Established in 1938 by Lee-Bying-chul, Samsung is a multinational company that manufactures electronics. The company initially started as a trading company, but expanded its portfolio into electronics by the 1960's, and has since become one of the most well-known and recognized brands globally. The company is noted for its viability and its powerful influence in its headquartered city, Seoul, South Korea, but is a cultural icon around the world in that it seeks to powerfully make the world better through business diversity. This objective includes creating high-tech electronics, digital media, semiconductors, skyscraper and plant construction and medicine to name a few (Samsung, 2016). For more than 70 years, the company has been committed and dedicated to shifting the way electronics are seen in society.
Mission, Goals & Strategy
According to Samsung (2016), the company's vision lies in having values that are strong and abiding by standards of the highest ethical aspects possible. Samsung stresses that it seeks to craft products that are helpful and useful to people’s lives (p.1). The company, essentially, seeks to make an impact by creating services and products that afford society to become better. Enrichment is key for Samsung. This ideal is so woven into the Samsung fabric; the company has sought to create a future built on inspiration. This has lent itself to three objectives: partnership, creativity and talent (Samsung, 2016). Simply put, innovation is the prime undercurrent for Samsung.
Manjoo (2013) writes Samsung has often defied the giggles and jokes of electronic gurus and its rivals in its simplicity. The fact of the matter is that Samsung is so successful and exemplifies brilliance in terms of dominating the electronics field (p.1). Samsung has over the years been recognized for its phones and tablets. The strategy of making products that are easy and simple to use, while simultaneously being profound against others is what has kept the brand viable throughout the years.
Manjoo (2013) continues by noting that the company has effectively deepened its technical capabilities. This has spilt over into both the craftsmanship and designs associated with each of its products (p.1). When viewing a product, consumers are able to identify the reasonable, and simplistic nature of the Samsung brand. It is important to note that the brand is very innovative, just not as over the top as its rivals, Apple and Nokia. This is why in recent years; it has been cited as a cultish brand by some electronics reviewers. One of the more fascinating parts of Samsung lies in its eco-friendly approach.
Samsung (2016) outlines that as a part of its strategy that it seeks to craft and create services and products that are able to deliver on the promises associated with ingenuity, while also helping to preserve the environment and produce a cleaner, better planet. The company prides itself on partnering with recycling companies that consistently seek out ways to reuse old phones and electronics products rather than disposing of them in landfills, or incinerating them. The company additionally states that it is dedicated to making it easy for consumers to recycle the various products that they have purchased under the Samsung umbrella (p.1). To this end, Samsung basically assists in helping to improve the environment with an approach that is new and impactful. Since the company is grounded on innovation, this methodology is in itself ground-breaking.
Manjoo (2013) highlights that where Apple seeks to have products that have a high level of usability and visual aesthetics, Samsung's strategy is focused on making devices that run smoothly and operate in a quick and swift manner (p.1). This philosophy has helped the company to push the limits because they are not reliant on wowing consumers, but rather making an essential statement on the relevance of products being useful in their daily lives, without being substantially exquisite.
New Product Creation
As a result of its innovative strategy, Samsung continually seeks to create new products that help to portray the brand as sleek in their application. Samsung is noted for being a master creator in this area. From televisions to tablets, the Samsung brand is reputable, and charming to the eye, despite the design not necessarily being over-the-top in appearance. For this reason, the product that Samsung has recently created that is characteristic of their reputation for being pioneering is the Oculus Rift. According to Oculus (2016), the Rift provides an experience like no other. Whether the consumer wants to watch a movie via virtual reality or jump into a destination that happens to be on the other side of the world (p.1), the proof is in the pudding as far as how incredible the Rift is. There is a particular curiosity that reveals itself in the Rift, as the product is very pioneering for Samsung, who partnered with Oculus to create the product.
Ehmke, Fulton & Lusk (n.d.), discuss that the products that are introduced into the consumer marketplace should be driven by satisfying the needs of consumers. Every success product works to alleviate something that consumers have highlighted or stated is missing in their lives (p.1). Chiu et al. (2006) finds that launching new products tends to afford companies a technological and competitive advantage over their rivals in that consumers tend to gravitate toward what is new and current (p.1244). This, in turn, allows for a considerable amount of flexibility in allowing the product to go through the natural product cycle, and establish impactful marketing campaigns that reach an extensive amount of people.
Hoyer et al. (2010) writes that companies that use technology in developing new products, create an enormous amount of possibilities with respect to satisfying the needs of consumers (p.283). Since consumers are frequently looking for the next best thing in their products, the Rift for Samsung has allowed the company to maximize and capitalize on both the psychological and technological factors related to this product. In other words, through marketing efforts, the Rift has the potential to not only 'beat out' the competition, but to allow Samsung to once again be recognized as being in its own lane regarding viability and reputation.
