Samsung Company Analysis

Introduction Samsung Electronics is one of the world’s largest semiconductor manufacturers; Samsung Electronics is also South Korea’s top electronics company. It makes many kinds of consumer devices, including DVD players, digital TVs, and digital still cameras; computers, color monitors, LCD panels, and printers; semiconductors such as DRAMs, static RAMs, flash memory, and display drivers; and communications devices ranging from wireless handsets and smart phones to networking gear. The company, which is the flagship member of Samsung Group, also makes microwave ovens, refrigerators, air conditioners, and washing machines.

Nearly half of sales come from the Asia/Pacific region. Top industries for Samsung Electronics Co. are memory chip and module manufacturing, communications chip manufacturing, wireless telephone handset manufacturing. ? Samsung is no longer the company that it used to be, it is a company that has put in a lot effort and money for changing its reputation. Today, Samsung is striving and growing into one of the most successful companies ever. It has an extensive product line that caters to many different people. It no longer operates on low profits; it’s striving on the highest.

Sales Preparation MarketValue160834. 8asof 2012-11-09 FiscalYear-EndDec 2011 Sales (mil)104,155. 453 2011 Employees101,970 EmployeeGrowthPercent6. 6% Assets (mil)101,260. 188 NetIncomeGrowthPercent-25. 94% SalesGrowthPercent5. 2% Income Statement201120102009 Revenue$104,155. 454$99,004. 037$77,007. 137 GrossProfit$26,216. 298$30,225. 083$18,331. 443 OperatingIncome$10,088. 036$13,163. 092$5,445. 767 NetIncome$8,646. 132$11,674. 559$8,277. 33 Diluted EPS$28. 8$39. 04$27. 96 SWOT analysis A good SWOT analysis can help the company and competitors place themselves in the market wisely.

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Thus, it missed the first mover advantages. • Samsung does not charge high price for its products, therefore often people relate the low price to begin a supplier of low quality products. General perception supports that the higher the price, the higher the quality of products. • Many Samsung products are not user friendly, therefore consumer often hesitate to switch to Samsung products even if the price and quality is exceptional. • Samsung does not focus on a specific niche; it offers its products to the mass market only. Samsung does not create its own software therefore it often relies on other sources to complete the products. • Samsung faces immense competition from new companies and online companies. • High set up and operation cost for such a company. Opportunities • Samsung should make an active effort to offer unique products to customers, in order to grab more market share. • Samsung could start creating software’s for their hardware devices and reduce outsourcing. • Samsung could launch sub brands to the company, with new and improved strategies. • Samsung could launch in countries to tap the needs of consumers. Samsung could open more stores to serve more customers. • Samsung could make an effort to launch creative products first, rather than after its competitors. • Samsung could increase its product variation in its products. • Samsung should participate in product development and attract more customers. It should also consider participating in various events to attract attention. • Samsung could offer additional services to retain existing customers and attract new ones. • Increase in the need for mobile phones, Samsung could exploit this need well.

Threats • Samsung has linked product lines, which means that if one product line fails due to its own reasons other product lines will also suffer. • Samsung is very scattered; it controls and operates different products while its competitors use their resources and effort on one segment only. Diversification takes a lot of effort and attention. • Samsung has set up production plants in low cost areas, which are subject to ample political and economic instability. These instabilities can have an impact overall company it the crisis gets unmanageable. Samsung is facing threats from many other low cost companies. • Various companies have realized the importance of advertising, therefore Samsung will be subject to a lot more competition as advertising creates and draws attention of consumers. • Countries all over the world are experiencing a high cost due to high inflation rates in most locations. • Many government legislations are now active against the innovative technology due to health and mental concerns. Samsung vs. others On the Kazakhstani market Samsung has various competitors as LG and Sony.

All three companies are strong, despite Samsung takes almost a half of market share. Still Samsung has lots of thing to work on here, in Kazakhstan. I have made an analysis of all three web sites of Samsung, LG and Sony, compared them and indicated Samsung’s weak sides. Samsung. com/kz Samsung doesn’t have a local web site in Kazakhstan. While entering it for the first time system asks to indicate your location. When choose Kazakhstan, Russian language is chosen by default. It is also worth to mention that in Kazakhstani version of website Russian is the only language, Kazakh is not represented.

