Samsung: The Making of a Global Brand - Essay Example

Samsung: The Making of a Global Brand What is a brand and what are its key components? Explain how the new non-OEM (Original Equipment Manufacturer) Samsung global brand meets and satisfies these requirements. A brand is anything that differentiates one seller’s product from that of his competitor’s. A brand may be a sign, a symbol, a color, a shape, a name, a design; any feature that becomes a differentiating factor for the product (Marketingpower.com, 1995). The brand is also the connection between the product and its end consumer and often, the consumers see the brand as an extension of themselves or a reflection of their lifestyles. For example, someone who always wears a Rolex may see the brand “Rolex” as an extension of his own persona and his luxurious, elite lifestyle. Chernatony and Riley (1998), in their research paper demonstrate the different tangible and intangible elements that make up brands. For example, some tangible qualities this research paper lists down are “symbols, slogans, name, logo, colors, brand mark, advertising slogan, trademark, functional capabilities, legal protection, presence and performance, physique, physical design and graphics”, ultimately anything that helps the product differentiate itself from competition. In listing down intangible components of brands, this research paper states “identity, corporate brand, integrated communications, customer relationships, positioning, user identification, relevance, advantage, bond, personality, relationship, culture, self-image, social and personal values, esteem, familiarity”. In effect the, a brand becomes the product’s differentiating identity. When Samsung was known as only an OEM producer, there were a set of tangible and intangible elements associated with its brand. Expected product quality was low, with high defect rate. Consumers thought of Samsung products as low quality, low price. Firms would only choose to buy from Samsung if they could not afford better quality or more expensive products from the more renowned OEM companies. The non-OEM, globalized Samsung brand stands for a completely new set of tangible and intangible components. It embodies high quality, modern technology, an integrated communication strategy, a bond with its customer base; it creates relevance by making its products usable and relevant to the lifestyles of its target audience. Meanwhile, Samsung’s new logo conveys stability and warmth through the use of the colors white and blue and advancement and evolution by using the elliptical shape. When it shed its OEM skin, Samsung transformed itself into an electronics brand with high end, high quality products that it made available and relevant to people of all ages and all walks of life. In effect, it adopted for itself a new corporate identity by changing its company logo from what it was before, when the company was an OEM brand. Samsung also altered the design of its products to be more aesthetically appealing and technologically balanced. In an effort to really embody its new, non-OEM brand, Samsung expanded into the production of cutting edge mobile handsets. In an effort to globalize, Samsung partnered with several US conglomerates which would also help it expand and establish its new corporate identity. Samsung also sponsored the International Olympics and the Nobel Prize Foundation to reach out to its customers and reestablish its image. Finally, to incorporate the brands key elements into the logo, it introduced the DIGITall campaign in 1999 and used to restructure and redesign its brand logo so that it now represented a more globalized brand that catered to consumers of any age and from all walks in life. 2. Why did Samsung reposition their brand away from being an OEM provider? When Samsung was known only as an OEM brand, its brand equity and brand image were really poor in the market. It was associated with low quality, poor technology and cheap products. When the brand was repositioned away from its OEM image, the immediate effect was an increase in the brand equity of Samsung. As defined by Wood (2000), brand equity is net value associated with the brand alone. It also measures the customers’ relationship and attachment levels with the brand. The value, strength and image of a brand, thus make up its equity or value on the market. Since Samsung wanted to improve its brand equity, among other things, it was critical that is positioning be moved away from being an OEM provider to a more globalized brand that offers high quality, high technology electronic solutions to end consumers. In effect, if Samsung were to modernize and globalize while improving its status in the market it would have to move away from its identity as an OEM provider and the connotations attached to being one. Samsung had plans to expand globally and capture new market segments while improving brand equity. To this end, they entered into partnerships with giant companies across the globe, redesigned their brand and cut loose old alliances while forming more profitable new ones. Samsung’s management also undertook corrective