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7th International Scientific and Expert Conference TEAM 2015Technique, Education, Agriculture & ManagementBelgrade, October 15-16, 2015

SMARTPHONES POSITIONING ON SAMSUNG EXAMPLE

First A. Katolik Kovačević1*, Second V. Vučemilović2 and Third M. Aračić3

1College of Slavonski Brod, Slavonski Brod, Croatia2Associate on College of Slavonski Brod, Slavonski Brod, Croatia

3Former student of College of Slavonski Brod, Slavonski Brod, Croatia* Corresponding author e-mail: [email protected]

First A. Katolik Kovačević, Second V. Vučemilović and Third M. Aračić 1


Abstract

Product positioning is related to creating an image about product in a mind of final consumer. That is the major difference between positioning and differentiation which is related to real product features and segmentation which is focused on market and final consumers. Product positioning and repositioning are two product strategies which are most commonly used.

The aim of this paper is to show and emphasize importance between market success of product and company as a producer, and product positioning according to final consumers’ needs and desires which are partly real but mostly created by producers marketing activities.

This paper is based on market research conducted this year on student population regarding their opinion about Samsung smartphones and other smartphone producers. Market research was conducted in April this year online through internet by e-mail and social networks.

Keywords:

Product positioning, product strategies, smartphones, Samsung

1. Introduction

Today, so many products and services exist on the market. Final consumers are getting information regarding products/services on every day basis through different information channels. Mass marketing cannot be effective today as it was in previous period. It is very difficult for producers to gain satisfying market position for their products/services and attract final consumer’s attention.

Target marketing is far more appropriate for today’s market conditions. Marketing experts must create for each product/service marketing mix and special attention must be taken regarding not only product/service differentiation and market segmentation but also product/service positioning in a mind of a final consumer.

Product positioning starts with product/service but image which final consumer has regarding product/service defines positioning.

Samsung is a company which started as a producer of no name products. Today it is one of strongest and well-known brands all over the world. They distinguished themselves on the smartphones market through innovation and with each new product they worked on satisfying needs and desires of final consumers. With this policy they gained better market position today then their major competitors which were far ahead of them at the start of mobile phones market.

2. Product positioning

Product positioning is one of the product strategies used together with product repositioning, scale of products strategy, product creating strategy and new product strategy.

Product repositioning is a process of revision actual product/service position and marketing mix. Through this process company is looking for new position on the market which would be more appropriate for the product/service. This activities can be directed to actual or new consumers and to new ways of product/service consumption.

Scale of products strategy is related to product portfolio company produce. It can be one product strategy, multiproduct strategy with complementary products and product portfolio strategy which is created according to needs and desires of final consumers.

Product creating strategy is based on the product standardization level. Product can be standardized, adapted and standard product with certain modifications.

New product strategy consists of all operations related to creating new product and putting it on the market regarding existing product line. There are three basic ways for this process which are modification of existing product, product imitation and product innovation.

According to Kotler product position is how product defined by final consumer is related to important product attributes – place taken by product in relation to competition products. [1]

Product positioning is not something connected to product features it is image of concrete product in a mind of final consumer. It means that product positioning means creating product image in a mind of final consumer on specific way. [2]

Title of the Paper 2


Product positioning as a term was first time mentioned and defined in articles written by advertising directors Al Ries and Jack Trout in late sixties. Their definitions of product positioning are still today in all marketing textbooks.

Product positioning starts with establishing differences in terms of product, service and image related to products produced by competition. Next step is establishing criteria for selection the most important differences relevant to final consumer. At the end, selected differences relevant to final consumer must be communicated to targeted market segment through promotional activities.

It is important to select wright differences which will be pointed out.

According to Kotler difference must be important, distinctive, superior, communicable, preemptive, affordable and profitable. [1]

Positioning can be applied on company image, specific product or product line. Positioning as a process has steps showed in next table.

Table 1.Positioning process steps1.

Identification of competitors products-brands

2.

Identification of criteria/attributes relevant for positioning

3.

Present market situation analysis

4.

Positioning strategy selection

5.

Market launch of selected positioning strategy

6.

