COURESE INTERNATIONAL MARKETING topic discuss the market segmentation of samsung

NATIONAL ECONOMICS UNIVERSITY SCHOOL OF ADVANCED EDUCATION PROGRAMS COURESE: INTERNATIONAL MARKETING Topic: Discuss the market segmentation of Samsung... Samsung diversified into many ar

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NATIONAL ECONOMICS UNIVERSITY SCHOOL OF ADVANCED EDUCATION PROGRAMS

COURESE: INTERNATIONAL MARKETING

Topic: Discuss the market segmentation of Samsung

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I Introduction of Samsung 1

1 History of the company 1

2 Samsung’s vision 1

3 Samsung’s mission 1

II Samsung segments in Korean market 1

1 Geographic 1

2 Demographic 2

3 Psychographic 2

4 Behavioral 3

III Samsung segments international market 3

IV Discuss the effective segmentation of Samsung 4

V Evaluate effectivity of Samsung’s market segmentation 6

VI Explain how the company combine its understanding of the market with its internal capabilities (SWOT MATRIX) 10

VII Discuss how the company differentiate and position its product for maximum competitive advantage in the marketplace 13

1 Comparison between Samsung Galaxy A51 and OPPO A91 in Vietnam market 13

2 The important of positioning criteria to chosen market 15

3 The company’s decision on positioning map 15

TIEU LUAN MOI download : skknchat@gmail.com

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I Introduction of Samsung

1 History of the company

The Samsung group is a South Korean multinational conglomerate headquartered

in Samsung Town, Seoul It comprises numerous affiliated businesses, most of them united under the Samsung brand

Samsung was founded by Lee Byung Chul in 1938 as a trading company Samsung diversified into many areas including food processing, textiles, insurance,

securities, electronics industries, shipbuilding industries, in particular, its mobile phones and semiconductors have become its most important source of income As

of 2020, Samsung has the 8th highest global brand value

2 Samsung’s vision

“Inspire the world, create the future” Samsung will inspire the world with

innovative technologies, products, and designs that enrich people’s lives and

contribute to a socially responsible, sustainable future

3 Samsung’s mission

Samsung focuses on the following components in its corporate mission:

Human resources and technological resources

Superiority of products and services

Improvement of the global society

II Samsung segments in Korean market

1 Geographic

Samsung supplies their products through Korean, both urban and rural They always improve and upgrade their goods to satisfy almost the customer’s needs and give the customers the best experience with their goods

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2 Demographic

Age: Samsung targets customers from teenagers like 16 to the olders like 65 years

old In Korean Samsung products are popular, their mobile phones are used

everywhere from school, university and office… Samsung phones are diversified with modern design, from trendy to luxury; therefore they are suitable for the

youth, business, workers…

Family size: Samsung products are offered for all family sizes.

Gender: Samsung products can be used by both males and females Their phones

have many colors, the pink for girls who like trendy and attractive, even they have the blue for the man like comfortable and optimistic

Income: Samsung products are offered with various features to every income class.

Samsung mobile phones are supplied with many ranges, each of range is suitable for the one class, from upper class, middle class to low class Samsung Galaxy Note- one of the most modern forms of phones that Samsung supply with the large screen and S-pens attached the phones, which brings the effectiveness for using With these features, Galaxy Note is suitable for the upper class, who have

1.500.000 won each month to 2.000.000 won Samsung phones also have other ranges of products that have 100.000 won, 600.000 won… that attractive the youth and workers who don’t have much income per month

Occupation: Samsung has divided the customers into different groups based on

their occupation: businessmen, self-employed, students…

3 Psychographic

Lifestyle: Samsung is offered for customers who are from teens to olders who like

trendy, modern, elegant, who like new technology and can afford to buy it

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4 Behavioral

Benefits: Customers are also targeted differently based on the benefits that

Samsung provides Some people may want good quality, some may want the

simple appearance and effective…

User status: Samsung wants to know the user status in order to supply the best

products; therefore they divide the users into ex-user, potential user, first time user, and regular user

