Consumer Electronic Goods of Samsung and Philips - Assignment Example

? Mid Term Assessment Consumer Electronic Goods Samsung and Philips 29th October of the Companies Marketing is a tool to sell the product or service. It is sold to a target audience. They are the customers of the brand. It is very important to understand what things, products or services to offer and at which time. When things are in demand their supply increases. Companies manufacture different products to boost sales and returns. To form a brand which is recognized and appreciated, years of hard work in all departments are required. To produce a product at its best is not the only focus; however, to sell it effectively, it is required to be advertised efficiently. Whether an awareness campaign is run or the product is promoted through magnificent advertisements, it is necessary to let the customer have knowledge about the company’s products and also to convince them to buy. This makes the consumer use the product time and again. Hence, in the long run the customers keep on buying the products promoted efficiently and promote it in front of others, which ultimately gives a boost to the sales. Consumer electronic goods are a huge business, and the two big names of the field are Samsung and Philips. 1.1 Samsung Electronics Co., Ltd Samsung Group was formed in South Korea, in 1969. Its headquarters has still been in Suwon since then (Michell, 2010, p. 43). The company started manufacturing home appliances. Just one year later, it formed another subsidiary partnering with Japan’s NEC Corporation to manufacture audiovisual devices along with better home appliances (Lee, 2006, p. 197). In 1974, they started making semiconductor and became the first in the country to produce semiconductors. By the 1980s Samsung had started developing DRAM up to 64 kb. Samsung Electronics launched its first mobile phone in 1988. By the early 1990s, the sales had been poor (Samsung, 2012). By 1996, the company had focused on advertising its brand to the sports lovers and sponsored Olympics, and is still sponsoring it as it works for them. From 1999 with Erick Kim working for Samsung’s global marketing, the advertisement of Samsung cell phones and flat TVs increased visibly. Samsung partnered with the top U.S. retailer Best Buy (Samsung, 2012). In 2009, they produced Giorgio Armani Smartphone B620 targeting the fashion conscious customers. The vision currently followed by the company speaks for their journey and improvement they are making towards the success. ‘Inspire the World, Create the Future’ describes new technologies, innovations and creative solution that Samsung is trying to sell under its brand. And by the improvement they have shown in the last years, becoming the top cell phone company and leaving behind brands such as Sony and Panasonic, their marketing strategies seem to pay off (Michell, 2010, pp. 43–80). 1.2 Royal Philips Electronics Philips Electronics was founded in Eindhoven, in 1891, by Gerard Philips and his father Frederik. It is one the largest and oldest electronic companies. It has three divisions and one of them is Philips Consumer Lifestyle that produces electronic appliances and personal care items (Haberberg and Rieple, 2008, p. 788). The company went in loss at the beginning but in 1895, with the joining of Anton Gerard, things became better. By 1912 the business had expanded to two more companies. By 1920, company had started producing a variety of products (“Philips Marketing Rethink Drives Profit Lift”, 2012). In 1939, they introduced an electric razor known as ‘Philishave’. Philips also produced radio sets and kept on improving them. After World War II the company started again at its headquarters and by 1949, it had produced television sets that set records. They made audio cassette, typing stenographer, portable radio, first ever boom box, telephone answering machine, video cassette recorder, CD, DVD and later Blue-ray. But the ‘Net Promoter Score’ way of marketing by Philips targeted only the mature customers (“Philips Marketing Rethink Drives Profit Lift”, 2012). By 2004, Philips had changed its tagline from ‘Let’s make things better’ to ‘Sense and simplicity’; it not only worked as a tagline to Philips but a way to make their products better. The company has had ups and downs in the last decade but now it seems to revive its brand advertisement, and the situation seems to get better. Philips works with the advertising company DDB and its digital unit Tribal DDB under the supervision of Van Kuych, the chief marketer at Philips (Haberberg and Rieple, 2008, p. 788). 2. Perceptual Mapping Perceptual mapping of the two companies’ marketing strategies before and after 2000 and before and after 2010 Philips Samsung Marketing through Advertisement and Campaigning High After 2010 Before 2010 Forming long-term After 2010 Relations with After 2000 Costumers High Before 2010 Low After 2000 Before 2000 Before 2000 Low 3. Target Consumers of Samsung and Philips The target consumers depend on the positioning of the brand. A brand may be positioned as sporty, smart or fashionable. For example, a cosmetic brand could position its products as fashionable and trendy by advertising through fashion icons. In the 1990s, Samsung was considered as a secondary option for Sony or Panasonic as the brand quality was considered low and its price was less. The company worked on improving this tag and worked in making their quality better in the eyes of its customers. It started associating itself with big names. For example, Samsung sponsored Olympics held in Japan, which was a step forward to target sporty costumers and as sports somehow appeals to the youngsters more, it also targeted young costumers. It also produced a smartphone designed by Armani, a leader in the fashion industry, to attract prestigious and wealthy, brand conscious customers. By the time they started competing with the mobile and TV industry, Samsung had produced innovations. According to the future vision, the company is trying to enhance its corporate image and create as much awareness of their products as possible. There focus is to entertain