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Loyal3 Own What You Love Case Study Solution and Analysis


Introduction

Historically, the business's core consumers include the Original Devices Manufacturers (OEMs), which utilized to offer Loyal3 Own What You Love Case Study Solution products withtheir own brand name. Its customer circle consists of Original Devices Manufacturers (OEMs), who utilized to sell Samsung products with their own brand name. He repositioned Samsung as a global brand and educated his divisional supervisors to comprehend marketing and its importance.

Issue Statement

Samsung's shift from a product based to a marketing company is not going as efficiently as planned.Overcoming the unwillingness of divisional supervisors to integrate marketing effectively is still a major difficulty. Creating a consistent brand identity throughout the entire world and employing marketing methods that best fits the regional culture is no easy task. The M-net program analysis have actually been actually helpful in determining the high and less potential growth areas, but allotment of resources appropriately is not well gotten amongst the managers. There is no agreement amongst the hierarchy relating to the best fit future method.

Situational Analysis

Loyal3 Own What You Love Case Study Analysis efforts for developing its brand across the world was begun after introducing the "brand-new management initiative" by Chairman Lee in 1993. The goal was to change Samsung from a low-cost OEM to a high value-added item provider. To make the vision of Samsung a reality, Chairman Lee designated Yun as a vice chairman in 1997. Yun had a rather clear picture in his mind about how Samsung can change from a low end to a luxury item company. He knew that improvement can only be done through placing Samsung as a business using high-end products and this might just be done through high level of marketing.

In spite of having a clear vision about how to develop Samsung brand name, with a prospective assistance of its executives, Yun faced several marketing difficulties in early years of its efforts.

Among the marketing obstacles for Yun was the perceptions of executives about the value of marketing. They considered marketing and selling as very same tools and believed that quality products do not needed marketing for increasing sales. As their focus towards marketing was rather low in their previous service practices, and the current marketing requirement was excessive high, the gap was too broader and to fill this gap with wrong understandings about marketing was rather difficult for Yun.

As stated above, marketing focus was very low in previous practices, therefore there were no appropriate marketing budget plans for each of the product on the portfolio. There was no marketing preparation provided for the existing items. Together with it the product series of the business was increasing with the ripening of brand-new item concepts by the R&D sector of Samsung. Yun had a difficulty to carry out marketing planning and to create marketing spending plans for existing along with for brand-new items from the very start, and this would take a substantial time.

A huge shift would be needed in present marketing expenditures to build the Samsung brand. This would result in increased marketing expenses for Samsung and could disturb the administration concerning increased expenditures, as they were unwilling to marketing expenses previously and an abrupt big shiftwould make them disrupt.

Internal Analysis
SWOT Analysis
Strengths


Samsung strengths lie in its huge product portfolio. Samsung has biggest variety of patents in the market with total variety of 15499 patents granted in US( USP). Big amount of R&D spending has enabled the business to grow its item portfolio at a higher rate than its competitors. Loyal3 Own What You Love Case Study Help spent about $13.079 billion on its R&D sector in 2016, which is 7.3% of its total revenues.

Another strength of Loyal3 Own What You Love Case Study Help is its capability to establish innovative items at a constant rate. It significant shows for the innovation and product developing of Samsung is that the business has actually received a lot of awards for its innovation and product style.

Unlike Apple and other rivals, Samsung is focused on producing gadgets which can be quickly integrated with any type of open source Operating System (OS) and software. This supplies Samsung an edge over Apple devices.

Samsung's capability to produce high-end items at low expense of production is also one of the significant strength of Samsung as it allows the business to capture more market by offering quality products with cost control.

Weak points

Loyal3 Own What You Love Case Study Solution weak points are hidden in the company's dependence on outsourcing software for its gadgets due to business's failure in developing software application, unlike Sony. Samsung also has low profit margins as compare to Apple due to big distinction in the prices of Apple and Samsung with a much lesser difference in quality. The diverse focus of the business due to a great deal of items in its portfolio, result in the less effective production and make the company not able to charge greater costs like Apple. The business is likewise inefficient in managing its patents and frequently faces the problem of patent violation.

Opportunities

Opportunities for Loyal3 Own What You Love Case Study Help lie in the growing Smartphone market and the company's effectiveness in the market. Samsung currently runs in about 80 countries and the business has an opportunity to increase its geographical expansion by moving towards more emerging markets outside Asia.

