Case study: Positioning & IMC Strategy

Implementation for Silver Nano Health System

Products

Prof. Youngchan Kim

School of Business
Yonsei University
(youngkim@yonsei.ac.kr)
Introduction

ƒDescription:
The Southeastern Home Appliance (SEA HA) market is a very attractive one
with a high growth potential. Samsung(SS) company as a late comer, needed to
come up with strategies aimed at boosting sales and establishing a premium
brand image. To that end, SS applied silver nano technology to its products, and
implemented strategies to effectively communicate product benefits to
consumers.

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Contents

1. Environmental Analysis

2. Strategic Direction & Marketing Goals

3. Segmenting & Choosing Target Segment

4. Product Positioning & Concept Development

5. Integrated Marketing Communication

6. Market Reaction

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Environmental Analysis

ƒ Current Status of SEA Market

– Composed of markedly different nations in terms of culture and ethnicity.
– Abundant agricultural and mining resources and low production cost.
– Rapid growth of consuming population with purchasing power.
– Wide income gap composed of both developed and less developed
countries.
– Changes of consumers’ purchasing behavior (demand of medium-to-high
priced durable goods).

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Environmental Analysis

ƒ Competitive Environment of SEA Market

– Home Appliance(HA) market of SEA expanded about seven times in
terms of demand and market size.
– The percentage of premium products in the HA market, which stands at
7% as of 2004, is expected to jump to 60% by 2006.

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Environmental Analysis

ƒ Economic Growth Rate by SEA Countries (2005)

Population Unemployment GDP GDP Growth Rate (%)

Country
(millions) Rate (%) ($billions ) ‘03 ‘04 ‘05 ‘06F

Indonesia 214 9.9 256 4.4 5.1 4.6 4.0

Malaysia 25 3.6 118 5.3 7.1 4.9 5.0

Philippines 88 11.9 86 4.2 6.1 4.5 4.4

Singapore 4 4.0 107 1.1 8.4 4.1 4.2

Thailand 65 2.1 164 6.7 6.1 4.6 4.8

Vietnam 83 5.6 45 7.2 7.7 7.1 7.5

Australia 20 5.6 617 3.1 2.9 2.8 3.2

[Source: JP, BOA, CITI, SCB, DEUTSCH Bank Average]
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Environmental Analysis

ƒ Prints by Corporations in the SEA market

Thailand Vietnam

Panasonic TOSHIBA TOSHIBA SANYO

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Environmental Analysis

ƒ Prints by Corporations in the SEA market

Malaysia Indonesia

Panasonic LG SHARP SHARP

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Environmental Analysis

ƒ Prints by Corporations in the SEA market

Philippines Singapore

LG Panasonic TOSHIBA LG

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Environmental Analysis

ƒ Communication Strategy by Corporations in the SEA market

Current situation Opportunity

SS has an opportunity in:

Needs Lifestyle and “higher” Needs

Sharp: Plasma cluster/ Silver Ions

(Purifies, Refreshes) Nature
Product Shows it. Research Proves it.
claim LG: Plasma Air Purifying System
Life’s Good. There with you every
precious moment.
Hitachi: Silver Ion Deodorizer
(Neutralizes bacteria and
eliminates odors)
Toshiba: Hybrid Plasma
Fresh, longer, healthier

Brand claim Opportunity

Lifestyle Opportunity

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Strategic Direction & Marketing Goals

1. Recognize economic differences of Southeast Asian nations and draw up branding and
marketing communication strategies localized for each country.

2. Formulate the same branding strategies for the entire Southeast Asian countries to build a
consistent brand image across the world, and reflect national differences in implementing
marketing communication strategies.

3. It was hard for SS to release a premium product to the market as there was a widespread
perception that manufactures low-to-mid-end products. Thus, SEA needs to develop a new
communication strategy to launch premium products to the market.

4. Draw up a strategy to emphasize the brand of SS itself as it has a strong brand power
across the world.

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Segmenting & Choosing Target Segment

ƒ SEA Market Segmentation

Ethnographic interviews per

F2F interviews per
market with families, AV Survey per country
country
products and HA

OUTPUT : OUTPUT :
Statements for Quantitative OUTPUT :
Insights for quant segment Market
Segmentation Solutions
generation Segmentation

Sample :
• Decision Makers of DA products
• Countries : Australia, Singapore, Thailand, Indonesia
• Age : 25-49 years old
• Purchase Behavior : 60% past 2 years purchasers & 40% intenders in next 12 months

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Segmenting & Choosing Target Segment

ƒ SEA Market Segmentation

The purchasing factors are summarized as 1) consumers’ needs 2) attitude toward
technology 3) attitude and involvement for washing machine and refrigerators

Cluster Analysis :
1) Segment 1 (30%): They purchase a product if they really want it.
2) Segment 2 (15%): They purchase a product that can be used over the long term, that is,
a big great durable product.
3) Segment 3 (20%): They purchase the best product that suits their own taste.
4) Segment 4 (15%): They have used a product for long, and do not want to change it with a
new one
5) Segment 5 (10%): They purchase a product that can show their success.
6) Segment 6 (10%): They want to enjoy their life through a product they purchased.

