Apple Vs Samsung (1).docx

Group Report Comparative Analysis between Brands of Apple & Samsung

Prepared for Mr. Mustaque Ahmed Course Instructor Brand Strategy (M602)

Prepared by GROUP 4: THE PURPLE MARKETIERS NAME

ID

MD ASHIF HOSSAIN SHUVO TONMOY GHOSH NURUL AFSAR CHOWDHURY UDOY KISHOR SAHA MOHAMMED AKHTAB UL HUDA EKRAM AHMED BHUYAN MAKSUM-UL-HOSSAIN TANJINA SHARMEEN FAISAL IBNE SHAHJAT TAZREEN TAMANNA NAZNIN NAHAR

ZR1703001 ZR1703003 ZR1703012 ZR1703013 ZR1703016 ZR1703035 ZR1603010 RQ1603020 ZR1603036 RQ1602005 RQ1602024

EMBA BATCH

29

26 25

Institute of Business Administration, University of Dhaka

January 11, 2019

Comparative Brand Study and Analysis between Two Global Tech Giants: APPLE INC VERSUS SAMSUNG

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EXECUTIVE SUMMARY The purpose of the report is to evaluate the brand creation, building, sustainability of two global tech giants Apple INC and Samsung that led the companies in the position of top 10 global brand as per inter brand global ranking 2018. We have conducted the study based on secondary data available on the internet.

We have conducted the comparative study on brand promises, brand positioning, wow factors, core identity of two companies Apple Inc. and Samsung; their brand building strategy through integrated marketing communication and holistic selling proposition, their brand sustainability, renewal strategy to determine which company is leading in terms of brand equity, brand strategy and execution.

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Table of Contents 1. Introduction ..................................................... 1 1.1 Origin of the Report: .......................................... 1 1.2 Background of the Report: .......................................... 1 1.3 Objective of the Study ............................................. 1 1.4 Scope of the Study ............................................... 1 1.5 Methodology of the Study .......................................... 1 1.6 Limitations of the Study ............................................ 1 2 Company Overview ................................................ 2 2.1 Company Overview and Brief History of Apple Inc. ......................... 2 2.2 Mission of Apple Inc. ............................................. 3 2.3 Vision of Apple Inc. .............................................. 3 2.4 Company Overview and Brief History of Samsung .......................... 4 2.5 Mission of Samsung Inc. ........................................... 5 2.6 Vision of Samsung Inc. ............................................ 5 3.0 Brand Promises and Wow Factors of Two Brands: Apple versus Samsung ........... 6 3.1 The Brand Promise to “Think Different” ................................. 6 3.2 Apple: Wowing Customers with Innovation and Superior Experience .............. 6 3.3 Brand Promise of Samsung: ......................................... 8 3.4 The Wow factor of Samsung ......................................... 9 3.5 Comparison of Samsung and Apple on Delivering Wow Factors ................. 9 4.0 Positioning of the Two Brands Globally: Apple versus Samsung ................ 12 4.1 Blue Ocean Strategy of Apple: ...................................... 12 4.1.1 Product Strategy of Apple: ................................................................................................................. 12 4.1.2 Pricing Strategy of Apple:................................................................................................................... 14

4.3 Blue Ocean Strategy of Samsung: .................................... 14 List of Tables

Table 1: Year wise Research & Development Expenditure......... 10 Table 2: Number of Utility Patents............................ 11

List of Figures

Figure 1: Blue Ocean of Apple................................. 12

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1. Introduction 1.1

Origin of the Report: Under the EMBA program of IBA, University of Dhaka this report is prepared for Professor Mustaque Ahmed as a course requirement for Brand Strategy. 1.2 Background of the Report:

1.3 Objective of the Study The primary objective of the qualitative, comparative study is to find out some in depth perspective of the factors and strategy undertaken by the two tech giants Apple Inc. and Samsung to become and remain in the top 10 global brands. 1.4 Scope of the Study The scope of the study is the comparative analysis of the brand strategy of the two companies Apple Inc. and Samsungas well as infers some conclusive statements based on facts and qualitative study.

1.5 Methodology of the Study Data Collection The main source of the data was from secondary sources found on the internet.

1.6 Limitations of the Study The collected data are mainly found from the secondary sources

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2 Company Overview 2.1Company Overview and Brief History of Apple Inc.

Apple Inc. is an American multinational technology company headquartered in Cupertino, California, that designs, develops, and sells consumer electronics, computer software, and online services. Apple Inc. is considered as one of the big four tech companies around the globe and has successfully built a brand that offers a brand equity value of $ 214,480 million and has grown at 16% in 2018, thus becoming the number 1 global brand.

Apple Inc. was cofounded on April 1, 1976, by Steve Jobs and Steve Wozniak in Los Altos, California. There was a third cofounder, too, named Ronald Wayne. Jobs brought Wayne on board to provide business guidance for the two young cofounders, but he ended up leaving the company before it was even officially incorporated. Wayne took an $800 check for his shares in the company. Here is a short snapshot of 35 years of Apple history till 2010.

The company has always been in a path of tremendous growth through perpertual innovation 2

after Steve Jobs return and the momentum somehow slowed after his death on 2011. The company has turned to a new leader in the form of current CEO Tim Cook. Apple has expanded its horizons through other means. The company has launched several charitable ventures that arguably might not have occurred under Jobs’ reign. Apple’s products throughout this decade have since primarily undergone upgrades rather than the introduction of any new product designs.

