Branding according to Rumelt (1991)
brings in the aspect of trust, loyalty and excellent value to customers. To venture in the international market branding is important for sustainability and survival Finch P., 2004.
It is also an innovative way of improving the customers' experiences in using products and reserving identifying with the products. Branding by Samsung has ensured that customer identification of the products is easy and they can easily accord a value on the product.
Overview of Samsung's Strategy
In choosing its preferred internationalization strategy Samsung electronics deploys emphasis on three major aspects. These aspects give a summary of strategies discussed earlier. They include Adaptation, Aggression, arbitrage (AAA triangle).
Adaptation is concerned with specific market condition where aspects of culture, regulation and needs for the market are incorporated Ricart et al., 2004.
Samsung electronics uses adaptation to obtain an edge in market penetration and add value to the market.
Aggression works on ensuring the economies of scale are within bounds of operations. It entails standardization of products and brings the activities of the corporation together. Samsung embraces aggression through marketing, branding and producing its products in a standardized manner.
Arbitrage involves assessing the differences and exploiting them for economies of scale and product development Ricart et al., 2004.
The assessment entails determining the suitability of using one location to source for raw materials and another to develop technology based on suitability. Samsung uses arbitrage to determine whether it is viable to locate a production plant in a particular country or just exploit the market. In arbitrage factors such as local knowledge of technology source of raw material and government regulations are put in mind Ricart et al., 2004()
Lessons learned by Samsung Corporation
Increased competition means a decrease in profits and market share to Samsung owing to high supply and decreased sales. Competitors in the electronics international market will bring in lower prices and segregate the market proportion enjoyed by Samsung. Competition will also bring in the aspect of technological advancement and thus higher cost to Samsung. The elevated costs will be due to the need for innovations required to match the international competition. Other issues facing Samsung are discussed below.
Threat to entry
Samsung faces great threat is a company dealing in the international arena take up to produce a variety of products just as it does. Though it is not easy to open up a wide range production such as the one run by Samsung technology, should such development occur the corporation faces a grave danger of threat.
Rivalry
Rivalry in the electronics market is very high. Firms have not only to be on level with technology but also, track the developments of their competitors. Rivalry is heightened by introduction of new products in the market (Barney and Hesterly, 2008). It is even worse where the competing firms are not in a position to technologically differentiate products. Failure to keep up with trend development in the market of electronics will lead to loss of customers.
Suppliers
The supplies of electronics are a formidable force to reckon with where competition is volatile. Suppliers can easily form partnership with producing firms. Since this are the linkages to the market and consumer Samsung faces more threat if they fail to ascertain they are in good relations with the suppliers. Suppliers will keep with companies whose future is promising Rumelt (1991)
Buyers
This is the greatest threat among all since they consumer is the back bone of every production activity. Consumers decide what and where to buy the products and since the electronic products are based on need and want of the consumer the threat is great. This threat comes in when the producer fails to consider the needs and wants of the consumer and also does not keep trend with technology advancements.
Solutions
Redesign and make innovative electronics
Samsung needs to differentiate its products more from those of its competitors. It is admirable to remain at the top of electronic industry in competition however it is not easy. Samsung needs to keep bring new electronics and technology into the market. Technology advancements need also to be miles away from replication...
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