Samsung is best known as one of the world’s biggest sellers of smart TVs, it is also the world’s second biggest handset seller after Nokia. To explore Samsung’s success this report develops a theoretical framework for analyzing their strategies in UK market, it first explores the external conditions for Samsung Company and their competitors. A major part of the report is devoted to analyzing Samsung’s resent strategies and perceiving the strategic issue they have. The strategy suggestion is applied in the last past of the report to solve the strategic issue.
2. Samsung’s Mission and Vision
Samsung mobile’s vision is guided by a extraordinary vision that to lead the digital convergence movement. Samsung believe that through technology development today, they find the solutions address the challenges of tomorrow. They also aim to develop innovative technologies and efficient processes that create new markets, enrich people’s living and continue to make Samsung a market leader with high reputation. All they do is leaded by their mission: to be the best “Digital-Company”. Samsung became a global corporation by facing challenges. In past years, their dedicated people would keep to embrace many challenges and come up with new ideas to develop products and services that lead in their markets (Samsung UK website, 2010).
3. External Analysis
External analysis is very important to the firm to understand the market environment and find their opportunities and threats.
3.1. PEST Analysis
Political, economic, social and technological factors can direct and indirect affect Samsung. Political: Confusion over the rate of growth for short-term future, plus confusion as result of different policies from political parties. They announced reduction of import tax for international company therefore if they win the election Samsung can have incentive tax. Economic: 6.1% decrease in sale due to recession
Consumer buying power has strong impact on their choice of product. If in a booming economy it may promote more differentiated goods. and if in downturn, most industries will be facing difficulties however this may help growth of sub sector (strategic groups) that offer value for money (H. Adrian & R. Alison, 2008). Although smart phone are expensive, their perceived value is high which may explain the increase in sale in 2009. Social: More differentiation in the market segment. Worldwide mobile phone sales totalled 286.1 million units in the second quarter of 2009; a 6.1 per cent decrease from the second quarter of 2008, according to Gartner, Inc. Smartphone sales surpassed 40 million units, a 27% increase from the same period last year, representing the fastest-growing segment of the mobile-devices market (S. Holly, 2009). Technological: Customer demand better technology, easier to use everyday
3.2. Strategic group analysis and strategy clock
Industry analysis is that which industry Samsung mobile division operates in, for a firm such as Samsung which is diversified, there needs to be an analysis for each of its divisions separately. Analysis of Samsung mobile takes account of handsets and infrastructure. However this report is dedicated to mobile handsets and not infrastructure such as radio transmission and reception equipment. Strategic group is defined by types of behaviour that firms may have in an industry, those with similar behaviour will be grouped in a group and each group could be analysed on range of attributes such as, their size, their scope of activity, internationalisation, resources, and research and development (H. Adrian & R. Alison, 2008). In mobile handset industry it could be said that major players in the market (Nokia, Samsung, LG, Motorola, Sony Ericson) have fairly similar behaviour thus most of them could be placed in one group (Normal). The other group consist of low price handsets such as Nckia and Samsung etc. And there is another group (luxury phone) that includes...