2.2Mission of Apple Inc. Apple is commited to bringing the best personal computing experience to students, educators, creative professionals and consumers around the world through its innovative hardware, software and internet offerings. The mission statement is as follows: “Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App store, and is defining the future of mobile media and computing devices with iPad.”

2.3Vision of Apple Inc. Apple Inc.’s corporate vision influences strategic management in terms of the decisions that the company’s managers make to reach a future of leadership in the various industries where the business operates. Apple introduced a new vision statement under the leadership of Tim Cook, who stated the following: We believe that we are on the face of the earth to make great products and that’s not changing. We are constantly focusing on innovating. We believe in the simple not the complex. We believe that we need to own and control the primary technologies behind the products that we make, and participate only in markets where we can make a significant contribution. We believe in saying no to thousands of projects, so that we can really focus on the few that are truly important and meaningful to us. We believe in deep collaboration and cross-pollination of our groups, which

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allow us to innovate in a way that others cannot. And frankly, we don’t settle for anything less than excellence in every group in the company, and we have the self-honesty to admit when we’re wrong and the courage to change. And I think regardless of who is in what job those values are so embedded in this company that Apple will do extremely well.

2.4Company Overview and Brief History of Samsung Samsung is a South Korean multinational conglomerate headquartered in Samsung Town, Seoul. It comprises numerous affiliated businesses; most of them united under the Samsung brand, and is the largest South Korean business conglomerate .Samsung was founded by Lee Byung-chul in 1938 as a trading company. Over the next three decades, the group diversified into areas including food processing, textiles, insurance, securities, and retail. Samsung entered the electronics industry in the late 1960s and the construction and shipbuilding industries in the mid1970s; these areas would drive its subsequent growth. Following Lee's death in 1987, Samsung was separated into four business groups – Samsung Group, Shinsegae Group, CJ Group and Hansol Group. Since 1990, Samsung has increasingly globalised its activities and electronics; in particular, its mobile phones and semiconductors have become its most important source of income. As of 2018, Samsung has the 6th highest global brand value totalling $ 59,890 million and 6% growth.

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2.5Mission of Samsung Inc. Inspire the world with our innovative technologies, products and design that enrich people's lives and contribute to social prosperity by creating a new future. Mission statement: “At Samsung, we follow a simple business philosophy: to devote our talent and technology to creating superior products and services that contribute to a better global society.”

2.6Vision of Samsung Inc. Inspire the World, create the future.

The Vision 2020 is at the core of our commitment to create a better world full of richer digital experiences, through innovative technology and products.The goal of the vision is to become a beloved brand, an innovative company, and an admired company. For this, we dedicate our efforts to creativity and innovation, shared value with our partners, and our great people. We have delivered world best products and services through passion for innovation and optimal operation. We look forward to exploring new business areas such as healthcare and automotive electronics, and continue our journey through history of innovation. Samsung Electronics will welcome new challenges and opportunities with joy.

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3.0 Brand Promises and Wow Factors of Two Brands: Apple versus Samsung 3.1The Brand Promise to “Think Different” Apple’s iconic branding strategy is centered on emotions; it focused on building a community of dedicated fans rather than just making sales. The secrecy around its new launches, the much hyped reveal presentation by the CEO, the conversations and buzzes around each release; makes it different. The customer does not think of buying Apple iPhone because they merely need a phone with great specs, they want to buy the Apple iPhone. From the creation of hype, to focus on aesthetics and experience to association with exclusivity and luxury, all led by innovation which brings something different to the market always; makes the promise “Think Different” effective. It thinks in a different way than other players and inspires its customers to think differently as well with its new innovations and experience which are like no other. 3.2Apple: Wowing Customers with Innovation and Superior Experience (a) Innovation Since the beginning of its journey, Apple walked a different path. Innovation is in the brand’s DNA which helped it bring in the WOW factor. Apple markets its product based on what it can do, not on raw specifications. They always strive to bring in something different which the world did not even think of yet or only dreamt of till now. The journey began in 1977 with Apple II. It was the first PC to support color graphics and have a floppy drive which was much more affordable than competition’s product. It also launched the world’s first electronic spreadsheet, VisiCalc. Apply continued its journey of firsts and innovation through licensing graphical user interface (GUI) in 1983, introducing “the Macintosh”, supercomputers such as Power Mac G4, OS X and the iPod, iPhone, iPad, MacBook Air etc. Each was an event that caused much media hype among the tech lovers and presses alike. The incredibly charismatic leader Steve jobs’ forward thinking and presentations set Apple truly apart from competition. They brought in devices which gave user a different experience; something they had not encountered before. Therefore, innovation has been on the forefront of Apple’s journey to become one of the most revered global brands in present day.

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(b) Delightful customer experience Apple practices empathy as one of its three pillars of business philosophy. Apple’s understanding of its core customer base is light years ahead of its competitors like Samsung, Huawei, or even Google. The competition may understand what it takes but may not invest in the same manner as Apple does. One does not have to go farther than its retail stores. From its speckless layout of store designs to uniform dress codes to exemplary services, the people orientation aspect of Apple is clear. The same cannot be said for companies such as Huawei, Samsung etc. who competes more on product feature, technology, product portfolio etc. It takes decade long analysis; investments to become a people focused company such as Apple. They do not see their products as mere devices but as individual pieces in the much larger pattern of customers’ and their close one’s life and work. Apple has a story which is still lacking in powerhouses such as Samsung. The iOS is unremarkably similar in every generation and every device. The same experience carries through its entire product lineup from iPods, iPads, Macintosh to iPhone and to Apple TV and watches. From purchasing to post sales, the entire experience is consistent. Apple also built an ecosystem encompassing iTunes store, iMessage, Facetime, iCloud etc. which makes sure customer and their friends and family stay close together.

