nutrient retention: Food cooked in Bio Ceramic enamel cavity microwave
ovens retains significantly greater amounts of vitamin C and F (an essential fatty acid
that helps reduce cholesterol and blood pressure) than food cooked in conventional
stainless steel cavity microwave ovens.
Exclusive Feature: 3D Shower wave
Unlike other Microwave Ovens, only Samsung Microwave Ovens come with the
unique 3D Shower wave System, which helps to distribute heat evenly, enabling
uniform cooking horizontally and vertically.
Television
The Samsung 70-inch PDP TV (Plasma Display Panel) and at 54 inches is the world's
largest thin film transistor liquid crystal display (TFT-LCD) television and offers the
highest picture resolution available anywhere in the world.
The 70-inch PDP delivers high-definition imaging from over two million pixels - a
resolution twice the clarity of other models on the market today. Samsung has also
applied its proprietary Digital Natural Image engine image-enhancement technology
to ensure the highest quality possible image in terms of picture brightness and
contrast.
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DVD
The highlight of the Samsung DVD Range is the Hypervision DVD, HD 938, which
is the worlds first and only HDTV compliant DVD Player. The Hypervision DVD
utilizes the worlds first digital visual interface (DVI) output to transmit
uncompressed digital video signals without any analogue conversion, preventing
image quality loss. This results in viewers being able to enjoy high definition quality
picture quality even for standard DVDs.
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Mobile Phones
India is one of the fastest growing mobile markets in the world, having more than
400+ million mobile subscribers. Currently in India 2.5G and 2.75G are in the
existence in GSM Technology. Whereas another technology is CDMA (code division
multiple access), 3G is coming into the existence.
As per as mobile market in India is concerned there are number of GSM service
provider such as:
o Airtel
o Vodafone
o Idea
o BSNL
o TATA DOCOMO etc.
Whereas in CDMA there are few number of player as compare to GSM mobile, such
as:
o TATA (TTSL/TTML)
o Reliance India mobile
o Virgin
o MTS.
.
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CDMA
GSM
28%
72%
MTS (SSTL)
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CDMA MOBILE
120.00%
100.00%93.39%95.28%
80.00%
74.52%
71.69%
63.65%
60.00%
Mobile retail stores in terms of %
40.00%
20.00%
25.47%
18.86%
9.43%
5.66%
0.00%
Handsets
Above figure shows that Samsung is most preferred brand in CDMA mobile handsets
among all the brands.
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No of mobile stores
LG
Spice
Haier
80
70
60
50
40
30
20
10
0
Samsungs market share is high among all the brands. In majority of mobile retail
stores Samsungs CDMA mobile market share is half or more than 50%.
In most of the mobile stores Samsungs CDMA mobile market share is 30% - 40%.
LG is close competitor of Samsung; in majority of mobile shops market share of both
of the brand is almost equal.
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120%
100%
80%
Market Share
60%
LG40%
Samsung
20%
0%
Stores
As per the above figure the market share of Samsung and LG are overlapping in some
of the stores. It mean where demand of both the brand is equal.
The above figure indicated that LG and Samsung are the close competitors.
Somewhere LG is leading in CDMA market share, somewhere Samsung is leading.
120%
100%
80%
Market Share
60%
Spice
40%
Samsung
20%
0%
Stores
Majority of availability of Spice mobile in retail stores is less than 20% of market
share.
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Whereas almost Samsungs market share in mobile stores is more than 20%.
120%
100%
80%
Market Share
60%
40%
Samsung
Haier
20%
0%
Stores
Sales of Haier mobile are very good in some of mobile stores because of low price of
handsets available in Haier.
In some of the stores Haier mobile market share is more than 40%.
But its market share is less as compare to Samsung.
120%
100%
80%
Market Share
60%
Samsung 40%
Haier
LG
Spice
20%
0%
Stores
The above figure shows that Samsung is most preferred brand in the CDMA segment
by consumers.
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70.00
60.00
50.00
40.00
Consumer demand in terms of %
30.00
20.00
10.00
0.00
Above figure shows consumer demand of Samsung CDMA mobile is very high. In
61% of retail mobile stores consumer demand is very high.
Approximate in 10% of retail mobile stores Samsung consumer demand is extremely
high.
