INNOVATION MANAGEMENT AND NEW PRODUCT

DEVELOPMENT
BM-050-3-3 IMNPD
INDIVIDUAL ASSIGNMENT

Student AROOSH MASUD

TP TP029202

Intake UC3F1610SE

Lecturers Name DR. PUVANESWARAN A/L KUNASEKARAN

Due Date 09TH JUNE, 2017

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Contents
Question 1 3
1.0 Introduction 3
1.1 Company Background 3
2.0 Market Positioning and Brand Management 5
2.1 Market Positioning 5
2.2 Launch Activities 12
2.3 Brand Management Strategy 12
Question 2 14
3.0 S.W.O.T 19
3.1 Strengths 19
3.2 Weaknesses 20
3.3 Opportunities 20
3.4 Threats 20
4.0 Ansoff Matrix 21
4.1 Market Penetration 21
4.2 Product Development 21
4.3 Market Development 22
4.4 Diversification 22
Conclusion 22
References 23

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Question 1

1.0 Introduction
1.1 Company Background
From its start as a small export business in Taegu Korea, Samsung has grown to be one of the
leading companies of the world that specialize in digital appliances and media. Samsung
Electronics was established in 1969 in order to provide an engine of future growth for the
Samsung Group. Following the establishment, in the early 1970s Samsung began to produce
black-and-white televisions under its own name, Samsung. After a few years it began
producing other home appliances, including washing machines, refrigerators, colour televisions
and microwave ovens. During the 1980s, it expanded its business lines to personal computers,
semiconductors, and telecommunication networks and devices. In 1992, the company became a
leading semiconductor manufacturer in the Dynamic Random Access Memory market. Samsung,
being a domestic latecomer at that time, successfully became even better than their competitors
in the world market. Samsungs new management formed in 1993 after an incident where a
member of the marketing team was hiking in the mountains. He saw a person getting full signal
coverage on his Motorola while he was getting none on his Samsung. This event made it clear
that increasing connectivity would be crucial factor. In 2003 Samsung positioned itself as one of
the worlds best mobile phone manufacturers after staying remarkable in the business for their
semiconductors and home appliances. When it first entered into the business of mobile phones
the consumers thought of the move as too fast paces and reckless but it turned out to be a great
success for the company considering their profit growth and brand reputation. Samsungs exports
currently account for two-thirds (79%) of total sales. In addition, Samsung has built its brand
around the world; in 2003, the Samsung brand was ranked 25th in the annual
BusinessWeek/Inter brand study of the worlds most valuable brands, having grown from $8.31
billion in 2002 to $10.85 billion in 2003 (Lee et al, 2004)

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 Figure 1: The newly launched Samsung Galaxy S8

Samsung galaxy S8 promises to meet the several requirements of the loyal buyers in the industry
and then loyal customer of Samsung Mobiles. It would be the first in the class to offer an infinite
pixel display which is considered to be the best screen on a mobile phone at the time, along with
that S8 would introduce the Snapdragon 835 processor which will be boosted on an octa core
technology. It is created in a polished aluminium frame, Gorilla Glass 5 front and rear; IP68
certified for water and dust resistance and it will be released in Arctic Silver, Orchid Grey, Black
Sky, Maple Gold, and Coral Blue colour schemes. It will have a 12 megapixel and 8 megapixel
dual phase detection cameras. The Samsung s8 will sport a 3,000mAh Li-Po sealed battery;
Adaptive Fast Charging (same as the S7); Quick Charge 2.0 support; WPC&PMA wireless
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charging and a 6GB RAM in future models. The company has further decided to launch their
product by using the aggressive marketing strategy (Dwyer and Priluck 2012). This will help to
create competitive advantages and would position ahead of its competitors by ensuring its
availability anywhere in the world.

