Analysis of the Integrated Marketing Communications Mix Strategies of Smartphone brand - Case Study Example

Analysis of the Integrated Marketing Communications Mix Strategies of Your Chosen Smartphone brand Table of Contents Table of Contents 2 Executive Summary 3 1.Introduction 4 2.Literature Review 5 2.1.Samsung 5 2.2.Integrated Marketing Communications 6 3.Market Environment Review 8 4.Critical Analysis and Discussion 10 4.1.Swarovski for Samsung Marketing 10 4.2.Samsung Galaxy S5: Sponsorship of England World Cup Team 11 5.Conclusion and Recommendations 13 References 14 Executive Summary In the modern world, which is driven by ICT, marketing has undergone significant changes. The introduction of new information and communication technologies has presented opportunities and challenges to marketers. One of these challenges is the high risk of confusion in marketing because of the multiple marketing channels and high volumes of information. In addressing this challenge, the IMC (integrated marketing communications) is emerging as a popular strategic marketing concept. This concept emphasizes the use of different channels to send a consistent message that is centered on the target market. The implementation of the IMC strategy should also be result oriented. Samsung is one of the companies that have embraced the concept of IMC. Within the UK smartphone market, Samsung is among the leading brands. Part of this success has been due to the company’s IMC strategy. This report presents a critical analysis of Samsung’s IMC strategy in the UK market by focusing on two marketing strategies adopted by the company. From the analysis, the report concludes that Samsung’s IMC strategy is effective to a large extent. However, the report finds one weakness in the strategy and makes the recommendation that the company should engage in an in-depth analysis of different channels before deciding to use them as part of the IMC strategy. 1. Introduction The marketing function is one of the strategic areas of any organization. It forms a strategic area of business because it provides a platform through which a business can communicate with consumers and other external stakeholders. A business operates in a macro environment that comprises of various external factors and agents. The success of a business depends on how effective it is able to deal with these external factors and agents. Consumers are among the greatest factors that influence how a business operates. Businesses strive to meet or exceed consumer needs. However, to identify these needs and satisfy them, businesses have to use marketing. Marketing is the appropriate avenue through which businesses can gather market insights and develop strategies that will influence consumer decisions. A consumer is in a position where he has multiple options to choose from. In such a situation, the consumer will be easily swayed by businesses that apply marketing concepts effectively. The marketing message should be clear and in line with the consumer’s expectations. This may appear quite simple. This is not the case as it is evident in the numerous marketing campaigns and strategies that have been deployed by different firms unsuccessfully. The main reason for the ineffective and unsuccessful marketing campaigns and strategies is the lack of proper planning and implementation. Before selecting a particular marketing strategy, a business needs to undertake an intensive planning process. The planning process links the marketing strategies to the organizational goals and objectives. Therefore, when a company fails to align its marketing campaign to its organizational strategy, this forms a recipe for a failed marketing strategy. On the other hand, an effective implementation strategy is necessary to create an effective marketing strategy. The implementation process involves identifying the specific marketing strategies, media channels, and responsibilities in the implementation of the marketing strategy. With the emergence of new technologies, companies have a wide array of marketing media to use in reaching out to the target market. Both new and old media provide advantages and disadvantages. Selecting the best mix of the marketing media ensures that the consumers get the intended marketing message effectively. On of the common concepts in marketing in today’s marketing environment is integrated marketing communication (IMC). The concept of IMC has become popular and many companies are adopting it. This enables companies to combine multiple marketing media in sending a common marketing message to consumers. The underlying factor in IMC is to ensure that all marketing channels and messages are integrated to create a single reinforced message. The main purpose of this report is to present a critical analysis of Samsung’s integrated marketing communications strategy in the UK market. Through the analysis, the strengths and weaknesses of the current IMC strategy will be identified. Ultimately, the report will provide recommendations on how to improve the company’s IMC strategy. 