Generally web site is not very easy to use, even though most of major stuff represented on the main page. The problem is that in order to find an item customer is really has to search for it, using all these tabs and vertical search. Customer cannot just browse web site without knowing what exactly he wants. The main page represents new Samsung products as Samsung Galaxy Note II, Smart TV sets, etc. After clicking on the product you’d like to buy it immediately redirects you to product’s profile page where presented all the information about it, including Store Locator.

The problem with this locator that it works only in huge cities, engine does not allow to narrow search to smaller towns or districts. So, for example, if I live in Almaty and I want to buy smartphone, web-site will give the list of all distributors located in Almaty, not the nearest to me. Also, it doesn’t show the prices and discount that different distributors have. Instead they offer to call them by ourselves. The possible reason to this is security issues that require lot of financial investments.

Also profile page contains the feature called “Compare with other devices” where you can choose up to 5 devices and compare it in terms of technical characteristics. But this is all that Samsung offers as pre-order feature. They do not have any video review of products, 3D models of them, panoramic photos and many other things that could possibly engage them with new customers. Samsung actively works on creating local brand communities as on Twitter, Facebook and YouTube. With help of those communities they try to engage together all Samsung current and possible customers.

Another option that web-site introduces is collaboration with KupiKipon company, which provides coupons and discounts on selected Samsung production. To become a participant, customers, firstly, have to enter into Samsung Premium Club, only then all features as KupiKupon will be available, as well as many other options like discounts for AirAstana, service of Toyota service Center, etc. Sony. kz Web site of Sony has Kazakhstani domain and as well as Samsung’s web site, it has not got any possibility of changing language to Kazakh or English. Web site is also quite easy to use, I would say much easier than Samsung’s.

When customer wishes to buy something every step is structured and clear, so search engine is well organized and works nice: 1. He has to define what exactly he wants to buy. Whether it is TV or Walkman 2. He is given a list of different series of different price categories. He has to make another choice. 3. Then system provides him with a list of all, for example, Walkmans of specified prices and year of production. Price is also included but in rubles, not in tenge. The feature of comparison of different phones and cameras also presented on this web site.

Sony also does not have feature of buying online and store locator, no list of distributors and anything that could somehow get interest of Kazakhstani customers, seems like the web site is made for Russian customers with domain name . kz. Sony runs technical and customer support program that allows Sony production owners to upgrade, fix their gadget almost for free. They have created various brand communities in different social network in order to gather together their old and new customers, organize contests and actions. LG. kz

The web site of LG is pretty similar to Sony’s, especially in terms of search engine: it is very easy to use it. First of all the structure of site is very different from previous two: it all compact and arranged from left to right, so we do not have to scroll page up and down. The main page is divided on three parts: left, central and right. The first ad the last never changes, like a banner ad, they represent the list of production, vertical search and news and actions respectively. The central part is the most active, like a working are, where customer can look through products he chose, compare them and make a final decision.

But in comparison to Sony and Samsung only limited line of production is presented on their web site – only latest models. As LG has a domain name . kz, still default language is Russian and no possibility to change if to any other, only if change the location. Also as two previous web sites, LG does not have an option of buying production online (direct distribution). As it was mentioned earlier, this option might not be used because of very high financial expenses. So web site has only one direct task – to introduce new production to public. As well as Sony, LG has not got any information about it distributors or shops.

LG works a lot on CRM: they create brand communities on different social networks, provide customers with free OS upgrades and free application for their phones, microsite for SMART TV owners. Also they were the only who presented option for slow Internet connection, possibly aware of bad Internet in Kazakhstan. Customer relationship management (CRM) We are looking on internet strategy of Samsung Company. So, CRM in this case should not only manage a company’s interactions with customers, clients, and sales prospects, but also use technology, internet to organize, and synchronize business processes.

The goal is to find new clients, and safe those which company already have. Looking on the brochure that we received from representative of Samsung in KIMEP, we can make conclusion that now we know some characteristics of described printers, but nothing where to buy it. So, customer have to do it own research, to find where he could buy a product in which he is interested. Moreover, the lady that was representative is just from event agency. She cannot tell anything about the product in which students were interested, but which were not presented on the stand and material she learned.

