New product development strategy of Samsung R&D

1. Logo
New Product Development
Strategy of Samsung R&D
Presented by:
Submitted to:
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2. Objective
s
To understand new product development strategy overview in Samsung
R&D
To understand methodology followed by Samsung R&D in New Product
Development phase
To study effect of Consumer behavior on New Product Development of
Samsung
To understand challenges and problems faced by the organization in the
process of New Product Development
Here we are considering only the Mobile Market segment of Samsung
2

3. y
Samsung’s Methodology in New Product Development
Methodology followed in the project
Research
Planning
(e.g.
Understand the
patents)
NPD Strategy of
Samsung R&D
Customized
Samsung
Standard
Product
Developme
design lab
Product
Collected primary Developme
nt Regions
(e.g. GUI/
Analyzed the /US/
and secondary nt (in Korea)
Interfaces)
(India data
data from various
for various results
Vienna)
sources
Testing
Improve
(alpha/
and Version
Concluded on the
beta)
releases
basis of various
findings and
limitations
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4. Data Collection and
Analysis
35
30
25
20
15
10
5
0
 Samsung’s growth was mainly fuelled
by sales of digital TVs (in particular
LCD TVs)
 Global sales of electronic products
were affected by the economic
downturn.
2007
2008
2009
2010
Consumer Electronics (Retail)
 Samsung
leads
the
global
smartphones
market
and
commanded 43% of retail volume in
the high growth markets of Asia
Pacific and the Middle East and
Africa in 2012.
 Samsung's market share was nearly
double that of second ranked Apple
in 2012. A comprehensive suite of
products allowed Samsung to
dominate the smartphone market.
2011
Samsung Corp.
2012
 Samsung managed to achieve stellar
growth, driven primarily by sales of its
smartphones, in particular its Galaxy
range.
SAMSUNG Corp: Smartphone Market Share & Growth Prospects 2012-2017
Retail rsp (% CAGR)
Retail volume YOY growth
Consumer Electronics vs. Samsung Corp. 2007-2012
Asia Pacific
Western Europe
Latin America
Middle East & Africa
Eastern Europe
Australia
North America
Retail Volume (% CAGR)
Note: Bubble size represents Samsung Corp’s % market share in 2012
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5. Data Collection and Analysis
(Contd…)
R&D Expenses & Investment
(Unit: KRW trillion)
R&D expenses
R&D expenses as a % of sales
No. of R&D personnel
Patents in the U.S.
6000
5000
4000
3515
3611
4551
4923
3000
2000
1000
0
2008
R&D Investment Includes R&D cost and cost for development
of intangible assets in the income statement.
Samsung Electronics was included among the
top 10 global companies in R&D investment
announced by the U.K. Department for
Business, Innovation and Skills.
2009
Patents in the U.S.
2010
2011
Linear (Patents in the U.S.)
As we see from the above graph, patents filed by
Samsung in U.S. is increasing continuously over the
years. It depicts that Samsung is focusing more and
more on innovation and R&D
Source: IFI Patent Intelligence
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6. Landscape
Product Offered
Innovation
Design
Marketing
Comparative Analysis of various
brands
Samsung Electronics
Consumer
Electronics
(LCD
TV’s,
Microwave
Ovens, PC’s etc.)
Apple Computer Inc.
LG Electronics
Nokia Corp.
Sony Corp.
Motorola Inc.
PC’s, portable music Consumer
Leading Mobile Comm.
players,
Mobile Electronics
(Mobile Company (started as
communication devices handsets,
Front wood pulp producers)
etc.
loading
washing
machines, AC’s etc.)
Electronic
Motion
Financial
etc.
Occupies ‘feeling zone’
and emphasis on the
simplicity of products in
terms of design and
instability
Concentrated on 5
areas:
Mobile
comm.,
Digital
appliances,
digital
displays,
digital
media and home
networking
and
design their products
by using 4 values:
Theme,
Style,
interface and finish
Adopted telecom as its
core
business
and
designing was based on
3 principles: Simplicity,
Relevance
and
Experience
Creates
Value
added products by
doping 4 principles
of design: Originality,
Lifestyle,
Functionality
and
Usability
Focus on two criteria’s
for products for their
consumers:
personalization
and
socialization
Digital
Improvement in design
convergence using and product features
E-Processes
and
efforts in improving
design by investing
in R&D
Originally produces
electronics for mass
consumption
but
later transformed to
produce
premium
consumer products
for
attracting
premium customers
and to gain brand
image
Product categorization
is done by: Explore Live
classic, classic, achieve
and
entry
and
communicating brand
value to the customers
Do not rely on
customer
surveys
and create value
added
user
experience through
feature
design,
concept
development
and
eco-friendly
sustainable design
Paid
attention
on
development of new
revenue
generating
services
and
technologies
and
enabling customers to
experience
media
mobility.
and Focuses on Reason
and
feeling
to
create a design
and used global
localization strategy
to establish as a first
class
consumer
(user centric)
games, Mobility
solutions,
pictures, mobile services, cellular
services comm. Devices etc.
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7. Findings


During the Apple-Samsung lawsuit Internal
memos dented Samsung’s image; as an
innovator Lawsuit also showed Samsung’s pursuit
and obsession to mimic and beat Apple’s
iPhone while creating its smartphone range
Company’s sponsorship of London’s Olympics in
2012 and the 2-minute advertisement during
Super Bowl in 2013 reinforced Samsung’s brand
image in the minds of the consumers

Along with smartphones and TVs, Samsung
intends to compete aggressively in appliances,
cameras, health and medical equipment and
printers.
Rivalry
among
established
firms
Samsung has been spending consistently on
advertising Is one of the largest advertisers
globally Samsung spent US$4.3 billion worldwide
in 2012, four times more than Apple

Relations
with
suppliers
Substitutes
Five forces
to develop
innovative
strategy
Relations
with buyers
New
Entrants
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8. Conclusions and
Limitations
Conclusion
Limitations
•Within smartphones, the South Korean
manufacturer banked on its AMOLED
screen and custom UI for its Androidpowered flagship smartphone, and
single-handedly created the phablet
(phone/tablet) market
•Samsung is still not strong in cameras
and laptops, which offers it room for
growth, while the company is also
aiming to consolidate its lead in mobile
phones and digital TVs
•Samsung demonstrated that it was not
short on ideas in the mobile arena, as
well as on strengthening its lead in
digital televisions in 2012
•Samsung’s know-how in large-scale
manufacturing and its economies of
scale give the company an advantage
over competitors like Acer in computers
and Nikon in digital cameras
•Samsung has to show its competitors
that it is confident and knows exactly
where it intends to steer the market
•Samsung has to be selective in its
product line-up and avoid direct
competition with its rivals
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9. Reference
s

www.samsung.com/us/aboutsamsung/samsung_electronics/business_area/rd_page/
 http://www.businessinsider.in/Samsung-Has-A-Totally-Different-Strategy-From-AppleAnd-Its-Working-Great/articleshow/21250813.cms http://www.portal.euromonitor.com/portal/default.aspx
 http://www.businesskorea.co.kr/article/1505/samsung-group-marking-300-trillion-wonrevenue-500-trillion-total-assets
 http://articles.economictimes.indiatimes.com/2012-11-30/news/35483331_1_samsungtargets-asim-warsi-samsung-electronics-india
 http://www.engadget.com/2013/07/03/samsung-to-build-five-new-randd-centers/
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11. Querie
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