(c) Ease of use and exclusivity: Simplicity and ease of use has been an essential factor for Apple. It’s easier to use for a wide range of people such as older generation, busy business people, non-techy, teens, people who prefer easy purchase and excellent customer service. This comes at a price though, the iPhone X is priced at upwards of $1200. However, the experience that Apple offers along with its strong eco system, customer focus and exclusivity make it worthwhile for its customer base which is gradually expanding. As of 2016, over 700m used iPhones and there are over 1 Billion active users of Apple devices in the world. It has a premiumness attached to the brand and keeps its customer base hooked with its unique experience and products. To a lot of people, it is an aspirational brand, owning an iPhone is a matter of prestige and sign of affluence. Therefore, despite practicing minimalism in marketing efforts, they have been able to create that pull among

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consumers.

3.3Brand Promise of Samsung: Samsung is committed to complying with local laws and regulations as well as applying a strict global code of conduct to all employees. It believes that ethical management is not only a tool for responding to the rapid changes in the global business environment, but also a vehicle for building trust with its various stakeholders including customers, shareholders, employees, business partners and local communities. With an aim to become one of the most ethical companies in the world, Samsung continues to train its employees and operate monitoring systems, while practicing fair and transparent corporate management.

The brand promise of Samsung is people first; create the future; greener future together. The values that define Samsung’s spirit Samsung believes that living by strong values is the key to good business. That’s why these core values, along with a rigorous code of conduct, are at the heart of every decision the company makes.

People

Quite simply, a company is its people. Ay Samsung, we're dedicated to giving our people a wealth of opportunities to reach their full potential.

Excellence

Everything we do at Samsung is driven by an unyielding passion for excellence and an unfaltering commitment to develop the best products and services on the market.

Change

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As we have done since our foundation, we set our sights on the future, anticipating market needs and demands so we can steer our company toward long-term success.

Integrity

Operating in an ethical way is the foundation of our business. Everything we do is guided by a moral compass that ensures fairness, respect for all stakeholders and complete transparency.

Co-prosperity

Samsung is committed to becoming a socially and environmentally responsible corporate citizen in all of its communities worldwide.

3.4The Wow factor of Samsung

Innovation and lead, every year, Samsung invests heavily on Research and Development (R&D) globally. In 2014, Samsung spent $13.4 billion, over $14 billion in 2015, and $13 billion in 2016.

Samsung offers the wide range of options for the consumers according to their choices. If anyone wants a cheap phone, then Samsung has cheaper phones. If one wants a midrange phone, Samsung has that too. If one wants a top of the range, Samsung has that too. If one wants to be able to write with a pen on the phone, as well as draw, then Samsung has the note series. If one just wants a fast, durable phone, Samsung S series is very good. Now, if anyone were to not receive more updates, can install a custom ROM (basically another version of Android) which means anyone can install Android X on a phone that could only get Android P.

3.5Comparison of Samsung and Apple on Delivering Wow Factors The target audiences of Apple are professionals, managers, executives and students that are high

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earners and belong to upper class and upper middle class who are aspirer, explorer and succeder. Apple appeals to its customers and potential customer by taking the lead.The Mantra “Customer is always right” is not a priority to Apple. To customers, Apple is always right. Apple dictates the lead. Customers don’t always know what they want, they want to be directed. So Apple upgrades with innovation that wows the market and hence deliver its brand promise of “Think Different” by delivering novelty value through perpetual innovation and perpetual marketing consistently. . The target customer of Samsung, on the other hand, can be broken down in two segments. The primary target segments are: upper middle class Professionals and large businesses; whereas secondary target market includes Young trendy people, high school & college graduates, Common Cellphone users, Institutional sales for colleges, Services to public safety, government, utility and manufacturing enterprises. Samsung has a brand promise of being an ethical company to all of its stakeholders but its main wow factor is Innovate and Lead. So Samsung also focuses on perpetual innovation and marketing. Table 1: Year wise Research & Development Expenditure

Company

(Billion $ )

Chang

As

a

%

of

2014

e from

revenues (2014)

2013

(Billion

Change from 2014

$)

As

a

of

revenues(2015)

2015

13.4

28%

6.4%

14.1

5%

7.2%

Apple

6

32%

2.6%

8.1

35%

3.4%

Microsoft

10.4

6%

13.4%

11.4

9%

13.1%

Intel

10.6

5%

20.1%

11.5

9%

20.6%

Amazon.com

-

-

-

9.3

41%

10.4%

LG Electronics

2.3

9%

3.9%

2.1

-1%

3.8%

Sony

4.5

-10%

6.9%

3.9

0%

6%

Samsung

%

Electronics

From the table 1 above, it is seen that Samsung has invested a lot in research and development over the years compared to Apple. Also Samsung has higher patents from 2013 to 2015 compared to Apple as shown in table 2 on next page.