Dangers

The dynamic market environment of innovation industry posture a severe risk on Samsung's survival and force the business to invest much of its revenues share on R&D in order to survive in the long run. The market saturation in developed nations i.e. saturation of mobile company is likewise a huge risk for the business's development in the existence of strong competitors like Apple.

4 P's of Marketing

Item

Samsung offers quality items and has a quite abundant portfolio which caters to various sectors. LCD and mobile phones are the biggest products of Samsung, whereas DRAM is also not far behind in comparison of them.

• LCD/ TV
• Laptops.
• Smart phone.
• Air conditioning system.
• Computer.
• Hard disk drives.
• Washing machines.
• Refrigerators.
• Video cameras.
• Microwaves.
• Flash memory.
• DRAM.

Cost.

Loyal3 Own What You Love Case Study Analysis utilizes both market competitive and market skimming pricing techniques for its wide variety of products. In competitive pricing it adjusts the cost according to the competitors in order to gain benefit, whereas, it utilizes market skimming method where the item has actually an added worth and by selling a couple of products it can reach break-even.

Place.

It has one of the best supply chain networks, with retail distributors, their own sole distributors, E commerce channels like Amazon and so on. All its products are timely provided to the selling location/ delivered to the clients directly in case of online order.

Promo.

It wasn't a widely known company outside of Korea until 1993. The management initiative taken by their CEO has pushed them to market more efficiently outside the borders and now it has actually gotten in the league of leading 25 business in the world in simply 9 years. This is an exceptional achievement regardless of the continuous arguments among the managers about adopting marketing practices. It uses both offline & online channels of promotion to market their products. Paid product ads, social promo and digital ads are utilizes to produce awareness about Samsung items.

Worth Chain Analysis.

It's an analytical structure for identifying company activities that include worth or competitive advantage for the business.

Incoming Logistics.

It has among the most reliable and efficient supply chain network and has more than 2700 suppliers throughout numerous industries worldwide. Almost 80% of which is based in Asia and the remaining all over the world. For its inbound logistics it owns different logistics companies as it subsidiaries. It cares for its suppliers and produces an unified relationship with them and even decreased their payment cycles to increase this relationship further which adds value to their chain network.

Operations.

Samsung's core competency is its mass manufacturing it produces 90% of its items in-house. Divided into 3 various divisions its operations are particularly IT & Mobile Communications, Device Solutions and Customer Electronics. It is preserving operation hubs worldwide to further add value to its value chain network.

Outbound Logistics.

Its outbound logistics system efficiency is one of the main factors Loyal3 Own What You Love Case Study Analysis has the ability to take on Apple. Samsung's own Electronic Logitec system plays a major function in the outbound logistics operations. It even carries out the tasks of collection of payment, settling insurance claims, etc. on behalf of Samsung.

Marketing and Sales.

Drawing in target consumer attention towards the product is done through marketing and sales to interact with them the worth and competitive advantage the item uses. Loyal3 Own What You Love Case Study Analysis marketing spending plan is continuously rising since they began their repositioning internationally and will continue to do so as they are continuously aiming to invest and expand in high prospective development markets. The budget is spent on events, print and media ads, public relations and so on.

Samsung Service. Samsung put their clients at the top and continually aim to deliver unmatchable customer support standards. As after sales service is ending up being extremely crucial to keep customers happy and engaged, they even carry out studies through 3rd parties to learn their consumer's feedback and execute it in the favorable way to reduce or if possible entirely remove their consumer problems. By adding a direct assistance line to contact them 24 hours they have actually even more increased the added worth of Loyal3 Own What You Love Case Study Help service.

Division.

Loyal3 Own What You Love Case Study Solution has diversified market division, based upon its arrangement of wide variety of products to large number of consumers. Samsung target client sections can be divided into 3 classifications i.e. Loyal3 Own What You Love Case Study Solution IT and Mobile Communications, Samsung Customer Electronic Devices and Samsung Gadget solutions.

Geographical.

Loyal3 Own What You Love Case Study Help geographical division is based upon 2 requirements i.e. area and density. Samsung serves about 80 countries worldwide with its products provided to Urban in addition to Rural areas of the country. The Samsung is likewise growing its global presence and the company's versatility in finding its plants encourages global expansion of Samsung.

Demographic.

Samsung produces products that can be used by both females and males. The target clients for Samsung IT and mobile communication items have an age range of 18-65 with bulk at a young or recently married life cycle stage. Apart from it, Samsung Consumer Electronic devices are targeted to a client sector with an age variety of 25-65.

Psychographic.

