Samsung Pestle Analysis

The company's internal resilience is the source of its success. The company's strength will be built on its creativity, new global brand, research and growth, restructuring plan, customization, and annual product introduction.
The language barrier is a major limitation of the Samsung Mobile Phone business. The majority of the company's executives are of Korean descent, and they face difficulties communicating in English, which is widely spoken worldwide (Glowik 2017, p.16). Further, some products of the company are not user-friendly despite that the company relies on technology as a driving force (Pahl and Richter 2009). However, the company can utilize its innovation prowess to solve the issue of non-user-friendly products and recruit more staffs from the local market to resolve the linguistic misunderstanding.

The threats affecting the company are from the external environment. The legal challenges between Samsung and competitors such as cheap smartphones from China are a significant threat to the performance of the company (Lee and Park 2013). Overcoming this threat would require the company to manufacture low-cost products with high quality. Technological advancement is a threat to the company to some extent as it makes a mobile product obsolete.

However, there are numerous opportunities available for the company. The opening of many outlets and stores in different parts of the world has the chance of increasing more profits for the company (Muralidaran 2007, p.38). Further, technological advancement of the company has helped it to produce varieties of smartphones that suit different groups of customers.

External Environment

PESTEL factors

PESTEL analysis is used to examine the political, economic, social-cultural, technological, environmental and legal factors that may have an influence on a business enterprise (Institute of Marketing 2009, p.19). In the case of Smartphone industry, technological, political and social are the significant factors that would affect the corporation and the sector which it operates.

Political factors

The political environment has enormous effects on the prosperity of Samsung Company at the global scale (Cardoso 2017, p.67). Due to stiff competition between Samsung and Apple, it has attracted governments from various countries where the two companies are operating (Ferrell and Hartline 2010). Samsung was compelled to withdraw its Galaxy tablet German due to prohibiting legislation. The German used enforced protectionist policies to nature its domestic enterprises and therefore, the company lost the market.

Further, due to political instability between South Korea and Japan governments, South Korea prohibits Samsung from operating in the country. The instability is caused by the rivalry between the two countries to dominate the region (Vranica2014, p. 41). The unfavourable situation denied Samsung from exploiting the potential market which is growing daily in South Korea.

Moreover, there was an attempt by the U.S government to stop Samsung from conquering the European market avoid its influence over the Eurozone. The move of the American government was triggered by the fear of Samsung Corporation introducing eastern political control over the western nations (Wang 2014, p.57). The challenge denied the Samsung Company from dominating most countries in Europe where a significant population has high purchasing power.

Technological factors

There is a significant impact of technology in the operations of Samsung Company. The firm deals with products which require constant technological innovation for it to gain a competitive advantage in the market (Wang 2015, p.229). In the current world, there are drastic technological changes which would affect the manufacturing of the enterprise. Their nature has effects on the operations of the company positively as more consumers are demanding technologies products, including smartphones.

The development of the new technology such as touch screen technologies led the company to manufacture Samsung Galaxy (Stone 2012, p.287). The product helped the company to gain huge global sales that boost their profits and market expansion.

The other influence of technology is the competitive ability of the company which makes the market to be saturated. Xie and Liang (2013, p.123) state that initiative of the company to innovate new technologies in the market mean that other rival firms would develop similar products, which leads to a high volume of supplies in the market than the demand.

Social-cultural factors

Social factors are also impacted by other current trends that affect the company and the entire industry. The changes in the taste, preferences, and attitudes of the consumers have significant effects on the performance of the company, as the consumers would be willing to buy certain products while disregarding others (Daylen, Lange and Smith 2009). The negative response to the consumer's taste, preference and attitude would often lead to a reduction of the revenues and profits of the company. Moreover, due to adverse technological effects on the health of people, consumers have become more sensitive towards the safety of the mobile phones (Lang and Sittler 2011). The consumers are demanding smartphones with minimal radiation.

Samsung is a South Korean company, and its core operations are based on its country of origin. The company is experiencing several challenges from its global operations such as adapting to the local conditions (Chang 2011, p.41). Therefore, the company has to adopt global strategies to adopt the emerging markets.

The demand for ready labour and products depends on the influence of the social status. The aging population in a country has the impact of elevating the pension payment because people live longer and the burden is felt by the companies (Insights 2010, p.29). The demand for products is also affected by the aging population. For instance, the immigration of people to the United Kingdom (UK) is beneficial to the firms, including Samsung mobile firm because it increases the level of labour supply and market size.

Segmentation, Targeting, and Positioning (STP) Strategy

Segmentation Strategy

The market segmentation of Samsung Company is based on the lifestyles and demographic variables of the market. The company should consider emphasis more on the lifestyles of young people, as they are the majority in most of the market to cater to their changing needs (Stokes and Lomax 2008). Further, the firm should segment its market into rural and urban consumers to regain its market share. The strategy will help the company to compete favourably with other brands that are operating in the same market.