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Table 2: Number of Utility Patents

Company

2013

2014

2015

Samsung Electronics

4652

4936

5059

Apple

1775

2003

1937

Microsoft

2659

2829

2408

Intel

1454

1573

2046

Amazon.com

530

741

1136

LG Electronics

1945

2119

2241

Sony

3073

3214

2448

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4.0 Positioning of the Two Brands Globally: Apple versus Samsung 4.1Blue Ocean Strategy of Apple: Apple has successfully created Blue Ocean with its value innovation and perpetual innovation on continuous basis by attracting and targeting customers that are missed by the traditional MP3 player industry, mobile phone industry music industry on individual basis. The figure below can give a broad and visual understanding of the blue ocean created by Apple.

Figure 1: Blue Ocean of Apple

4.1.1Product Strategy of Apple: The Apple product strategy is a combination of value innovation. The products are simple, sleek, elegant, innovative but easy to use. Apple has successfully used the 4 Actions Framework for each of its product and also has focused on the 7 parameters: performance, features, conformance quality, durability, serviceability, reliability and style and design.

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(a) iTunes

Strategic thinking: Apple saw untapped demand for legal channels of digital music with wide selection at a price that appeals to the mass of potential buyers. Eliminate

 

Piracy concern Complex pricing method

Raise

  

Reduce



Restricting in using purchased music

Music quality Music selection Simplicity & ease of use Create

  

Pay per song 30 seconds free sampling Automatic sync with iTunes (Easy file management & transfer to a mp3 player)

Result: By 2010, Apple has sold more than 297 million iPods & maintained over 70% Global market share

(b) iPhone

Strategic thinking: PC like phones

Eliminate



Variety of Models

Raise

  

Reduce

  

Number of physical buttons Embedded business applications PC-like performance (through operating system)

Mobile internet Style & Entertainment Ease of use & Simplicity Create



Freedom to customize through App store (from 2008)

higher

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(c) iPad

Strategic thinking:a new product that provides breakthroughs in value for PC users

Eliminate



Hardware features

Raise

  

Reduce

 

Ease of viewing Ease of use, intuitive navigation, portability Non PC function such as hand held gaming and e-book reading Create

Technical specs (storage capacity, speed,  Style and fun etc.)  Hardware add on Functions (embedded software  Customization through app applications)

4.1.2Pricing Strategy of Apple: Apple provides all these innovations to its target audience at a premium price compared to other products of competitors in the market.High priced products give image of quality and

durability but how Apple continues to work with customers after purchase is what justifies price for most consumers. So Apple believes it focuses on value based pricing for its target audience. 4.2 Unique Selling Proposition of Apple: Apple has focused on creating a lifestyle for its customer instead of focusing on product attributes as compared to other functional brands. “We provide a lifestyle with our products” is the unique selling proposition.

4.3Blue Ocean Strategy of Samsung: Value innovation is at the heart of blue ocean strategy. Value Innovation, first component of Blue Ocean Strategy is Samsung’s primary tool for product development. Samsung has adopted successfully Blue Ocean Strategy and company has profited through this strategy in the past few

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years. Samsung has invested heavily in Research & Development that helps the company to innovate and create new products that helped the company to grow into a Global powerhouse. Samsung’s team of researchers and engineers include over 50,000 employees across 42 global research facilities—each one collaborating on strategic technologies to forge new market trends and set new standards of excellence. Blue Ocean Strategy visions the creation of uncontested markets with no competition through new product innovation leading to creation of new demand.

Value Innovation Program centre was started in 1998 and by 2004 the centre was playing a very key role in rapid growth of Samsung to become the world’s top consumer electronics company. Samsung BOS strategy has also helped it to maintain top position in TV market (since 20062010), Global; LCD panel market since 2002. BOS is still at the core of the Samsung product strategy and company has been able to make the necessary adaptations according to the business environment and changing consumer preferences.

4.3.1 Product Strategy of Samsung:

Samsungs product strategy focuses on technological leadership, Customer focused design, value added first to market products. 4.3.2 Pricing Strategy of Samsung: The Samsung’s pricing strategy undertakes two components with the first being the skimming price and the second the competitive pricing.

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For instance, when Samsung launches new products with different variants of storage capacity, it prices the product higher. But when other competitors launch a smartphone with identical features, Samsung lowers the price and easily prevents the reduction of its market share due to the launch of the competitor. Samsung uses competitive pricing for different products and product categories where it tries to compete with the competitors on the basis of the price of the product.

4.4 Unique Selling Proposition of Samsung For Samsung, they have a wide range of products and price points, which is a USP in and of itself. What Samsung really does push as their USP is that they can deliver an exceptionally high quality product for less money than the competition. Wide range of products and price points can be added. 4.5 Comparison of Apple and Samsung on Positioning Strategy and Unique selling Proposition:

5.0 Positioning of the Two Brands Globally: Apple versus Samsung 5.1 Multiple Brand Identity: Apple is a corporate brand and it is rarely that anybody states that he or she bought an Apple, it is always an iPhone, iPod or iPad that is mentioned, similarly a customer purchasing a Samsung smart phone will not refer to the purchase as a Samsung, but instead would say I bought a Samsung Galaxy S8 or Samsung Galaxy Note-7. Apple has been successful over Samsung in earning superior profits by embarking on multiple brand identities.

Samsung’s multiple brand strategy would be short termed, sighting that

Samsung is profitable due to the space it enjoys as No. 2 brand to iPhone which is more profitable than Samsung. Despite these views both brands continue to enjoy the attention of the consumer through their respective brand identities backed by consistent innovation in terms of functional capabilities and technological advancements. Apple has been successful in retaining its core identity and creating multiple brand identities such as iPhone, iPod and iPad. Even within these brands Apple has created sub brands such as Safari, iTunes, iBooks etc., thereby enabling it to successfully differentiate from Samsung and

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other competitors.

