Samsung_Brand_Story

Samsung Brand Story Table of Contents Section 1 – Samsung History 1969-1990 - Establishing Philosophies and Strategies 1 1990-2000 – Expansion and New Market Approach 1-2 2000 – 2012 - Redefining the Samsung Brand: The Smartphone Revolution 2 Marketing Investment 2 Repositioning 3 Timeline 4 Section 2 – Samsung in the Present Economic Environment 5-6 Market Position 6 Product Portfolio 6 Brand Architecture 7 Strategies 7-8 Identity 9 Current Opportunities & Threats 10 Section 3 – Future of Samsung Overview 11 Recommendations- Solar Power 12-13 * Reduce Diversification 13-14 * Innovation Investment 14- 15 Rational of Recommendations 16 References 17-20 Appendix 21-23 Section 1 - Samsung History 1969-1990 - Establishing Philosophies and Strategies Upon incorporation in 1969, Samsung’s initial goals were based around providing an economic contribution to the Korean nation. The 1970’s were seen as the beginning of Samsung’s transformation into a recognised organisation, producing a wide range of goods. Samsung placed great emphasis on expansion, seeing electronics as a value added industry. Strategic foundations for future growth were laid in the early decade through investment in areas such as, petrochemicals, semi-conductors and shipbuilding (Han 2011). They placed emphasis on foreign technology, mass production, cyclical process and Government support. Following on, the1980’s represented the period of Samsung’s global expansion. Their considerable determination was highlighted through the Ceo’s inspirational statement that not only defined the aims over the decade, but was utilised as a basis for all future visions, ‘Samsung Electronics' future is not guaranteed because most of our flagship products will be obsolete in 10 years from now’ (Taipei Times 2010). Upon establishing itself as a multi-national enterprise in the early years, emphasis was placed on the solidification of the company’s base of technology, brought about through the establishment of the R and D institutes in the mid 1980’s (Han 2011). Samsung sought to place themselves in a position to maximise usage of all resources and develop value-added products, and were able to do so in the later years. Samsung considered anything short of the dominant company in the industry to be a failure. They highlighted that, ‘falling short of emerging as a first-class company, would not simply make us a second or third class company, but would threaten our existence’ (Dongyoup 2006, P41) 1990’s - Expansion and new market approach The 1990’s represented Samsung’s stance as a firm international competitor. Their philosophical approach to progressing in the market was seen though the launching of the ‘new market initiative’. They acknowledged that change was imminent, due to their failure to truly adapt to the international market, a factor that would impact future success. It represented the 3 major strategies, relating to high quality product, globalisation and comprehensive integration (Dongyoup 2006). The company saw success as based within the organisation, and the statement addressing every employee, ‘change everything except your wife and children’, epitomised this approach (Yarow 2013). The new management era of Samsung also saw the adoption of the ‘quality first’ approach, based around their purpose of achieving global recognition as a producer of top-class products. Their enforcement of quality control across all plants in the world through the ‘Line Stop System’ was the determining factor, as a firm line for employees to work upon was established (Dongyoup 2006). As the final years of the 1990’s approached, Samsung also announced an official new millennium vision of, ‘leading the digital convergence revolution’, and it was this strategy that carried on to their success in the 21st century (Dongyoup 2006). 2000 – 2012 - Redefining the Samsung Brand: The Smartphone Revolution During the 2000s the Samsung brand was still centred upon delivering better products for more value (Elkin & Linnett 2000). As a brand they were ranked at #43. Internally the company knew that their brand belief of innovation and design was targeted towards enhancing the consumer experience. While Samsung had adopted the value of enhancing consumer value rather than building mere products this was not converting into increased brand equity or awareness. Consumers still saw Samsung for their products and not their brand. The weaknesses of the company are also identified (Elkin & Linnett 2000) as having a fragmented brand strategy, based on product and geographic segmentation. There was a lack of consistency and cohesion in global marketing efforts. Given their origins as a manufacturing firm, this was an oversight on potential brand loyalty. However the growth of the brand has caused a development of expectations in consumers. Without nurturing brand equity, the company’s global dominance was doubtful. Marketing Investment Samsung then embarked on a goal to become the leader in consumer electronics by 2005. Despite having such distinctive innovative advantages in the products, consumers were unaware. This caused Samsung to invest heavily in their marketing operations. They invested into leading golf tournaments in the US market (Lee 2003) as a measure to increase brand awareness. Using the 2008 and 2012 Olympics as their primary advertising platform then invested over $US3billion to boost branding (WritePass Journal 2013). Furthermore they continued sports advertising to become the primary sponsor of European Football club, Chelsea that was part of their jersey, worn at all matches. Around 2005, Samsung began to pursue their revitalised