Current Marketing Situation:

Samsung Smartphone, founded by Andy Rubin with experience in the Smartphone market. Now,
overall Smartphone sales have been high and profitability has increase by launching Samsung
Galaxy series. The estimated size of the market for multifunction Smartphones is 1.8 billion, with
7.3% growth expected within 3 years. To gain market share more in this environment, Samsung must
carefully target specific market segments.
Top Smartphone Operating Systems, Forecast Market Share and CAGR, 20132017
Smartphone OS

2013 Market Share

2017 Market

Android
Ios

75.3%
16.9%

Share
68.3%
17.9%

Windows Phone
BlackBerry OS
Others
Totals

3.9%
2.7%
1.2%
100.0%

10.2%
1.7%
1.9%
100.0%

Source: IDC Worldwide Mobile Phone Tracker, September 4, 2013

Market Description:
Samsungs market consists of consumers and business users who need to conveniently store,
communicate, and exchange information on the go. Specific segments being targeted during
the first year include professionals, students, corporations, entrepreneurs, and medical users.
Smartphone purchasers can choose between models based on three different operating
systems, first one created by Apple (ios), Second one created by Microsoft (Windows) and
third one created by Google (Android). Samsung licenses the market dominant Apple system
because thousands of software applications and hardware peripherals are compatible with
this system.

Product Review:
Our next product, Alien O1, offers the following standard features:

4GB RAM
Android 4.4 (KitKat)
5 inch 1080p Super AMOLED Plus display
2900 mAh Li-ion Battery
CPU - Quad-core 2 GHz GPU
16-core processor, manufactured at 20nm scale
16 megapixel Camera front 2 M.P.
Fingerprint Reader
Eye Scanner

The Galaxy s5 specs will slot in the trend of the 2014 smartphone market. Its display will probably
not go beyond the 5 inch threshold, as a display larger than 5 inches would make the Galaxy s5 a
tablet, & Samsung doesnt need to get on Galaxy Notes propriety. The resolution will even be
sucked at full HD, because, for the time being, theres no need of a higher resolution.

Targeted Segment

Customer Need

Corresponding

Professionals

Feature/Benefit
Stay in touch while on the Wireless e-mail

(consumer Market)

go.

conveniently

send

to
and

receive messages, voice and

Students

video call from anywhere.

Record information while Voice recognition for no-

(consumer Market)

on the go.

hands recording

Perform many functions Compatible with numerous

without carrying multiple applications.
gadgets.

Case wardrobe of different

New design.

colours and patterns allows

users to make a fashion
statement.

Corporate users

Input and access critical Compatible with widely

(Business Market)

data on the go.

available Software.

Entrepreneurs

Use for proprietary tasks,

Eye scanner

Organize and access No-hands, wireless access

(Business Market)

contacts, schedule details

to calendar and address book

to easily check appointments

Update,

access,

and connect with contacts

and
No-hands,
wireless

Medical users

(Business Market)

exchange medical records

recording and
exchange of information to
reduce
paperwork and increase
productivity

Ability to run any android application

Large colour display
Touch screen for input
Cradle for synchronizing data with PC
Interchangeable case wardrobe of different colours and patterns
Built-in digital camera.

Fingerprint Reader and Eye Scanner:

Sales of the Galaxy S4, the Samsungs current marquee handset, slowed after Apple released the
iPhone 5s and 5c in September. The 5s includes a fingerprint-identity sensor, and Samsung is
considering using an eye scanner and a fingerprint-identity sensor in its top-end smartphones.

Camera:
The camera of Alien O1 will be 16-megapixel that uses optical image stabilization technology. The
improved camera sensor could help you take better pictures on the go.

Rapid charging Battery:

Alien O1 are pointing toward a 2,900 mAh battery. This battery will include rapid charging
technology which can charge from 0-100% in two hours. Currently the Galaxy S4 is boasting a
2600mAh battery so a small increase would be better than nothing. These kind of batteries use a
silicon anode instead of a graphite one which many others use. This allows for that slight jump up in
battery life.

Multi-Party Video Conference:

A new patent has been filed outlining a multi-party conference call feature which may appear on the
Alien O1. These built-in conference calls would allow the user to have multiple users in one
conversation. It seems that users can use the front and back camera at the same time when in a video

call. Samsungs ChatON application already allows one-way conference calls so it seems like the
next logical step for the app.
The images below show multi-party conferencing in progress.