5.2 Brand Personality: Brand personality defined as “the set of human characteristics associated with a brand” by David Aaker could be viewed through strong affiliations a brand may have to a single person such as the founder or brand ambassador, as in case of Apple whose corporate brand personality was defined by its founder, Steve Job’s personal characteristics such as vitality, imagination and passion was associated with Apple and whenever Jobs was present at a product launch there was tremendous hype and anticipation and when his health deteriorated and took him away from leading Apple, the companies’ stocks plummeted . Samsung is protected from exposure towards fallibilities associated to a single personality, as; although Samsung was founded by a Korean by the name of Lee Byung- Chul in 1938 his association with the Samsung brand is little known

Apple has successfully built a sense of genuineness and feelings of energy to the personality of their brand, whereas Samsung has an edge over it sense of ruggedness through its functional dimensions. With functionalities such as replaceable batteries and free mobile apps the brands Samsung is more appealing to a certain segment of consumers who are risk takers and do not believe in paying for software. As such the Samsung brand is to a compelling functional benefit whenever possible and generates deep consumer insight in the construct of their brand

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5.3 Brand Self Image: Brand self-image is also an internalized facet of the brand identity prism. According to Kapferer,Brand self-image has been found as the target’s own internal mirror when s/he interacts with the brand. It has said that consumers wish to acquire the characteristics of a brand by using them, for e.g. Userof an iPhone is associated to eliteness although actually he may not belong to the elite class ( Ponnam, 2007) , and the same image cannot be drawn by Samsung as it is not perceived to be identified in that position. The strength of the iPhone’s self- image is illustrated by a study conducted where it was revealed that “Apple's iPhone remains the smartphone with the greatest appeal for shoppers in North America”

5.4 Brand Physique: The physical appearance of the iPhone has contributed immensely towards establishing its brand personality in comparison to Samsung, the software (iOS 8) of the iPhone 6 has been optimized to enhance the physical design iOS swipe gestures have been designed to flow seamlessly making it easy to navigate with one hand thus linking traits of human characteristics to physical design.

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Apple targeted towards the high end customers although it was widely expected that Apple would introduce a cheaper lower-end product with the 5C model to capture the emerging markets, the pricing did not reflect this expectation and iPhones remains to be identified and reflected with the affluent class. This view is illustrated by Reis (2014) who is of the opinion that “Getting an iPhone, for instance, is a symbol of moving up in the world, a status symbol. In many countries, including the U.S, an iPhone is a symbol of wealth. Conversely, Samsung’s Galaxy range has targeted their brand to the mass market with a phone to fit any customer’s budget. iPhones are sold mainly through their branded stores or authorized resellers, in 2003 Apple spent $293 million to open 73 retail stores to create excitement for the brand , the logic behind this investment is to allow more customers to touch and feel the Apple product. Comparatively Samsung is distributed freely and is available readily in most markets. In essence, iPhone is reflected to be identified with the affluent and limited in availability thus earning superior profits which no doubt enhances brand equity , the way Samsung is positioned and reflected it is a revenue driver and is associated with affordability , and value for money but includes high-end product options as well. When it comes to “understanding competitors” both Apple and Samsung have been equally successful, Apples success though is limited to a niche high-end market, whilst Samsung has a deep understanding of the mass market.

5.5Brand Logo:

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5.5 Brand Slogan:  Mac Mini: “It’s Mini in a massive way  Mac Book: “The note book you love”  iTunes: “You have never been so easily entertained”  iPhones: “Bigger than Better” “Progress is a beautiful thing.”  iPad: “What will your verse be?”  Mac OS X: “Every bit as powerful as it looks”  App Store: “There’s an app for that”  Apple TV: “ All Things entertaining”  Apple Watch: “ Our most personal device yet”  Apple Pay: “Your Wallet. Without the wallet”  iTunes Radio: “Hear where your music takes you.”  iPod Touch: “Engineered for maximum funness”  iPod Shuffle: “Small but big on Music”  iPod Nano: “Tap play. Then go play.”

5.6Packaging as an Element of Differentiation between Brands: Apple’s packaging strategy is based on simplicity that features the product and easy use of

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products

6.0 Positioning of the Two Brands Globally: Apple versus Samsung 6. 1 Integrated Marketing Communication of Apple: 

Trade Shows: In earlier days, Apple used to perform trade shows.

Apple uses Television and Online marketing as a medium for its marketing communications. 

Advertisements with Celebrity Endorsements: Over the years, Apple has relied heavily on catchy TV commercials and viral marketing campaigns. They often use songs that are trendy, catchy and hip hop. Apple has solidified its position with simplistic yet powerful ads in collaboration with numerous celebrities alike. Celebrity endorsements help to communicate their brand position. Some of the award winning commercials are mentioned below:

 “1984 Super Bowl Commercial”: The 1984 Super Bowl commercial was Apple’s introduction of Macintosh personal computer based off the eponymous dystopian George Orwell novel. It was successful in introducing the philosophy of empowerment and today is considered as the most well-known advertising in history. Apple advertising and marketing campaigns have continued to be successful and won many awards.