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Chapter 4
AFTER SALES SERVICE AND
FUTURE PROSPECTS
4.1 After Sales Service
4.2 Promotion
4.3 Advertising
4.4 Sales promotion
4.5 Sponsorship
4.6 Direct mail
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has
launched
its
3S
Speed,
Smile
and
Sure
campaign.
As part of this customer service program, the company is working on a two-pronged strategy.
This involves: one, improving the service infrastructure by setting up customer service plazas
in key metro locations; and two, improving the skill levels of technicians by setting up a
training school with a technical evaluation system for after sales service engineers.
Till now, most of the players in the sector have been professing that it's the relationship with
the customer that matters. However, with the competition increasing, customer satisfaction is
fast becoming a core issue,'' an industry analyst pointed out. He further stated that Samsung's
current effort ``will also strengthen its customer base as most of the players claim that 60 per
cent of their sales is repeat purchase.''
4.2 Promotion
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Offering advanced technology products and positioning itself on the technology platform will
not help a company sell its products if it fails to communicate properly with the potential
customers. To raise brand awareness and create strong, favorable and unique brand
associations, Samsung adopted various marketing strategies like celebrity endorsements,
corporate advertisements, highlighting its technological superior goods and many
promotional schemes.
4.3 Advertising
Samsung is involved in aggressive marketing and advertising of its product to develop
attitudes, create awareness, and transmit information in order to gain a response from the
target market. Their main advertising channels include 'media' such as newspapers (local,
national, free, trade), magazines and journals, television (local and national) cinema, outdoors
advertising (such as posters, bus sides). The initial advertisements communicated presence of
Samsung in worldwide markets and its dominance in those markets. To increase its brand
awareness, Samsung went in for celebrity endorsements. Initially, the company signed Hindi
film actress, Tabu, to endorse its brand. Till 2002, Samsungs ads focused on the
technological supremacy of its products. But by late 2002, in addition to the technology
plank, the company started advertising on the plank of passion for country and sports
(cricket and football). Its latest ambassador is John Abraham for its mobile phone and Rahul
Dravid for its Television range.
brand ambassador, Tabu interacted with the customers and dealers of Samsung in Bangalore
and Chennai and handed over the lucky coconuts to select Samsung customers. The prizes
included products from the Samsung range.
The Phod ke Dekho offer was followed by another promotion scheme in May 2002, Dabake
Jeeto offer coinciding with the football World Cup. During the promotion every customer
who purchased companys electronics or home appliances product got plastic football with an
alarm clock in it. The customer had to press the football from the top, and was given the free
etched on the tamper-proof anodized sticker. Under this campaign, Samsung gave out gifts
worth Rs. 100 mn, which included Samsung digital flat TVs, frost free refrigerators,
microwave ovens, Karisma washing machines, mobile phones, cameras and Soccer 2002
official licensed T-shirts from Adidas. This campaign notched up sales worth Rs.310 Crores
during the period of the Promotion.
The next major promotional campaign was the Phir Se Phod Ke Dekho offer. The offer was
launched during October-November 2002 generating a sales of Rs. 380 crores. It was a repeat
of the earlier Phod Ke Dekho campaign.
On March 20, 2003 Samsung Launched 'Samsung Rang De Kismat Offer' for Frost Free
Refrigerators which entitled a customer to Lucky Gifts worth Rs 4 Crores, with the purchase
of any Samsung Frost free Refrigerator. This Promotion derives its name from the 'Rang de
Kismat' glass, which was handed over to a customer with the purchase of any Samsung Frost
Free Refrigerator. The Customer needed to pour chilled water into the glass and wait for the
'Bio' logo on the Glass to change colour to find out the gift won by him/her. There were
Colour Codes for types of Gifts won by the Customer - For example, a Green 'Bio' entitled a
customer to a Samsung Microwave oven while a Red 'Bio' gets the Lucky winner a Gift
Voucher from Tanishq worth Rs 30,000. This offer was launched to capitalize on the sales of
its Frost free refrigerators in the summer months. The Companys market share went up to
21% in the Frost free refrigerator market after the offer.