branding strategy of involving consumers in the technological experience. This was supported by their foray and later global dominance in the smartphone arena. Samsung started to ‘humanise’ (Rooney 2013) their products for consumers, by making the premise of their product R&D contingent upon consumer lifestyle behaviours. Repositioning They also underwent repositioning (WritePass Journal 2013) to modern technological products with a dedicated emphasis on design. Once a clear vision of position was established, they began in 2010 a journey to connect with consumers on an emotional level (Martin 2012). A tagline ‘Design for Humans’ was the signal to the market that Samsung was all about the consumer experience. This was a definitive attempt to convert brand awareness to repeated purchases, a problem Samsung was facing for many years. Timeline 1970- The Samsung Group established a subsidiary in the form of, Japan's NEC Corporation and Sanyo in order to manufacture home appliances and audio-visual devices. 1971- Samsung’s initial consideration of integrating American technology was ignored, meaning that Samsung entered the Korean electronics industry as a market follower, rather than a pioneer. 1974- Samsung undertook a significant development, expanding into the semiconductor business through a 50% stake in Korea Semiconductor, an innovator in the chip making industry. 1975- Samsung electronics listed on the Korean stock exchange. 1978- Over 4 million black and white Televisions had been produced in less than 10 years making them one of the largest home appliance producers in the world. 1980- The acquisition of Korea Telecommunications, leading to the entry to the production of telecommunications devices soon after. 1981- Samsung Electric Industries had manufactured over 10 million black-and-white televisions. 1986, 1987- The Samsung Economic Research Institute was established in 1986 followed by the Samsung Advanced Institute of technology in 1987 enabling Samsung to expand deeper into the electronics, telecommunications and semi-conductor markets. 1988- Samsung launched its first mobile phone in 1988 upon the merger between, Samsung Electric Industries and Samsung Semiconductor and Communications to form Samsung Electronics. 1993- Creation of the ‘new market initiative’ approach. 1994- All 17 Samsung products received top market rankings in their respective areas. 1995- Samsung Electronics acquired a 40% stake in AST Research, for US$378 million. 1996- Becoming an official sponsor for the 1998 Winter Olympics. 1997- Samsung’s overcoming of the Asian Financial Crisis that severely impacted multiple local companies. 1999- Proclamation of their desire to be ‘leading the digital convergence revolution’ in the new millennium 2000- Firm secured $26 billion in sales and $4.7 billion in net profits. 2001- Teamed up with Dell in a $16 billion technology and research development agreement. 2005- Surpassed Sony for the first time, becoming the 20th largest and most popular consumer brand. 2007- Became the world's second-largest mobile company, surpassing Motorola for the first time. 2008- Served as a key sponsor in the 2008 Beijing Olympics 2009- Samsung achieved total revenues of US$117.4 billion, to become the world's largest technology company based upon sales. 2010- ‘Design for humans’ marketing strategy was launched Section 2 - Samsung in the Present Economic Environments Macro-economic environment The global economy demonstrated an uneven recovery in 2012. The Gross Domestic Product (GDP) in industrialised countries expanded 3.70% in the first quarter of 2013 (IMF 2013). Despite this, Samsung’s most important regions, situated in Europe, Asia and U.S remain in jobless recovery with a solid proportion of long term unemployed (Approximately 9%) and continued decreasing household income (IMF 2013). Real disposable income saw little to no gain, held down by the weak labour market. Household wealth also remains well below the elevated levels that prevailed in the mid 2000’s. Micro-economic environment Despite this challenging environment, the global consumer electronics industry posted healthy value growth in 2012, buoyed by several important growth categories in personal computing and portable electronics. Consumer expenditure on leisure, recreation and telecommunications products increased throughout the year, recovered total pre-recession totals in various cases. Growth of Tablets and Smartphones Tablets were among the dominant products in the global consumer electronics market, as the Samsung Galaxy Note and Apple IPad experienced exponential growth (Leonard 2013). The media tablet format has resulted in innovations in mobile applications for social networking, gaming and streaming media, redefining global personal computing. Imminent problems as portables consolidate Despite the fact that 2012 was a positive year for consumer electronics, the forecast is less optimistic, with the reduction in unit volumes, as global personal electronics usage merges around several main devices (Longford 2013). As price erosion presents itself in personal computers, in-home entertainment and mobile phones, it will demand continuous innovation on the part of Samsung, seeking to respond to, and shape consumer demand. Smartphone Market Fast growth in emerging markets has resulted in a strong reduction in Apple’s global market share. ComScore’s latest data (see Appendix item 1) indicates that, Apple’s share of the smartphone market stands at approximately 21% during Q1 2013, with a solid 70%% on the part of Android (Epstein 2013). It has been observed that the trend among mobile operating systems in