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 “Think Different”: When Steve Jobs left Apple Inc. for a short period of time the company was not successful in keeping their brand image, they focused more on price and features of the product. Jobs rejoined the company and in 1997 launched ‘Think different” campaign, which again helped the company restore its brand image in the customer’s mind. This campaign was a major turning point of company’s history. The commercials featured many greats who have made a change in the world including martin Luther king Jr., Albert Einstein, John Lennon, Thomas Edison, Muhammad Ali and Pablo Picasso.  “Switch”: Apple is in fact a company that does think different, for their campaigns. Apple did not advertise in the regular computer magazines, instead chose popular magazines and magazines related to fashion. Something that other company never thought of doing before. In 2002, Apple launched a new campaign ‘Switch’ in which it featured “real people” who had switched from Microsoft Windows platform to a Mac. Again this campaign featured famous personalities such as Tony Hawks and Will Ferrell.  “Get a Mac”: The “Get a Mac” campaign was launched in 2006 which was a form of negative advertisement where the company talks bad about the competitors. The purpose of the campaign was to target users of the competitors rather than concentrating on the hardware superiority. The campaign featured a cool young guy who personified the Mac is for young and trendy whereas PC is history. The positive point of the campaign was that Apple took advantage of the problems faced by the operating system launched by Microsoft during that time and it pointed out the weakness and failures through these ads. In 2007 ‘Get a Mac’ campaign won the most successful Marketing Campaign by Effie Awards. 

Product Placement: Apple tries to place their products into movies and TV Shows such as Transformer 4 and Captain America: The Winter Soldier. Apple uses their logo in product placement.



Press Conferences: Apple often calls for press releases and introductory meeting to announce their new product and show them off to the world. This creates anticipation and excitement among customers and potential customers.

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

Buzz Marketing: Apple uses this technique a lot in marketing their products. They heavily relied on buzz marketing when they promoted their “siri” product and they used celebrity like Zooey Deschanel and Samuel L Jackson to do it.



Online Marketing via Apple Website: Apple make sure that traffic is driven to their website via search engine marketing. When customers visit the websites, they find it is simple and easy to navigate. The iPhone website has clean, clear and witty interface. The iPhone advertisement is similar to white background of website that is alluring to customer. The website gives the consumer information on all the Apple products, so that customer can make informed decisions before they purchase the Apple products. Apple can spread information about their products before they put it on TV.



Infomercials (Direct Marketing): When a consumer installs a new app from App Store or update, Apple sometimes slips in infomercials that show the consumers how to use the new updates or new products. This promotes the image of simplicity while providing information to the customers. Apple promotes by limiting music/media to be available by iTunes purchases only to attract customers.



(i)

Integration tools:

Apple iD- requiring registered information to download apps/media, use products and update apps /iOS are a way for Apple to understand who is using their products and what uses they are using them for.

(ii)

Software updates and App Stores allow Apple to have an idea of who is still using the products and who utilizes the importance of simplifying and fixing bugs.

(iii)

The iCloud is a tool for consumers to simply use multiple apple products, but also gives Apple an idea of who is loyal to the brand, and what different products are being used.

6. 2Integrated Marketing Communication of Samsung:

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6.3 Comparison of Apple & Samsung’s IMC Based on Related Factors: Factors

Apple

Samsung

Winner

Innovation &

Leading Innovator

Follower for a long time. Became major

Apple

competitor after launch of Galaxy S4

Technology Social Media

Minimalist presence on

Visible on social media channels like

Presence

Social Media

YouTube, Twitter, Facebook, connected

Samsung

with major apps and platforms and launched digital campaign #SamsungCares Advertising

Focuses on online

Samsung is giving importance on Apple

advertisement campaigns.

advertisement of Galaxy S. It promotes &Samsung

The iPhone website has

mobile phones- bringing a dark blue

clean, clear and witty

interface in contrast to the white

interface. The iPhone

background brought by Apple. Galaxy

advertisement is similar to

S is promoted as somewhat vibrant, fast

white background of

and thinnest mobile phone and the

website that is alluring to

advantages embraced are explained

customer.

clearly.

Customer

Apple launched ‘Your

Engagement

Verse’ campaign to highlight how different people use ipad to do things incredibly and in

Samsung launched its own campaign, ‘Incredible Art Piece’ to

Apple & Samsung

promote Galaxy Note pen style. This campaign itself became a Guinness

their own way in 2014.

World Book entry with the record of

(Lifestyle brand)

maximum number of artists working on a single art work.

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(Functional brand) Public

Apple is using publicity

Samsung uses Social Media such as

Relations &

for free and yet powerful

Facebook to market its product and has

Publicity

way to interact with

less visibility on public relations

customers. More users are

compared to Apple

Apple

buying Apple due to halo effect. Viral Video

In 2012, Samsung launched campaign,

Making

“The Next Big Thing is Already Here”

Samsung

to promote new smart phone series Galaxy SII teasing Apple with taglines““Why don’t you guys just get 4G phones?” and similar campaign Samsung’s Grad Pool Party ad on May 2013 to promote Galaxy S4 Entertainment

Apple also generated the

Samsung believes in its value and

buzz among the music

adores the power of a celebrity.

industry for

Samsung made sure its product was

procuring ‘Beats’ by Dr.

front and center at the Oscars.

Dre but it felt to be a little

The brand partnered with famous music

late

icon JayZ for his ‘Magna Carta Holy

Samsung

Grail’ album, and teamed up with Usher for product placements in his ‘Looking for Myself’ music video. Brand Equity

Apple

7.0 Survival and Sustainability of the Two Brands: Apple versus Samsung

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Last Decade Scenario of Apple’s success: Apple’s major competitive advantage is its technological advancement & visionary thinking which made it most desirable brand in the world. Telling someone you own an Android doesn’t have the same effect as telling someone you own an iPhone. It’s the name which makes the difference.