Following its success with its 'Samsung Rang De Kismat Offer' Samsung India come up with
another innovative Consumer Offer Samsung's Bundling Offer with Reliance IndiaMobile
for the buyers of its Consumer Electronics and Home Appliance Products in the Delhi and
NCR Region on 25 July, 2003. A buyer of any Samsung Consumer Electronics or Home
Appliance products gets the option of walking away with a sleek, advanced Samsung Mobile
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Phone N191 model along with a Reliance IndiaMobile connection, without having to pay any
activation charges. Furthermore, the user gets free talk time worth Rs.600 over a 6-month
period. All other payment terms are the standard billing terms and conditions offered by
Reliance IndiaMobile depending on the package taken up by the customer. On 6 October
2003 Samsung India Electronics Ltd launched its mega festival promotion called Samsung
Pinning Toh Winning Offer on an all India basis. In this Promotion, where the consumer
stood to win an assured gift on the purchase of any Samsung product, have gifts worth Rs.
100 crores to offer as prizes. The offer entitled the buyer of a Samsung product, a card with a
unique 16 digit alpha-numeric code. All the consumer had to do is SMS SAM followed by
the 16 character code to 8888 and s/he would immediately get a message showing what gift
has been won. The Gifts won in the Promotion include; Samsung Projection TVs, Samsung
Mobile Phones, Samsung Yepp Disc Players, Samsung DVD players, Titan Fast Track Glares,
Touch Screen Landline Phone, Trendy Portable Travel Iron and Britannica Encyclopedia 3
pack CDs.This offer was basically launched to maximize its sales during the festival season.
Following its success with its Samsung Pinning Toh Winning Offer Samsung India
Electronics Ltd launched The $-DOLLAR Program for its IT Reseller and System
Integrator fraternity on June9, 2004. The program meant for the System Integrators (SI) was
applicable on Samsung monitors, Hard Disk Drives (HDD) and Optical Media Storage
(OMS) products. Each time a SI/reseller purchases Samsung products from a Samsung Star
Elite or Samsung Storage Preferred Partner (SSPP), the SI was issued a cheque. The cheque
was of one of the four colors White, Blue, Silver, Gold depending upon the products
bought.
Samsung believes that its SIs and re-sellers play a pivotal role in business growth. They are
the ones who provide them the edge that they need in todays competitive marketplace. This
is why they have spearheaded revolutionary programs for them ensuring healthy growth in
revenues and profitability.
The last sales promotion offer was launched on Feb 3, 2005 called Fastest Finger First
which was a nation wide contest to find Indias fastest SMSer. The message to be typed reads
as follows: The razor-toothed piranhas of the genera Serrasalmus and Pygocentrus are the
most ferocious freshwater fish in the world. In reality they seldom attack a human". This
SMS had to be typed on the cell phone keypad, complete with punctuation marks and lower
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& upper case. No predictive text (T9 Dictionary), QWERTY keyboards/ any keyboard was
allowed.
4.5 Sponsorship
Samsung used sponsorship of events like Olympic series to boost its sales. Samsung was the
global wireless communications sponsors at the Athens Olympics. Samsung used the strategy
of relating itself directly with the values of the Olympic games, which included attributes like
world class, global, excellence, fair competition and peace. The Olympic series of August5,
2004 was Samsungs salute to the Olympic values.
Samsung was the sponsor of Lakme India Fashion Week held on April21, 2005. Team
Samsung cricketers - Irfan Pathan, Mohd. Kaif and Virendra Sehwag launched the Worlds
Best Handset, Samsung D500 during the Samsung Show at the Lakme India Fashion Week.
The theme for the Samsung Show was The Best Thing Says Everything in keeping with the
positioning of Samsung D500 - Samsungs latest and path-breaking mobile phone which has
been rated as the Worlds Best Mobile phone by the 3GSM Association World Congress
held at Cannes in February 2005.
Samsung sponsored Samsung & MTV Youth Icon 2005 on June10, 2005. The idea behind the
sponsorship was that the Samsung Mobiles were targeted at the fun loving, lifestyle oriented
and trendy youth of today. By associating with the Samsung & MTV Youth Icon, they are
seeking to further strengthen their relationship with the youth. Samsung mobiles make a style
statement and by partnering with the Youth Icon, this positioning is further re-inforced.