The psychographic segmentation of Loyal3 Own What You Love Case Study Solution s based upon the social class and the lifestyle of the consumer. Samsung target consumers on the basis of social class are mainly upper middle, middle and working class consumers, as Samsung offer items like cellular phone not much less expensive i.e. Motorola along with very little costly i.e. Apple. It offers quality items to middle level customers at a somewhat high cost than others targeting the exact same sector.

Behavioural.

Loyal3 Own What You Love Case Study Analysis majority target clients have distinct behavioural characteristics. It has clients with an ambitious, fashionable and figured out personality with moderate level of loyalty towards the brand name. Its clients have some degree of shift towards other distinguished brands i.e. Apple. The majority of Samsun consumers desire quality along with expense control. Since of its moderate prices with a level of quality, they are attracted towards Samsung.

Quantitative analysis.

Sales of Samsung has increased remarkably from 16 billion $ in 1997 to 44.6 billion $ in 2002, and the net earnings of.48 billion $ to 5.9 billion $. It has also reduced its financial obligation from 15 billion $ to 4.6 billion $. Digital media is the largest selling classification of Samsung with sales of 13.9 billion $, whereas, Telecommunication and Semiconductors sectors both reached 11 billion $ in sales. Revenues/ sales are increasing but net revenue is not increasing appropriately because of the high overhead expense. New expansions and working with's were the main factor of the boost in the overhead expenses, with china presently not providing any profit to Samsung, however there is so much capacity in the present market with 75 % yet to be checked out.

Qualitative analysis.

Yes, this decision is based on the objective of Kim to target the more youthful audience and create a worldwide brand name image of the company. Whereas, the core strength of the company is presently manufacturing but long gone are those days when great items were offering themselves. In the present age marketing is really essential and companies can not succeed without it. Kim has actually currently started to enhance the marketing activities of Samsung and soon it will become one of its core strength like making if not better.

VRIO.

Worth.

Samsung runs styles, makes and sell a large portfolio of customer electronic devices. It runs in an incredibly competitive environment and has actually effectively positioned itself as the maker of quality products. The response is yes.

Rarity.

As, said earlier that Loyal3 Own What You Love Case Study Help runs in an extremely competitive environment, which implies all the companies have similar items. So, the answer for rarity is no.

Imitability.

Due to the nature of the market, it is very easy for rivals to comprehend the performance of the items and quickly make their own designs. Yes, Samsung is just behind IBM in signing up brand-new patents yearly, but the advantage is very short term in this market.

Organization.

Chairman Lee has totally turnaround Samsung, from going almost bankrupt throughout the Asian monetary crisis of 1997 to the leading 25 business in the world. Certainly yes there is proper company in the company and the results promote themselves.

External Environmental Analysis

PESTLE Analysis

Political

Being an international brand spread almost in every country worldwide, bulk of the environments like USA, Europe, China etc., are extremely conductive for its operations. However, it deals with some political pressures in less industrialized countries where law and order circumstance is not good. Latin American, African and some Asian countries fall in this classification, where political instability do have an effect on Loyal3 Own What You Love Case Study Analysis operations.

Economic

Buying power of clients is important for companies like Samsung to succeed and grow. Emerging markets like India, middle-eastern countries etc. provide growth chances, whereas, due to economic crisis even the customers of industrialized nations suffer badly. It is very crucial for the company to keep an eye on the continuous financial scenario of the country before going into the market.

Socio-Cultural

International companies need to face various social and cultural concerns throughout its operations in a foreign country. Samsung has actually also dealt with numerous concerns however have actually adopted to the regional environments of the majority of the countries remarkably well. It has customized its products, practices, policies etc. appropriately in order to succeed.

Technological

With an annual expenditure of 2.4 billion dollars in Research & Advancement, and with constant innovative item launches, Loyal3 Own What You Love Case Study Solution is among the leading innovative companies of the world. With a clear mission to be ahead of the rest when it comes to technological improvements, Samsung has actually increased to the no 25 of the leading successful companies of the world.

Legal

Each country has their own laws and policies, being a multinational business Samsung need to strictly follow those laws in their jurisdictions. Failure to do so, will result in major legal effects. It has to study or hire a local law professional before beginning its operations in a particular country.

Environmental

With the increasing awareness amongst customers about the ethical & environmental violations of companies, Samsung needs to make sure that it follows all the security standards. Environmental damages, ethical misbehaviors are not acceptable and in some nations the effects can be very serious. On the other hand it has to do some Corporate Social Responsibility practices to show the residents that it appreciates their environment and individuals.