2.0 Market Positioning and Brand Management

2.1 Market Positioning
The positioning process is important to be identified and followed by any organization which
wants to implement its marketing strategy soundly (Bhasin, 2016). The current business
environment is very competitive which is why all the companies in the world look for certain
strategies and tools to stabilize their position in the market and at the same time allowing
enhancements to their brand. Its character obviously describes that it is a strong brand
approximately innovation, cutting edge technology and world class design. To clear its brand
image, it reinforces Samsungs strong connection to the brand community to customer; besides,
it reinforces its brand image of always being in leading position of innovation and design.
(Martin Roll, 2006.) . Samsung is not just a well-known name in the market but the biggest
electronics manufacturers in the world. It is a name that that when heard reminds of products like
galaxy phones, televisions, refrigerators and other electronics that make up the brand association.
Samsung is also very famous for their up to the mark customer service which is considered as
one of the fastest product services in the world. Samsung has provided its customers with
tangible as well as intangible products. Its wide range of product has strengthened Samsung
electronics.

Samsungs marketing strategy is proven to be one of the most effective strategies used in the
world as it has helped a cost driven company to change its structure entirely and grow in the
business to become a major authority manufacture. All of the Samsungs products fall under the
name of Samsung Electronics which helps consumers to understand the subsequent products
with an umbrella approach. Samsung mission is to continue to become a worlds leader of digital
convergence with the number one market share of most products segments. (Ilse Jurrien, 2005).

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Samsung has been constantly redesigning their products through innovation and introduction of
new technologies. For instance, their mobile features are a crucial part of their which describes
the release of Galaxy phones. Despite of the critics who think that the brand has found its success
by taking bits and pieces of other brands features Samsung tires to give humanized and better
personal experience, customer insight product and innovative technology which describes their
innovative features in S6 like curved display and an infinite display in S8. Samsungs Q3 2015
results appeared to indicate that the company was growing again and coming out of a two-year-
long slump. Show that the company has been growing once again after a lump in 2013 as it has
already outlasted other android phones and goes head to head with Apple in terms of business
and sales comparisons. The recovery was well carried as the revenue grossed to $45.6 billion.
The company specially had increases in demand for the Galaxy Note 5 and S6 Edge and S7
Smartphones following in 2016.

Figure 2: How Samsung has managed to edge its competitive rival Apple over the span of past 6
years in terms of net income.

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There are 6 main steps in positioning process. In each of the steps, marketing research techniques
can be employed to get the necessary information:

Step 1: Know the target audience:

Samsung targets wide range of audience from day to day usage devices and moreover industrial
equipment as well. Samsung mobile target customers are mostly teenage to early adults (14-35)
as people from this age group are technology savvy and considering the fact that this age group
has more power to spend money than in the past. Adults aging from 25 to 50 make up a group
that is the largest portion of the targeted market as they would be familiar with any Samsung
product and will continue to grow in future.

Step 2: Identify the product features: Samsung has over the years created an upward trend by
generating new looks and feels of its devices year after year. With every new launch Samsung hits
the mark and designs a top notch user experience. It all started in 1993 with SH100, Samsungs
first analogue mobile phone which made waves in the early days of handheld devices. To step up
the competition, Samsung introduced the Galaxy series with Galaxy S that introduced a super
AMOLED touch screen keeping the right phone dimensions in mind when it comes to a sleek
design. The Galaxy series introduced new members in the family with Note which gave consumers
a revolutionary tablet experience in a Samsung device with an enhanced input by the S-Pen that
allowed users to take notes, sketch and draw as well. Over a period of time as technology advanced
further, the company introduced leather back covers, better resolution screens and a more advanced
S-Pen. Moreover Samsung launched the S8 in 2017 marking the birth of the infinite display, often
called by critics the best display in the market currently.

Step 3: Unique Selling Propositions: The goal behind unique selling propositions is to stand out
from competitors by being different and having that difference viewed as something beneficial to
consumers. Samsung has developed the four Ps in their strategy which stand for price, product,
promotion and the place. The actions that are taken by them are executed by a plan they implement
on their products which makes Samsung socially very responsible. The unique selling proposition
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in Samsung smartphones can be the quality of the screen display, battery life, memory space or
durability.

