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0px}span.s1 {font-kerning: none}Samsung is a international brand which all consumers associate with a variety of exceptional technology products. In the last two decades it has tactfully transformed it’s brand from a Korean, blasé ‘copy cat’ into a innovation leader within its product category. Today it well surpasses its former competitor Sony and now goes head to head with the likes of Apple, dominating a whooping thirty percent of the smartphone market.

This process hasn’t happened over night, or without extensive and effective strategic planning. In 1993 Samsung CEO Lee Kung Hee revolutionised the organization by shifting the company’s marketing objectives to target new customers which it hadn’t previously competed for. Instead of differentiating themselves as an affordable alternative to brands such as Sony by producing cheaper, inferior knock offs of their products, Samsung rebranded themselves as an organisation that produced ‘lifestyle works of art’. It began marketing itself as a company that ‘produces innovative technology that brings genuine change to people’s lives’ with the intention of positioning themselves as a premium brand. It pumped huge investments into hiring a new team of savvy designers and managers to carry out its business and marketing objectives to develop new innovative products in the hope of targeting new customers in a more sophisticated market.

These efforts have lead to award winning recognition of their state of the art products and an astounding increase in sales. Today Samsung’s revenues are more than two and half of Sony’s at $196 billion dollars. Samsung has shifted it’s focus from the likes of Sony to Apple in recent years to dominate market share in the smartphone market.

The Galaxy smartphone differentiates itself to the iPhone by being slightly more affordable ($750 for the 64GB Galaxy S8 vs. $999 for the 64GB iPhone X and $1,149 for the 256GB iPhone X), offering a different operating system and even better applications such as a longer lasting battery, elongated display and better camera quality. With every release of the new smartphone, each feature seems to be bigger and better than the last, with Apple and Samsung trying to outdo each other. This creates the necessity for constant development of exisiting products. Apple initially dominated the smartphone application content with it’s App store, however Samsung created its own Galaxy App store to remain competitive.

Due to increased demand and market dominance, most app’s are now available for both Apple and Galaxy users. In today’s ever changing market, it’s simply not enough for a company to be content with just achieving its goals- it must keep evolving and differentiating itself and it’s products before it’s forgotten. Samsung has experienced this in the last year with the release of the new iPhone, cutting its global market share to 25%. Even though the Galaxy is still the leader of global market share (satisfying its marketing objective) Lee’s ‘horse that does not stop’ strategy reflects he’s desire to push forward to obtain new objectives to continue growing the company. One of the avenues of achieving this is through new product development. Even though Lee has admitted Samsung don’t as of yet know what these new products will be, they’ve invested $13.

4 billion dollars into new research and development, double that of its competitors to keep them ahead of the innovation game. It’s already put the wheels in motion to shape its future business portfolio. This creates a challenge for the company in managing it’s current business portfolio. Such huge investment requires Samsung to reassess its current business portfolio and assess which strategic business units (SBU’s) should receive less investment to fund the extensive research and development for future products. The Galaxy smartphone, according to the Growth Share matrix, would identify as a ‘cash cow’. It’s an established strategic business unit (SBU), has a whole 30% of smartphone market share and can be used to support investment into creating new products. On the other hand, another one of Samsung’s products might be characterised as a ‘dog’ (for this example lets use Tv’s). They might generate enough cash to support themselves yet they have low growth and low market share compared to other competitors in that product category, such as LG or Panasonic.

Samsung must now evaluate whether investment for their TV products should be withdrawn in order to fund newer investments in planning for their future business portfolio. It can be difficult assessing which SBU’s to withdraw investment from, not to mention a timely process for one of the worlds largest consumer electronics manufacturers to evaluate each of their SBU’s success. However offering such a diverse business portfolio also has it’s advantages. Firstly, there is safety in knowing that if the demand for one product declines, the increase in sales of another product will counteract the loss.

Offering a wide range of products can also help support the original product. For instance if you buy the Samsung TV it seems only logical to purchase along with it the DVD player and camera with the same operating system. And finally, offering a diverse range of products in different markets allows you to capture a larger portion of the overall market and increase total sales. Increases in sales over a diverse range of categories in turn increases brand awareness and captures value.

If consumers are satisfied with the performance of one electronic appliance they’re more likely to stick with Samsung for future purchases.  Even though Samsung investments billions of dollars into research development for their actual products and has received international acclamations for their sleek designs and ground breaking technologies, their core focus has always been on how the designs of their products satisfy customer needs, with the fundamental goal of ‘brining genuine change to peoples lives’. For most consumers the smartphone has definitely revolutionised their everyday lives. This is also the core focus behind Samsung’s expansion into the ‘Internet of Things’ market. Whilst other competitors in the market, such as Apple, are going their seperate ways and working to create incompatible systems, Samsung is going along to create software and hardware that does ‘right by the customer’ to give consumers more choice and flexibility. This is why I believe Samsung will be successful in achieving its goals of becoming a leader in the Internet of Things market.

Instead of being focused on their financial performance and blocking out the competition by limiting consumers to one operating system, their strategy is to improve the experience and connectivity of their customers. As consumers we value choice and flexibility, which would increase our overall satisfaction of the product itself. These new technologies will no doubt ‘transform our economy, society and how we live our lives’.  History is in Samsung’s favour based on their numerous strategic successes but I have no doubt Samsung and it’s ‘horse that does not stop’ strategic approach will be successful in remaining the leader in the technology game. 


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