Competitive Review:

Increased entry of established smartphone companies has pressured industry participants to

continually add features and cut prices. Competition from specialized devices for security, such as
Apple devices, is also a factor. Key competitors include:
Competitors
Apple

Model

Features

Price

High resolution display, High pixel density

screen, HD camera (8 MP), Dual core

$ 649.00

processor, Fast mobile data support (4G),

Small dimensions, Figure print Reader.
i
Phone 5s
Google

Very big display, High-resolution display,

Extremely high pixel density screen, over
370ppi (445 ppi), HD camera (8 MP),
Quad core processor, Fast mobile data $ 349.00
support (4G)
Nexus 5

LG

Very big display, High-resolution display,

Extremely high pixel density screen, HD
camera (13 MP), Quad core processor,
Fast mobile data support (4G), HDMI $ 299.00
connector for TV-out.
G2

Sony

High resolution display, High pixel density

screen, Quad core processor, Fast mobile
data support (4G), Water-resistant phone.
$ 575.00

Xperia Z1
Apple: Apple is targeting business markets with its iPhone 5s, many with wireless capabilities to
accommodate corporate users. For extra security, one model allows access by fingerprint match as
well as by password.

Google: There are some spectacular features of Google Nexus 5 that can attract customers. Android
4.4 KitKat is the latest operating system from Google. Google Nexus 5 has a Qualcomm
Snapdragon 800 2.26 GHz speed processor which should easily make the smartphone one of the best
Android device in the market for its performance and specifications.
LG: LG has launched its latest flagship smartphone, the G2. The LG G2 sports a 13.0-megapixel
rear camera with Optical Image Stabilisation and a 2.1-megapixel front shooter. LG's latest flagship
runs Android Jelly Bean 4.2.2 and is powered by a 3,000mAh battery.
Sony: Sony kicked off its CES 2014 campaign with the launch of the Xperia Z1 Compact, which is a
mini-variant of the company's flagship smartphone, the Xperia Z1. It is Water-resistant phone.

Distribution Review:
Alien O1 will be distributed through a network of select store and non-store retailers in the
top markets. We are expecting about 15 million sales in first month that will break our
previous record of selling 10 million of Galaxy s4. Among the most important channel
partners being contacted are:

Electronic specialty stores: Best Buy and Best Buy Mobile, Costco, RadioShack, Sams
Club, Staples, Target, and Wal-Mart will carry Alien O1 in their stores.

Computer stores: Gateway stores will carry Samsung products.

Online retailers: Amazon.com will carry Alien O1 and, for a promotional fee, will give
Alien O1 prominent placement on its home page during the introduction.

Strengths, Weaknesses, Opportunities, and Threat Analysis:

Alien O1 has several powerful strengths on which to build, but we have some weakness too. The
major opportunity is growing demand for Android Phone. We also face the threat of ever-higher

competition. Table A1.3 summarizes the main strengths, weaknesses, opportunities, and threats
facing Alien O1

Strengths: Alien O1 can build on three important strengths:

1. Operating System: Alien O1 build in latest Android operating system.
2. Big Display: It has 5 inch 1080p super AMOLED Plus display.
3. Fingerprint reader: It has been included Fingerprint reader option for extra security,

Weakness:
Heavier than most competing
model.

Latest Android vesion,

Big Display
Fingure print reader
Eye scanner

Strengths:

Sumsung
Galaxy s5
Threats:

Increase demand in worlwid,

Support all Android application,
Availibility of application for
business use.

Increasing competition.
Downward pricing pressure.

Opportunities

Weaknesses: It is heavier than most competing product.

Opportunities: Alien O1 can take advantage of three major market opportunities:
1. Increasing Demand: It has now worldwide heavy demand. People are now very dependable
on Samsung product.
2. Android Apps: It build in latest android version.
3. Availability: All business related application available for business user.

Threats: The competitors of Samsung increasing day by day. Apple, Nokia, Sony, Google Nexus
and LG are the most powerful competitor.

Objectives and Issues:

We have set aggressive but achievable objectives for the first and second years of market entry.

First-year Objectives
During the Alien O1 initial year on the market, we are aiming for a 5 percent share of the U.S. cell
phone market through unit sales volume of 350,000.

Second-year Objectives
Our second-year objectives are to achieve a 10 percent share based on sales our models and to
achieve break-even early in this period.

Issues:
One major issue is our ability to establish a well-regarded brand name linked to a meaningful
positioning in U.S.A market. We will have to invest heavily in marketing to create a memorable and
distinctive brand image projecting innovation, quality, and value in USA market. We also must
measure awareness and response so we can adjust our marketing efforts if necessary.

Marketing Strategy:
Alien O1 marketing strategy is based on a positioning of product differentiation. Our primary
consumer target is upper income professionals who need one portable device to coordinate their busy
schedules and communicate with family and colleagues. Our secondary consumer target is graduate
students who need a multifunction device. This segment can be described demographically by age
(2030) and education status. Our primary business target is mid- to large-sized corporations that
want to help their managers and employees stay in touch and input or access critical data on the go.
This segment consists of companies with more than $100 million in annual sales and more than 250
employees. A secondary business target is entrepreneurs and small business owners. We are also
targeting medical users who want to reduce paperwork and update or access patients medical
records. Each of the four marketing mix strategies conveys Samsung differentiation to the target
market segments identified above.

Positioning:
Using product differentiation, we are positioning the Alien O1 as the most versatile, convenient,
value-added model for personal and professional use. The marketing strategy will focus on the Eye
Scanner system as the main feature differentiating the Alien O1.

