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Rimsha answered on
Jun 05 2021
APPLICATION OF PORTER’S’S FIVE FORCES MODEL ON SAMSUNG
Executive Summary
The cu
ent report deals in the analysis of the organization Samsung, for which its Porter’s five forces analysis has been done. This is a strategic management tool that bears a significant level of utility in the field of strategic management in order to identify as well as analyze the five factors or driving forces in the market that can harm or influence the competitive advantage of a company. These forces are bargaining power of suppliers, bargaining power of customers, threats from substitutes, the threats of new entrants and level of rivalry in the industry. For Samsung, these have been identified and analyzed in order to suggest suitable recommendations.
Table of Contents
Introduction 4
Cu
ent Market Status for the Firm 4
Revenue System of the Company 4
External Environment of the Company 5
Internal Environment of the Company 6
Application of Porter’s Five Forces Model to the firm 6
Bargaining Power of Suppliers 7
Bargaining Power of Customers 8
Threat from Substitutes 8
The Threat of New Entrants 9
Level of Rivalry in the Industry 9
Proposed Strategy 9
Justifications for Choice of Strategy 10
Conclusion 10
References 12
Introduction
The business organization selected for the study is Samsung; it is a South Korean multinational company. The headquarters of the organization is in Samsung town, Seoul. This organization is founded by Lee Byung-chull. It has been seen that Samsung is affiliated to many businesses. In 1960s, the company entered in the field of electronics. It must be noted that after 1990, company entered the mobile phone industry and semiconductors for their primary source of the income. This assignment focuses on the Samsung mobile organization. It has been seen that over the past few years, Samsung was successful in development of the image of their organization globally using their mobile phones.
They are managed to become competitive leader of the mobile industry. Today, Samsung mobiles support the organization in producing large turnover (Trading Economics, 2018). Apart from this, it must be noted that Samsung mobiles help in development
and image globally. Samsung is now known for its mobile phones. Following assignment identifies the cu
ent market status of the firm and then applying Porter’s five forces model on the organization. Apart from this, based on the analysis using the five forces model, marketing strategy for the product is proposed and justification for the proposed strategy.
Cu
ent Market Status for the Firm
Revenue System of the Company
Samsung electronics has successfully maintained sixth rank with the
and value of $61.1 billion in 2019. It must be noted that the
and value of Samsung has increased up to 2% since 2018. Samsung is known for the consumer products such as mobile devices. They are the global leading smartphone vendor. In 2012, it held the share of 20 to 30 percent in the smartphone market. It must be noted that Samsung’s main line of smartphone product is Galaxy series, which was released in April 2009. The shipment of the smartphone has increased rapidly from 2.4 million at 20100, which increased to 74.1 million in the fourth quarter of 2017. Samsung has become the global leader in the smartphone industry (Samsung Newsroom, 2020).
Many factors, which contributed to the critical growth of the Samsung includes continuous launches of the innovative products, which can suits the customers lifestyle, need and trends such as Galaxy fold. It has been seen that strong growth potential is there in the organization based on the future innovation technologies such as 5G, AI, IoT and the automotive business. Apart from this, Samsung is having number one position globally in the semiconductor memory market and technology leadership in the industry (Counterpoint, 2020). Samsung is successful in launching the mobile series, which keep the business of mobile running. The company led the industry in the foldable smartphones category launching Galaxy fold and ensure resonating the
and with the customers.
It has been seen that Samsung provides the consumers through QLED 8K and Micro LED displays. It must be noted Samsung is advancing its technology by launching advanced 5G technology. Semiconductor memory business reinforced its market presence by producing the mass production of the industry’s first 12-gigabit (GB) LPDDR5 mobile DRAM and its sixth-generation V-NAND, which features the industry’s first 100+-layer single-stack design. Apart from this, it must be noted that Samsung has been investing in the Research and development, which support the organization in successful expansion (Samsung Newsroom, 2020).
External Environment of the Company
On analysis of the external environment of the company, it has been seen that technological and social factors are the main ranking factors, which affect the Samsung and the mobile industry, in which it operates. It must be noted Samsung organization deals with the technology and their products require regular technological innovation to remain competitive in the market globally. Apple is the rival organization of Samsung, which give very high competition to the company in the market industry.
It must be noted that change in the technology at the global level can affect the business directly especially manufacturing and sales can be affected. Technological change can be positive or negative depending upon its nature. The development of the touch-screen technology at the global scale led to the introduction of the Samsung galaxy in the market. Apart from this, high competition towards offering similar technology to the company developed the global saturation of the market (Chen et al. 2015). Many mobile organizations with their similar product at cheaper price or new technology are targeting the customers of the Samsung.
On the contrary, social factor has equal impact on the function of the organization. Social factor, which can be critical for the organization, is change in the preferences, attitude and preferences of the customers. It must be noted that large segment of the customers of the Samsung is between the ages of 20-40 group, who prefer to buy the trending products. It is necessary to note that choices of the millennial generation changes very frequently with the launch of the new product. Thus, to remain in the market and trending company needs regularly to develop new products, which increase the loyalty of the generation towards the product (Safavi, 2020). The change in the attitude of the customer towards the product can...