Byung-Chull Lee founded the South Korean trading company simply known as Samsung back in the late 1930s. But never in his wildest dreams would he have envisaged the company evolving into what it is today. With a series of mergers and acquisitions, Samsung would transition from a trading company into Samsung Electronics Industry Co Ltd by 1969.
Now a full-fledged multinational conglomerate, this global electronics brand would establish over 200 subsidiaries in different parts of the world. By 2020, the brand achieved its longstanding vision of being among the world's leading electronics manufacturing and distributing companies. The culture at Samsung Electronics Industry Co Ltd is to create innovative products that offer optimal value to its target audience.
Without a doubt, the success of Samsung Electronics Industry Co Ltd can be attributed to the quality of its value-added products. Samsung Electronics Industry Co Ltd is leading the way in producing Mobile devices and Home Appliances, including Televisions and Home Theatres.
However, these products would never exist without a well-orchestrated Samsung marketing mix. This report highlights Samsung 4ps (Product, Price, Place, and Promotion) strategies that have led to the continued success of the brand.
Samsung Product Strategy
Samsung Electronics Industry Co Ltd spends a tremendous amount of time and money on R&D. Research and development is key to the company delivering a wide variety of electronic products. At present, Samsung offers consumers five different types of products, namely;
- Mobile Devices: Samsung uses imitative positioning initiatives to produce affordable mobile devices that offer similar functionalities as Apple iPhones. The Samsung Galaxy smartphone and tablet collection, in particular, is very popular in the US and worldwide. Samsung also produces mobile device accessories like wireless earbuds.
- Memory and Storage Devices: Speaking of accessories, Samsung is also known to produce top-quality Memory cards, Portable SSD, and USB Flash drives.
- Television: Samsung is known for producing high-quality smart TVs. They also produce compatible home entertainment systems.
- IT & Computer: Samsung Electronics Industry Co Ltd also manufactures multifunctional devices, printers, laptops, computer peripherals, and monitors.
- Home Appliances: In addition to mobile devices, television, Iat, computers, and storage devices, Samsung is known for its quality home appliances. Some of the more popular home appliances produced by Samsung include Air conditioners, Refrigerators, Vacuum cleaners, Cooking appliances, and Washing Machines.
Samsung Price/Pricing Strategy
Samsung is a leader in the global electronics market, and the company has been able to achieve this by using a couple of pricing strategies. The first pricing strategy adopted by Samsung is the competitive pricing strategy.
Samsung is able to position its brand in the mobile device, television, IT & computer, home appliances, and memory/storage device market by offering quality products to consumers at competitive prices.
Samsung is a brand that most consumers are aware of and most consumers trust. This, in addition to a market competitive pricing scheme, has made Samsung products one of the most in-demand brands around.
The second pricing mechanism Samsung uses is a Skimming price strategy. With this pricing policy, Samsung is able to maintain its market share by regulating the price of its products. For example, Samsung may launch a new smartphone at a high price. However, the moment a competing brand releases a similar smartphone with a better price, Samsung will reduce the price of its own smartphone brand.
This way, the company can avoid being priced out of the market by other brands offering products that more or less offer identical functionalities and features. It goes without saying that the competitive and skimming pricing policies used by Samsung play a major part in seeing the company consistently record an annual revenue above USD$200 billion.
Samsung Place & Distribution Strategy
Distribution can rightly be described as one of the main strengths of the Samsung marketing mix. Presently this internationally renowned electronics brand sells its products directly to designated service dealers and retail outlets. These service dealers play a significant role in promoting Samsung corporate sales.
Also, it must be said that most electronics retail outlets around the world are obliged to have Samsung products amongst their product offerings. This is so because the Samsung brand is highly recognized and in demand.
Another way Samsung Electronics Industry Co Ltd distributes its products is by relying on an authorized wholesale distribution company. This company is usually strategically located in a country or region. The primary focus of the distribution company will be to distribute Samsung products to different retail outlets spread across their country or region of operation.
The retail outlets purchase the products at wholesale prices, leaving them with a lucrative margin from the sale of Samsung branded products. Samsung is also known to distribute its products via its official website as well as through various eCommerce sites.
Samsung Promotion & Advertising Strategy
Promotion is a key element of Samsung 4Ps, and the brand takes pride in its advertising promotional campaigns. Samsung uses advertising to reach out to the target audience and in positioning the Samsung brand in targeted consumer markets. The digital media plays an important role in promoting new Samsung products. The brand influences buying decisions with audio-visual viral ads available on cable television and social media platforms like YouTube.
Samsung also takes full advantage of star power by recruiting celebrities as brand ambassadors. These celebrities endorse both the brand and specific Samsung products. Traditional forms of advertising like billboards and posters are still in use by Samsung. It is not unusual to drive past a large billboard advertising a newly launched Samsung product.
These traditional ads are supported by aggressive digital marketing consisting of online ads, product reviews, YouTube unboxing videos, and social media messages on the likes of Twitter, Instagram, and Facebook (Meta).
Samsung also offers time-constrained promotional discounts to attract target consumers to buy newly launched products. Other promotional activities engaged by this reputable electronics brand include sports and event sponsorship.
Samsung’s marketing mix consists of the 4Ps of Product, Price, Place, and Promotion. This brand is known for manufacturing mobile devices, home appliances, IT & computers, memory/storage devices, and televisions. Samsung uses both competitive and skimming pricing mechanisms to position its brand in target market segments in terms of pricing policies.
The use of distribution outlets is still pliable, but they also distribute products via eCommerce platforms as well. Samsung Electronics Industry Co Ltd promotes its products in many ways. This brand deploys digital ads, celebrity endorsements, and event sponsorship in promoting new and existing products.
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Samsung Marketing Strategy & Marketing Mix (4Ps) by MBA Skool Team, September 29, 2021
Extensive Marketing Mix of Samsung - 4Ps with Explanation by Aditya Shastri