2. Literature Review 2.1. Samsung Samsung is global conglomerate based in South Korea. The company, which is comprised of many subsidiaries, was established as a trading company in 1938 by Lee Byung-chul. Since then, the company grew through diversification into other business areas such as insurance, textiles, and securities trade. In 1960, the company ventured into the lucrative electronics business. This led to the birth of Samsung Electronics, which is the flagship company subsidiary, the largest electronics brand in the world (Samsung Electronics, 2012: 5; Grobart, 2013). The successful story of Samsung can be partly be attributed the company’s marketing strategy. Samsung adopted an aggressive marketing campaign that involved all the 4Ps of marketing, which enabled the company to dethrone major brands such as Nokia and Apple. For example, Samsung came up with stylish and innovative smartphone designs that competed favorably against the competitor brands from Nokia and Apple. For example, the new Samsung smartphones had a striking appearance, feel, and functionalities such as large displays, slim body, bright colors, and amazing features that met consumers’ met surprise (Lev-Ram, 2013: 98). In terms of price, Samsung chose the road less travelled by the main rivals. The company adopted a low pricing strategy, which made the Samsung smartphones mode affordable to a wide consumer market (Edwards, 2014). To support this strategy, Samsung also deployed an extensive distribution network that involved multiple players across the world. This ensured that Samsung products were all over the world. Finally, Samsung adopted a major promotional strategy that included new and traditional channels. The company relied heavily on online platforms such as social media marketing and marketing through the company’s websites. Ultimately, Samsung made the smartphone a common gadget for the ordinary person, which had not been the case before. 2.2. Integrated Marketing Communications The world is changing continuously. Part of this change is based on the development of new technologies and innovations that are affecting almost every aspect of life and society. One of the major changes that have influenced the business world is the development of information and communication technologies. The development of ICT has impacted businesses in various ways. However, for the purpose of this report, we will focus on the effects of ICT on the marketing component. The development of ICT has provided numerous opportunities and risks to businesses in terms of marketing. One of the greatest opportunities has been the increased outreach of marketing. For example, companies can use internet technology to reach out to the global market, which was almost impossible before the development of internet technology. Additionally, ICT has enhanced cost efficiency in marketing by reducing marketing costs. For example, social media marketing provides a cost-effective marketing strategy for companies. Yet, the development of these new communication technologies has also created challenges for businesses. The greatest challenge has been the high volumes of information and data that require analysis and management. In conducting market research, companies have to deal with larger volumes of information and data from the market. On the other hand, consumers are plagued with a wide array of information sources to choose from. With a wide array of old and new media channels, businesses may be confused on which specific channels to use. Without proper planning and understanding, some businesses may end up sending disintegrated marketing messages by using a wrong combination of the available marketing channels. As Olenski (2013: para 1) points out, there is a growing need to deliver integrated messages to consumers even when using multiple channels. The concept of IMC has received considerable attention. As a result, there are various definitions of the concept. However, there are certain common elements of IMC across most of the definitions provided. IMC is a planning process that is purposeful. The purpose of IMC is to create a consistent marketing message through deploying a brand communication program using different marketing media. Ultimately, the IMC strategy hopes to achieve short term gains (profitability) and long term gains (brand equity) (Ang, 2014: 4-5). IMC combines traditional and new media in creating the consistent marketing message and brand image (Percy, 2014; 3-4).Reinold and Tropp (2012: 115), summarizes the elements of IMC into four pillars including stakeholders, channels, content, and results. Stakeholders – IMC is stakeholder-centered and has a special focus on customers. Channels – IMC uses different channels, which are strategically integrated to send a consistent message. Content – IMC sends a unique and relevant message that is consistent across all the channels used. Results – IMC is purposeful in the sense that it aims to produce measurable outcomes. Although IMC is still regarded as an emerging concept in marketing, it is gaining so much attention and adoption in the modern business environment. Many companies are embracing IMC because of its potential benefits. However, the success levels of the adoption of IMC are varied across different companies. While come companies have been too successful in their IMC strategies, other have not. Understanding why these disparities in the success of IMC implementation are important. 