The objective of the report is to generate a report on the international marketing of the tablets of Samsung which is one of the global leaders in the digital world. The report carries illustrations regarding the expansion of the business of tablets in the international market, specifically in the digital market of the United States of America and Japan. The challenges that are and would be faced by Samsung while approaching the tablet business expansion in international marketing. The marketing environment for Samsung tablets in the markets of the United States of America and Japan is critically analyzed. The analysis and evaluation of the strategies that have been and should be implemented by Samsung while devising approaches for business expansion in these two countries have been reflected in the report. Various research data that illustrate the current global scenario of the market position of the Samsung tablet are discussed further in the report.
Global business in today’s world is fast-paced which constantly requires to shift in the direction of the creation of limitless environments for business to ensure the efficiency and productivity that businesses require for achieving success. Tablet users appeared first a few years ago, however, this behavior of the new users has been changing the landscape of technology. Samsung can happen to believe in the early innings of the tablet cycle that has been trending for the last few years. Various researchers predict that the digital industry would witness 20 million tablets to be in use by the end of 2020 which is currently 3 million (Bhasin, 2017).
The responsiveness and flexibility that tablets bring to the personal and professional place have made them analytical tools for the enhancement of the productivity of businesses. These tablets allow professionals in the business to constantly access professional and personal work along with considerably developing flexibility of tablets. Now people can access business or any kind of personal data on tablets at any time and any location which are very much portable as well as broad in physical structure. These aspects facilitate fast responses to the fast-changing requirements of the business world (Verbeke, 2013).
Samsung is one of the largest multinational electronics companies headquartered in Samsung Town in Seoul of South Korea. Samsung was founded in the year of 1938 and has numerous subsidiaries and businesses that are affiliated to date. After the death of Lee Byung-chul who is the founder of Samsung, the company was categorized into various groups of business – Shinsegae Group, Hansol Group, CJ Group, and Samsung Group. Samsung had around 80 companies that were handling consumer electronics, construction, shipbuilding, financial and medical services along with other businesses (Einhorn, Alpeyev & Lee, 2017).
The tablet product line of Samsung is operational under Samsung Electronics which has been observed to become one of the crucial sources of income for the company. It was in the year 2012 when Samsung outperformed Nokia in the global tablet market to gain the position of a market leader. Despite the extensive expenditures in the marketing of the high-end Samsung tablets in recent years, Samsung was not successful in maintaining its position when confronted by the massive margins of profit the iPad of Apple (Verbeke, 2013).
The environment of the United States of America is highly favorable for expanding business. As per Bhasin, the US market is highly competitive, increasingly fragmented, and highly commercial which provides a wide range of opportunities for growth in business as Samsung is and will be challenged by new and innovative businesses and digital outlets (Bhasin, 2017). The country provides a very flexible background for the use of Samsung Tablets as almost 98 percent of the residents of the USA happen to use personal computers out of which almost 73 percent of residents prefer to carry tablets because of their compatibility and portability which is not obtainable in the cases of personal computers.
Figure 1: Top 5 Tablet Vendors
Source: (Bhasin, 2017)
The net shipments of tablets in the United States of America in the year 2016 were 174.8 million out of which the total units of Samsung tablets that were shipped is 26.6 million. It is also evident that the market share of Samsung tablets in the year 2016 was 15.2 percent. Despite the slight decline in the shipments and the market share of Samsung tablets from the year 2015, the competitiveness in the US market provides huge scope to continue the business expansion in the digital industry (Huberty et al., 2012).
Moreover, the United States has a mixed economy. The international market expansion for Samsung tablets in the US has been facilitated by flexible and adaptable economic affairs. As the US market has the elements of planned economic control by the US Government and free markets, the marketplace has been more dominant which has been facilitating Samsung to grow its business with more and more innovation in its tablet technology.
The market of Japan is characterized by strong innovation and drive to excel which provides a great platform for the growth of businesses around the world, especially for the digital industry. This is found to be relevant as most of the digital brands are born in Japan which has led the Japanese market to be the connoisseur of digital innovation and companies (Martin Roll, 2017). It is also observed that the entire Japanese market is flooded with renowned digital brands, applications, and other technologies. The Japanese market is very healthy yet rapid in terms of possessing demand for tablets which encourages more shipments of Samsung tablets with every passing day.