Porter's 5 Forces

Risk of Alternative

Risk of replacement for Samsung's each product classification is quite significant. Aspects for high risk of substitution for Loyal3 Own What You Love Case Study Help Mobile phone consist of the existence of high number of suppliers and Market saturation in developed countries, which make the expense of changing for consumers practically absolutely no. Along with it, Samsung printing solutions items are threatened by the increasing tourist attraction of clients towards cloud storage.

Rivalry Among Existing Firms:

The rivaly among Samsung and its close competitors is extreme. The significant factor behind this is the method of market saturation in various variety of product categories, requiring Samsung to introduce more innovative features in existing items and brand-new ingenious products to preserve its development. Other aspect for the intense rivalry amongst the rivals is the little item distinction among the products. The popular gamers in the technology market are quite aware of the importance of R&D spending for their survival and are running into a race of marketing and R&D costs, to record the marketplace. The major rivals for Loyal3 Own What You Love Case Study Solution samrtphones consist of Apple, Motorola, LG, Nokia, Huawei, OPPO etc. High competition rivalry results in the varying market shares which can be seen in Display F.

Bargaining Power of Providers:

Loyal3 Own What You Love Case Study Solution has a huge supply chain including about 2700 providers across the world.( Samsung Sustainability Report, 2016) Provider's bargaining power for Samsung is low as Samsung runs economies of scale and its orders are of prospective size and worth. These big orders make it possible for Samsung to work out rates with its providers. Nevertheless, due to incapability of Loyal3 Own What You Love Case Study Help to build its own software, it needs to outsource its software application development to Google, which becomes a potential supplier of software for Samsung, leading to high bargaining power of Google. In many of Loyal3 Own What You Love Case Study Analysis has a power to negotiate rates, but it provide significant prices to its providers to construct a strong supply chain and to have strong relationships with its suppliers.

Bargaining Power of Buyers:

Bargaining power of purchasers for various number of product categories of Samsung is extreme. Among the factor leading to the intense bargaining power is the schedule of large number of rivals in nearly each item category i.e. rivals of Samsung Smartphone, with a really little distinction. The high accessibility of providers of Smartphones with minimum differentiation, make the changing expense for purchasers practically zero, for this reason increasing the bargaining power of buyers. Market saturation in most of the item categories also make the bargaining power of buyers more extreme in for Loyal3 Own What You Love Case Study Help. In spite of igh bargaining power Samsung is quite capable of selling its products at a higher price than much of its competitors, due to high end quality product and a fair brand name image.

Hazard of New Entrants:

Danger of new entrants for Samsung is quite low. Among the significant element for low danger of new entrants is the high competitors in the market. The requirement of huge amount of capital to go into in the market is likewise among the possible barrier to entry. Along with it, requirement of substantial expertise and research and development expenses for survival in the industry also make brand-new entrants reluctant to go into in the market. Market saturation is likewise one of the barrier of entry in technology industry. High bargaining power of suppliers force the players in the industry to charge as low rates as possible and this can just be achieved by production performance. New firms, in bulk cases, do not have the production effectiveness, for this reason increasing the risks for entrance in the technology market.

Competitive Analysis

Samsung's high product diversification supplies it distinction from its rivals. Unlikely to its close competitors including Sony, Intel and Nokia, who focus bulk on a single product category with Sony focusing on customer electronics, Nokia on cell phones and Intel on chips, Loyal3 Own What You Love Case Study Solution had a big R&D costs on all of its product classifications which enable the business to make prospective income from sales of nearly all of its products.

The business ranks initially in 4 product classifications i.e. DRAM Chips, LCD Displays, Cinema Televisions and Microwave ovens, in terms of worldwide market share, among 8 various item categories. Samsung was the worldwide leader in making DRAM, SRAM and NAND flash chips. Samsung earnings from chips was less than Intel however its earnings from chips was growing much faster than Intel and has grown close to the revenue levels of Intel, as provided in the case Display 2.

In addition to the chips Samsung mobile market was likewise thriving at a high rate than its rivals i.e. Motorola and Nokia. Samsung's mobile phone's sales development was 51% as compare to Motorola with only 4% and Nokia with no sales development. The significant reson behind Samsung's high growth despite of higher prices than Nokia and Motorola was the business's high-end quality cellular phone.