Apple understood that their products are of high price so it will only be possible for youngsters with hefty income or backed by rich parents to purchase their product while middle class who forms the majority of the world population will not be able to purchase the same so they tied up with telecom service provider in various developed/developing nations to sell it on EMI basis with 2-3 years of unlimited calling /data usage. These strategies of Apple have been successful so far in various nations.

Vertical integration has given Apple competitive advantage, as it owns chip manufacturers, controls manufacturing, follows extremely strict software standards, and operates in a nearly closed ecosystem of proprietary 400+ worldwide retail stores. With these advantages, the company has more control of its value chain and, more importantly, its component costs. Brand equity – Apple is one of the top most companies of the world for its brand equity. From the days of McIntosh computers, Apple is known to be a brand with promise. Tag of innovation – Besides the brand equity, the tag of innovation has always been applied to Apple. From Ipod to Iphone and Ipad, Apple has been responsible for many tech revolutions. Apple has always been known for its innovation& out of box ideas like “SIRI”, a personal assistant having features of speech control and interactivity, user-friendly software platform. Consumer loyalty – An Apple loyal customer will proudly proclaim in front of the whole world that he is an APPLE guy. The brand loyalty of Apple iphone can be compared with the Harley

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Davidson brand loyalists. Just like the HOGS are known to be furious Harley enthusiasts, so are the iphone owners. Amazing software and OS – The IOS which is the operating system of Apple iphone is a respected mobile platform because of its flexibility and speed. The user interface is fantastic, and one you use an iPhone, you get addicted to its ease of use. Wide developer support / control in the hands of users –Google play came long after the Apple developer network. Before Google play, or android even started, Apple had millions of applications and games made through its developer network. And the Apple developer community is one of the strongest online communities till date. Design consistency – iphone has delivered hit after hit due to its design consistency. Apple Iphone is very much similar in looks, and design wise there are not many changes. But it is what is present inside the machine that Apple Iphone sells. What are the challenges for Apple’s sustainability? High price – With such brand equity, you are bound to target the A grade segment itself. But even then, the Apple Iphone is costlier as compared to Samsung phones which offer similar features. Restrictions on the phone – There are unnecessary restrictions on the Apple Iphone out of the box. There is no Bluetooth, expandable memory is absent, and battery is non-removable battery. With such a high priced phone you expect more features from the phone. No variety – Apple Iphone design is very consistent which a plus point is. But at the same time, there is a large population which continuously changes phones. They don’t get the variety that they expect from Apple Iphone. This can be a reason that customers switch to other brands. The variety and features offered are very high in a brand like Samsung, Huawei, MI etc. No Steve jobs anymore – Many of Apple followers were staunch Steve jobs fan. And with no Steve jobs anymore, Apple has lost some of its charisma. Lack of Innovation on Artificial Intelligence and for Market place: Mobile phone market is now completely going based on the market place and their applications. IOS is not opening not

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many spaces for the open source application which causing trouble for its users. Apple is telling they are investing on artificial intelligence but truth is for last 3 years no one can see that much up gradation to their new apple product and phone as well. This industry is changing rapidly and statistics is showing new innovations are coming within 6-8 months but apple is not adopting those rapidly which is a big concern for sustainability and those who are apple haters, competitors they are getting a tool to say negative word of mouth for apple. What Apple needs to do for sustainability? Market potential of smart phones – Smart phones are the rage now a days and the market is not going to get smaller. Thus the large market of potential customers is there for the taking for a brand like Apple. Continued technological advancement – Apple has delivered hits every decade or even every 5 years. So people have started expecting more unique products from a company like Apple. And products which are technologically advanced can take the company to even higher levels. More dependency on digitization – People are becoming more and more addicted to internet and apps. So much so that nowadays hardly anyone is seen without a smart phone. As people become more digitalized, and as spending power increases amongst consumers, smart phones like Iphone Will see a boom in the industry. Strategy for Market Place & Artificial Intelligence: One of the main competitive advantage of android operated phone like Samsung is it’s market place which is known as google play store . Google is a huge back up for android for market place and we can see that the market place is the present and future of mobile phone. Though IOS has a market place which competing with Google play store but still android based phone are winning due to it’s easy going nature. SO apple has to make serious strategy for it otherwise they will not continued as a market leader and it will count as threat for sustainability. And regarding the artificial intelligence they have already developed ‘SIRI’ but it has no match with google AI. So if they want to give something better to it’s users then they have to think seriously. Success Reason of Samsung: Samsung reads the markets: Samsung figures out where the world is heading in terms of mass-market consumer electronics products, sees what is selling well and what is growing and moves into that space with a better product than the original offering.”

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Samsung is the classic fast follower: they’re attuned to what competitors are doing and what other people are bringing to market first. They watch like a hawk as others gain traction and then very rapidly come up with their own version. This emphasis on speed usually pays off, but it can also backfire – as the problems with the Galaxy Note 7 highlight. Lessons from the world’s best-known fast-follower: Samsung Samsung didn’t invent the mobile phone – that honour goes to Motorola – but it took a transformative new technology and ran with it. Even when Samsung is in the news for the wrong reasons – the company has recalled the Galaxy Note 7 smart phones on safety grounds after some of the devices caught fire – its fortunes are expected to recover.