Figure 2: Tablet Shipments in Japan
Source: (Martin Roll, 2017)
According to the research conducted by the IT trends firm of Japan, MM Research Institute, it could be observed that there has been an increase in tablet shipments from 8.4 percent in 2014 to 9.4 million units in the year 2015. This was found to be more evident from the research that approximately 46.2 percent of shipments in the digital market have been for Android tablets which has been accounting for around 4.4 million dollars in the year 2014 (ntc.ntu.edu, 2017).
Japan has a global free market economy that is industrialized which has been providing an economic environment and system with optimum competitiveness which has been favoring high demand for Samsung tablets resulting in the business expansion of Samsung tablets in the Japanese market.
However, it has also been noticed that both countries have favorable factor conditions for business expansion of the Samsung tablets which has been and would be a great support for wide-scale growth of opportunities for further growth in the digital market of both countries (Samsung, 2017).
One of the key challenges that Samsung tablets have been facing in the international business expansion in the US is the preference of the people to use the Android mobile platform over the Android tablets. This is primarily caused due to the physical compatibility of mobile phones than Android tablets which provides the user with all the essential features in a smaller device that are also available on tablets. The concept of screen size and resolution in a smaller device has been challenging to the smart masses of the US. The second challenge that Samsung has been facing in the market expansion for its tablets in the US is the unsuccessful transition of all the apps that are primarily designed by considering the smartphones in mind which do not happen to be compactable on a tablet-sized display. The Samsung tablets have been unsuccessful in reorienting the apps on the bigger size of the Android tablets of Samsung (Reuters Institute. Politics 2017). The cost and the contacts of the Samsung tablets have been hindering the international business expansion of Samsung tablets in fast-moving and time-saving countries like the US. The market competitor of the Samsung tablet, i.e., the iPad of Apple has been offering the same features to the masses which has been becoming very challenging for the Samsung tablet regarding sales. Samsung can only be able to increase sales in this context if it undercuts the price of the iPad which is a rare thing for an innovation-oriented company like Samsung to do.
One of the major challenges that Samsung has been found to have faced during its market expansion in Japan is the reverberations of the lawsuit in the China-based factories regarding labor abuse which gave a serious challenge to the brand image of Samsung in Japan. Thus, during the business expansion of the Samsung tablets, these threats to the brand image restricted the operation of the business in Japan to some extent (Samsung, 2017).
It has been observed that Samsung also faced challenges in its business expansion in the Japanese market when there were reports regarding several incidents of explosion of the mobile handsets which spread the negative image for the brand all across the world which affected the sales of the Samsung tablets in Japan too.
It was also seen that the Apple lawsuit against Samsung about the dilution of the trade dresses and features associated with iPad and iPhone in the latter’s Android tablets lead to considerable constraints to the business expansion of Samsung tablets in Japan.
According to Porter’s 5 Forces Analysis of Samsung tablets, there has been a huge rivalry in the business of tablets which mostly has been revolving around price competition in both the US and Japanese markets. The market in the US has been filled with consumers who are choice-spoiled for electronic gadgets which encourages more companies to launch new products (Bhasin, 2017). The Japanese market is digitally saturated in the tablet product category. Thus, this possesses a high threat specifically for Samsung as both markets are flooded with global competitors like LG, Sony, and Panasonic.
The threat of new entrants in the operating industry of Samsung tablets is high in Japan as this country leads in innovation and new companies keep entering the market. The US market is highly oversaturated with the digital business which provides constant challenges to the business expansion.
The bargaining power of suppliers is very much low in both countries due to which the suppliers in US and Japan are not successful in negotiating prices as the competition keeps increasing among the suppliers as they constantly seek profits.
It could be noted that the bargaining power of the buyers is one of the crucial threats to the business expansion of Samsung tablets in both the US and Japan as the competition in both countries is very high. This result in the overwhelming of customers with promotional information those are oriented toward them (Bhasin, 2017). The oversaturation of the customers with the promotional information acts as a challenge that needs to be counteracted by Samsung by investing more budget and time into the research of the target customers to covey appealing messages that would increase the sales of the tablets in both countries.
It has also been observed the threat of substitutes is very much high in Japan and US as the population would prefer to use PCs, laptops, and smartphones for entertainment purposes. Samsung has been innovating various models of TV that are more interactive and sophisticated that also have been offering endless integration with the applications on the web and other external device. It has been noted that most of the population in both the US and Japan have been opting to use these TVs which has been threatening the use of Samsung tablets.