Samsung was even the sponsor of Samsung IIFA Awards held on June 13, 2005. Popular film
actress, Preity Zinta was awarded the Samsung Diva award while Hrithik Roshan was
conferred the prestigious Samsung Style Icon award at the Samsung IIFA Awards 2005.
Samsung India had carried out an online voting process on the Samsung India website
between May 20th - June 5th 2005 for selecting the recipient of the Samsung Style Icon and
Samsung Diva awards. The same was also promoted extensively on other sites like
indya.com and msn.com as well. The Company received a phenomenal response to this
online voting contest. The Samsung Style Icon and Samsung Diva awards which have
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been growing in popularity year on year, the company uses the response level received every
year as its popularity indicator.
Samsung are passionate about football. That is based on the company-wide belief that sport
plays a unique role in unifying people. They have been connecting with sports fans the world
over by supporting sporting events including the Olympic Games, the Winter Olympic
Games, the Asian Games, the World Cyber Games, Samsung Super League (Equestrian) and
of course football. As well as being very proud sponsors of Chelsea since the 2005/6 season,
they support many teams across the globe. Samsung became the Official Club Sponsor of
Chelsea Football Club from 1 June 2005 in a five-year deal. The agreement was signed at
Stamford Bridge, Chelseas stadium, by In-Soo Kim, Samsung European President, and Peter
Kenyon, Chelsea FC's chief executive at the time. It was the biggest ever sponsorship deal
signed by Chelsea and the second largest by Samsung after its sponsorship of the Olympic
Games. The logo of Samsung now appears on the famous Chelsea shirts.
Peter Kenyon said at the time: We are absolutely delighted to have Samsung as our new
official club sponsor. The company is one of the worlds largest brand names, and we are
excited about what it can offer Chelsea.
'Samsung has a key part to play in the future global development of Chelsea and we believe
we can play a similar role for it in its strategic aims. There is a great synergy between the two
brands in terms of recent dramatic growth and success, levels of performance and market
targets.'
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In addition to GLONETS, Samsung also believes in JIT (Just-in-Time) concept to its dealers.
To make delivery of products within 48 hours of the expected date of delivery, the company
has setup four RDCs, one at each regional location of the country.
The distribution channel is structured very systematically wherein all the transactions and
business conducted is documented. The program is based on incentives so that dealer
payments can be made on time. The Company supplies its goods to the Star Elite who
supplies goods to the distributor who in turn sell the goods via their own channel of retailers
and distributors. The Samsung Brand shop network complements the over 8500 retail points
for Samsung products located across the length and breadth of the country. Samsung plans to
continue enhancing its penetration levels in the country to reach out to more and more Indian
consumers. They consider the Star Elite partner as their actual product champion as their link
with the end customer. As, they have been adding value to the sale to the customer and
guiding him to the right purchase decision at a fair price.
Shop-in-shop:
Samsung is ensuring a presence in most big malls and multiplexes; even in the multi-brand
outlets, as the focus there is to create a shop-in-shop atmosphere.
The exclusive showrooms:
Keeping its target customer to display Samsung products in a more lifestyle ambience and to
communicate the product benefits in a more interactive manner, Samsung India has set up a
widespread network of over 80 exclusive showrooms comprising Samsung Digital Zone
(focusing on high-end digital audio-video products such as MP3 players, camcorders and
LCD/plasma TVs). The Samsung DigitAllhome goes beyond the concept of a Digital Plaza or
a Brand Shop because in the DigitalAllhome, they are trying to create a more interactive
environment and providing a more lifestyle orientation to the display, so that the customer
can visualize the products in his/her own home settings. The Company plans to supplement
its existing Samsung Digital Plazas' (Brand Shops) by setting up 'Samsung DigitAllhomes' in
select cities. The Company will also be creating exclusive Samsung corners in multibrand
outlets this year.
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The demands and needs within the distribution channel lead to the establishment of
MyMemoryStore.com. The site is more than an ordinary selling site, infact it is an industry
portal that allows the business partner to come in and track the relevant industry information
within the channel, meaning minimizing the inventory overhead.
