Pricing is one of the trickiest issues in marketing as it requires understanding the product and understanding the market. Samsung is faced with highly rivalry by others in the market like Apple, HTC, and Microsoft among others. To curb this competition and in order to be competitive, Samsung undertakes a pricing strategy which is winning.
Sepherteladze reports that Samsung has not been so popularly in the past but have undertaken strategies in marketing to increase its popularity in the Smartphone market. As a result of these strategies, the company has been able to acquire a position a major competitor for Apple Inc. Further in regards to brand, it is the seventh most valuable brand currently and the largest tech business with regards to revenue.
Competitive Edge by Samsung: Best Price Offers
Samsung seeks a competitive pricing strategy in ensuring a competitive edge. Palmer (2004) argues that in order for a company to acquire a competitive edge, it requires to have a marketing strategy that is optimal and unique. This is the advice that Samsung followed and developed a marketing strategy which enables it to become an industry leader in the technology sector. The following images show a range of Samsung phones which have been launched in the market to compete with the other brands in the Smartphone market.
The Samsung strategy has been argued to be the most effective marketing strategy ever undertaken by a company with the article reporting that as a result of their cost driven strategy the company is becoming an industry leader. As a result of the past success in its marketing strategy, the company have over the years been evolving in its strategy to attract more and more consumers in the market. The Samsung’s pricing strategy undertakes two components with the first being the skimming price and the second the competitive pricing.
Skimming price is utilized by the company in order to compete with its rival. Like Apple, it utilizes a skimming price in order to acquire a competitive edge in the market and Samsung has followed suit with the Galaxy S6 and S6 Edge new products for the company and promoting them as the best Smartphone in the market.
S6 Edge goes for 1180 dollars which has attracted a large number of consumers across the globe. Stanley et al., (2009) argue that skimming allows the firm to adjust and update its prices with increased competition resulting to a decreased price in order to attract more consumers.
In the event that other smart phones are introduced to the market, the company needs to lower their prices such that those consumers who want to buy a Smartphone are attracted to purchase their products.
The second pricing strategy utilized by Samsung is the competitive pricing whereby unlike other smart phones in the market such as Apple which have managed to lock a particular segment of consumers have in the past been faced with difficulties in acquiring a competitive edge. In its move to face the stiff competition, we can conclude that the company has employed the use of competitive pricing.
Samsung can be considered as a late comer in the major product market it produces with the company finding it with already established brands and as such the need to utilize a practicing strategy this gives it an edge.
Relevance of Pricing
Pricing is very crucial for a firm as it ensures that the company communicates to the consumers the value which they attach to the product. This is particular in the cases where consumers use the price set to judge and make a decision on the value of a particular product. As such, pricing is a critical marketing element as it communicates the market and product value of the product being introduced in the firm. Introducing a new product is critical as it ensures that the company products are well represented in the market.
However, before introducing a new brand or product in the market, it is important for the company to undertake a market research in order to ensure that the product being introduced in the market meets the needs of the consumers. This is through understanding the competitors, consumer behavior, pricing and other factors affecting the purchasing behavior of the consumer.
Sepherteladze, S., (2015), Samsung Marketing Strategy: The Master Brand, https://inevitablesteps.com/marketing/samsung-marketing-strategy/
Palmer, A. (2004). Introduction to Marketing – Theory and Practice, UK: Oxford University Press.
Stanley F. Slater, G. Tomas M. Hult, Eric M. Olson. (2009), Factors Influencing the Relative Importance of Marketing Strategy Creativity and Marketing Strategy Implementation Effectiveness. Industrial Marketing Management, (3):1-9.