Samsung has been having a wide range of product portfolios when it comes to tablets. It has been observed that the driver of the brand image of Samsung is the tablets and smartphones of the Galaxy series.
The Samsung Galaxy Tab has been considered the line of the upper and middle range of computers that are Android-based tablets that are found to be produced by Samsung Electronics. It is observed that this series has similarities with the Samsung Galaxy Note Series. According to Einhorn, Alpeyev & Lee, various models of the Galaxy Tabs of Samsung are the Samsung Galaxy Tab 7.0- 2010, Galaxy Tab 7.7- 2011, Galaxy Tab 8.9-2011, Galaxy Tab 10.1-2011, Samsung Galaxy Tab Pro S-2016 and the innovation of the tablets of Samsung continues as innovation has been the forte of the brand (Einhorn, Alpeyev & Lee, 2017). The wide range of options in the products of Samsung products has been found to enhance the demand by customers in the US and Japan (Ajami & Goddard, 2014).
As per Huberty et al, Samsung has been observed to be present in the market of the US and Joan through various channels. It has been observed that the brand has been working on the channel marketing concept regarding the Samsung tablets. The service and the sales dealers manage the key accounts for the brand which include corporate sales in both countries. This has been encouraging the company to open exclusive showrooms for the sales of Samsung tablets in both countries (Huberty et al., 2012). Samsung is a highly renowned brand, the retailers have been bound to retain the tablets of the brand as a primary product or alternative product. The distributing network in the US and Japan has been very efficient in distributing tablets in both countries.
Whether it is the USA or Japan Samsung is the company that comes up with a wide range of products. In this case, the situation is acquired by the tablet produced by Samsung. The concept of pricing is the part that provides the real valuation of the product. So Samsung came up with innovations based on the demand of the customer so it can be said after the proper evaluation that the USA market Samsung adopts the process of skimming pricing strategy as well as the competitive pricing strategy. Basically, with the launch of Samsung Galaxy Note, 3 enhanced the market demand for the product. In that case with the pricing strategy, the company raised the price of the commodity before the competition commences. It then gets reduced after a long time when the product gets old. At the same time sometimes Samsung uses the process of competitive pricing specifically to compete hard within the market. In this situation, the pricing strategy can be considered to be based on emotional considerations, value considerations, and situational factors (Martin Roll, 2017).
So considering that Samsung follows the process of maintaining its reputation whatever may be the scenario. Thus it can be critically presented that Samsung never lowers its prices to match with customer level and to compete with the competitors in the USA market rather it makes its competitors match its level to continue the competition. It is therefore quite clear that with the strength of its quality and innovations Samsung creates a unique brand image among its customers. Thus in that context whatever may be the price the customers go for choosing Samsung tablet over any other brand in the USA market. Similarly, when the situation in Japan is analyzed it is observed that Samsung follows the same strategy as that of skimming and competitive pricing (ntc.ntu.edu, 2017).
But in some instances in Japan Samsung carries out the lowering of price to some extent to steal the customers from the market specifically to deal with competitors who launch the same product with similar features. In addition to that, the critical market analysis provided the fact that Samsung is an authentic brand name and comes in the first position to launch any kind of change or innovation within it. So the company never compromises with the price to withstand the competition.
After pricing, the promotional strategies are another part that provides the company to reach the customers without any difficulty. With the promotional activities, the company will also be able to attract customers. Though Samsung is one of the finest brand names still it requires effective promotion to enhance its brand values. In that context, it is analyzed critically that while promoting the Samsung tablets the company faces difficulty based on three factors, i.e…….., individual differences, situational factors, and mechanical problems. The individual factors, therefore, include gender, age educational level, personality, and status. At the same time, it is again affected by emotions, distractions, and context along with language, physical disabilities, or any other problem. Out of all the factors, Samsung carries out the same promotional strategies in both places, i.e.., USA and Japan in the same manner. Based on that when critically evaluated it has been found that Samsung went on with the incorporation of push and pull strategies. In that case, the major strategy used is sponsorship and advertising. In the USA market, the advertising and sponsorship of Samsung are found to be in the huge amount which raised the budget to about approximately $500 million as per the current study carried out. This massive amount of advertisement attracted customers towards the tablets (Reuters Institute. Politics 2017). Along with that it also carries out the sponsorship procedure where there Samsung makes the trade partners and provide them various offers along with discounts to make them carry out more and more selling of the tablets in the both USA and Japan markets. Again it promotes many corporate events by which the newly launched tablets come into tablets.
