BUS0119 | Element of Marketing Mix Strategy

You are required to select two companies or brands that markets its consumer products in Singapore. (Groups are to choose a product-based business and not a service-based business). The companies you have chosen should be a manufacturer and not a distributor.   Next, identify two brands (or companies) operating in Singapore. It must be a brands that is related to its line of business and serving the same target market segment. I.e. If you choose OSIM vs Ogawa, determine which product line you would like to select for your project. For example, you may decide to pick the latest range of massage chairs introduced by these two brands

Answer:

Part 4 Marketing Mix

Price

Price is considered as the important element in the marketing mix strategy that is adopted by the business in the competitive environment. The price of the product is the amount that the customer is willing to pay for availing the product or service.

LG Pricing strategy

• Cost plus mark up: - The pricing policy of LG electronics includes mainly cost plus markup which means the cost of the product and reasonable profit of brand in the market of Singapore. In most of the rural areas, the company generally follow the policy of price competitiveness.
• Price competitiveness: - In price competitiveness, the company keep the prices of the product after reviewing the competitor's prices in Singapore. Though, LG evaluates the prices of the competitors with the customers thought for prices and after evaluating the prices and cost it evaluated the actual cost of the model is determined by them.

Samsung pricing strategy

Samsung Electronics it follows different types of pricing strategies for their products.

• Skimming price strategy: - For the innovative products, Samsung generally asks for the higher prices as it follows the skimming price strategy (Bhasin, 2018). In this strategy, the marketers set high initial price for the products and then reduce the same with time in the market of Singapore.
• Competitive pricing strategy: - For the remaining products, it makes use of the competitive pricing strategy which is required to beat the competitors that are present in Singapore. This shows that the company can easily manage their profit out of the products.

Current pricing and offering of Samsung: - The key competitors of the company include Samsung, Sony, Panasonic and many others. Out of these, the major competitor of the company is Samsung. The current pricing and offering of the products are generally less or equal to competitors because it wants to earn high profit and goodwill in eyes of Singapore customers.

Research on TV in market: - Research on TV has been done which shows the prices comparison of two products that is LG 43 LH576T 43 Inch LED Full HD TV and Samsung UA32EH400 3R 32 inch LED HD-READY TV which is 37,199 and 21,990 respectively (Gadgets Now, 2018).

Promotional pricing of LG Company: - LG Company makes use of the promotional pricing in which the company reduce the prices for a short period of time. This generally takes place in the lean season as to increase the sale of products. Though, on the other hand, Samsung electronics doesn't make use of promotional pricing.

Comparing the strategies of both the brand, this has been found that LG Company has applied the strategies effectively in selling the products in the market (Grant, 2016). The company has balanced their profit by following the two strategies. Along with this, they have made their good reputation and image in the market. This shows that in Singapore market LG company is dominating the market than Samsung.

Place

The place is the location or areas where the product is distributed from where the buyer can access the products and services.

Distribution channel of LG

LG electronics serve their products in Singapore market and at different locations (Bhasin, 2018). The aim of the company is to achieve the rapid and fast growth due to which they sell it’s by performing the tie-up with distributors. The distributors have given the responsibility of distributing the LG HD TV efficiently and on time. This has been found that there are different types of the channel of distribution which include: -

(Source: Armstrong, Adam, Denize and Kotler, 2014)

The above-given image reflects the channel structure and types that are generally present in Singapore market. LG follow 4^th distribution channels (producer-distributor-wholesaler-retailers-customers) in which they distribute their products directly to their own distributors. Further, the distributors ensure that they make the product available to the final customers in Singapore (Armstrong, Adam, Denize and Kotler, 2014). This will further include numerous intermediaries such as wholesalers, retailers and finally to the end users. LG has approximately 46 branch offices that perform the work on the field of distribution across the world.

Strategy of LG: - The strategy which is followed by the company is that they have their own distributors which help the company to make the product easily available in malls and supermarkets which enhance revenue in Singapore. Moreover, the products of the company are available through online mode which helps them in generating high profit.

Distribution channel of Samsung

On the other, Samsung electronics competitor of LG makes the Samsung TV available through channel marketing which includes: -

• Sales and service dealers
• Modern retail and distributors  (Bhasin, 2018)

The company retailers make their products available through chains of the supermarket. This reflects that it follows the 2^nd method of distribution (producer-retailers-customers) and a unique distribution channel which involve a single distributor.

Strategy of Samsung: - Company has a large number of retailers who make the products available to customers and this strategy is followed to earn a maximum profit because fewer intermediaries are available. This reflects that both the companies follow the unique strategies in Singapore.

Comparing, the strategies, this has been found that the strategies of LG in Singapore market are more effective than Samsung. This shows that LG is dominating in the market comparing it with the other competitors.

References

Armstrong, G., Adam, S., Denize, S. and Kotler, P. (2014) Principles of marketing. 6^th edition. Welbourne: Pearson Australia.

Baker, M. J. (2014). Marketing strategy and management. London: Palgrave Macmillan.

Bhasin, H. (2018) Marketing mix of LG – LG marketing mix [Online]. Available from: https://www.marketing91.com/marketing-mix-of-lg/ [Accessed on 15^th October 2018]

Bhasin, H. (2018) Marketing mix of Samsung – 4P of Samsung [Online]. Available from: https://www.marketing91.com/marketing-mix-of-samsung/ [Accessed on 15^th October 2018]

Gadgets Now (2018) Compare LG 43LH576T 43 inch LED Full HD TV vs Samsung UA32EH4003R 32 inch LED HD-Ready TV [Online]. Available from: https://www.gadgetsnow.com/compare-television/LG-43LH576T-43-inch-LED-Full-HD-TV-vs-Samsung-UA32EH4003R-32-inch-LED-HD-Ready-TV?from=mdr [Accessed on 15^th October 2018]

Grant, R.M. (2016) Contemporary strategy analysis: Text and cases edition. New Jersey: John Wiley & Sons.