Measuring positioning strategy efficiency

The most common mistakes in positioning process are under positioning when final consumers do not know anything particular about the certain product brand, over positioning when final consumers image about the product brand is too narrow, mixed positioning which occurs due to often position changes of certain product brand and suspicious positioning when final consumers have doubts regarding promoted attributes of product brand. [2]Positioning is connected with differentiation and segmentation but differs from this two processes. Nevertheless, this three different processes are often mistaken. Basic difference between this three processes comes from their definition. While positioning is related to final consumer’s product image, differentiation is connected with product itself and product characteristics that differ certain product from similar competitors’ products.

Market segmentation is a process through which company selects different market segments to which creates appropriate marketing mix. This process often includes product differentiation which means that for each market segment is created specific product that suits the best to expectations of final consumers in certain market segment. Market segmentation is focused on final customers and differentiation is focused on product/service.

3. Market research results

Market research was conducted this year on student population regarding their opinion about Samsung smartphones and other smartphones producers. It was conducted in April this year online through internet by e-mail and social networks. Research covered student population and included VUSB students, other faculty students and employed persons. Total number of respondents was 222. Majority of respondents is between 20-25 years old which shows figure 1.

15-20 20-25 25-30 30-40 40+0

20406080

100120140160180

Figure 1. Age of respondents Majority of participants, 185 or 83% owned Samsung smartphone. They are satisfied with product but their opinion is that improvements can still be done to improve the product. That is shown in table 2.

Table 2.Are respondents satisfied with their Samsung Smartphone?

Yes, they are perfect.

I'm satisfied with Samsung.

Not bad, but Samsung can better.

I don't like it.

35 92 70 25

Samsung smartphones design market research participants characterize as attractive and modern. Only 11 participants answered that they don’t like design.



0

10

20

30

40

50

60

70

80

90

100

Samsung phones are attractive .

The design is modern, but could be better .

I like design of Iphone more than Samsug's.

I don't like it.

Figure 2.Design of Samsung smartphones

After-sales activities especially guaranty, delivered by the company Samsung, are rated with average mark. Some had rather bad experience but others had no problem with solving problems with product or time needed for that.

0

20

40

60

80

100

120

140

After-sales activ-ities are bad. I have a bad ex-perience.Samsung servis take my smart-phone and fail-ure is removed in a given time. It's good.Failures are removed quickly and ef -ficiently .

Figure 3.After-sales activities

Participants answered on question regarding Samsung smartphones quality and price ratio. Majority of participants wants to have this smartphones but they cannot afford it. They mostly wait for price reduction and regard price as higher than it should be

Table 3.Quality vs. price

Price is proportional to quality, but I still

They cost a fortune . The price is not

I'm waiting for discount

Price of Samsung mobile

can not buy their mobile phones

reasonable.

s on products because I want to buy high-quality mobile phones at a lower price.

phones is not problem for me. The price is okay.

25 60 112 25

Quality is major factor which determines purchasing decision. It is more important than image or range of products produced by the certain company. Nevertheless, majority of our participants believe that well known producers guaranty better quality. It is shown in table 4.

Table 4. The importance of corporate image

I have more confidence in companies that are stable and well know on the market

No, important to me is the design of the phone .

Most important to me is the quality of the product , no matter who produces it .

No, I think „no name“ products can be as good as the products of famous companies.

40 20 111 51

Marketing activities are stated as important and participants consider Samsung as company with good marketing concept. They also emphasized innovation as an important factor.

Table 5. Samsung marketing activities ratings

Marketing does a good job . Samsung smartphones are very advertised and very popular.

Marketing is one of the key elements of the company Samsung . Marketing is very important.

Marketing is good.

Marketing isthe weakest part ofthe company .

82 120 15 5



Participants in our survey consider price reduction of Samsung smartphones to be the most efficient strategy to increase the sales figures. They also see quality improvement as second area for company’s development

0

10

20

30

40

50

60

70

80

90

100

Increase qual-ity.

Prise reduction.

It could not be better

Missing much.

Figure 4. Opportunities for advancement in company's business

Participants in our market research selected Samsung to be a leading smartphones producer today. Very popular Iphone took second place and HTC third. Nokia took fourth place and it is hard to believe that it was a leading company on the very beginning of the mobile phones market. It is interesting that no one mentioned Sony as a producer of smartphones. Figure 5 shows how our respondents rated major producers of smartphones today.