Loyalty status: Target market of Samsung may contain people with different

loyalty status; therefore Samsung separates their customers based on their loyalty: hardcore loyals, split loyals, shifting loyals, switchers

III Samsung segments international market

Besides the inner market segmentation of Samsung, we can discuss how they

segment their markets in international market There are 3 factors that can affect to Samsung to broaden its market

Geographic: Samsung has a large market, their products appeared in 80 countries

in the world They divided the market into different regions, such as they have divided the Asian market into northern, eastern, and southern areas Each market they have different strategies and different prices Samsung makes slight variations

in languages and applications to adopt the languages of customers

Political- legal: Samsung focuses on finding a good environment to develop,

which means politically and legally A country that has a good environment will

promote their goods, keep good quality, safe and are consumed better Cultural:

Samsung always changes the approach to customers in different countries based on the way the people consume For example, Samsung knows about the US market, the behavior of them They like technology and they are able to pay money for their hobby However, they are intelligent customers, when the

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economics is not stable, they take a decision carefully Therefore, Samsung sells products through the internet to reduce the fee and through the store which is

expert in technology, not through mass retail like Wal-mart

IV Discuss the effective segmentation of Samsung

Measurable

Only about 10% of Samsung's revenue comes from the domestic market, so

Samsung focuses more on international market

Moreover, Samsung’s IT & Mobile Communications segment is expected to

contribute about $86 billion to Samsung’s Revenues, accounting for about 43% of the company’s total revenues So, target customer of Samsung focus on people who follow the latest technology trends Based on the table above, we can see that

Samsung’s customers are mainly between the age of 25 and 34, and their lifestyles are driven by heavy consumption of TV and digital media

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According to counterpoint, in 2020, Samsung is still the leading smartphone

market share in the world, with about 20% in the first 3 quarters of the year and

down to 16% in the fourth quarter In Vietnam, Sam Sung takes up 24 %

smartphone market share

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Xiaomi 10% 10% 13% 11%

Accessible

Samsung Electronics has assembly plants and sales networks in 74 countries, 9

factories producing mobile phones globally, and employs around 290,000 people

The store network helps Samsung to understand customers better, meet as much

them as they can and approach more people

Differentiable

Samsung has decided to sell its products from low-cost to high-end This makes

Samsung easy to reach many types of users, suitable for many industries as well as the purpose of using smartphones of customers and significantly increases sales

Moreover, the launch of devices in all price segments of Samsung also helps users

to have many options, from price to features Customers can consider which

products to buy based on their economy as well as their own needs

V Evaluate effectivity of Samsung’s market segmentation

Samsung Electronics is a global leader in consumer electronics, semiconductors,

telecommunications, and digital media technologies with 236.81 trillion in revenue

in 2020

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Along with Apple and Huawei, Samsung has become one of the leading brands in the smartphone market In particular, Samsung still leads the Vietnam’s

smartphone market with about 38% market share

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Samsung has been the world's largest television manufacturer since 2006 and is the world's largest producer of LCD panels Samsung Electronics topped the global TV market for the 15th consecutive year, according to market research firm, Omdia Newly released data notes that Samsung Electronics retained the largest annual category market share by revenue in 2020, at 31.9% Besides, Samsung accounted for 53.5% of 80-inch or larger TVs sold in the third quarter in terms of sales value

We think that Samsung should choose a differentiation strategy targeting a number

of different market segments, such as the segment for people who like technology,

or like convenience, or fashion, Because of diversification with products and marketing strategies for customer segments, Samsung can meet the diverse needs and desires of the market As a result, businesses have the ability to increase sales and penetrate deeper into many market segments

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VI Explain how the company combine its understanding of the market with its internal capabilities (SWOT MATRIX)

* Samsung’s strengths (Internal strategic factors)

1 Strong Brand Image

Samsung has maintained the image of an innovative brand that delivers superior quality products However, it is essential that Samsung maintains its image if it wants to retain its growth momentum

2 Dominates the Smartphone Market

Samsung has dominated the smartphone market for years According to Gartner, in Q1 of 2020, Samsung has maintained the No 1 spot globally with a 18.5% market share, where as Apple is at 13.7% market share