Figure 3. Before the launch of the S8, Samsung asked their customers through an online pole on
how would they like their next smartphone to be. The strategy was well planned since S8 gave
the consumers all these features.

Step 4. Know your competitors: Samsung has been selling smartphones for a relatively short
time. Although the company sold Windows Mobile, Linux and PalmOS during the last decade, it
did not receive the recognition it deserved until the release of Galaxy series in 2010. Trial
evidence reveals that the sales level for Galaxy S1 series phones burst out of the gate taking
Samsung from 90k units to 2.5 million units in one quarter. (Dediu, 2012)

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 Figure 4: Samsung currently dominates the global android market share

Samsung is better than anybody else at learning from its competitors. "A market reader is sort of
the classic fast follower," (Jaruzelski, Global Innovation 1000. Samsung has also gotten into
trouble in the past, losing a very high profile case to Apple for copying its design for which it
had to pay a small price and the release of Note 7 which was later discontinued due to having
technical faults and battery burns. In Spite of all these incidents, Samsung pushed harder and
continued with the release of S8 to position their brand once again on the top. The company
produces very quickly, coming out with a variety of devices. Over the years Samsung has
realised what consumers actually respond to, figure out a way to push success and minimise the
chances of failure. Unlike other phones, Samsung has differentiated itself with larger screens,
different features, successful marketing, and delivering what customers want.

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 Figure 5: Samsung and Apple share common grounds in the US households.

Apple and Samsung have been going head to head in the US share markets making them the ace
rivals over the past several years. Apple is traditionally viewed as Samsungs arch rival as its
easy to make comparisons between two brands with high end phones and rapidly increasing fan
bases. The new Samsung S8 goes neck to neck with the new iPhone 7 as both sport a state of the
art design, incredible cameras, fastest chipsets in their respective brands and both allowing the
highest standards of connectivity possible. Although sometimes the comparison at times feels
pale as Apple users are not always likely to switch to Android and vice versa which is why some
critics even see both companies going parallel rather than in a competing environment.

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5. Ways to promote your brand: Samsung not only does advertising but promotes its products
using different tactics to build interest in customers. The introduction of discount, sponsored
events, engagement worldwide at festivals has attracted customers from everywhere. Apart from
being an electronic giant famous for its quality, it is also well known for being a sponsor for
wide range of Olympic Games and music festivals. Unlike many brands, Samsung always
promote their most important products.

Figure 5: After a hectic 2014, Samsung bounced back and maintained stability

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6. Maintain the position of the brand:

Despite of the recent bumps that the company had to take due to technical faults in recently
released now discontinued Note 7, Samsung has still kept its brand's reputation based on
innovation, cutting edge technology and a class design as the reviews of the new S8 make up for
a loss. Samsung mobiles make sure that all the latest features are effectively used to attract
consumers from all groups of ages unlike brands like Apple are for the high end niche market.
Over the past decade Samsung has brought in millions of consumers by not only producing fine
products but also by using efficient marketing strategies. Samsung uses the idea of having a good
brand image and by releasing products that are eco-friendly.

2.2 Launch Activities

Samsung unveiled the new S8 in New York City on March 29th 2017 also having an unpacking
in London which made the event to be covered on various platforms. The event headlined the
unpacking of S8 as well as introduction of Bixby, the new AI assistant by Samsung competing
with Apples Siri. It showed the new Samsung eight point battery testing procedure. In addition,
the event worked wonders for Samsung as there were no prior leaks on design or specifications
of the S8 which caught users by a surprise when the phone was uncovered.