Samsung was likewise reaping the benefits from increasing market share of high-end LCDs as given up case Display 3. The major reason, making the business allow to get the opportunity is its mass production at low cost. Sony was the greatest competitor for Loyal3 Own What You Love Case Study Analysis in LCD market, however, it had actually also begun joint venture with Samsung in 2003 for LCD manufacturing, reducing the competitors for Samsung.

Porter's Competitive Strategy

Low Cost Leadership method of porter is totally implemented by Samsung the way they achieve economies of scale by strengthening their core competencies of manufacturing. Even to the point that their competitor SONY decided to form an alliance with them to make for them, due to the fact that they were not able to compete with them on low cost. Differentiation is another strategy well implemented by Samsung by constant financial investment in the R&D and staying ahead of the competitors. They always bring something ingenious and brand-new whether it's a product or a service.

Alternatives

Alternative Solution 1

The Chief Marketing Officer (CMO) of Loyal3 Own What You Love Case Study Solution would produce a new brand image by targeting the younger generation of the specific nation. As, specifically smart phones of Samsung are popular among the more youthful market.

Pros

1. It is the very best technique to develop Client Life time Value (CLV) by developing a long-lasting relationship with clients. Construct loyalty through providing worth and reap the benefits for long-term, as research has actually showed it is more affordable to keep current customers than to bring in new ones.
2. Another pro of this alternative is that word of mouth spread quicker amongst more youthful people and which in turn will generate brand-new customers for my items.

Cons

1. Old clients who were connected with Samsung prior to might not like this new image the company is trying to portray.
2 It will sustain additional expenditures to rearrange some items and it might not even bring success as the patterns alter very rapidly among the more youthful group.

Alternative solution 2.

Samsung has made producing its core proficiency for the a lot of part of their organisation and due to which its managers are not scared to completely get out of their convenience zone. It would be done by organizing training workshops throughout which value of marketing will be taught and numbers will be provided. Failure to get the passing scores will get benched. Marketing environment should be produced internally initially as real marketing starts inside the corporation.

Pros

1. Its pro will be that all the marketing method advocates will come out and likewise the opposite ones.

Cons

2. Its con can create a really unhealthy environment in the work environment, as people typically withstand change because they fear it.

Determine the very best alternative

First alternative is the best as it plainly has more pros since when a Client Life time Worth is developed the company will profit from it till that consumer is alive and has purchasing power also. Plus, our target clients are the younger generation which are bound to live longer than the current old age people. Samsung's main objective is to produce loyalty amongst its consumers and make them repurchase it from them and even buy their different items.

Implementation Plan

• Targeting younger generation through social marketing, developing a relate to them like Pepsi finish with music. And set the expectations achievable and realistic.
• A team including finest marketing and sales professionals need to be assemble, and both views must be taken into account prior to protecting the resources required to carry out the plan.
• Thorough communication of the strategy should be done as it is really important for everybody to be on the very same page to make it work.
• Tasks and timelines need to be develop and interacted accordingly to each person responsible.
• The supervisor should use a control panel which reveals the development of all the jobs which have actually been done or about to be done and by whom.
• The supervisor ought to keep track of and keep a consistent look at the overall and specific efficiency.
Due to the fact that any new trend or policy may come in due to which all the things already prepared have actually to be adjusted, • Everyone must be willing to adjust midway. It's much better to have contingency strategies currently prepared.
• At the end of the project the manager must interact the outcomes and if successful should commemorate with the team.

Budget plan

This change the budget plan allocation of various nations and many supervisors were unhappy and argued but the analysis done by the program was precise and revealed figures like North America and Russia growth potential warranted a 35% allowance while they were getting 45%. It truly helped to relatively distribute the resources and catch more clients by investing more on ads on the high growth capacity regions of the world.

Conclusion

Loyal3 Own What You Love Case Study Help is a leading 25 company on the planet now and prepares to get ahead of Sony who sits currently at no. 20. Its constant financial investment in R&D and innovative practices have actually propelled them to new heights however for them its' just the start and they wish to be amongst the leading 3 brands in the world. They totally turn-around from practically going bankrupt during the Asian Financial Crisis to a world renowned brand, understood for quality and innovation. Their value chain and their core proficiency their production ability, along-with international brand name image building have seen their sales go from 16 to 44.6 billion $ from 1997-- 2002. With additional growth in China and other emerging markets those numbers will only increase even more in the future. Their marketing efforts must be directed towards younger market amid the internal arguments about marketing and ought to create Client Life time Value as it will not just give them advantages now however will continue to reap it till the consumer lifetime. As the cost of keeping the consumer is more affordable than bring in a new one.