3. Market Environment Review The UK is one of the developed economies in the world. The UK economy is among the top ten largest economies in the world. As of 2013, the Gross Domestic Product of the UK was $2,828 billion (PricewaterhouseCoopers, 2014: 1). However, there are projections that the UK economy will overtake that of France and probably that of Germany by 2030. This is based on the current trends in the economies of these countries, which indicate that the UK’s economic growth is the fastest in the G7 countries (Bootle, 2014: 10). The strong economy of the UK provides a viable environment for the smartphone sector to thrive. The smartphone sector is thriving in the UK. According to Whitfield (2013: para 2), the smartphone market in the UK in 2012 exceeded over 82 million mobile subscribers, which marked a 65.2 percent marketing penetration rate. This market is dominated by Android smartphones, which comprise of approximately 33 percent while Apple accounted for 12.6 percent (mobilesquared, 2014). There are projections that indicate this market will grow in the next five years. Apparently, the penetration rate of 100 percent will be reached by the year 2018. This means that the UK smartphone market is about to reach the maturity stage. After 2018, the market will already be mature and growth will slow. Nevertheless, smartphone companies are struggling to gain more market share before the market matures. In terms of Smartphone brands’ market share, Apple dominates the UK market with over 28 percent market share comprising of more than 8.6 million users. Apple is followed closely by Samsung with a market share of 24 percent. BlackBerry comes third and HTC closes the top four smartphone companies with market shares of 15.2 percent and 15 percent respectively (Chapman, 2012: 1).Although these figures have been changing over the last two years, the market shares have remained almost the same. There are several key trends driving the smartphone market in the UK. One of these trends is the growing popularity and adoption of Tablet computers. Over 40 percent of households in the UK owns or uses Tablet devices. In the first quarter of 2014, this market segment grew by 24 percent (Ofcom, 2014: 4). The growing adoption of the Tablet computers could threaten the growth of smartphone business in UK considering that the Tablet computers provide substitution to the smartphones. The Tablet computers have larger screens that smartphones and contain typically similar features of the smartphone such as calling capabilities, SMS, internet, camera, and video recording among others. Yet, the Tablet computer is more convenient than the personal computer because it is more portable and cheaper. Another major trend in the smartphone market in the UK involves technological developments. Specifically, the UK has seen an increase in 4G technology accessibility. 4G mobile technology is now provided by the four MNOs (mobile network operators) in the country. Over 73 percent of the UK premises had been connected to outdoor 4G network coverage (Ofcom, 2014: 4). The implication of the growing accessibility of 4G network is that smartphone manufacturers will have to manufacture smartphones with 4G capabilities. UK consumers will drive this trend as they seek to have faster and better internet experience using 4G network. Finally, competition is also intensifying in the UK smartphone market. This is driven by the high number of competitors in the industry. Most of the world’s leading smartphone manufacturers and brands including Samsung, Apple, HTC, Microsoft Nokia, and BlackBerry have operations in the UK market. These smartphone brands engage in intense competition based on their internal strengths and economies of scale. For example, a company like Apple uses its brand value to compete against the rivals. On the other hand, Samsung uses its penetrative pricing strategy to outdo its rivals. The high level of competition within the smartphone sector in the UK will result in lower smartphone prices and better smartphone features and functionalities. 4. Critical Analysis and Discussion Samsung has always adopted an IMC strategy in the UK market. The company deploys various marketing media in its marketing strategies in the UK. Specifically, the company uses both traditional and new media to communicate and interact with the target markets. However, the company relies so much on online marketing. 4.1. Swarovski for Samsung Marketing Samsung has been using traditional advertising media to market its products and brand. A good example of this is the Swarovski for Samsung TV commercial that was released in 2014. In this TV commercial, Samsung is marketing the Swarovski crystal accessories that provide a glamorous and outstanding cover appearance to the GALAXY Note 4. The advert sends the message that Samsung is focused on providing outstanding products and services. Through the add, this message comes out clearly in the manner in which the young lady with the GALAXY Note 4 covered with Swarovski is attracting attention from other people because of her stylish phone appearance (Samsung Mobile, 2014). However, Samsung has incorporated new media to form an IMC strategy for Swarovski for Samsung. The same TV advert appears in the company’s online platforms including the company’s official website and social media networks. The same message cuts across all these media. For example, the phrase “make the moment shine” features in all the media channels used for advertising the Swarovski cover (see Samsung, 2014). Based on Reinold’s and Tropp’s four pillars of IMC (see