representing Android as the nation’s top smartphone platform by a fair margin also resulted in a holt in Iphone growth as well. Market Position Samsung’s current market position is strong in the consumer electronics market. Samsung was one of biggest successes of 2012 with a 19.1% increase in market share and acted as a global leader for smartphone shipments (beating Apple and Nokia) (Epstein 2013). Samsung dominates the global smartphone market, selling more than double the number of devices of Apple. (52mil vs. 26mil) (Sarnataro 2012). The S3 and S4 release’s acted as a major helping factor. Samsung also leverages brand recognition across all pricing strategies and such innovative factors result in other android rivals falling short of being serious competitors. Stretching beyond the Smartphone market the Korean electronics giant managed to increase its share of TV sales from 20% to nearly 30% (Smith 2012). Samsung now sells more TVs and more cellphones than anyone else globally (see Appendix item 2), and the brand still has a lot of headroom to move from a symbol of quality and innovation to a brand that is truly loved by consumers (Smith 2012). In addition, Samsung ranked second on the list of top patent assignees, subsequently strengthening Samsung’s position among its competitors (Kivett 2012). The firm also won many awards for the design of its products, proving the superior advantage over its competitors. Product Portfolio Samsung currently holds a broad position in the electronics market through their involvement in 17 categories within the electronics sector. Samsung offers a wide range of innovative consumer products, mainly in computers, digital TVs, video players, portable consumer electronics and home audio and cinema. In addition, Samsung manufactures semiconductors and components like LCD and Plasma panels. Brand Architecture Samsung presents itself as a ‘Masterbrand’ that utilises its recognised brand name as a firm anchoring point from which all of their underlying products are based. Samsung made the move away from sub-brands to a single brand strategy in an attempt to increase the company’s sales, profit margins, and market capitalisation (Dongyoup 2006). Examples can be found in the form of the broad portfolio previously mentioned, as they establish the same perception of quality across every one of its products. Strategies Samsung’s strategies are largely based around the concept of brand architecture, as they acknowledge that differentiation and uniqueness is the key. Samsung’s vision of its role in the consumer market is based upon the synergy and merging of multiple devices on a single platform, an approach branded as the ‘connected home’ with connectivity as the core consumer value proposition (Samsung 2013). An example can be found in the form of the recently introduced, ‘sidesync service’ allowing for the seamless integration between PC and smartphones. It holds the capability to use a PC’s keyboard and mouse with the smartphone, as well as the ability to copy and paste text and data seamlessly from either (Samsung 2013). In addition, the deep integration of the ‘Dropbox’ application provides consumers with a seamless content syncing experience across all Samsung devices, enabling wireless connections between all smartphones, pc’s, tablets and camera’s (Samsung 2013). Finally, epitomising the concept of innovation and integration is the impending introduction of the wireless printers, enabling consumers to use their smartphones to print directly to their computers without the need for a wired connection (Samsung 2013). All of these innovations are based around Samsung’s desire for consumers to discover the magic behind a reinvented Samsung which put the focus of the company on the consumer and not the product. Samsung’s strategies not only address their target market, but society as a whole. Based upon their philosophy of ‘leveraging innovative technology to change communities and human life’, Samsung has established three strategic directions relating to; technology innovation to drive positive change, planet first and establishing a link with products (Song 2012). The corporate citizenship practices of Samsung comprise a wide range of activities, from voluntary services, social assistance, education, and in particular, environmental protection activities. Examples can be found in the form of the 2013 ‘green management objective’ upon developing a greenhouse gas emission management system that monitors direct and indirect emissions connected with all applicable business activities (Samsung 2012). Furthermore, social contribution can also be highlighted through Samsung’s establishment of the ‘Samsung Hope for Children’ campaign. Subsidiaries in over 30 countries conducted various programs including, low-income youth health and educational benefits and job trainings, tailored for needs of the youth and children. Samsung essentially considers their impact on the environment and society first, prior to developing, engineering and designing its new and innovative products (Samsung 2012). Another powerful development of brand image for Samsung was to design an impression of the brand with global sporting events (see Appendix item 3). Samsung became the official sponsor of the wireless technology in the Olympics in 1998, 2008 and 2012 (Marketing mag 2012). By representing its brand into sport events, consumer awareness saw significant growth. With the Olympic Games, Samsung gained quick, cost-effective global exposure. Its brand awareness increased after each Olympics about 2% and had a huge impact on the quick rise of the brand. Nowadays Samsung is still using