In short, in terms of marketing, both these brands do equally well. Established in 1976, Apple Inc. is an American company that manufactures a wide range of consumer electronics. . The first case study is the analysis of competitive advantages of two successful smartphone device makers, Apple (iPhone) and Samsung (Galaxy). Apple drafted a proposal to license some of its patents to Samsung for $30 per smartphone and $40 per tablet, with a 20 percent discount for cross-licensing Samsung's portfolio back to. Samsung was the Apple iPhone chip supplier that dared to compete directly against Apple by making a similar-looking smartphone, and with the Android operating system, which Jobs abhorred. Knowledge capital is an intangiblevalueofan organization made up of itsknowledge, relationships,learned techniques, procedures, and innovations. Often, a customer uses a blend of both measurable and subjective factors to decide on a . These companies have adopted operational strategies that are different from each other. . According to Gustin (2012), Apple is currently engaged in developing the existing products as opposed to creating new ones. Soon after Apple introduced the Apple Watch and AirPods, Samsung doubled down on innovating around these devices too, and many now consider them an equal competitor to Apple on all of these above-mentioned products. The problem was that Samsung, up to this point, was not attempting to tell a story. For example, it improved iMac, which led to the introduction of iTunes and iPod. Therefore, brand reputation is a key strength in maintaining Apples market presence. Theres a lot of unlimited design services out there but only one like Kimp. The company relies on high-end technology and innovation to set its products apart from those of the competitors. Norman, R.: Service Management: Strategy and Leadership in the Service Business. Photographer: Nina Westervelt/Bloomberg, Vivaldi 6 Brings Workspaces To The Browser, Elon Musk Promises (Again) Encrypted DMs Are Coming To Twitter, Forget The New MacBook Pro, Apple Has Something Much Better, Canadas Public Broadcaster Joins NPR In Quitting Twitter, Vivo V27 Pro Brings The Fight To OnePlus 11R With A Better Design, Artist Reveals His Award-Winning Photo Was Created Using AI, Apple Reveals New Game-Changing FaceTime Features, Elon Musk Says U.S. Govt Had Full Access To Private Twitter DMs. You will find hardly any posts on Apples main Twitter page (though it actively does share content on Apple Music and other pages). This figure was considerably higher when compared to what rival companies such as Apple had spent as their advertising budget within the same period. Apple had a 20.5% share of the market in comparison to 19% last year. Then another pedestrian hails a taxi on the sidewalk, holding the mystery device. Not to forget the viral Oscar selfie featuring a Samsung phone, (and celebrities of course!). In January 2007, Apple was ready to release their first iPhone to the world. A product differentiation strategy identifies your unique selling proposition (USP) and uses that as a wedge to pry customers away from your competitors. 48, no. This is exactly what I wanted, Jobs said of Samsungs flash memory, according to Hwang. All is fair in love and marketing warfare! Opinions expressed by Forbes Contributors are their own. . Through the strategy, Apple can avoid flooded markets by innovating unique products (Buisson & Silberzahn 2010). Kapferer, J 2012, The new strategic brand management: Advanced insights and strategic thinking. A competitive advantage stems from strengths the organization possesses and weakness the competitor possesses (Ferrell & Hartline, 2014). As for Apple, I have not seen or heard of any serious interest in developing a folding iPhone anytime soon. StudyCorgi. If we have to talk about firsts Apple takes the lead. . 41-61. In 2005, Chang-Gyu Hwangpresident of Samsungs semiconductor and memory businesstraveled with two fellow executives to Palo Alto, to the home of Steve Jobs. If you look at the 4 Ps of marketing, Samsung has all four of them . Samsung has been Apple's fiercest competitor on the smartphone market, and has achieved a great amount of success. This is possible when you clearly define your brands personality and values and take measured steps toward conveying them to your customers. Nearly three-quarters of Apple's revenue comes from the iPhone lineup, making the firm single product-dependent. Once Samsung had the marketing budget to reach out directly to customers, Pendleton could initiate step three: hiring an ad agency. Apple employs the blue ocean strategy as a competitive plan to beat its rivals such as Samsung. The main competitive strategy of Apple Inc is developing new and innovative products that blend technology and art. Apple, particularly, successfully sued Samsung for patent infringement (Cusumano 2013). Nisen (2013) observes that Samsung filed numerous patents in the US in 2012, coming only second to IBM. The other had a Samsung phone. For the last three to four years or so, Samsung has made sure to announce their new premium smartphones before Apple and has used mid-August for the fall Unpacked events. It relies on continuous research to implement this approach. It was designed by Pendleton to get the South Korean executives to grasp the size of the problem. 7030 Woodbine Avenue, Suite 500, Markham ON, L3R 6G2, Canada. This compensation may impact how and where listings appear. The new Galaxy Buds 2, with superb audio and active noise canceling at $149, is $40 cheaper than Apple's AirPodsPro. You are free to use it to write your own assignment, however you must reference it properly. The Next Big Thing Is Already Here, the commercial finishes. 