SAMSUNG GALAXY BRAND EXTENSION ANALYSIS

Sowmya Godise, PGP30108 IIM Lucknow

PARENT COMPANY SAMSUNG ELECTRONICS

1938 Founded by Byung Chull Lee, Korea

1970s Market leader of black & white televisions and micro ovens

1980s Color TVs, Air conditioners, Personal Computers

1991 First mobile handset

1999 First wireless equipped phone-smartphones

2009 Galaxy

BRAND EXTENSION

Samsung Electronics

Category Extension

Mobile Phones

Line extension Samsung

Galaxy

BRAND EXTENSION ANALYSIS

Brand Equity

Samsung wanted consumers to think of Quality and specifications and build up the brand up to the lifestyle and features differentiating from other manufacturers

Brand Logo & Brand Name

Graphic element of galaxy to the visual of brand logo so that

a) consumers remember easily

b) Persisting brand name so that brand familiarity exists

Tagline

“Galaxy in your hands” states whole world in your hands, implying:

a) stay connected to most important people and receive updates from them

b) user can use it to the core and benefit out of it the most

MARKET SHARE

Samsung galaxy achieved NO.1 ranking in sales revenue and market share in the mobile phone market

2014 2013 2014/2013 growth rate

2012

25.2% 32.3% -3.9% 26.9%

2014 2013

Samsung 25.2% 32.3%

Apple 11.9% 13.0%Huawei 06.9% 04.3%

Manufacturer’s Revenue in Billion US dollars2013 2012 2011216.71 190.57 154.05

MARKET ANALYSIS

Samsung’s official Q1 2015 reports convey operating profit $5.63 billion and revenue of $44 billion

These numbers represent a drop in operating profits year-over-year, down from $7.8 billion in Q1 2014

Taking mobile sales into account, Samsung reports an operating profit of $2.5 billion on revenues of $24.1 billion

Reasons:

lowered tablet and feature phone sales

increased smartphone market competition

“strong competitive pricing” at the lower half of the portfolio

SAMSUNG GALAXY PRODUCTS

Galaxy Note Series

Galaxy Y Series

Galaxy S Series

Galaxy Tab Series

Galaxy Grand Series

PRODUCTS

• Best quality manufacturers of tablets and high end smart phones• Largest manufacturer of Android driven devices• By end of 2014 sold over 600 million cellular devices• Samsung comes with new model every month

PRODUCTS

• Business efficiency

• Security

Samsung Galaxy S5

• Professional lifestyle

Galaxy Note 10.1

• Ease of tasks

Galaxy note PRO

CHANNEL MARKETING

Samsung retail: sells products through supermarkets to expand their in-store share

Sales and service dealers: involved in corporate sales or own exclusive Samsung show room

Modern Retail: Viveks, Vijay Sales, Hypercity, Croma-exclusively prefer Samsung

Distributors: Scheme of single distributor in single city Eg: SSK distributor in Mumbai for all products in the city

PROMOTION

Newspapers and the electronic media help in promoting new launches as well as in informing about Samsung products and its goals

Celebrities are invited for the launch of a new productOften-famed celebrities like Amir Khan and Priyanka Chopra are made its brand ambassadors

Hoardings and posters are put up in the major cities

Samsung’s strategy is to use almost 5% of revenue generated from sales in promotion

Public relations, putting out new releases, writing articles for trade publications etc. are usually the part of promotional schemes.

PRICE

• Skimming Price technique:

Samsung gets a high value for a commodity before the competition sets in the market.

Once the product becomes old or faces a clash by other such products, Samsung reduces its price

• competitive pricing schemes:

Samsung doesn’t have the reputation of entering late in the market.

Doesn’t have to produce products at a lower price in order to catch up.

Instead, other companies have to price their products lower in order to compete with Samsung.

MARKET SEGMENTATION

• Geographic Segmentation:

Europe, US, South Asia

• Psychographic Segmentation:

People who are Android friendly & who do not prefer iPhone, tech savvy (latest), social addicts

• Demographic Segmentation:

IT working class, students, 18-35 age group

ALTERNATE PRODUCTS

BRAND EXTENSION ANALYSIS

Target customers:

a) 18-30 year old users

b) Young and social addict

c) Value based

d) App necessity driven

Points of parity: operating system, product features, innovation

Points of difference: more features at low cost, constant innovation, first mover advantage in smart phone category

REFERENCES

• http://www.portal.euromonitor.com/portal/analysis/tab

• http://www.marketing91.com/marketing-mix-samsung-galaxy/

• http://www.portal.euromonitor.com/portal/analysis/tab

• http://www.in.techradar.com/news/phone-and-communications/mobile-phones/Samsung-Galaxy-S4-vs-iPhone-5S/articleshow/38596123.cms

• http://www.business-standard.com/article/management/samsung-goes-for-galaxy-shower-113070400966_1.html

THANKYOU