2.3 Brand Management Strategy

Brand management is the analysis and planning on how that brand is perceived in the market
depending on the target audience. Samsung has been adopted open personnel management
system to enhance efficiency and competitiveness. Samsung has also developed a strong
customer-focus which emphasizes on understanding needs and wants of future (Jung, 2014)

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1. Identifying and Establishing Brand Position: According to, Samsung has developed
technology to standing in leading of electronic market; for example, Samsung is the first brand of
Thinnest Blu-ray player in 2009, Released the worlds first infrared video phone in 2009. That
make Samsung is the No.1 in customer loyalty for 8 years in succession by Brand Keys of the
USA (Journal, 2012) Samsung, once known to be the low-quality service provider of all time is
now one of the leading mobile companies of the world. Having said that, we can see how it all
comes down to proper brand positioning and innovation, which takes a brand to its zenith. After
having its share of booms and slumps, Samsung came up with new ideas to be more customer-
focused and creative in order to establish a strong brand image in the global market. Through
constant innovation and introduction of new technologies, Samsung has been trying to establish
their point of parity. The features of their mobile phone are the crucial part of their parity, for e.g.
introduction of galaxy phone. In addition, Samsung was once known to be a company which was
a low quality service provider but is now one of the leading mobile companies in the world despite
of the slumps in recent years. It came with fresh ideas for smartphones rather than usual. It took
customers need into perspective

2. Planning and implementing a brand marketing program:

Figure 6: Samsung logo

In 1993, Samsung acquired a new corporate identity when it changed its official logo, it was
written in the white colour with a blue background to maintain stability, warmth and reliability.
The words were used in English to have a worldwide consumer rate and the initial designs
included a spin design of the blue background symbolizing advancement and change.

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3. Measuring and Interpreting brand performance:

A) Primary Activities

a. Inbound logistics: The majority of Samsung suppliers are based in Asia and accordingly,
79.4% of its supply-chain expenses occur in Asia. This is followed by Americas (14.8%),
Europe (4.4%) and other places. In order control inbound logistics aspect of the business
more effectively, Samsung owns a number of logistics firms as its subsidiaries. The most
notably, Samsung Electronics logistic, established in 1998, is an integrated enterprise
logistics management agent that serves logistics needs of the company with 540 employees
and 8,600 partner employees around the globe.

b. Operations: As of December 31, 2014, the company maintained 213 global operations
hubs that included subsidiaries, sales subsidiaries, design centres, and research centres.

Figure 7: illustrates the full scope of Samsung global network of operations.

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Outbound Logistics: Logistics is handled in a unique way in Samsung so that it covers many
administrative processes. It is more complex than described in a basic value chain model (Value
chain analysis, 2012). Samsung has proved to be exceptionally quick in launching its own
products to compete with Apple. Effective outbound logistics system plays an important role for
Samsung in terms of being able to deliver updates of its popular products to customers in a
timely manner. Moreover, Samsung Electronics Logistic conducts the comprehensive range of
logistics operations including negotiation of payment collections on behalf of Samsung and
dealing with insurance claims.

c. Marketing and Sales: as primary activities aim to channel the attention of the target
customer segment to the perceived competitive advantage of the brand associated with high
quality and advanced functions and capabilities of products. Samsungs total marketing
budget of USD 363 million in 2013 is considerably higher than the marketing budget of
the majority of its direct competitors.

d. Service Samsung strives to deliver the customer services of the highest standards. The
company conducts customer satisfaction surveys managed by external parties in a regular
manner in order to achieve and sustain high levels of customer satisfaction. There is a
universal phone number for Samsung Direct Support and unlike the majority of
multinational enterprises, Samsung promises to get back to customers in developed
countries within 24 hours.

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B) Support Activities

a. Infrastructure: Firm infrastructure will be modified to account for new employees gained
through acquisition, which will include adjustments in the accounts related to said
employees and their companies, the management of these employees, the quality of the
newest items produced, and in the information systems required to communicate live data
across national borders.

b. Procurement: Procurement is a process of acquiring goods, services or works from an

external source usually through a competitive bidding process. Samsung promotes a very
favourable situation for mutual benefits with cooperating companies. Some of the ways are
by providing a funding of equipment for modernization and to promote enhancement
through site improvements as well.