This small research showed us how it is hard for customers find the shop were to buy the product they need. For sure it is cheaper to pay once lady from the agency for representing the material, rather than open department dealing with this. But, we thing department will be more productive, because they can answer on more questions, than just learned. Or not spending more money lady-representative can refer to the site, where customer can find more information about interested product. Also, site should be written on the brochure. Recommendations

While researching Samsung site, we found that company does not represent online shopping or delivery services as all sales go trough distributors and Samsung don’t interfere into contact between customers and dealers. Samsung has no official shop in Almaty or any other cities of Kazakhstan. As we understood their main aim is dealing with promotions, PR, advertisement and publicity. In Kazakhstan many products that are resell by disturbers always have special additional price that have a huge difference between initial and final prices.

It would be a good idea if Samsung on their site near the products placed their prices so customers will know at first hand the cost of the product. On the other hand it could cause discontent of distributor since clients choose negotiated price of other dealers or no profit will be gained. Samsung in advance can discus and find the optimal additional price for distributors so both customers and dealers will be satisfied. Here is the situation; Customer is surfing Samsung site to find the product he or she liked and willing to by right away.

Site provides all dealers addresses and contact numbers and this entire list is about50 shops around one city. Customer need to find on the Google maps of any other gadget where these shops located. While processing all the Almaty streets aspiration can go away and company loosing a potential client. We suggest directing present location of the customer and pick out top 5 closest shops to get product they like. No need for searching and finding out which store is right next to your location. This novation facilitates search and willing to own Samsung products.

Any tracking for products creates a desire to possess and enjoy them. Samsung can create online delivery through dealers just right on their site. No potential customer is missed and no dealer left without profit. This ability gives a client to choose any dealer and store he liked and order the product without leaving home. Another convenient option would be listing all Samsung goods dealers have in the moment. It can ease life and prevent the buyer in the way there will be no need to have a long ride to the store and find out that good you need is out of stock.

Very often happens the situation when a client came to buy a Samsung product but because it is out of stock shop assistance offer goods of other companies, which is detrimental for Samsung sales. The main aim of dealers is to make a potential customer buy and if there is no special product he or she needs they can easily find a substitute as the world of technology is extensive and easily replaceable. Process improvement What makes Samsung’s potential customers to enter the site and search it further? Most important page on the whole website is main page. It makes client be interested in products company offer.

In our previous group research of Samsung we found out that main page of the company is not attractive at all. Here are some solutions how to make it more catchy and favorable: 1. Customers should be informed with updated news or special offers the first thing. Samsung needs to update this information daily so buyers see that company is alive, it is operating ever day and care to hold customers on the site. 2. We noticed a very huge mistake of designers of the site that all pictures allocated are so not real and it’s hard to see how actual products look like.

Nowadays, most of the sites that provide any selling activity make the goods look very realistic as if you are shopping in the mall and see the product, e. g. 3D pictures can create this visual effect. 3. Forum is also another important part of the web site as here customers can discuss their complaints, whether they like the product or they don’t, get some new ideas to improve the site and marketing strategy. It brings benefit to both visitors and company. Visitors can find for themselves the product that suits them the most, advantages and disadvantages, write critique, review and so on.

Company gets new ideas, fix errors or mistakes, and see how people react to some updates of the goods system. 4. Our group has conducted an independent research about Samsung and LG companies to understand how these two companies maintain customer relationship management and meanwhile provide service for its customers. We have gone to one of the retail stores representatives of both Samsung and LG which is serving as distributor at the same time and pretended to be secret buyers. We were just like ordinary buyers who were interested in purchase.

As the result, we created a list of statements and criteria that for our opinion are important when choosing an electronic company. In the table below we have rated them on the following criteria and identified to what extend do we agree with the following statements about Samsung and LG customer service representative. SamsungLG GoodAveragePoorGoodAveragePoor Selection of productsVV Quality of productVV Price of productVV AdvertisementVV Recommendation of friends and relativesVV Store layoutVV Guarantees/WarrantiesVV Online shop VV Convenient LocationVV Brand name recognitionVV Service CenterVV

AgreeNeutralDisagreeAgreeNeutralDisagree The staff is friendlyVV The staff is patientVV The staff is politeVV The staff is responsiveVV The staff has listened carefullyVV The staff has sufficient product knowledgeVV Conclusion Samsung is well known company. We think that using our small research and recommendations this company will be closer to customers by itself, not just through retailers. Solutions about their web site will make company more attractive to customers. Finally, brief information about the company in the beginning of the paper will help reader to make clear understanding about company products and processes.

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