Samsung differentiation strategy

Etymology[ edit ] The word, brand, derives from its original and current meaning as a firebrand, a burning piece of wood. That word comes from the Old High Germanbrinnan and Old English byrnan, biernan, and brinnan via Middle English as birnan and brond. Later the firebrands were replaced with branding irons. Through that association, the term eventually acquired its current meaning.

Samsung differentiation strategy

A question summarizing RBV approach. Definition The resource-based view RBV is a model that sees resources as key to superior firm performance.

If a resource exhibits VRIO attributes, the resource enables the firm to gain and sustain competitive advantage. RBV is an approach to achieving competitive advantage that emerged in s and s, after the major works published by Wernerfelt, B.

Smartphone Industry: Analysis of Samsung's Dominance | The Market Mogul

The supporters of this view argue that organizations should look inside the company to find the sources of competitive advantage instead of looking at competitive environment for it.

The following model explains RBV and emphasizes the key points of it. According to RBV proponents, it is much more feasible to exploit external opportunities using existing resources in a new way rather than trying to acquire new skills for each different opportunity.

In RBV model, resources are given the major role in helping companies to achieve higher organizational performance. There are two types of resources: Tangible assets are physical things.

Land, buildings, machinery, equipment and capital — all these assets are tangible. Physical resources can easily be bought in the market so they confer little advantage to the companies in the long run because rivals can soon acquire the identical assets.

Intangible assets are everything else that has no physical presence but can still be owned by the company. Brand reputation, trademarks, intellectual property are all intangible assets.

Unlike physical resources, brand reputation is built over a long time and is something that other companies cannot buy from the market. Intangible resources usually stay within a company and are the main source of sustainable competitive advantage.

The two critical assumptions of RBV are that resources must also be heterogeneous and immobile. The first assumption is that skills, capabilities and other resources that organizations possess differ from one company to another. If organizations would have the same amount and mix of resources, they could not employ different strategies to outcompete each other.

What one company would do, the other could simply follow and no competitive advantage could be achieved. This is the scenario of perfect competition, yet real world markets are far from perfectly competitive and some companies, which are exposed to the same external and competitive forces same external conditionsare able to implement different strategies and outperform each other.

Therefore, RBV assumes that companies achieve competitive advantage by using their different bundles of resources. The competition between Apple Inc. Apple competes with Samsung in tablets and smartphones markets, where Apple sells its products at much higher prices and, as a result, reaps higher profit margins.

Why Samsung does not follow the same strategy? Simply because Samsung does not have the same brand reputation or is capable to design user-friendly products like Apple does.

The second assumption of RBV is that resources are not mobile and do not move from company to company, at least in short-run. Intangible resources, such as brand equity, processes, knowledge or intellectual property are usually immobile. Although, having heterogeneous and immobile resources is critical in achieving competitive advantage, it is not enough alone if the firm wants to sustain it.

Barney has identified VRIN framework that examines if resources are valuable, rare, costly to imitate and non-substitutable.

The resources and capabilities that answer yes to all the questions are the sustained competitive advantages. Resources are valuable if they help organizations to increase the value offered to the customers.

The resources that cannot meet this condition, lead to competitive disadvantage. Resources that can only be acquired by one or few companies are considered rare. When more than few companies have the same resource or capability, it results in competitive parity. A company that has valuable and rare resource can achieve at least temporary competitive advantage.Because Samsung has a focus on both differentiation and cost leadership, there can be concluded that the company has a combined cost leadership and differentiation strategy, that focuses on delivering a product which offers unique benefits over products manufactured by its competitors, at a lower price than for example Apple.

Segmentation. This article examines Amazon’s current corporate strategy and evaluates its suitability going forward. This analysis is based on the drivers of corporate strategy including the need to grow quickly and more importantly sustain such growth, the need to not lose sight of either longer term profitability and the shorter term results and the balancing of both, and its focus on cost leadership.

Samsung is a diverse business with chips, displays, and other technology. This pays dividends, allowing it to compete on price and increasingly, offer features Apple hasn't gotten to. Business level strategy SAMSUNG From business-level strategies, a competitive advantage of a business can be created over its rivals.

Differentiation vs. cost leadership The company has an experience of pursuing both, cost leadership as well as product differentiation strategies .

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Samsung differentiation strategy

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