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 Segmenting & Choosing Target Segment

ƒ Choosing a SEA Target Market Low / Weak

High / Strong

Segment 1 Segment 2 Segment 3 Segment 4 Segment 5 Segment 6

Fit with Samsung’s

corporate targets

Ability to Influence

Segment Size AU
TH
Level of Category
Involvement

Growth Potential

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Segmenting & Choosing Target Segment

ƒ Choosing a SEA Target Market

In General Technology Adoption Demography

• active, pursue progress • adopt technology not to lag • educated a little higher than
Segment 1 • purse consistency behind others average
(30%) y avoid leading • use only a confirmed and
proved technology

• prefer leisure time • prefer an easy-to- use , reliable • aged 40 to 44

• environment-friendly & technology • female
Segment 2 futuristic • invest in the future • married
(15%) • generous • adopt technology, but have a low • receive a junior-college or
understanding of technology higher
• education

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Segmenting & Choosing Target Segment

ƒ Choosing a SEA Target Market

In General Technology Adoption Demography

• risk-taking • have a good • aged 25 to 34

• have a string tendency understanding of • live alone or
Segment 3
to present their own technology • with a girl/boyfriend
(20%)
opinion • pursue a free life • highly educated
• pursue flexibility • young DINK

• resistant to changes, • resistant to technology • aged 45 to 49

introversive • use only a confirmed and • female
Segment 4
• pursue cheap products proved technology • married
(15%)
• not well-educated

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Segmenting & Choosing Target Segment

ƒ Choosing a SEA Target Market

In General Technology Adoption Demography

• eager to try new things • adopt technology initially • aged 35 to 44

• design-centered • white collar,
Segment 5
• lifestyle-centered • middle-to-high income
(10%)
class

• adaptable to society, • adopt technology depending • aged 25 to 29

Segment 6 family-centered on functions and social values • Make a single living with
(10%) parents

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Product Positioning & Concept Development

ƒ Product Positioning & Concept

Silver Nano
System Appliance

SS is the ONLY brand that has the same technology across all products
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 Product Positioning & Concept Development

ƒ Communication Concepts for Silver Nano Health System

(1) Hiding-Creative Rationale (2) Purity-Creative Rationale

(3) Protected Zone-Creative Rationale

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 Product Positioning & Concept Development

ƒ Primary Message: Drive “Protected Zones” Benefits Through 3 main

positions
Primary: Total Well Being

Trendsetter

Supportive: Supportive:
Nothing but Partner for
the best Feeling good Modern Day Living

On top Progression

Achiever Aspirant

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Integrated Marketing Communication

ƒ One Voice, One Look

– communicate products’ technical features and distinctive benefits with a consistent
image.

ƒ AD Campaign

ƒ PR

ƒ Road Show

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 Integrated Marketing Communication

ƒ AD Campaign : Print

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 Integrated Marketing Communication

ƒ AD Campaign : Banner & POP

1
7
2

7 3 2
6
5
8

4
8
3

4
5

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Integrated Marketing Communication

ƒ PR
Philippines SS strengthen their position as a leader in home appliance biz. By
launching several models with Silver Nano tech. in refrigerator,
washing machine and air conditioner.

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Integrated Marketing Communication

ƒ PR
Vietnam “ Side By Side –a wonderful idea ”

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 Integrated Marketing Communication

ƒ Road Show
2 day road show, 6 countries Thailand, Singapore, Malaysia, Philippines, Vietnam and
Indonesia)

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Market reaction

ƒ Market Share increased in HA market.

ƒ API rose across overall HA product categories.
ƒ Sliver Nano Health System’s communication strategies received a positive evaluation from the
media and won a 2005 Asia Pacific PR award for excellence in the area of product and promotion.

MS (%) 2004
API
2005

28 32
100 106
92 103
85190
10 12
8 8
1 8 8
2
REF SBS WM DRUM RAC REF WM RAC
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However, need more effort

ƒ Consumer response survey

– Financial performance and brand awareness fared well, communication of health benefit was
not effective.

– Consumers had a low understanding and trust in the anti-bacterial and germ-killing functions
enabled by Silver Nano technology.

– Explanation through ad campaigns is not enough for enhancing trust and understanding of the
technology.

– It is hard to trust the benefits offered by Silver Nano technology just by reading a few phrases
in ads, and consumers needed a proof they can see with their own eyes.

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Thank You!

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