Marketing within the Global Economy: Analysis of Samsung's Operations in India and UK

RUNNING HEAD: Marketing within the Global Economy 0
Samsung
Marketing within the Global Economy

Marketing within the Global Economy 1
Contents
Business overview..............................................................................................................................4
Purpose of the report..........................................................................................................................4
Analysis of the market structure- India and UK..............................................................................4
Comparative analysis of macro-economic indicators -India and UK...........................................6
Analysis of monetary and fiscal policy...........................................................................................12
Analysis of foreign trade policy instruments..................................................................................13
References........................................................................................................................................15

Marketing within the Global Economy 2
List of figures
Figure 1: GDP growth comparison..............................................................................6
Figure 2: Annual inflation rates (CPI) of UK...............................................................7
Figure 3: Annual inflation rates of India.......................................................................8
Figure 4: Unemployment rate of total labour force India.............................................9
Figure 5: Unemployment rate of UK...........................................................................9
Figure 6: General government structural balances UK.............................................10
Figure 7: General government structural balances India..........................................11
Figure 8: Balance of Payments -Current Account Balance (% of GDP) UK..............11
Figure 9: Balance of Payments -Current Account Balance (% of GDP) India...........12

Marketing within the Global Economy 3
List of tables
Table 1.1: GDP growth comparison
Table 1.2: Annual inflation rates (CPI)
Table 2: Unemployment growth comparison
Table 2.1: General Government Structural Balance (% of GDP)
Table 2.2 Balance of Payments (% of GDP)
Table 3: Official Interest Rates UK
Table 3.1: Official Interest Rates India
Table 4: Currency Exchange Rates - USD vs. lb
Table 4 .1: Currency Exchange Rates - USO vs. Rs

Marketing within the Global Economy 4
Business overview
Samsung electronics is a South Korean electronics company. The company has
become global leader in telecommunications and digital media and started working
in 1969 and having it’s headquarter in Suwon, South Korea (Park, 2015). The
company offers a variety of electronic components such as semiconductors, chips,
flash memory, lithium-ion batteries and hard drive devices. It supplies electronic
components to Apple, Nokia, HTC and Sony.
Purpose of the report
This report is going to focus on the operations of Samsung in India and UK and is
going to investigate how macroeconomic environment within these two situations
can affect the economic activity of Samsung.
Analysis of the market structure- India and UK
India
In 2014-15 the electronics hardware production was estimated at US$32.46 billion. It
represented about 1.5% share of the world’s electronic hardware production. The
purchasing power of consumers in India is still very low. Indian economy is one of
the world’s leading and fastest growing smartphone markets. The electronic industry
is growing industry in the world. Out of the electronic industry, mobile industry is
growing fast and India is adding more mobile connections every month. The telecom
industry is dominated by the mobile phones in India (Forsgren, 2017). Samsung is
one of the leading brands in India. The company focuses on high and mid-range
markets. The mobile industry is attractive destination for the mobile phone
manufacturers because of the broad range of customers (Baker & Saren, 2016).
The electronic market in India can be classified by oligopoly competition. Samsung is
one of the brands which dominate the market. The firms are price makers which
mean firms can fix prices without losing profits. There are only few sellers of
differentiated products. There are more electronic businesses in India when
compared to US. Samsung account for 40% share in the market. The electronic
industry in India has observed strong presence from multinational corporations and

Marketing within the Global Economy 5
small and medium size enterprises (Dinnie, 2015). The electronic item stores are
major purchasing points for mobiles.
The competitors offer slightly different products, for instance Samsung has launched
Google Android and has taken advantage of Google Android operating system and
has launched attractive handsets. The company sells wide series of smart phones.
There are no barriers to newcomers which are seeking to enter in market (Auer &
Schoenle, 2016). Such players make huge investment in advertising and promotions
to increase their market share.
UK
The sales of Samsung in UK are comparatively low as the respondents focus more
on the Apple iPhones. According to a report of 2017, Apple have 48% share market
and Samsung has comparatively less that is 34%. UK is a developed market and
over the years it has seen that the domestic electronics items have grown by an
estimation of 10-15% annually in comparison to the global average of 2%. The sales
of smart phones remained flat in the third quarter of 2017. Due to lack of product
software it has to depend on other companies. Samsung along with Huawei provides
strong volume platform in the country (Park, 2015). Samsung also identifies the
contribution that that BBC makes to UK. The mission of British Broadcasting
Corporation (BBC) is to make public service available to customers.
In 2018 the company is likely to lose ground in the smartphone segment. It is due to
the growth of other smartphone companies and dominance of Apple. The share of
Apple in market stands for 48% whereas Samsung’s share kept decreasing to 34%
(Wu & Vasquez-Parraga, 2016). According to the market research, the UK electronic
market is mainly composed of Apple and other smart phone companies such as
Huawei, Sony Xperia, HTC, Nokia, LG, Xiaomi and Microsoft. The electronic sector
in UK is made up of 16.6% which contributes to the country’s economic growth. The
electronic companies in UK has doubled from 2007 to 2012 and showing increasing
trend towards the mobile segment. The country is the most exclusive smartphone
market in the world. The focus in the industry remains with the top players Apple,
Samsung, Huawei, HTC, and LG (Chen & Ann, 2016). These five companies
accounts for 91% of overall market. Huawei and LG have captured the rural part of
country where as Samsung and Apple has focused on urban UK. Xiaomi enjoys it’s