Marketing Mix

Segmenting, Targeting and Positioning (STP) of Samsung Mobiles:
Samsung Electronics (Mobile Division) operates in one of the most competitive markets of the world. According to the US Federal Communication Commission 67 new Smartphone devices are introduced every year. Samsung traditionally had a conservative image that focused on low-price products for the lower end of the market. With low prices it was able to compete in the lower-market whereas in the upper market it had lesser penetration. To penetrate the upper-market Samsung had to give up their lower-market position and focus on innovation and perceiving a higher brand value. The following is the STP Analysis of Samsung Mobiles:

SEGMENTATION:
One of the fundamental principles of marketing is the segmentation of the market. Segmentation means the splitting of the market into groups of end users who are:
1. Maximum similarity within each group
2. Maximum difference between groups.

Based on recent Marketing definitions, Behavioral and Psychographic Segmentation are the definitions that best represent Samsung’s current Segmentation Strategy. There are more segmentation of the Samsung market that are:

GEOGRAPHICAL PRESENCE:

It has Samsung Guru Segment for rural areas as well as Galaxy segment for urban areas. Samsung is one of the largest manufacturers of mobile phones and it shares the highest cell phone customers with Nokia in India. It has something for everyone. There are some analyses of geographical segmentation:

1. Urban Market: Targeting urban youth with many handsets. There are in built features for the busy urban populations such as 3G, Wi-Fi, GPS and different operating systems. Its price ranges according to the handset from Rs.10,000 to Rs.25,000, which denotes accordingly the user status.
2. Rural Market: In rural market or area it is a better brand and widely used handsets. It is a better brand image in rural market. Samsung recently tied up with Indian Farmers Fertilizers Cooperative (IIFCO) for rural telephony. Special applications and better features such as battery backup and torch light with in the light. Language text messaging. Its price ranges from Rs.1000 to Rs.5000.

DEMOGRAPHICAL SEGMENTATION:

Samsung has mobile phones for youth, age of 16-29, for businessmen etc. for middleclass youth it has Samsung Guru which is for govt. lower class workers also. Guru has many variants; it is coming in 3G also. It is a good option if you want to get a cheap 3G handset. Samsung Galaxy is a good option for youth as it has many attractive features as Wi-Fi, 3G. Galaxy is also for Businessmen.
Samsung has partnered with IT industry leaders to bring you the most relevant enterprise solutions and the most comprehensive mobile implementation of Exchange ActiveSync. Decidedly adept in security concerns and the answer to your every business need, the Galaxy S II is ready for serious enterprise usage. Price ranges according to the age of the user:
1. 15-21 = Rs.1,000 to 1,0000
2. 21-35 = 1000 to 20000
3. 35-60 = 1000 to 35000
4. 60 and above = 1000 to 10000

It also has segmented its market into various segments. The following are the segments:
Demographic Segmentation by sex-

Males: Males use the phones or handsets according to their needs and styles but the major constraint that they look in the phone is the colour. Colours vary to the users but every male neglects the common colour that is “Pink”.

Females: Females are the user with opposite likes and dislikes that of male. e.g. Samsung B3310 pink, U600 pink.

PSYCHOGRAPHICAL SEGMENTATION:

Samsung mobile is available for those customers too who have their choice based on their lifestyle. Samsung came with some so fancy mobile phones especially for girls and cheaper touch screen stylish phones so that everyone can enjoy touch screen the rate of normal mobiles. Samsung has its range of mobile phones start from 1200to 32,000.

TARGETING:

After segmenting the market based on the different groups and classes, the targets need to be chosen. Samsung mobiles have the following target customers. Samsung target market is high and medium level communities.
Trendy young people.
Professionals.
Large businesses.
The common cellular phone users.
Organizations such as: services to public safety, the government, and both utility and manufacturing enterprises.
Institutional sales for colleges.
Target is not only number driven but also about acquiring and retaining customers.

POSITIONING:

Positioning is about the customer perception about the brand as being different from the other brands on specific dimension including product attributes. The concept to position the brand may be based on the functions provided by the product, the experience it offers or the symbols it conveys.

The strategies adopted by Samsung to position itself in the Mobile Phone market are as follows: It focuses more on the real margin which comes from mid-to-high-end segments

Samsung Concept Store
Market making & category creation in small towns
Wider Care Network
Access to Samsung care line
Pioneering in the 3G segment of mobile phones.
Branded itself as a synonym for quality.
Created a Unique Brand Image for itself as a high end value driven brand.