2023. The blue ocean strategy supposes that consumers are in constant need of mobile phones that bear unique features. Chandrakala, V & Devaru, S 2013, Blue ocean strategy and bottom of the pyramid marketing, International Journal of Management Research and Reviews, vol. Amusingly, the rapid nature of technological advancement often leaves the comparatively dinosaur-like legal system in the dust. The new health monitoring built into the Galaxy Watch 4, which now includes real-time BMI measurements and the ability to monitor blood pressure, brings new advances to smartwatches. 3, pp. If you have to compare the smartphone market share, back in 2009, Apple was at 16.1% and Samsung a mere 3.3%. The Galaxy S and Note are Samsungs products that have different features and hence their high prices in the market. In the past days, Apple invested colossal sums of money in innovation aimed at creating new products. In the US, for instance, Samsung used $401 million in 2012 to promote its Android commodities (Nisen 2013). Probably not. Here are a couple of things the brand does to stay ahead of the curve. The iTunes music store fed the demand for digital music to the companys consumers by offering a selection of music at an affordable price. And Apple has managed to remain nearly consistent despite the rapidly-growing competition. When Dale put out a call for a new chief marketing officer, a headhunter zeroed in on Pendleton. https://studycorgi.com/apple-vs-samsung-companies-operational-strategies/. . ! Vergara, R 2012, Samsung electronics and Apple, Inc.: A study in contrast in vertical integration in the 21st century, AmInt J Contemp Res, vol. This is a BETA experience. Chen, C & Ann, B 2016, Efficiencies vs. importance-performance analysis for the leading Smartphone brands of Apple, Samsung and HTC, Total Quality Management & Business Excellence, vol. Find out more. But Apple on the other hand sticks with targeted marketing and wins at it. Conclusion Both strategies are effective in their own right. "Apple vs Samsung as Blue & Red Ocean Strategy Examples." Barriers to entry are the costs or other obstacles that prevent new competitors from easily entering an industry or area of business. Customised Android OS and display screen evidence this strategy. I have either been to, or watched all of Samsung's Unpacked events since they debuted, and marvel each time at the innovation they continue to bring to their devices. Samsung and Apple are the two worlds largest producers of Smartphones. Additionally, the company works to remain a formidable force in the global market. As a result, Apple reported an increase in its annual sales. People might mock Apple for not modifying its designs too much but most Apple users love the consistency the brand maintains. The two companies have found themselves engaged in legal battles. I write about tech industrys impact on the PC and CE markets. I would be pleasantly surprised if these two features are on the new Apple Watch coming out this fall, but I am not expecting it as of now. Here are a couple of reasons for this difference. You dont need to follow the hype. Vertical integration is used to achieve control over the production chain of a facility. "Apple vs Samsung as Blue & Red Ocean Strategy Examples." Samsung employs the red ocean strategy, which involves observing the existing competitors, identifying their weaknesses, and building on the faults (Chandrakala & Devaru 2013). To redirect Samsungs marketing budget. The figures have changed over the years with Apple at 18% and Samsung at 23.4% in the first quarter of 2022. With Examples, Non-Disclosure Agreement (NDA) Explained, With Pros and Cons. Pendletons team convinced Dale Sohn to reverse the figures: to put 70 percent behind Samsungs own efforts and devote 30 percent to the carriers. Four days before, January 4, 2007 . Gershon, R 2013, Digital media innovation and the Apple iPad: Three perspectives on the future of computer tablets and news delivery, Journal of Media Business Studies, vol. This situation has proved successful since Samsung continues registering more profits relative to other global companies. 21 February. Samsung didnt use people in its commercialsjust product and voiceover and talking about the product benefit, said Samsungs chief marketing officer, Todd Pendleton. The new Galaxy Z Fold3 and Galaxy Z Flip3 are by far the best folding phones one can buy today. Ive got a Note Edge. that we need, and in a very effective manner.. Have you ever seen two Apple ads and thought that they do not look similar? Other mobile phone manufacturers have to purchase these chips from elsewhere, raising their operational costs considerably above the fee charged by Samsung. These changes indicate two things: Samsung has made a tremendous amount of progress in the smartphone market The above ad wins because of two reasons: Kimp Tip: The above ad works because the core idea is great. Chair Lee Kun-hee saw his company's global share of smartphone sales drop from 35% in 2013 to 24% by early 2015, and his son, Lee Jae-Yong, reportedly wants to respond through mergers and acquisitions (M&As) and partnerships. Version 2 was better, and on paper, the Galaxy Z Fold3 deals with the inadequacies of models 1 and 2 and shows more promise. And Samsung was one of few companies that could guarantee a rock-solid supply. This paper was written and submitted to our database by a student to assist your with your own studies. He also blatantly mocked Samsung and other competitors, calling