Chiu et al. (2006) reveals that when companies have the opportunity to create new products, and be one of few that have said product, this allows them to use a variety of marketing approaches in order to effectively introduce consumers to the product. It also allows for a significant and substantial differentiation in terms of what the competition offers, if applicable to the particular product that is introduced (p.1244-1245). The Rift seems to only have one rival in terms of competition. Therefore, the amount of marketing that Samsung can execute is endless.
Marketing Strategy for the Oculus Rift
Given that there are many different types of marketing strategies that can be used to introduce and continue to establish recognition for the Oculus Rift, the following strategy was selected: mass marketing. Mass marketing is a particular type of strategy that uses a substantive amount of both conventional and newer advertising efforts in order to grow. Arora et al. (2008) discusses that mass marketing intertwines each of the 4P's in a distinct fashion, especially if there is a small amount of competition for the product. Mass marketing can create a feeling in consumers that they are specifically being honed in on by the company, even if the company is simply trying to sell its product. This, in effect, affords the opportunity to tap into multiple market segments and increase their revenue (p.306-308).
Given this, the Rift will be aligned with the 4P's in the following manner: the product will be introduced as an entertainment device, that seeks to be the next best thing and spark curiosity in the area of virtual reality. The Rift's price is relatively low considering what it provides to the consumer. Presently, the price of the Rift is $599, which affords consumers the opportunity to obtain their very own virtual reality headset. If consumers want bundle, which includes an extensive amount of bells and whistles, then the price goes up from there with the most expensive package being $3150 in terms of features (Mamiit, 2016). Ehmke, Fulton & Lusk (n.d.) states that the price strategy should be extensively considered by companies that are introducing new or rather innovative products into the consumer marketplace. There are multiple types of pricing strategies that can be established including: value-based, competitive, cost-plus and price skimming (p.2). With respect to the Rift, Samsung chose to use price skimming.
Ehmke, Fulton & Lusk (n.d.) defines skimming as a product being introduced at a rather high price to consumers and then later being lowered when the market starts being saturated with like products (p.2). It can be reasoned that Samsung will undoubtedly have competition at some point in terms of the virtual reality headset and gear. The skimming strategy will work in the interim as it will allow Samsung to maintain its dominance in the marketplace with new and innovative products. When it comes to place, which is the third P in the marketing mix, the Oculus Rift will utilize direct sales. This means that consumers have to want to purchase the VR headset and bundles directly from Samsung.
Ferrell & Ferrell (2012) observe that direct sales is often a good place to begin the selling of a product that is considered unusual and/or limited (p.2). Since the Oculus Rift is a rather new product, going the direct sales route allows Samsung a considerable potential in obtaining consumers. This is because customers who are already loyal to the brand will give the Oculus Rift a look and through an extensive marketing effort, prospective consumers are also slated to seek out the products. When looking at promotion, Samsung plans to use a variety of different types of marketing. Since mass marketing was chosen at the best approach to promoting the Rift, a combination of traditional and newer approaches to promotion are needed. This will include: radio, television, print and social media.
Specifically, Samsung will employ several social media campaigns using Facebook, Twitter, Instagram and Pinterest primarily – and intertwine the messaging on the traditional forms of promotion. The company believes that this will be the best way to capture consumers, both loyalists and prospective purchasers. Ferrell & Ferrell (2012) write that when companies integrate social media into their marketing and promotional strategy, this allows for a deeper connection and communication with the consumer. While each of the social media platforms are unique, the main aim of each is to engage (p.3). As such, by intermingling both the conventional and social media strategies, the Rift's image will be ever present in the eyes of consumers.
It becomes necessary to examine the 5 C’s as it relates to the Oculus Rift as well. The 5C's are customer, company, competition, collaborators and context. With respect to the consumer, the Rift will more than likely appeal to those interested in virtual reality first and foremost. Other consumers who are technologically savvy, might find the product useful - but initially, it can be said that the Rift will find its allure with a specific niche. As far as the company goes, Samsung thoroughly understands its strengths and weaknesses, as well as the opportunities that lie before them in terms of capitalizing on a small, amount of competitors. The only threat is that additional companies like Apple and the like will enter the VR marketplace and try to poach consumers from Samsung. The company cannot necessarily stop this, but there is hope and belief that because it is one of few available VR headsets in the world presently, that the customers who purchase the product will remain loyal to the brand. This gets to the competition.