I phone Samsung

Nokia Alcatel HTC LG0

20406080

100

Figure 5. The best mobile phone company today

Product Galaxy S4 is Samsung smartphone regarded as the best smartphone on the market today. Second place is taken by another Samsung smartphone, Galaxy S5.

Figure 6.The best Samsung smartphone on the market

4. Samsung smartphone positioning

Samsung Galaxy S4 is smartphone regarded as one of the best on the market today by participants of our market research. Introduction of this product on the market created interest on the global market. High technology features and quality improvement created great interest among final consumers. Galaxy S4 is smartphone from product line Galaxy. Previous model Galaxy S3 was very popular due to high quality and new model from that product line Galaxy S4, only continued good sales figures. Each and every new model in this product line was well accepted on the market because of quality improvements and new technological features.All functions of this product are focused on final costumer’s needs and desires. Sales are supported with marketing activities and image of Samsung as a company strongly support all products from this product line.Product design of Samsung smartphones is related to customers’ needs so Galaxy S4 has larger screen and it is lighter than previous model. Corners are slightly rounded which improves handling the product such as typing.After-sales activities such as servicing the product and guaranty are mostly, in reasonable time. Price of Samsung Galaxy S4 is slightly lower than same products from competitors.Distribution of Samsung smartphones is excellent so their products can be bought almost everywhere and anytime.Marketing activities were focused on raising demand even before the product was placed on the market. Therefore Galaxy S4 was well accepted from the beginning it was introduced. Advertising included internet, social networks, press and television and product presentations on sales points.6. Aim and Scope of the conference Transfer of knowledge and dissemination of achievements mobility of teachers and international cooperation interdisciplinary approach on development



5. Conclusion

Every company once when defines its market position must work on achieving goals set by the company management. Positioning is not just wishful thinking or well-designed marketing advertising massages, it is whole process of designing products/services according final costumers expectations and desires. Samsung example showed us how they worked with each new product on improving their products characteristics in terms of features but also in creating better image regarding not only products but company as a whole.Their smartphones are today very popular and well accepted, especially among younger population. On the very start of introducing mobile phones market Samsung was far behind market leaders such as Nokia and Motorola.Today, our participants in market research are pleased with Samsung smartphones in terms of quality, market presentation and other characteristics covered with research. Most of them own Samsung smartphone and in future will stay loyal to this brand. That is the best indicator which shows how well Samsung positioned their smartphones on the market today.

Note: This paper is result of a final thesis of former student at the College of Slavonski Brod

6. References

[1] Kotler, Ph.,Wong, V., Saunders, J., Armstrong, G., Osnove marketinga, Mate, ZŠEM, Zagreb, 2006.[2] Renko, N., Strategije marketinga, Naklada Ljevak, Zagreb, 2009.[3] Ries, A.,Trout, J., Positioning;The Battle for Your Mind, Warner Books, New Yourk, 1982.

[4] Harrington A., Quelch J. Samsung Electronics Company: Global Marketing Operations[5] Hiroyuki, J. (1987) Mobilizing Invisible Assets, Harvard University Press, Cambridge [6]http://www.samsung.com/hr/aboutsamsung/corporateprofile/history06.html [Accessed: 05-April-2015][7]http://www.samsung.com/hr/aboutsamsung/samsung/history_07.html [Accessed: 05-April-2015][8]http://www.samsung.com/hr/aboutsamsung/corporateprofile/history03.html [Accessed: 06-April-2015].[9]http://www.samsung.com/hr/aboutsamsung/corporateprofile/history02.html [Accessed: 05-April-2015].[10]http://www.samsung.com/hr/aboutsamsung/corporateprofile/history01.html [Accessed: 07-April-2015].[11]http://www.samsung.com/hr/aboutsamsung/corporateprofile/history.html [Accessed: 07-April-2015].[12]http://www.samsung.com/hr/aboutsamsung/samsung/history_02.html [Accessed: 07-April-2015].[13]http://www.samsung.com/hr/aboutsamsung/samsung/history.html [Accessed: 08-April-2015].[14] Pilić L. Samsung Galaxy S4 http://samsung.mobil.hr/Galaxy_S_4 [Accessed: 08-April-2015].[15] Blažev K., Recenzija: Samsung Galaxy S4 http://mob.hr/recenzija-samsung-galaxy-s4/ [Accessed: 07-April-2015].


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