New Product Development
Platt—Samsung
How was Samsung able to go from copycat brand to product leader?
Samsung was able to go from copycat brand to product leader by using a “new product development” strategy (Kotler and Armstrong, p.261). According to Kotler/Armstrong new product development is defined as the development of original products, product improvements, product modification, and new brand through the firm’s own product development. In 1993, the CEO and chairperson, Lee Kung Hee decided to revamp the company’s management because he was not content to remain the best of the knock-off brands. Rather, he set high goals (to become the biggest consumer electronics company and to surpass Sony) and established a strategic plan to accomplish those goals. Samsung accomplished its goals in less than two decades.
The first step that he took was idea generation. He hired a “fresh new crop” of young designers to produce new ideas that could get the company in the direction that he wanted it. Sleek, bold and beautiful products were the aim so that they could target high-end users to the company. Next idea screen (Kotler/Armstrong, p. 264) was also implemented in the development stage. Each product had to pass the “Wow” test otherwise; it would have to go back to the drawing board for further improvement (Kotler/Armstrong, p.285).
Samsung then went a step further by testing new product concepts. From Blu-Ray players that changed colors, Eco-fit monitors with transparent stands that gave the appearance of a floating monitor, to a small Pebble MP3 player that is so simple that even grandma can use it, demonstrates what sets them apart from other companies and why they are no longer a copycat brand. With the use of market strategy development, Samsung removed its products from low-end distributors (Kotler/Armstrong, 286) like Wal-Mart and Kmart and built strong relationships with specialty retailers like Best Buy and Circuit City. This helped the company to target the high-end users
How was Samsung able to go from copycat brand to product leader?
Samsung was able to go from copycat brand to product leader by using a “new product development” strategy (Kotler and Armstrong, p.261). According to Kotler/Armstrong new product development is defined as the development of original products, product improvements, product modification, and new brand through the firm’s own product development. In 1993, the CEO and chairperson, Lee Kung Hee decided to revamp the company’s management because he was not content to remain the best of the knock-off brands. Rather, he set high goals (to become the biggest consumer electronics company and to surpass Sony) and established a strategic plan to accomplish those goals. Samsung accomplished its goals in less than two decades.
The first step that he took was idea generation. He hired a “fresh new crop” of young designers to produce new ideas that could get the company in the direction that he wanted it. Sleek, bold and beautiful products were the aim so that they could target high-end users to the company. Next idea screen (Kotler/Armstrong, p. 264) was also implemented in the development stage. Each product had to pass the “Wow” test otherwise; it would have to go back to the drawing board for further improvement (Kotler/Armstrong, p.285).
Samsung then went a step further by testing new product concepts. From Blu-Ray players that changed colors, Eco-fit monitors with transparent stands that gave the appearance of a floating monitor, to a small Pebble MP3 player that is so simple that even grandma can use it, demonstrates what sets them apart from other companies and why they are no longer a copycat brand. With the use of market strategy development, Samsung removed its products from low-end distributors (Kotler/Armstrong, 286) like Wal-Mart and Kmart and built strong relationships with specialty retailers like Best Buy and Circuit City. This helped the company to target the high-end users