Samsung is also planning to invest over $1 million in setting up a chain of exclusive outlets
called `Samsung Talkies'. The entire Samsung mobile range including the latest handsets will
be displayed at the outlets, which will be set up in more than 10 cities across India, including
Bangalore, Mumbai and Hyderabad.
Post VAT they have modified in their policies a bit. The most important step was to bring
down channel inventory post the Budget impact and the VAT impact. They made a conscious
decision to bring down channel inventory, which was at that point of time 60 days, today it is
reduced to 11 days, which entails total inventory among dealers, distributors, star elite and SI.
This has been done to ensure that the channel stays profitable.
Samsung India tied up with PlanetM for displaying its new audio range at the PlanetM
Outlets in Delhi, Mumbai, Kolkata, Pune, Chandigarh and Bangalore.
4.8 Pricing
Pricing also seemed to have played a significant role in Samsungs success. Differentiation is
the key for a brand to be preferred by consumers, when there are so many brands within the
same product category. Samsung believes in providing good products at reasonable prices to
its customers. Samsungs technology plank communications helped the company to gain
market share, even though it did not offers any discounts or exchange scheme when it entered
India. Samsung focuses on cost-cutting measures to keep its price low which helps to combat
the discount schemes of the local companies.
For e.g.- In 2001, due to high competition in the 20CTV segment, Samsung had to resort to
price cuts. The company said that value engineering, new product lines and new chassis
development had contributing in combating price erosion. Samsung negotiated with its
vendors to reduce costs on cabinets, plastics, speakers, harness coils, remote controls, etc.
Samsungs Brand image seemed to have helped it survive the price erosion. Dealers also
agreed to lower margins owing to companys brand image.
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Samsung in the year 2002, drastically reduced its operational costs which enabled the
company to keep low prices for certain products and extract higher profit margin from
premium products. This helped Samsung to post a turnover of Rs.30bn, a 2 growth from the
year 2001.
Samsung is very transparent in functioning. It has a fixed MoP (Marketing Operating Price)
whereby the goods are sold to the distributors and to the customers at a fixed market price
only.
The focus of its competitors is to penetrate in the rural and semi-urban mass markets. But
Samsung insists that it's a high end technology driven player. That's why the urban areas are
still a focus area for it and only 30 per cent of revenue comes from rural and semi-urban
India. They have always been a hi-end technology driven player and want to keep that equity.
Not surprisingly, the target customer for Samsung products wont be found in the pricesensitive mass market. Adopting the lifestyle product platform, Samsungs aiming for the
high-end premium market. Hence Samsung has always been keeping premium prices.
Samsung claims its never been a price warrior its focus has always been on the premium
market, which is why it has remained a steady No. 2 or No. 3 player in most product
categories.
It is difficult to achieve the ambitious targets keeping in mind the pricing strategy of
Samsung. But, they believe that it takes time to ensure your supremacy in market share. Once
you get your brand perception right in the minds of the consumers as a brand that delivers the
best technology and gives you value for money, then ultimately market share goes up.
Later on Samsung changed its policy a bit and instead of just remaining a high-end
technology driven brand it tried to change its image to sell products to the huge number of
middle income families in India. It started pricing its products on the value for money
concept, keeping in mind the price sensitivity of Indian consumers.
But still Samsung has the repute of being a premium brand, aggressive in launching newer
models with the latest technology and at economic costs throughout the world.
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Future Prospects
We have done a survey at retail outlets selling Samsung products and one thing that we found
out common is that Samsung lacks in after sales service. The drawback in their after sales
service strategy is that they have only one customer service centre throughout India which is
situated in Delhi. When a customer has a complaint he approaches his retailer who in turn
registers the complaint in the Delhi service centre from where the complaints are processed
and replacements are made.
The presence of only one service centre makes it very difficult to give timely response as the
complaints come throughout India. The complaints are not entertained for a period of 10 -15
days. Hence the customer is not satisfied with the after sales service of Samsung.
Marketing Strategy
Samsung has to improve its after sales service in order to retain customer and create brand
loyalty. The current policy adopted by Samsung is aggressive spending more on advertising
and marketing and less on retaining customers that is after sales service.
So the corrective strategy to be adopted by Samsung must be to spend more on retaining
customer rather than acquiring them as it costs 5 times more to the company to get to a new
customer rather than pleasing existing ones. Moreover it costs 16 times to take the new
customer to the loyalty stage.