their larger phones Hummers. No ones going to buy that, he said at a press conference in July 2010. (Tim Wimborne . Its a giant fuckin phone that Steve Jobs made fun of. It talks about Apple going towards a greener approach. Samsung not only competes with Apple in the notebook, tablets, and smartphones market, It also supplies Apple with crucial items for iPhones like OLED display and flash drive memory chip for storage. Samsung on the other hand often shows off its adventurous streak. During a frantic all-nighter, someone in the room suggested that they turn the commercial into a single scene, rather than two separate, awkward, forced moments of chatter between disparate characters. Entrepreneurs love using Kimp to design, launch and scale their unique brands. Of course, there are many other smartphone brands out there but Apple and Samsung often rule the charts. Who was right? Weve got a campaign!. Big brands that have been head-to-head for the market-leader position are known to adopt this strategy now and then. Privacy policy The first smartphone from Apple, the original iPhone from 2007, created a buzz in the world of communication devices. What do we infer from this? The clean layout and signature font instantly connects with the rest of the marketing designs that Apple uses. Can you instantly tell that they are all from Apple? Slack, N, Brandon-Jones, A & Johnston, R 2016, Operations management, Pearson Education, Upper Saddle River, NJ. Since Apple was copying Samsungs patents, they argued, Apple had to pay Samsung. This strategy is aimed at ensuring the company comes up with unique products so that it may not be seen as a copycat. The product became a success because it could be sold as a brand independently of the existing brands. The first bag, people on the street would be told, contained the next unreleased iPhone. In fact, the team completed their work in eighteen months. Step two was to ensure that the economics of the coming marketing war on Apple made sense. Apple has always been about delivering quality over quantity, and about consistently delivering products that are reliable. Indeed, Samsung is a worldwide industrial and consumer products company whose mobile division has become one of its greatest success stories and cash cows. You can find out more about our use, change your default settings, and withdraw your consent at any time with effect for the future by visiting Cookies Settings, which can also be found in the footer of the site. Dale provided air cover from headquarters, giving them an unusual degree of latitude and space to get their work done. In addition, Samsung has relied on sheer volumes of products in the past where it releases numerous models in the market at the same time. Apples packaging designs are great examples of this. About 30 percent of the budget went to Samsungs own branding efforts. I can live with that. The two companies have found themselves engaged in legal battles over intellectual property and patent fights. These changes indicate two things: So, both these brands are worth evaluating if you are looking for branding and marketing inspiration. Rather than pitch consumers on why Samsung was great, marketing stories were framed around the telecom carrierstelling a story around their network and why their network is great., The South Korean headquarters, meanwhile, sent over goofy and culturally inappropriate commercials that incited rebellion among the Americans on staff. Declining profit margins in 2014 and 2015, however, forced some introspective analysis within Samsung's executive team. I want someone whos got tattoos all over his arms and earrings!. Apple continues to be an example of maintaining consistency in branding. So, how did the world of smartphones become a duel of Samsung Vs Apple? According to Kushida (2015), research and development have enabled the company to launch the iPad, which is a redefinition of the use of portable devices. As a result, Samsung can release a variety of products to the market at the same time. "Fabless company refers to a company that designs and markets hardware while outsourcing the manufacturing of that hardware to a third-party partner. I hope to be able to test one of these in real-time and develop a stronger business case for foldable smartphones, besides its ability to also become a small tablet. Want to create such simple impactful ads for your brand? The following is an overview of the two companies. Now lets look at some of the packaging designs from Samsung. Kimp helps Professional Services maintain polished and professional branding. Samsung's competitive strategies are primarily concerned with maintaining a competitive advantage and increasing brand recognition. It means theyve given you enough rope to hang yourself, Sohn said. Geoffrey Cain is a foreign correspondent and author who has covered Asia and technology for The Economist, The Wall Street Journal, Time, The New Republic, and other publications. Apple employs the blue ocean strategy as a competitive plan to beat its rivals such as Samsung. Having that built into the Galaxy Watch 4 is a serious differentiator and could help Samsung grow its wearable business. And with all of its product lines, the brand has continued to hold on to these values. We had to even take some of it out because it was just so harsh.. When Samsung joined the market, its main strategy involved maximising on the weaknesses of rival companies to gain an edge. Or this unusual campaign below. 285-286. Samsung and Apple apply different strategies in their management. 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