Samsung's main competitors are Apple and Nokia, primarily, with Google coming on board with their technological progression. As such, Samsung will have to impactfully showcase to consumers why the Rift is the optimum headset that they should purchase should its main competitors opt to start making such technology. The main focus of its competitors has been mostly in tablets, phones and the like - but with Samsung having a new, innovative product in the marketplace such as the Rift, there is a strong likelihood that the company will have competition sooner rather than later.
The context of the VR product is that it is new and ingenious. The Rift stands to make a considerable and noteworthy impact technologically, particularly in an era where that rules the day. The culture of the 21st century operates on the next best thing, and what's current and trendy. Given this, if Samsung is able to tap into that dynamic, then the Rift will be well-known just as its other products are. Moreover, the company should also take into consideration the legal problems that might result.
Samsung recently had issues with Apple in terms of patent infringement, so it will be critical for them to extensively understand the aspects of virtual reality, how headsets are created to avoid issues with this again. Market segmentation, targeting and positioning also need to be observed by Samsung. As noted, the target market segment that Samsung will target with the Rift is technological savvy consumers, and those who love gadgets. This is actually reasoned to be a widespread and ranging population. Samsung can also seek out those who are currently using its main rivals’ products with the hopes of poaching them and getting them to not only purchase the Rift, but other items that the company sells also. Targeting works in conjunction with the segmentation selected. Samsung will need to consistently measure how the sales of the Rift are going in order to ensure that the segment is being reached through its promotional and place efforts. This gets to the positioning context of the marketing strategy. As Samsung has positioned itself as an innovator in the minds of consumers, the company will need to be continually on the ball when it comes to its marketing efforts. There can never be a time, in other words, where the company falters on making certain that consumer understand what the Rift is and why they need it in their lives.
Measures of Marketing Strategy Success
Short Term
In the short term, Samsung will effectively measure the extent to which its strategy is working through the use of consumer sales and analytics. For the former, this will mean a significant examination of how well the Rift is performing with the selected direct sales route - which is where consumers purchase it directly from the website. For the latter, analytics is the data observed from marketing efforts, specifically, social media marketing. It affords companies the opportunity to understand how well they are engaging their consumers on the various platforms. The company's marketing team will utilize Hootsuite to better comprehend the success of the strategy. Hootsuite (2016) states that it is a social media dashboard, which allows for a credible, straightforward assessment of social media engagement. Each of the platforms can be connected through the dashboard (p.1). In doing this, Samsung will be able to better position and target its consumer base, should any issues or problems arise from the introduction of the Rift into the marketplace.
Long Term
In the long term, Samsung will need to do as Dobbs & Koller (2005) explain. The company will specifically need to see how well the headset is performed by examining its long-term relevance of the product to the consumer marketplace. This is testing for fitness and future growth of the product. Moreover, the company will need to consider how well the product is performing compared to other products in its portfolio, and against any competitors who have emerged over the course of the time in which the initial product was introduced (p.1). This will provide additional insight into just how innovative the Rift is in the eyes of the consumer, and whether changes or modifications need to be made to the product.
Dobbs & Koller (2005) go on to state that the threats related to the company need to be considered as well. This means reasoning how successful the introduction of new products has been in the past and whether the pattern will emerge in the future. There cannot be a full comprehension of the product performance until the end of a year. At the conclusion of a year, the company can feasible calculate the limitations of the product and whether changes might occur in the future as it relates to sales (p.1).
There is reason to believe that the Rift will perform well because of the nature of the 21st century consumer, who is frequently looking for something new to purchase. While the price is not the cheapest, the long term benefits of entertainment outweigh that. Samsung might not see evidence of the Rift’s success in the short-term, but in the long-term, it can be argued that the company will see the effects of its combinatory marketing efforts and the placement of the product. This might cause the company to expand how it markets the product as well once it recognizes the success.
Conclusion
This paper examined Samsung, with an emphasis on the company’s current vision and mission as it relates to marketing its products. The paper discussed how Samsung has maintained its viability throughout the years to emerge as a global leader in the area of electronics. The paper also explained the need for Samsung to introduce a new product into the consumer marketplace, noted as the Oculus Rift. This particular product was discussed in extensive detail with respect to how the company can feasibly sell it to the consumer. In particular, the paper delved into the marketing strategy that was selected for promoting the Oculus Rift – mass marketing, and why it will work on a significant amount of levels for the product. Moreover, the paper also looked at the potential success of the Rift through the lens of how Samsung has chosen to position the product, as well as indicators of short and long term success.
It can be said that the company will find substantial results from the selling of the Oculus Rift. As mentioned earlier, there is reason to believe that in the short term, a small amount of consumers will find value in the product, but as time goes on, Samsung is likely to notice that the product is a frequent seller, and is making them revenue. This will, in effect, further the reputation of the company for being an innovative leader in the electronics and consumer products industries against its competitors.
References
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