They should have regional service centres in North, South, East, West where the complaints
can be received and processed quickly. Moreover they should employ and train the
technicians to provide quality and timely sales service.
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60%
YES
40%
NO
20%
5%
Advertisement
Family Member
60%
15%
Friends/Relative/Neighbo
ur
Other Source
It
shows
that
60%
of
people
know
about
SAMSUNG
through
Yes
No
90%
It shows that 90% of people have seen SAMSUNG Ad and 10% people
have not seen SAMSUNG Ad
10%
30%
20%
Concept/Message
Logo/Slogan
Picturisation
40%
Overall
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15%
40%
Impressive
Satisfactory
45%
Unsatisfactory
15%
35%
Logo/Slogan
20%
Message
Presentation of Ad
30%
Model/Celebrity
35%
65%
Yes
No
It shows that 65% of people went SAMSUNG showroom and 35% Dint
went to Showroom.
15%
Yes
No
85%
It shows that 85% of people say that the advertisement reflect actual
product profile and 15% say No.
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30%
40%
Economical
Costly
Neither Economical nor
Costly
30%
It shows that 40% people found the price range as Economical,30% found
it costly and 30% found it Neither Economical nor Costly
Q.10 Are you happy with After Sales Service of SAMSUNG?
80%
Yes
20%
No
It shows that 80% of people are happy with the after sales service of
SAMSUNG and 20% people are Not happy
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SUGGESTIONS
Company should improve the after sales service of products as it is the main
factor for the sales of consumer products.
Company should constantly get innovative in advertising its products, mainly
focusing on Value it will bring to the customer after buying the product
Company can use some of the marketing tactics like distributing free key chain,
calendar, t-shirts for making brand popular among people
Company can introduce low price and low power consumption Refrigerators
for acquiring the lower middle income group to increase their market base
Dealers desire more advertisement to be done through local newspaper and
cable TV ads to make consumers aware about the product.
Advertisements of the companys products should focus on quality and main
features.
Proper Segmentation should be done and accordingly marketing strategies
should be planned for premium products.
Welcome call as well as follow up call will help the company to maintain
customer relationship; hence the company should focus on such softer these
aspects.
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Establish the service center as per taluka place for easy accessibility to
consumers.
Conclusion
With respect to the above study and the findings thereby
are that the company has definitely entrenched into the
urban market.
With few more concerted efforts, the said organization
needs to enter the rural market in order to completely
establish itself all over.
Customer Service and Satisfaction are of utmost
important in this highly Competitive market
Value Proposition should be created in the eyes of the
customer to gain Loyalty which will in turn help to
sustain and be a Leader in the Market
Constant Investment in R&D will help an Organization
to get Innovative products in the market and in turn lead
to higher Customer Satisfaction.
Brand Recall is of utmost importance and the Company
should make efforts to increase the same
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QUESTIONNAIRE
PROJECT TOPIC: - MARKETING STRATEGIES OF SAMSUNG
RESPONDENT PROFILE
Name:Sex:-
Male
],
Female [
Age Group:-
15 to 25 [
],
25 to 35 [
],
45 to55 [
],
55 and above
Q. 1
Q. 3
No
Family Member
Friends/Relative/Neighbour
Other Source
Q. 4
Q. 2
35 to 45 [
],
No
]
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Logo/Slogan
Picturisation
Overall
Q. 5
Q. 6
Q.7
Impressive
],
Unsatisfactory
Satisfactory
Logo/Slogan
Message
Presentation of Ad
Model/Celebrity
],
No
Q. 9
Yes
Q. 8
],
No
Based on the price range what impression do you carry of SAMSUNG product?
Economical
],
Costly
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Bibliography
Websites
http://www.Exchangeformedia.com
http://www.Agencyfaqs.com
http://www.Magindia.com
http://www.Indiatelevision.com
http://www.Indiainfoline.com/bschool/biz.asp
http://www.samsung.com
Books
Principles of Marketing Philip Kotler ( Vipul Prakshan )
Special Studies in Marketing- Romeo Mascarenhas ( Vipul Prakashan )
Magazines
Advertising and Promotion- Belch
Advertising today Warren berger
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