their clients to their best. They did not stick to the consistency concept; instead, they improved or at least tried to improve. Samsung manufactures a number of products but advertises what is most desired, which is an important point cited. Leaving behind Sony, Panasonic and Apple speaks itself for the success they had made in the 1920s. Samsung has truly motivated the costumers by making their products desirable. Every second person wants a Galaxy S3, even if they do not need it (Stonehouse, Campbell, Hamill and Purdie, 2004). Philips’ way of marketing is a way different from Samsung’s. The company has been in the industry for 110 years and has formed relations with its customers (“Consumer at the Centre of Philips Philosophy”, 2012). They believe in making and maintaining the quality of their products. The marketing strategy they possessed in the past years may be termed as old or obsolete (“Consumer at the Centre of Philips Philosophy”, 2012). They have made some advertisement campaigns in the recent years but on the whole, Philips wanted their customers to speak for their product, which is, to some extent, risky as not all customers would speak well. The target and priority customers for Philips are mature markets. This may be the reason why Philips does not focus on making products such as attractive cell phones. Despite all, they do consider the importance of forming awareness of their goods. They work on building product loyalty and quality and provide desired benefits; thus, there goal is more to fulfill needs than desires (Lamb, Hair and McDaniel, 2011). 4. Analysis of the Two Brands 4.1 Similarities Philips and Samsung both are two big names of the electronic industry, both have a long journey of ups and downs, but currently both are making profit as they are improving, whether it is in the marketing department or production. Both of them manufacture quality products and their customers trust and buy them. They both have changed their taglines and strategies at the same time and have their future plans clear. 4.2 Differences In terms of producing variety and modernizing their products, Samsung is way above Philips. It started making products such as cell phones and now laptops and tablets at the right time. Instead of remaining with the past, they are moving on. Samsung is now producing 3DTV which is future and justifies their tagline. Today everyone and everything are updating and that is what the two companies differ in. 4.3 Applaud or Criticism The marketing strategy of Philips is criticized because it is not generating any results, although this year they have started new campaigns but still have a long way to go. These products are reliable and durable, which is what Philips is always applauded for. Samsung had left that time era back when it was highly criticized and was considered ‘poor man’s Sony’. Now it is a brand everyone knows and wants. 4.4 Suggestions Philips should try to produce updated products such as cell phones and screens that are beautiful and sleek. They need people to desire their products instead of using them for years and years. It is great that one produces quality products, but they should be updated at the right time to get things going smooth. Customer satisfaction became a prime objective under the marketing concept (Kotler, 1972, pp. 20–21). One should let people know what one’s product has good in it before anyone else tells them why they should not buy them. Samsung had a problem with its quality and still there are people who go for Apple and Sony because they not only want a good product but also want them to get sold at a beneficial price. So their products should have more brains with the beauty they already have. 5. Conclusion The two companies chosen were Samsung and Philips. Both of them are huge names in consumer electronic goods. The major visible difference is the way they market their products. However, they are correct in their places. There is nothing wrong in the way they market their products. Nevertheless, it is very important to consider what the customer’s perception of a product is. It is very difficult to gather individual opinions about a product and if one succeeds in this task, it is a huge achievement (Yu, 2007, p. 187). Huge brands, however, do not have time to reach out to individuals one by one. Therefore, good marketing strategies are required. The companies should pay attention to the fact that their customer should gather information about the product before purchasing it so that the product is up to their expectations. The companies should keep a record of how their sales are increasing. The decision made by by a customer to buy a specific product is a result of someone recommending it, result of advertisements or browsing over the Internet. References Consumer at the centre of Philips philosophy, 2012. Marketing Week. [Online] Available at: http://www.marketingweek.co.uk/consumer-at-the-centre-of-philips-philosophy/3006200.article [Accessed 24 October, 2012]. Haberberg, A. and Rieple, A., 2008. Strategic management: theory and application. 1st ed. New York: Oxford University Press. Kotler, P., 1972. Marketing – management. Vol. 2. India: Pearson Education. Lamb, W., C., Hair, F., J., McDaniel, C., 2011. Essential of marketing. 7th ed. U.S.: Cengage Learning. Lee, D., 2006. Samsung Electronics: The Global Inc. 1st ed. LEE Dongyoup. Michell, T., 2010. Samsung Electronics and the struggle for leadership of the electronic industry. 1st ed. Singapore: John Wiley & Sons. Philips marketing rethink drives profit lift, 2012. Marketing Week. [Online] Available at: http://www.marketingweek.co.uk/news/philips-marketing-rethink-drives-profit-lift/4001287.article [Accessed 23 October, 2012]. Samsung, 2012. Samsung. [Online] Available at: http://www.samsung.com/us/business/ [Accessed 24 October, 2012]. Stonehouse, G., Campbell, D., Hamill, J. and Purdie, T., 2004. Global and business strategy & management. 2nd ed. England: John Wiley & Sons. Yu, F. L. T., 2007. Taiwan's economic transformation in evolutionary perspective entrepreneurship, innovation systems and government.1st ed. Taiwan: Nova Publishers. Read More