the same strategy. Samsung has decided to become an official sponsor for Chelsea football club and it was the second largest sponsorship signed by Samsung since the Olympics Games (Jones, 2005). Identity Samsung develops its brand identity through emphasis on the emotional and beneficial characteristics of its products, basing it around their focus on different customers within their 20-50 year old target market. A key factor that Samsung seeks to emphasise in contributing to its present day identity is their focus on the humanising, convenience and sophisticated style of the brand. These characteristics are commonly associated with mobile phones, and directed towards the younger end of the market. Samsung has enhanced the human-technology interface by personalising and pursuing simplicity for users. They seek to develop characteristics, relating to the ‘smart’ and ‘cool’ side of operations. This view can be epitomised through their $400 million ad campaign “digitAll-everyone’s invited” (Chang 2012). This was a change from its rather product oriented communication strategy and a move towards the image creation by its products. Examples can be found in the form of the Galaxy S4. Features such as the eye tracking (scrolling pages up and down through eye movements), floating touch (select without touching the screen) and health tracking (monitoring heart rate and blood sugar) are all based around the humanisation of its products (Beavis 2013). Samsung also bases its identity around brand prestige and positioning, built upon premium quality and product innovation, mainly found within the TV and laptop markets. In the HD and 3D television markets Samsung maintains firm control, following its launching of this new technology in 2010. Samsung’s line of TVs earnt brand prestige and repute as having the leading sound quality, extensive features and most detailed TV quality by consumer watchdog reports (Kennemer 2013). Samsung passes this image of quality onto its business laptops, with the recent introduction of the Series 9, recognised as the most innovative and durable laptop on the market. Samsung highlights the fact that 75% of the components found within Samsung laptops are produced by Samsung, ensuring quality and reliability (Kennemer 2013). The Samsung flagship brand develops an instant recognition from consumers, as they associate it with the observed excellence of their past experience. Current Opportunities and Threats Opportunities 1. Expanding upon their already ethical approach based upon the continuing increase in environmental concerns, through solar power. Take advantage of the growing trend for cost and reliability by providing a sustainable energy source. 2. Growing demand for quality application processors (Marvell 2013). Samsung is one of the key manufacturers of application processors for smartphones and tablets. The growing demand for these products requires best quality application processors that only Samsung provide. 3. Growth of tablets market. Tablets market is expected to grow in double digits over the next few years (Jones 2013). Samsung has a strong position in tablets market and could expand it by introducing newer, better quality tablet models, such as its current galaxy line. Threats 1. Saturation of smartphone markets in developed countries. This may in turn impact the growth rate of sales, due to the product overcrowding of developed economies (Barwick 2011). 2. Rapid technological change, in turn placing emphasis on speed and innovation, as companies are under pressure to release products faster. 3. Declining margins on hardware production. Samsung is currently the second largest producer of semiconductors, which stands to thin the companies’ profit margins and damage Samsung’s figures. 4. Price wars. Samsung currently maintains a very low gross profit margin on several products and are already selling them with significant price cuts (Sherman 2013). If competitors were to follow on the path of price cutting strategies, it could lead to the erosion of Samsung’s profit margins. Section 3 - Future of Samsung Overview The future of Samsung is a very interesting scenario. Primarily because of their history and recent development they have experienced phenomenal growth. Their current situation as a market leader in many of the consumer electronics industry, gives way to a bright future for the company. There are many opportunities in the market, coupled with competitive pressures. Samsung as the leader has unique problems and advantages. They have to remain at the forefront of the industry, and also seek to develop into areas, which will provide positive financial and brand outlook. It is important to ensure that the brand identity of being a high quality electronics company that centres on innovation is maintained and that any developments are true to the core business philosophy of enhancing human lives (Samsung 2013). The past aimed to deliver this through increased global expansion and a value for money approach. The present is aiming to do this with increased integration of gestures and motion-sensing technology along with ergonomically improved products. Their overarching goals are to become a brand of preference and a top 5 brand by 2020 (Samsung 2013). For this to be achieved, strategic planning needs to occur to clarify direction, method and execution. With the modern day consumer focused upon consumption for meaning, the need for delivering products, which connect with the consumer’s emotions (Learmonth 2010), is critical. Furthermore consumers buy into the confidence of the brand and its reputation. Samsung holds such a diverse portfolio that the