The current competitive world had encountered various economic fluctuations. In that condition, Samsung is adopting efficient innovative strategies so it can be able to face the competition raised due to the revolutionary technological innovation. In that case, Samsung is also going through the situation by showing aggressiveness about carrying out the growth properly as well as gaining extensive market share within the market. So critically it can be said that in the current globalized market, Samsung will choose for the expansion of its business in the global competitive market for which it has to choose the requisite strategies which will help in its branding in the USA and Japan. It is because the emergence of the tablet by Samsung is seen to be one of the important divisions of digital media in which it has aimed to shape the lifestyle (Ajami & Goddard, 2014).
In that context, Ajami & Goddard said that the company came up with the telecom expertise to create more innovative tablets which should be liked by most customers. It, therefore, included the incorporation of more realistic and interactive personal multimedia services which eventually reflect the vision of the company providing convergence as well as ubiquity to the business. It is clear from the sources that the sales of laptops and desktops were at their peak in the year 2011 (Ajami & Goddard, 2014). Thereafter the innovations brought the replacement of the laptops which is seen in the tablets. It is because this machine is quite flexible having adaptive perks and specifically can be the replacement for laptops. Thus the statistics examination of the USA regarding the media environment can be considered as quite highly competitive as well as commercial. Along with that, the USA market is said to be easily fragmented which has increased the chances for the expansion of the international digital footprints. The idea of expansion no doubt is hindered by many challenges that are raised at the local level but the regular experimentation provided the enhancement of the technological environment. This is eventually clear from the analysis that it will lay down the base for a successful market for Samsung in the USA. Similarly in the case of Japan where there has been strong competition between the brands because the market is full of digital businesses. This led to the emergence of a strong market base for Samsung in Japan.
While viewing the global perspective the evidence shows that the world is quite homogenous specifically in the case of communication and technology. For that reason, it is critically analyzed that Samsung should go for choosing global standardization for its consumer electronic tablet in USA and Japan by formulating specific pricing strategies as well as promotional strategies (ntc.ntu.edu, 2017).
In addition to that, the standardization of the tablets provided an increase in the financial returns of Samsung which raises the economic scale. Moreover, the strategic evaluation presents that the implementation of global strategies is supposed to pose a positive influence on the performance of Samsung globally. Again the performance of the organization is examined based on the marketing mix of Samsung concerning the markets of the USA and Japan (ntc.ntu.edu, 2017).
As per the analysis, it is clear that the use of global standardization within Samsung tablets will affect the company’s performance positively. It is because standardization will bring about changes in the design of the products. The tablet by Samsung is considered as a specialty product because customers want this product to be very specific. They will not also accept any kind of substitute and always want the exclusive one for their use. Thus it depends on the retailers on how they offer the products to the customers as the customers will only prefer selective brands in which they feel secure and luxurious. In that context, the evidence shows the fact that the company takes specific measures to get adjusted to the market like in the USA and Japan irrespective of any kind of cultural as well as socio-economic differences.
Thus the demanding additional expenses will properly justify that Samsung had taken up global standardization for business enhancement. As a result of which they take care of the preferences of the customers globally and depending upon that they design the product line of the tablets. So it is observed from the facts that this process will also take into account the standards of usage of the tablet by the customers by increasing the competitiveness.
The proper examination of why Samsung chose global standardization indicated that the organization must build its proper brand portfolio. This brand portfolio should be carried internationally to get a successful position within the market statistics. In that context, Samsung is better evaluated with its competitors like Apple, Lenovo, and much more.
The figure provides the result of the market saturation as well as the presence of intensified competition. With that it got clear that Samsung’s revenue increased but the profit percentage of the company got decreased with the rise of several competitors. For that reason, Samsung came out to lower its price range so that more and more customers can avail of the product. Moreover, the model of Samsung Galaxy provided good competition to the iPad of Apple Company. Thus Samsung is expecting growth in its sales values and based on that it made its product a bit low-budget than that of other competitors of high-volume brands like Huawei and Xiaomi. Thus by acquiring global standardization, the company is meant to have the capitalization on the gaps by which it can compete between various product ranges. In that context, it can be said that Samsung is ranked fifth ranking within the world’s most valuable technology brands as per the survey conducted in 2015 (Reuters Institute. Politics 2017). This ranking indicated the aggressive marketing as well as effective promotional activities carried out by Samsung on a global basis.
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