Industrial analysis of Samsung with porters model, VRIO and other financial details as per 2017.

1. INDUSTRY & FIRM ANALYSIS
Samsung Electronics
( Smartphone Industry)

2. INTRODUCTION
INTERNATIONAL SMARTPHONE
INDUSTRY
• Evolution
• The first smartphone in1995, IBM
Simson
• 1996 Nokia launched 9000
• Expansion of smartphone market due
to apples innovative iphone in July
2008
• Market breakup
• High end [above 24k]-39.37%
• Mid range[12k to 24k]-20.60%
• Lower end[below 12k]-40.02%
• Financials
• Global revenue-$478.7billion
• Contribute 5.1% of global GDP
• Major players
• Samsung,apple,xiaomi,lenovo,moto,
Sony,LG
SAMSUNG
• Overview
• Samsung group is a south Korean
multinational conglomerate
• Samsung was founded in 1938
• 2nd most profitable smartphone
company in the world
• Financial
• Revenue-$80.9billion
• Net profit-$13.4billion
• Competitive advantage
• Effective market readership
• New product development

4. 21.60%
14.70%
10.40%
7.60%
6.30%
39.50%
Samsung Apple Huawei OPPO Xiaomi Others
Source: IDC Worldwide Quarterly Mobile Phone Tracker, February 1, 2018
GLOBAL MARKET SHARE

5. INDUSTRY ANALYSIS
Threat of New Entrants Bargaining power of
suppliers
Threat of Substitute
Products Bargaining power of
Consumers
• Moderate
• Communication,
distributing information.
• Numerous substitutes
• High competition
• Focussed utility.
• Technological innovation
• Moderately High
• Increased information
• Low Switching Cost
• Brand image
• Quality of Product
• Low
• High capital Requirement
• Patent Barriers.
• Customer loyalty.
• Advanced Technology in
use.
• Legal & Regulatory
Pressure
• Very low
• Small size
• Low financial strength
• Can switch supplier
• High for google
• Intense competition
• Difficult for new
brands to enter
• Technology innovation
for growth
• Deeper market
penetration
Rivalry among existing
competitors

6. STRATEGY & POSITIONING
Competition
• Samsung smartphones positioning:
• High quality
• Mass consumers
• Wide price range
• Feature oriented
• Apple smartphones positioning
• Premium brand
• High quality
• High price
• Design and trend oriented
Positioning of Samsung Brands

7. SAMSUNG RESOURCE-BASED VIEW
VRIO EVALUATION
The Question of Value?
•
Samsung has positioned itself in a manner that allows the company to answer the
question of value with a strong yes.
 Samsung designs, manufactures, and sales several types of consumer electronics. The
company has equipped itself with multiple resources and abilities that have enabled the
firm to enter, and exploit, several areas of consumer electronics.
 These creative and technological skills have even allowed Samsung the opportunity to
enter the home appliance market.
 The products created by Samsung exist in markets that are extremely competitive.
The Question of Rarity?
 The products created by Samsung exist in markets that are extremely competitive.
 With that being said, many of the players in those markets have valuable resources and
capabilities that are similar to other competing firms.
 As a result, no one company has rare resources; thus leading to what is considered
competitive parity.

8. The Question of Imitability?
 Samsung has only been 2nd to IBM in annual U.S. patents filed over the past 6 or 7
years.
 Although Samsung produces several patents, the competitive advantage
established from the same patents is only temporary.
 Some patents allow other competitors to understand the overall functionality of
products produce which ultimately negates the advantage gained from the patents.
• Despite the fact that some competitive advantage is lost, collectively, Samsung
produces several industry leading products annually which create a sustained
competitive advantage.
The Question of Organization?
 Samsung has become the world’s largest electronic company by revenue as a
direct result of value and imitability of its products combined with the direction
provided by CEO Lee Kun Hee.
 In 2012, the company had sales of up to $179 billion and sales have been
increases since Chairman Lee took over in 1987.
 The increase in sales figures is a direct result of proper organization which
allowed the company to reach its full potential.

9. VRIO FRAMEWORK

10. SAMSUNG STRATEGIC STEPS
Scenarios Strategy
Introduction of first full touch screen by Iphone- -
2007
Samsung launches Omnia eventually, becomes dominant in touch screen phones
globally.
Smartphone Market Dominance by NOKIA in 2008-
54.1 % in India and 40% in world.
Made use of android OS market and launched its first android phone Samsung Galaxy
GT I7500.
New players like Micromax, Karbonn , Lava, Spice
launch cheaper android phones, Nokia continue with
Symbian OS- crashes its market share to 32.9 % in
India.
Samsung launched Galaxy S series, its premium range of smartphones.
Later Galaxy 3and Galaxy 5 priced below Rs13000 to tackle new players.
Nokia-Microsoft partnership announcement lag,
Iphone 4 .
Starts campaign for S3 as Anti-Iphone ad, Takes advantage of Nokia merging lag and
wide carrier suport, focus on service, customer support
Apple sues Samsung -Design copy
Huge success of iphone 6 along with Xiaomi
introduction.
Cut back the number of models, Skimming price and competitive pricing, Introduction
of Note Series, Super AMOLED displays
Distributes to product to any willing retailer unlike Apple.
Battery Explosion of Note 7 Creates Battery advisory group, 8 point battery safety system.
Wide range of players with Flagship Killers Out innvoating apple with Infinity Display and Iris Scanner.

11. REFERENCES
1. https://www.statista.com/statistics/276477/global-market-share-held-by-samsung-
smartphones/
2. https://www.statista.com/statistics/237093/samsungs-operating-profit-quarterly-
figures/
3. https://www.businessinsider.in/samsung-introduced-10-times-as-many-phones-as-
apple-last-year-but-its-mobile-division-made-half-as-much-
revenue/articleshow/57401333.cms
4. https://www.slideshare.net/RISHIBANSHIWAL/smartphone-industry-analysis
5. http://www.bgr.in/news/mobile-sector-to-account-for-8-2-percent-of-indian-gdp-by-
202
6. https://www.cheshnotes.com/2017/10/samsung-five-forces-analysis/
7. https://www.managementstudyguide.com/porters-five-forces-analysis-of-
samsung.htm
8. https://research-methodology.net/samsung-porters-five-forces-analysis/
9. https://www.slideshare.net/gauthamreddy39/porters-5-forces-for-mobile-industry
10. https://only4comac.blogspot.in/2014/02/firm-evaluation-resource-based-view.html
11. https://www.idc.com/getdoc.jsp?containerId=prUS43548018

12. THANK YOU