management of the brand is indeed a challenging scenario. The brand architecture involves the management across 17 different industries (Samsung 2013), in different countries and with different marketing strategies. As a result there is high complexity in how the corporate brand transmissions the product brand into the various lines of consumer electronics such as the recently famous Galaxy line. For Samsung, many of its innovative products are also linked to the larger corporate brand reputation, which is characterised by innovation, high quality and enhancing lifestyle. Thus products or strategies that are created by the company should be consistent with this overarching corporate reputation. Upon analysis of their history, strengths, weaknesses and potential growth avenues, the following key strategies are recommended for Samsung. If implemented, it could result in an extension of market leadership. Key Recommendations 1. Solar Power Product Augmentation – Product strategy 2. Reduce Inefficient Diversification- Brand strategy 3. Innovation Investment: ‘Samsung Theatre’ – Product/brand strategy 1. Solar Power Product Augmentation – Product Strategy Samsung has a vision to ‘inspire the world, create the future’ (Samsung 2013). Inspiring involves making the lived experience for consumers larger than life. It’s about the company positioning itself as a game changer that excels in performance. With the sustainability of technology ever doubtful, due to resource constraints and supply, the need for sustainable measures has never been greater. Over the past 13 years (Samsung Sustainability Reporting 2011) Samsung has invested gradually into ‘green’ initiatives to support the movement to eco-friendly practices both as a component of CSR for the brand and on the product level. In their effort to ‘enhance lives’, they aim to achieve this both through innovative products and CSR activities. Some of these activities include; alliances with eco-friendly companies, recycling, management, and energy efficient measures (Samsung Corporate Profile 2013). They treat it as a qualifier of brand equity, building their stance as a positive global citizen that contributes to the well being and betterment of society. The recommendation thus stands for Samsung to create solar power functionality and compatibility across its range of products such as tablets, smartphones, laptops and related accessories. As ‘co-prosperity’ (Samsung 2013) is one of their key values, supporting the environment through sustainable measure is rational to product augmentation as it is consistent with the larger corporate identity. Solar power features on these devices can include charging, data transfers, and powering battery intensive features, reallocating the use of energy in the device to ensure maximum efficiency. It will also capture a growing trend in the market as the ‘US has added 3.3 Gigawatts of solar power capacity’ (Forbes 2013). This investment is also reflected in the Australian market with a ’35-fold increase in solar panel installation’ (ABC News 2011)’. Consumer electronics, their cost and sustainability are key factors in the modern environment. Providing consumers with a sustainable solution and reducing the global footprint will be a positive environmental move from the company. With a 40% reduction in greenhouse gas emissions (2011-2008) (Samsung Sustainability Report 2011), Samsung is moving positively in this direction. Further evidence of this is their 2010 investment into ‘photovoltaic business’ (Samsung 2013). The table below (see Appendix item 4) illustrates steady declines (Samsung Sustainability Report 2011) in their GHG emissions in Korea and globally. Furthermore there has been a 25.6% increase of product energy efficiency beyond forecasts since 2009 (Samsung Sustainability Report 2011). It is a recommended strategy, as financial savings will become a bi-product of the renewed CSR efforts into solar power product augmentation. 2. Reduce Inefficient Diversification – Brand Strategy One of Samsung’s key business structures and arguable weaknesses is the extent of its diversification. The recommendation here occurs on the corporate brand level addressing the portfolio with rigour. Being involved in 17 different industries whilst providing a depth of risk diversification also leads itself to diminishing returns created by inefficient portfolio management. Having more products across different industries, while possibly increasing brand awareness through mass-market penetration, does not benefit the financials and controls for Samsung as it merely adds complexity to the operation. It would be recommended here to in fact cut off certain product lines, to re-focus and engineer a more targeted approach on the few highly successful product lines. In some respects there is even a degree of product cannibalisation occurring, with the release of Samsung’s camera line and the emphasis placed on smartphone camera sophistication. To avoid these inefficiencies minimising product lines and innovating around the key product players is recommended. These key products highlighted in the graph (Handsets, Digital media and LCD TVs) are the main revenue sources. With limited diversification they can still maintain a balanced portfolio. Referring to a Boston Product Portfolio Matrix, Samsung can still have its cash cow of Semiconductors, stars of Handsets and TVs along with room for innovation. Samsung’s aim should thus be to capitalise on profitable industries and re-allocate resources away from inefficient industries to these segments. Doing this will propel their innovative edge and maximise the efficiency of existing