Targeting Strategy

The target market for Samsung Company should be based on the upper-middle-class professionals. The people in this group have busy routines in their workplaces, and they would need to communicate with their families and friends through the phones (Michell 2010, p.69). The other target market is the students in colleges and universities who are in high needs for mobile devices which are portable and can perform multifunctional activities (Lee 2008, p.19). Moreover, the medium corporations are the other target market as managers and employees require phones to access crucial data’s of the company.

Positioning Strategy

The positioning strategy of the company needs integration of the value chain, price, product and the promotion techniques that concentrate on the market target. The company should match its capabilities with the preferences of the customers (Thornburg 2014, p.27). Samsung Company is employing the positioning strategy to market its new products in the market. The new products are conveniently valued added mobile devices which can be used for personal and professional needs (Eunjeong 2012, p.84). Further, the company should concentrate on the conveniences. The achievement of convenience can be done by incorporating the mobile devices with other features such as attractive camera power and design interface.

Statement and Justification of ¾ SMART Objectives

The aim of Samsung is to become the largest Smartphone manufacture corporation in the globe and to make revolutionary new phone that attracts significant profits. Based on these aims, the company will have the following objectives:

To provide well-made, durable and useful smartphones.

To advertise the company across the entire world.

The advertisement of the company image and its product would bring more benefits to the organization. The firm will raise more revenues from the new customers who will buy the advertised new products (Rossiter 2014, p.537). Advertising creates a sense of brand loyalty as the process conveys ideas, images, and personality of the company which correlates with the target consumers (Lee 2008, p.14). The aligning these values of the firm makes the consumers relate to the products much better, and the emotional connection makes them buy the product.

Providing well-made and unique smartphone would be beneficial to the company. The more powerful and smarter the phone get, it becomes much vulnerable to spoilage (Glowed and Smyczek 2011). The phone should be constructed in a manner that it can withstand extreme temperature, water, and dust damage to meet various needs of the customers.

Proposal on 7ps

The following are the proposal for the company on the marketing mixing:

Products

The firm should manufacture smartphones which have interactive features for those potential consumers who are interested in the latest mobile phone gadgets.

The mobile devices should have a high-performance consistency, and the design should be stylish to ensure that the brand recognition in the market.

Place

The company needs to avail its products where consumers can be able to see and handle to increase their consideration of buying.

The company needs to recruit more independent retailers where it can sell its products to reach more remote markets such as in rural areas.

Currently, the company have more than 25 production bases in the global scale and more than sixty sales subsidiaries in around 50 countries. However, there is the need to reach more countries especially in Africa where opportunities are being availed each day to reach more customers.

Price

The company should provide different pricing structure to suit various groups of customers.

The price plans of the company should be reviewed on a monthly basis to match the changing economic situations in different geographical markets and also to allow prepay options for customers.

The company should adopt a competitive pricing in areas where there are already other established rivals to be competitive in the market.

Promotion

The company should use different channels of promotion to reach its target customers. For example, advertising using print, visual and other media outlasts would help the company to reach a broad audience and spread the brand message and image effectively to other consumers.

The firm should establish a better public relation to ensure that the consumers receive reliable information concerning its new and existing mobile products.

Special offers, print, and promotion of sales posters and should be in each distribution and retail outlets of the company to attract potential buyers.

People

The firm should equip itself with well-trained technical and non-technical personals.

The workforce should be well motivated to improve their work performance.

Customer care personnel should provide support to the customers that meet their expectations.

Process

The company should review it exists policies and procedures to ensure that they are effective.

The manufacturing process of the smartphones should be efficient to ensure that they incorporate every valuable element.

Physical Evidence

The packaging materials should incorporate the entire necessary visual layout, barcode and the precise instructions of how to operate the smartphone.

Measurement and Control

The marketing plan will be evaluated based on the return investment and the response of the customers. The return on investment will be determined on whether the money spends on the implementation of the marketing plan yield profits (Ying 2016, p.39). The reactions from the customers will also be used to measure the outcome of the marketing plan. The feedback from the customer’s services would help to reveal the most significant effects of the plan.

The plan will be monitored based on the sales of the target market and the market share. The market survey will be done on all the retail partners to compare the marketing plan projections to determine if any changes can make (Lee and Slater 2007). The market share will also be used to determine how dominant are the Samsung products are in the target market. In case there is a deficiency of the market share from the planed, adjustments will be made.

Recommendations

The company should adopt its new technology instead of depending on the already existing technologies.

The company should exhaust the available global technological revolution opportunity to expand its market and to generate more profits.

The company should invest heavily in market reach to produce Smartphones which constantly matches the needs of the consumers.

Samsung Mobile should incorporate itself into the new markets by adopting a “think global and act local” (Wang 2014, p.31). The strategy will effectively link the social and cultural bridges between its native nation and foreign markets.

The company should develop new strategies for complying with the constant changing laws and regulations in different countries where it operates.

The company should divert its operations to other countries which are having a favourable political environment.



References

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