Product, Price, Promotion, Place

1. Product:
Samsung has divided its product into five category, they are as follows:

• Mobile Phone: Tablet smart phone, Smart phone, dual sim phone, touch phone, qwerty message phone, multimedia phone, CDMA phone, essential phone, memory cards, Samsung mobile and TV aps, Tablet, Laptop, Chrome devices, media players
• TV/Audio/Video: Television, Blu-ray, DVD player, Home theatre
• Cameras/ Cam corder: Smart cameras, cameras, camcorders
• Home appliance : Refrigerator, Air conditioner, washing machines, microwave oven, smart oven, dish washer.
Samsung offers wide variety of product mix in the 3D market, offering LED, LCD and plasma 3D TVs. It starts to provide customers with innovative and cutting edge products and rapidly become a huge player in electronics field competing to be with another magnet Sony.
The newly launched Samsung Galaxy Star has been tremendous increase and is performing well for the South Korean company by boosting sales. The smart phone is priced at Rs.4999.

2. Price:

Pricing also seems to play a vital role in the success of the Samsung Company. Samsung focuses on the cost cutting measures to keep its price low which helps to combat the discount schemes of the local companies. Samsung drastically reduces its cost in the year 2002 which enables the company to keep its price low for certain products and extract higher margin from premium products. This helped Samsung to post a turnover of Rs.30bn a growth from year2001. Since Samsung is into various electronic products ranging from mobile phones to house hold appliances; it doesn’t apply a specific product strategy or fit into a premium product category like Apple. In Mobile and TV segment it employs completion based pricing, i.e. the pricing model depends on the prices of competitor’s products.

3. Place:

Samsung’s products are distributed to all major electronic goods retailers. Apart from small and large scale retailers, Samsung has its own outlets ‘Samsung Plaza’ which showcases all the models available with the company. It has technically competent staffs to provide all information to the customer. Its sales and marketing offices are location in 16 areas.
Institutional sales such as airport, hotels, banks, theatres are taken care by the VMB (vertical market business) department. One of the major reason for Samsung’s success in Indian market its effective distribution system and after sales service. The competitors penetrate in the rural and semi urban mass markets. But Samsung insists that it’s a high end technology based company or player. That’s why urban area still the focus market for the company and 30% of its revenue comes from the rural and semi urban market. Later on Samsung changed its policy a bit of just remaining a high end technology driven company or brand it started changing its image in selling its products on the concept of “value of money” keeping in mind the price sensitivity of Indian customers and sell its products to the middle level income group population or families in India.
Samsung beat Nokia to take no. 1 position in the Indian mobile phone market. Nokia was down by a rank to be placed at number two in the Voice & Data survey with a 27.2 per cent market share following a significant 18 per cent drop in revenue, the report showed. In the 12 months ended March 2013, Nokia's revenue from Indian operations was placed at Rs 9,780 crore compared to Rs 11,925 crore in the last financial year, it added. "The rise of smaller local players like Micromax, Karbonn, Lava and Zen was a clear indication that consumers wanted cheaper feature phones. The next phase of mobile penetration in India, now at the bottom of the pyramid, will be driven by these companies," says Ibrahim Ahmad, Group Editor, Voice & Data. Homegrown handset company Micromax captured the number three position among V&D100 Top10 mobile handset brands for FY'13 and enjoyed a market share of 8.7 per cent and earned revenue of Rs 3,138 crore. Closing in was Karbonn Mobiles, the company among the Indian handset players that grew most consistently.

4. Promotion:

When Samsung entered in India it recognized that no one knows Samsung Company. So in order to establish itself in the market ‘Samsung’ launched corporate advertisements highlighting its technology superior goods. Samsung has been actively involved in sponsoring for various sorts activities and it has been associated with Olympic Games and Asian games for many years. In India Amir and Priyanka Chopra has been assigned as the brand ambassadors for Samsung. It actively promotes its products through social media campaigns.
Brand ambassador: Amir Khan
Promotional offers like free entry in the show 10 ka Dum
Opening Samsung funclub for the better customer relationships
Free online software update, tutorials and customer service.
Established many Samsung stores to create awareness about the brand of ‘Samsung’
Offering advanced technology products and positioning itself on the technology platform will not help a company sell its products if it fails to communicate properly to the potential customers. To raise brand awareness and create strong, favorable and unique brand associations, Samsung adopted various promotion strategies like celebrity endorsements, corporate advertisement, highlighting its technology superior goods and many promotional activities. Along with advertisements Samsung also focuses on increase in sales through promotional schemes. In October 2001, it introduce its products with the ad of “phod ke dekho” this increase the sales to 2.75bn. This offer instantly boosted the sales of the Samsung Company.

Marketing strategy:
Samsung has to improve its after sales service in order to retain customer and create brand loyalty. The current policy adopted by Samsung is spending aggressively on advertising and marketing & less on retaining customers that is after sales service. Samsung's rise in India was attributed to its rich product portfolio catering to customers of all categories.

The company's handset prices ranging from Rs.1, 500 to Rs.50, 000 in varied screen sizes, besides product quality and new features, helped the company grab customers' attention, the survey report said.

Samsung ended the year with a revenue of Rs.11, 328 crore compared to Rs.7, 891 crore last year showing a growth of 43.6 per cent. The company also became the market leader with a 31.5 per cent market share.