resources based on market response. Particularly important is the comparison to other companies (see Appendix 5). Given the competitive nature of the consumer electronics industry, rivals such as Apple, Microsoft and Google are all streamlining their product lines to synchronise portfolios that match consumer demand and expectations. In the consumer electronics industry, brands seek out points of differentiation, particularly as they are all competing on a high product quality basis. There needs to be a reason beyond quality that consumer’s bond with in the brand. Apple creates this through the emphasis placed on touch-point experiences during the purchase process in store and globally. Google promote the freedom of product use primarily from a software standpoint, while Microsoft harnesses the reliance and stability USP. Samsung’s competitive edge is its innovative capacity and the market leadership across its successful industries, and thus should make this the central communication message in the future to increase the believability point of difference for the brand. 3. Innovation Investment: Samsung Theatres - Product/Brand Strategy Samsung prides itself on its innovative capacities. For the future Samsung themselves identify a trio of ‘innovative products, new technology and creative solutions; (Samsung Vision 2013) to be the factors in achieving their industry leadership in 2020. They dedicate plentiful investment into the R&D division of the company (Arab News 2013). They believe this is a key element in creating their value-adding proposition for consumers in order to enhance their lives. They outperform all rivals in this area, reporting a $US42billion recent explosion of investment into R&D in 2012 (DailyTech 2012). Their investment however reaps significant brand and product benefits. Overall the corporate brand receives a positive image in the innovation sector through the product brand recognition worldwide. Devices such as the Galaxy S4 smartphone represent Samsung’s commitment to innovation, being the smartphone leader in 2013 for innovative features. In 2013, Samsung received 27 awards for design and innovation (Samsung 2013). This shows the market acknowledgement, of their extensive efforts into delivering customers with the most technologically advanced products that are designed to enhance lives. Samsung Theatres Recently Samsung has been accredited with discovering the capacity of 5G technology (Sydney Morning Herald 2013). They have found a way to increase the capacity and speed of large data transfers. This can result in immense possibilities for the company. The future can include possibilities of Samsung creating their own theatres and delivering movies through streaming capacities. Videos and music are the major contributors to large data transfers. The increased capacity will allow significant improvements in quality and speed. Consumers will be able to receive instantaneous media in a more sophisticated manner. These theatres will act as a new service offering, but will be based more around branding mediated experiences for consumers. It will give Samsung a chance to create a significant touch-point with consumers. Going to the movies is associated with positive social emotions and by allowing Samsung to be in the centre of that experience it will provide immense benefits for brand equity and customer’s realising the Samsung commitment to delivering the highest innovation in sync with general lifestyle activities. The whole theatre experience from booking tickets, selecting seats, and extra promotional activities for the film can all be accessed, shared and controlled via the respective Samsung devices that consumer’s bring with them. These theatres will feature state of the art technology guided by the innovative compatibility of related Samsung devices to connect and alert the consumer to show times, wait times, crowd capacities and latest events. This pushing of innovation and implementation of the theatre-concept however must be effectively managed. The ongoing legal pressures faced by patent battles are a major drawback for Samsung in their bid to be the worlds best. They need heavy investment into patent acquisition and legal protection. While they are the leaders of new technologies, if these are not patented, then replication at low cost becomes a major threat. As the diagram below demonstrates, there has been a significant increase in the patent applications particularly in the US market (See Appendix 6). Samsung has responded by doubling the patent workforce over a period of 6 years (Samsung Sustainability Report 2012). In the future, the investment in this area should see a more drastic increase in personnel on a yearly basis and financially. Rationale of Recommendations We believe this is the way forward for Samsung. These recommendations are based on existing strengths, weaknesses with close attention to the key values of the Samsung brand. To move forward, innovation is essential, but ensuring that products and services are in line with corporate brand identity of co-creating value through internal innovation and external quality of life improvement is a crucial factor. Our solar power suggestion is aligned with their decade long venture into increased CSR. This eco-friendly approach also provides long-term cost saving measures, along with the positive impact on consumer based brand equity and the Samsung company value of being a ‘good global citizen’. Further the reduced inefficient diversification suggestion, allows Samsung to regather their resources for more efficient allocation. 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