Week 3 Assignment ECO 365 1

Topics: Supply and demand, Costs, Cost Pages: 7 (1531 words) Published: May 18, 2015


Samsung Competitive Analysis
In today’s ever changing technological world electronics are continually improving, encouraging increasingly more users to upgrade with each new product release. Today, our marketing team will share with you the competitive landscape of our products at Samsung and products of our most challenging competitor.  This competitive analysis will review factors that affect demand, supply, and equilibrium prices in the market in which Ultra High Definition Televisions are operating and thriving.  Finally, we will lay out any issues or opportunities our organization may face concerning this landscape. Samsung, established in 1938, is one of the world’s top 10 electronics companies and is known as an electronic leader in its industry ("Samsung.com", 1995-2014).   Samsung has a commitment to cost effective processes, spearheading new platforms through innovative technologies, enriching people’s lives and maintaining its position as a “digital leader” ("Samsung.com", 1995-2014). Factors That Affect Supply, Demand, And Equilibrium

Since its initial introduction in early 2013, Ultra High Definition Televisions (UHD TV’s) are slowly but surely making their way into the market. Today, plasma, LED, and LCD televisions are the ones in high demand considering consumers are overall getting the best deal in terms of both pricing and features. However, in terms of the best visual impact a TV can possibly offer the 4K/8K UHD technology blows the lesser-advanced televisions out of the water.  There is no doubt that in today’s market UHD TVs are not within the average consumer’s price range.  With so many substitutions out there, spending $5000 or more just to maximize the quality of visual effects comes off as impractical and uneconomical, at least, for now. According to a forecast report by Strategy Analytics, by the year 2020 33% of households in the U.S. will have UHD TVs (2014). Currently, it has 6% of the overall TV market, with approximately 14 million units shipped globally and the majority making its way into households in China where prices are much more attractive (Mearian, 2014). The factors that affect the UHD TV’s market are centered around price.  Considering the elevated price on most of these units the demand is lower; however, plasma, LED, and LCD TV’s have a higher demand due to their more affordable pricing. Furthermore, the supply for Samsung’s units still remains high due to the current television demands. On the other hand, supply is directly related to demand and price, as the price for the UHD TVs continue to decline, so will the demand for the HD TVs resulting in a new equilibrium price. As more consumers will be shifting their desire from the HD TVs to the UHD TVs as the price continue to decline.   Opportunities Affecting Competitiveness

Samsung currently holds the title of industry leader within the TV and smart-phone categories thanks to an opportunistic move it made in the early 1990’s when they began a close relationship with the Russian Academy of Science. Russian experts in the field of science helped Samsung develop smart-phone software as well as image-processing chips in its digital TVs and refine its frequency-filtering technology that significantly reduced noise on handsets (Shaughnessy, 2013). But what really set the stage for the South Korean company was when Russian engineers introduced them to the concept of TRIZ, which is used for solving problems that require inventive solutions to overcome a dilemma or a trade-off between two contradictory elements.  Employees throughout the company, including the CEO, were trained to utilize TRIZ in their day-to-day operations.  By heavily investing in their employees, Samsung managed to create an innovative culture based on extensive training, repeatable methodology and creative elite formation, backed by the highest levels of management. Samsung reported making $165.0 trillion in sales in 2011, in which...
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