Figure 8: Samsung uses core competency proposal system based on the steps shown.

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c. R&D: Samsung invests in research and development more than any other technology
company in the world. It has partnered with Intel, Alphabet and companies like Microsoft
with an investment of over 11 billion Euros for the development of the new technologies.
Moreover, Samsung spent over $3 billion on ads alone in 2016 using aggressive marketing
and quality leadership it has shown that it is not just big about marketing but R&D as well.

Figure 9: Shows companies ranked by R&D investment with Samsung being highest for
any mobile phone brand.

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 d. H&R: Samsung employments are carried around the world in different sectors of the
company and basically follows the same routine of applicant going through the global
Samsung aptitude test which aims to assess applicants ability to respond flawlessly using
their knowledge instead of an information.

Figure 10: A typical employment process for Samsung

4. Growing and Sustaining brand equity:

The brand equity concept approaches brand equity from the perspective of the consumer
whether the consumer is an individual or an organization or an existing or prospective customer
(Keller, 2013). Samsungs branding philosophy is built on ve main pillars: innovation, cutting-
edge technology, world-class designs, recruiting the worlds best talents, and internal branding.

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Question 2
3.0 S.W.O.T

Samsungs SWOT Analysis

3.1 Strengths
Samsung offers a lot of different designs unlike its competitor the iPhone and not only they have
a good design but are cost and quality focused too. Samsung has selectively chosen different
countries with an advantage of producing to outdo themselves as a brand and make sure their
products are supplied all over the world. Samsung enjoys an advantage of being financially
stable most of the times due to the variety of their products which in return give a huge amount
of profit from the customers. Furthermore, not only is Samsung the largest market share in the
mobile market but it also has a low production cost which allows Samsung to produce budget
phones in comparison to its arch rivals. Samsung enjoys a strong environmental focus that lets
them have a strong brand reputation.

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3.2 Weaknesses
Samsung does not have its own operation system unlike Apple which uses the iOS on their
devices, this allows them to have a better handset offering. Not only does Samsung has lacking
in its android operating system, it also largely depends on other software. In addition, Samsung
keeps its profit margin very low.

3.3 Opportunities
Samsung smartphone market is ultimately rising in countries like India hence it will give them a
chance to promote their mobile industry. There is also an immediate increase of quality
applications processors and since Samsung is gaining patents through achievements already,
what other brand would be good enough to make the processors. Moreover, Samsung is also
acquiring new companies like Harman, Viv and AI platforms from the makers of Siri.

3.4 Threats
Smartphones with android operating system are at constant risk of facing security issues as well
as software issues resulting in bugs. In addition, the infringement lawsuits have greatly affected
the companys reputation in recent turn of events.

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4.0 Ansoff Matrix

4.1 Market Penetration

Samsung seeks growth with the existing products in the moderns market aiming to increase the
share of the company. The strategy although is very risky since it has an effect on brands current
capabilities.

4.2 Product Development

Product development strategy is used when the companys core strength depends more on the
customers rather than the product itself. Developing a new product for the existing consumer is
just like new market development, it carries more risk than trying to increase the share of the
market

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4.3 Market Development
Marketing new products means pursuing more geographical regions around the world.
Expanding into a new market has more risks than penetrating one and often at times according to
the circumstance Samsung would have to change their marketing techniques time to time to
remain in the business.

4.4 Diversification
Samsung is a diverse brand since it launches new up to date products for the new market as well
as the old customers. Diversification involves both product and market development which
implies that it is more risky than any of the other growth strategies. The only way this method
can be useful is when high rate of return is expected as it compensates for the high risk being put
by the brand itself.

Conclusion
Samsung has created a lot of attention and attraction in the past decade by using not only
different marketing strategies but also their cutting edge up to date technology. The brand
continuously drives itself to develop the products to a premium quality and at the same time
maintain their brand image by having a good customer service and an efficient management.
Furthermore, the competitiveness of the global market has caused organizations to not only
create products but also use different kind of approaches to make that product work.

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