Reinold & Tropp, 2012: 115), the marketing strategy for the Swarovski cover qualifies as an effective IMC strategy. First, the marketing message is consumer-centered. The marketing message is targeted towards the users of GALAXY Note 4 smartphone as it is clear in the TV commercial, which shows a typical user of the smartphone attracting attention from other typical users. Second, the company uses different media including the company website, YouTube, and TV advertisements to execute the marketing strategy. Third, the message is consistent across all the media channels used as is evidence by the appearance of the phrase “make the moment shine” in all the advertisement media. Finally, Samsung intends to attract customers to buy the Swarovski covers for their GALAXY Note 4 gadgets, which will translate to increased sales and profitability. 4.2. Samsung Galaxy S5: Sponsorship of England World Cup Team In early 2014, Samsung UK announced its partnership with English FA (Football Association). Through this partnership, Samsung would provide each player in the English world cup team with a Galaxy S5 smartphone. According to the marketing manager of Samsung in the UK, Ines van Gennip, Samsung chose this product-placement strategy to target influencers (Chapman, 2014: 1). This is not a new strategy by the company. Samsung has been involved in sports sponsorships especially in football in the past. This strategy is part of the company’s overall IMC strategy that uses popular footballers and clubs to influence consumers to purchase Samsung products and build a stronger Samsung brand. The product placement approach used by Samsung to market the Samsung brand in general and the Samsung Galaxy S5 in particular provides several benefits to the company in terms of IMC. By being the official partners of England Football team, Samsung actually gains reinforcement of its brand and marketing message when the players are seen using the Samsung smartphone. Football players such as Rooney have a wide fan base, which is what Samsung was targeting with this partnership strategy. The company was specific in its strategy because it targeted the UK market primarily by partnering with the English football team. The national team is a uniting entity for the UK. Participating in the world cup means that the team is representing all the UK citizens, who are keen to watch and follow up on the team’s progress. In doing so, the UK market gets to learn about Samsung. Apart from the sponsorship of the English national team, Samsung has also used other media channels to support Samsung Galaxy S5’s IMC strategy. The company has used the company’s website, social media networks, and mass media channels to market the product in the UK market. Therefore, the company’s IMC strategy for Galaxy S5 meets the mixed channels threshold. However, the deal with England FA falls short on supporting a holistic IMC in other areas. For example, with regard to the content or marketing message, this strategy may be sending the wrong signals to the customers. Since the English football team carries the Samsung brand, consumers may be confused regarding which brand is being communicated. Some customers may actually overlook the Samsung brand in favor of the English football team or popular players’ brands. This implies that this strategy breaks the consistency in the marketing message of the company. 5. Conclusion and Recommendations Based on the critical analysis of Samsung’s IMC strategy in the UK, the overall conclusion is that the company has an effective IMC strategy in place. The company uses different media channels to communicate a consistent message to the target customers. The outcomes or results have shown that this strategy has been effectively to a great extent. For example, Samsung has risen to become the second largest smartphone company in the UK in terms of market share partly due to its IMC strategy. However, the greatest weakness in the company’s IMC strategy is in the choice of marketing media. Although the company uses multiple media including traditional and new media channels, some of the specific media channels do not provide a consistent message that is at the core of IMC strategy. From the company’s strategy to provide Galaxy S5 smartphones to the English national football team, it has emerged that the marketing message may be diluted in the process. The target consumers may be getting different messages from this strategy. For some, the names of their popular footballers may overshadow the Samsung brand. This negates the essence of IMC strategy to reinforce a consistent marketing or brand message. To enhance the effectiveness of Samsung’s IMC strategy in the UK, the report recommends that the company undertake an in-depth review of all available media channels before deciding to use them. This is important to avert a situation where the wrong message will be sent to the target audience, which will have a long lasting implication on the company. It is better to prevent such a situation from occurring that trying to mitigate against the effects after it has occurred. With specific regard to the deal with English FA, Samsung should review the deal and make necessary adjustments to ensure a clear and consistent message is sent out. Marketing research provides an important way of doing this. 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