measures to improve the brand’s visibility in the market. As part of the expansion plan, Samsung announced in 1999 that it was aiming to be market leader in four specific markets; “personal multimedia, mobile multimedia, home multimedia and component business”. The company also invested heavily in research and development around this time. Consequently, they launched many innovative and technologically creative products that helped them capture market share in different markets and different product categories. Associating itself with the Olympics was also done as an effort to move further away from its past image as a low quality OEM producer. Samsung also invested heavily in integrated mass communication, through the radio, TVCs, print media and internet to reach its consumers and convey to them the new image it had created for itself. It entered into partnership with AOL Time Warner due to which its products were given high coverage in prominent magazines. A lot of emphasis was also paid to advertising and promoting the brand. The company called off its decentralized alliances and signed a contract with an American ad agency who would centrally design their advertisement and promotional campaigns. In 2001, they launched a centralized new campaign which portrayed that Samsung provided all kinds of products for all kinds of people. This was in line with the company’s globalization initiatives and in order to transcend cultural boundaries and to make it easier for all kind of people from all kinds of lifestyles to relate to Samsung’s comprehensive product range. If Samsung had not repositioned itself away from being an OEM provider, it would never have been able to be successful in reestablishing itself as a globalized, high quality, innovative electronics company across the globe. 3. Explain the role of marketing communication in developing the Samsung brand globally? Why did the company select the communications mediums and run the types of communications it did? Kotler and Levy (1969) talk about the concept of integrated marketing planning, according to which there are numerous tools available to marketers that they can use to reposition a brand or company, for example. But they have to make sure that the tools they use to this end do not “work at cross purposes”. Under an integrated approach, no single tool is used as the ‘one and only cure’ but several tools are used in symphony so that the desired effect(s) can be achieved. Likewise, marketing communication can also be used as an integrative model, like Samsung used it over the years to strengthen its position in the market and in front of its consumers. According to Ramos and Franco (2005), there is a positive relationship between advertising activities and customer perception of the brand; this was also practically illustrated in the case of Samsung’s repositioning. Advertising and brand communication were also seen to have positive linkages with brand equity. The more a company spent in this domain, the higher the perceived value of the brand. Samsung undertook numerous marketing communication activities to establish its brand presence worldwide. I used radio commercials, TV commercials, print ads, billboards and later internet marketing to reach sophisticated, high end consumers. It placed ads on famous websites, and advertised to increase brand awareness. Samsung was simultaneously using other print and digital media to reach out to customers as well. In addition to these efforts, Samsung also purchased a huge Electronic Billboard in NY Times Square. All these integrated communication activities worked to reposition Samsung as high technology, new world, globalized, fun and modern to the customers it was targeting. They also extended their DIGITall campaign to include other tag lines to make it more exhaustive in appeal. The communication model promoted that Samsung products were “user friendly and had flexibility of use” and that they were “revolutionary” in nature while still meeting the needs of its target audience. References Chernatony, L. and Riley, F. (1998) Modelling the Components of the Brand. European Journal of Marketing, 32 (11/12), p.1074-1090. Available at: http://www.metro-as.no/Artikler/99Modellingcomponents.pdf [Accessed: 22nd Nov 2012]. Kotler, P. and Levy, S. (1969) Broadening the Concept of Marketing. Journal of Marketing, 33 (1), p.10-15. Available at: http://trp.jlu.edu.cn:8000/yuhongyan_jpk../uploadfile/200705/20070523144447507.pdf [Accessed: 22nd Nov 2012]. Marketingpower.com (1995) Dictionary. [online] Available at: http://www.marketingpower.com/_layouts/dictionary.aspx?dletter=b [Accessed: 22 Nov 2012]. Villarejo-Ramos, A. and Sanchez-Franco, M. (2005) The impact of marketing communication and price promotion on brand equity. Brand Management, 12 (6), p.431-444. Available at: http://www.cob.unt.edu/slides/Paswan/Mktg5250/subaru/price%20promotion.pdf [Accessed: 22nd Nov 2012]. Wood, L. (2000) Brands and brand equity: definition and management. Management Decision, 38 (9), p.662-669. Available at: http://www.metro-as.no/Artikler/33Brandsmanagement.pdf [Accessed: 22nd Nov 2012]. Read More