Acc30009 Accounting For Innovative And Assessment Answers
Answer:
Introduction
Samsung, is a South Korean company that deals with different types of electronics. Due to its proper operational strategies and consideration of quality, the company is termed as one of the world largest producers of electronic devices. Over the years, large screen smartphones have increasingly become popular, a trend that is largely attributed to galaxy note phones being introduced to the market by Samsung. The purpose of this study is to provide a discussion how introduction of Samsung Note 8 to the market has affected the company. The report will also discuss the circumstances leading to its launch and whether or not the company has succeeded from the launch.
The recall and discontinuation of Galaxy Note 7 was one of the reasons why Note 8 was introduced. The primary reason for this introduction was that the company needed to recover from the stained reputation following Galaxy Note 7 failure as there we reports that the phone overheated to the extent where, in some cases, it busted (Eadicicco 2017). The company’s stained reputation was so severe that there was doubt whether the company, the Note line to be specific, would ever recover. Hence the need to introduce a much-needed updated Note 8 smartphone phone.
Introduction of this device was aimed at strengthening Samsung’s competition with iPhone, one of the firms that is believed to have dominated the mobile phone industry. Apart from competition, the company also wanted to address the changes in consumer perceptions. Some of the features portratyed by this device include display of 5.70 inch, a RAM of 4GM, Storage capacity of 64 GB, Resolution of 1140x2560, among other enhanced features
After multiple complains concerning the functionality of this device especially the quality of its battery, the company did various enhancements with aim of regaining customer trust on their Note phones (Reuter 2017). They pledged multiple improvements on the phones to ensure product and customer safety which included rigorous battery tests plus more improved standards. All these was to ensure that the next note phone they produced, which is note 8, was of higher standards meeting all the customer expectations and avoiding another disaster (Francisco 2017). Also the company wanted to be ahead of the competitors like apple who had launched IPhone 8. For that reason, Samsung needed to launch galaxy note 8 so as to maintain the competition.
While trying to make itself one of the most innovative and quality brands within the industry of electronics, Samsung strives to achieve a competitive advantage that is sustainable by ensuring that it remains number one in the digital market. Their policy is “we will devote out human resources and technologies to create superior products and services thereby contributing to a better global society” (Rudenko 2014). Through this policy, the company has remained in operation for several decades even with stiff competition that comes from various firms.
Based on its policy on attaining and achieving a competitive advantage, they have differentiated their products from their competitors in three categories (TMS 2016). The categories are firm linkages, product attributes and firm-customer relationships. Samsung’s products are similar to their competitors’ products, therefore, the company deals with this kind of competition within five industries that are different. Hence they ensure that features incorporated in its products are unique and different. A good example is the pod cast feature that is added within their headsets to give their customers more functionality.
Product differentiation strategy by Samsung can be vertically and horizontally seen. For analysis of product differentiation, considering the different types of smartphones that they offer is very significant. Technology sector is dynamic as change of mind by the consumers do happen very often, hence, the need for companies to change their products with the same pace so as to keep up with their customers’ needs (TMS 2016). They succeed in doing so because adaptability to its consumer demand is one their main powers.
Samsung can produce different product designs to match perfectly with each target that coexist in the same industry. Smartphone consumers tend to vary when it comes to paying for quality (Altavilla 2017). A good example is, people who are in their 70s have different preferences regarding smartphones compared to those people who are in their 20s.
Samsung, in its endeavors on ensuring success and competitiveness in the digital industry has also adopted the cost strategy (MASS 2016). The management of the company has drawn strategies and policies with the aim of ensuring that they have the lowest cost. By lowering production cost, Samsung has the golden opportunity of determining their products’ prices enhancing their competitive edge in the process. Minimizing operation and distribution costs and also controlling their labor cost tightly are practices that the company has adopted in executing their cost leadership strategy.
Vertical integration is a cost driver that benefits Samsung and to seek cost advantage within the company’s production facilities (Neha 2014, P. 25). Vertical integration, in microeconomics, is known as a strategy that is used by manufactures to gain control over chain of production. Samsung’s cost leadership is achieved through manufacturing their mobile devices major components. Also the company does not compromise the profitability of their core business for its mobile business purposes, because their businesses are treated as separate entities.
The launch of galaxy note 8 strengthened Samsung’s competitive advantage as it actually made the rivalry between them and other competitors fiercer. This is because Note 8 boost many features that are offered by their competitors especially apple, their fierce rivals, who launched their IPhone X around the same time as galaxy note 8. Both phone cost around 1000 dollars; Samsung cost 960 dollars while IPhone X cost 999 dollars (Shukla 2017). The competition between the two has been intense for years. Samsung struggled with note 7 but they have won back users with galaxy note 8 therefore increasing their competitive advantage.
The success of galaxy S8 following note 7 disaster proved that Samsung are good in regaining customers’ faith (Shukla 2011). Unlike others phones from competitors, note 8 would be the strongest phone for multimedia consumption and also multitasking which Notes phone are well known for strengthening their competitive advantage even further.
Upon making various advancements on this device, the company has realized a significant growth in revenue, as the device is termed as among those that have pleased the customer most (Passingha 2018). Some of the features that have pleased the consumer include its extra ordinary camera, huge memory, fast operation speed among others. As time goes on, mobile phone users are changing their taste of size of cell phones from small to big, and therefore designing this device in large size has seen it being purchased most in different countries.
According to Shukla (2011), considering the desires of consumers is essential because they are the reasons why businesses remain in operation. Samsung is one of the companies that studies the market before introducing new devices and this has been one of the reasons why it remained competitive over the years.
In conclusion, having a broad range of products is the biggest competitive advantage that Samsung has because it helps them stay in balance when one of the product is not doing well. In addition to that their brand is respected as they have business experience and their products are top quality.
References
Neha, P 2014. How Media Got the Biggest Bite of (the) Apple: A Look at the Media Misperception in the Apple-Samsung Case. Marquette Intellectual Property Law Review, vol 18, no.1, pp. 23-45.
LEADERSHIP, C 2013, Business level strategy SAMSUNG, viewed 10th September 2018 <https://www.academia.edu/5220714/Business_level_strategy_SAMSUNG>
MASS, B 2016, Samsung: Product differentiation, competition, strategies, viewed 10th September 2018 <https://brainmass.com/business/differentiation-strategies/samsung-product-differentiation-competition-strategies-381891>
TMS, T 2016, Innovation vs quality, viewed 10th September 2018 <https://themarkertingscope.com/business/innovationvsquality-381891>
Reuter, M 2017, How Samsung Plans to Win Back Consumer Trust after the Note 7 Debacle, viewed 10th September 2018 <https://howsamsung8planstowincustomertrust