3 Research and Development

The foundation of Samsung has always been on Innovative research and

development Expenditure in these departments resulted in the company having a wide range of product portfolio among its competitors These include tablet,

camcorder, mobile phone, camera, TV/video/audio, Memory Cards, PC, and other accessories They have 34 R&D (research and development) centers operating worldwide

4 Large product diversity (Stability on sale)

Samsung has a huge number of products in its product portfolio, it offers different types of products to its customers In return, the profit it makes is very much

stable When the sale of one product goes down, other products may be

experiencing an increase in sales

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* Samsung’s weaknesses (Internal strategic factors)

1 Weak position in China

China has grown into the world’s largest market for smartphones followed by India Huawei leads the Chinese market with the largest market share followed by Vivo, Oppo, and Xiaomi Samsung has a small and almost negligible share in the Chinese market Its market share in China has kept fluctuating between 0 and 1%

2 Heavily dependent on the American Markets

It is estimated that both Apple and Samsung sold at least 70.8% of smartphones in the USA While Samsung has diversified its resources and expanded its operations

in Asia, it is still heavily dependent on the American markets The American

economy is very unpredictable and another recession could put Samsung’s

revenues in jeopardy and can damage its operational resources That’s why

Samsung needs to involve itself into the Asian and European markets to ensure sustainability and avoid potential failures if the US economy ever collapses

3 Decline in Smartphone Sales

Samsung has been experiencing a decline in smartphone sales since 2017 A

similar trend was seen in China due to the price sensitivity of the Chinese market They dump a lot of those products in the Indian market at a lower cost which

harms the Samsung sales Samsung has tried to shift more focus in India, but that strategy did not produce substantial results for the company

4 Too Large Product Diversity (lack of focusing on specific one)

It takes a lot of work if the product portfolio is large It cannot be possible to give concentration to each product with the utmost importance

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* Samsung’s opportunities (External Strategic Factors)

1 5G Technology

As the world moves to 5G, Samsung has the capacity and know-how to exploit this opportunity The company is already in active commercial discussions with

operators in the EU to supply 5G and 6G network equipment Samsung is one of the top companies in the UK’s list of potential 5G providers

2 Growing demand for digital services

The demand for digital services have kept growing over the past several years However, the demand for these services was boosted further due to the coronavirus since a large number of people were leading lives locked up inside their own houses and had to depend on digital services for several things ranging from ordering essential products to entertainment Most of the people around the globe use their smartphones to avail of online services whether it is e-commerce or entertainment

3 Acquisitions and diversification

There are emerging opportunities in several areas including the latest technologies like AI, IoT, self-driving cars, and other technologies Samsung has made several acquisitions in its history These acquisitions have helped the company cement its position in the electronics and smartphone industries

* Samsung’s threats (External Strategic Factors)

1 Virus corona

The largest economies and markets like the US and China have also felt a severe impact as unemployment levels ran very high as the pandemic broke out In such

an environment, the sales of Samsung products were bound to fall and they did

2 High competition

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Despite being the global leader in the smartphone industry, Samsung is facing a lot

of competition from China and the US-based smartphone manufacturers Its leading competitor is Apple Apple’s iPhone range is globally famous and it is the main

rival of Samsung’s Galaxy range of smartphones In the US market, there are more

smartphone brands competing with Samsung including LG and Lenovo as well as

One Plus In the other leading smartphone markets too such as India and China,

there is a lot of competition from the Chinese brands as well as Apple

VII Discuss how the company differentiate and position its product for

maximum competitive advantage in the marketplace

1 Comparison between Samsung Galaxy A51 and OPPO A91 in Vietnam

market

* Product differentiation

Price And Launch

The launch Date of the first phone is December 20, 2019 The Expected cost of

OPPO A91 is 6.990.000 VND The launch Date of the second phone is January 29,

2020 The cost of Samsung Galaxy A51 is 7.990.000 VND

Display comparison

Samsung Galaxy A51 has larger screen size of 6.5 inches in comparison to OPPO

A91's 6.4 inch screen OPPO A91 has AMOLED Screen type where as Samsung

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