Product Strategy:
The Alien O1, including all the features described in the earlier Product Review section, will be sold
with a one-year warranty. We will introduce a more compact, powerful high end model (Samsung
Galaxy s6) during the following year, with more features. Building the more customer is an integral
part of our product strategy. The brand and logo will be displayed on the product and its packaging,
and reinforced by its prominence in the introductory marketing campaign.

Pricing Strategy:
The Alien O1 will be introduced at $750 wholesale and $850 estimated retail price per unit. We
expect to lower the price of this first model when we expand the product line by launching the
Samsung Galaxy s6, to be priced at $900 wholesale per unit. These prices reflect a strategy of (1)
attracting desirable channel partners and (2) taking market share from Apple.

Distribution Strategy:
Our channel strategy is to use selective distribution to have Alien O1 sold through well-known stores
and online retailers. During the first year, we will add channel partners until we have coverage in all
major U.S. markets and the product is included in the major electronics catalogues and Web sites. In
support of our channel partners, Samsung will provide demonstration products, detailed specification
hand-outs, and full-colour photos and displays featuring the product. We will also arrange special
trade terms for retailers that place volume orders.

Marketing Communications Strategy:

By integrating all messages in all media, we will reinforce the main points of product differentiation,
especially our exclusive Eye Scanner feature. Research about media consumption patterns will help
our advertising agency choose appropriate media and timing to reach prospects before and during
product introduction. Thereafter, advertising will appear on a pulsing basis to maintain awareness
about our features and communicate various differentiation messages. The agency will also coordinate public relations efforts to build the Samsungs features and support the differentiation
message. To attract market attention and encourage purchasing, we will offer as a limited-time
premium a leather carry-case. To attract, retain, and motivate channel partners for a push strategy, we
will use trade sales promotions and personal selling to channel partners.

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Marketing Research:
Using research, we are identifying the specific features and benefits that our target market segments
value. Feedback from market tests, surveys, and focus groups will help us to develop the Samsung
Galaxy s6. Finally, we will use customer satisfaction studies to gauge market reaction.

Marketing Organization:
Samsungs chief marketing officer in USA Richardson, holds overall responsibility for marketing
strategy and direction. Samsung has hired Worldwide Marketing to handle national sales campaigns,
trade and consumer sales promotions, and public relations efforts.

Action Programs:
The Alien O1 will be introduced in March. Following are summaries of the action programs we will
use during the first six months of next year to achieve our stated objectives.

February
We will initiate a $800,000 trade sales promotion campaign to educate dealers and generate
excitement for the product launch in March. We will exhibit at the major consumer electronics trade
shows and provide samples to selected product reviewers, opinion leaders, and celebrities as part of
our public relations strategy. Our training staff will work with sales personnel at major retail chains
to explain the Alien O1s features, benefits, and competitive advantages.

March
We will start an integrated print/radio/Internet campaign targeting professionals and consumers. The
campaign will show how quickly Alien O1 users can accomplish tasks using Eye Scanner. This
multimedia campaign will be supported by point-of-sale signage as well as online-only specials.

April
As the multimedia advertising campaign continues, we will add consumer sales promotion tactics
such giving away leather carry-cases as a premium. We will also distribute new point-of-purchase
displays to support our retailers.

May

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We will hold a trade sales contest offering prizes for the salesperson and retail organization that sells
the most Alien O1s during the 4-week period.

June
We plan to roll out a new national advertising campaign this month. The radio ads will feature Eye
Scanner and Fingerprint Reader system to operate their Alien O1. The print ads will show these
celebrities holding their Alien O1.

July
Our radio campaign will add a new voice-over tag line promoting the Alien O1 as a graduation gift.
We will also exhibit at the semi-annual electronics trade show and provide channel partners with new
competitive comparison hand-outs as a sales aid. In addition, we will tally and analyse the results of
customer satisfaction surveys for use in future promotions and to provide feedback for product and
marketing activities.

Budgets:
Total first-year sales revenue for the Alien O1 is projected at $180 million, with an average
wholesale price of $750 per unit and variable cost per unit of $650 for unit sales volume of 940,000.
We anticipate a first-year profit of up to $100 million on the Alien O1 model. Break-even
calculations indicate that the Alien O1 will become profitable after the sales volume exceeds
765,500, early in the products second year. Our break-even analysis of Alien O1s product assumes
per-unit wholesale revenue of $750 per unit, variable cost of $650 per unit, and estimated first-year
fixed costs of $76,550,000
Based on these assumptions, the break-even calculation is:
$76,550,000/ ($800-$650) = 765,500 units.

Controls:
We are planning tight control measures to closely monitor quality and customer service satisfaction.
This will enable us to react very quickly in correcting any problems that may occur. Other early
warning signals that will be monitored for signs of deviation from the plan include monthly sales (by
segment and channel) and monthly expenses.

Sources:
www.samsung.com
www.wikipedia.org
www.cnet.com
www.cnn.com
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www.indiatimes.com
www.forbes.com

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