Using innovation technologies:

Fast-follower approach to innovation still requires enormous creativity and skill. Samsung invests heavily in training its engineers to systematically innovate. Samsung is a company with a vast amount of technological expertise. They make about 50% of the world’s microprocessors in some sections of the market. They’re one of Apple’s biggest suppliers, providing memory chips, touch screen glass and other components. The reason they’re able to move so fast is because they already have so many other general-purpose technologies that underlie consumer electronics. So moving quickly is about bundling together new and existing technologies.

What are the challenges for Samsung regarding sustainability?

High Price: Compare to other android phones Samsung is selling their product in a higher price which is now considered as disadvantage for Samsung.

Dependency on Google android: Though Samsung has been successful for years by using Google android but they need to focus on their own OS and application processors for differentiating from other.

Need of New Technology: The market is in need of a new technology to disruptive the current situation. With 5G, Samsung is currently in the lead among companies which can be game

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changer and market leaders to a new wave of technological innovation. In order to become the market leader in the emerging 5G technology, Samsung needs to take a more proactive view which can propel the company to be the “first entrant” into the new market and get competitiveness.

What Samsung needs to do for sustainability?

1. Develop their own OS, application processors 2. Decrease dependency on Google android 3. Keeping brand loyalty in high end products 4. File patent more aggressively on 5G technology on 2020. 5. Align R&D plans of SISA, DTL, SERI, and BST centers to support 5G development 6. Invest to hire and train related researchers for the centers 7. Participate with OS providers and third-party companies to develop applications

In this sector it is hard to say who is going to survive for next 10 years. Once Nokia was the market leader of this sector. One has to make right decision and right research and development regarding user’s demand otherwise in it is difficult to sustain in this sector. From this point of view Apple has risk issue regarding sustainability comparing to Samsung.

8.0 Survival and Sustainability of the Two Brands: Apple versus Samsung 6. Who is winning the war? There’s no end in sight to the war between Apple and Samsung. In all likelihood, competition between the two will be healthier every year. But even though neither company is teetering on the brink, Apple is most definitely winning the current battle. Apple are widening the gap where it matters the most.

Why Apple s winning the current battle?

1. Capturing market share:

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Apple has significantly increased its lead over Samsung in the premium smart phone market ($400+) since the launch of the iPhone 7. Over the summer, Apple was selling just over 50% of the global premium smartphones, and Samsung was selling just under 25%. By December 2016, those numbers had grown to 70% and 17%, respectively.

2. Higher Profit Margin:

Although premium smart phones make up a minority of global smartphone sales by volume, they provide the bulk of the profit. The reason why Apple makes so much money off smartphones is because each iPhone it makes costs somewhere around $200 to make, and is sold for over $600. The profit margins are far better for premium smartphones than nearly any other segment of electronics, so Apple ends up making more money on a $600 iPhone

3. Competitors still facing challenges: That’s why it’s so significant that Apple is widening the gap on Samsung with premium smartphones. For the past five years, Samsung has been the only other smartphone company to give Apple real competition in the premium smartphone market. Other Android manufacturers have made great flagships, but they haven’t sold well, and sales of $300 smartphones haven’t been enough to support HTC, Sony or Motorola.The only thing that separates Samsung Electronics from the laundry list of failed smartphone companies is the premium devices. Samsung can’t get by selling the S6 Mini for $250 unlocked to a bunch of teenagers. It needs people buying the Galaxy S8 and the Galaxy Note 8 instead of the iPhone 8, or the profits will wither and die. According to Counterpoint, it’s really a battle for survival between Samsung and Apple. Their respective shares of premium smartphone sales are a “zero-sum game;” when one company loses its share of the profitable smartphone sales, the other gains.

4. Brand Loyalty:

Brand loyalty is very important to any manufacturer but is extremely important in the

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smartphone market due to the quick replacement cycles. Apple has a bit higher retention rate at 42% vs. 38% for Samsung. Apple does a better job of switching Samsung customers at 19% vs. Samsung only converting 7% of its users from Apple.Both Apple, at 79%, and Samsung, at 75%, users tend to keep their phones between one and three years with Apple turning them over slightly sooner than Samsung owners. 5. Apple’s own ecosystem:

Apple could be in a better position since it seems to be retaining a higher percentage of its users and doing a better job of getting Android users to convert to iOS. While I don’t expect Samsung to falter anytime soon, if the Android market becomes extremely price competitive and it is not able to make inroads in Apple’s install base Samsung’s profitability could be negatively impacted. Samsung will need to be at the leading edge of functionality and develop its own ecosystem.

6. Strategy of Apple:

This culture and strategy difference also is manifested in the innovation happening within the brand’s sales and marketing departments. It starts with customer data. You can’t use the iPhone without having an account with Apple, which means that Apple knows a lot about you. In Samsung’s case, it has yielded the customer data benefit to Google, though the benefits of that decision probably outweigh the detriments.The operating system excuse doesn’t let Samsung off the hook. Apple is continuously improving its internal sales and marketing capabilities because it has a straightforward management structure. Therefore, it can experiment as rapidly here as it does with its products (and probably faster). Apple is applying AI and other novel concepts in its operations. Apple was the first among the two to experiment with proximity in its sales operations, and its CRM system is state-of-the-art.

Based on all this comparison we can say apple is leading the market but as the technology, innovation is changing and all those competitors are making progress it is hard to say who is winning as winning is the word of future itself. Market trend always shows the path for market

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leader. But in this sector Nokia was the winner, but now Apple is.

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