ACC30009: Samsung's Note 8 Launch - Competitive Advantage Analysis

This report provides an accounting analysis of Samsung's launch of the Galaxy Note 8, examining the circumstances leading to its introduction, including the recall of the Galaxy Note 7 and the need to regain consumer trust. It discusses Samsung's strategies for strengthening its competitive advantage against rivals like Apple, focusing on product differentiation and cost leadership. The report analyzes how the Note 8, with its enhanced features and focus on customer satisfaction, contributed to Samsung's revenue growth and market position. It also highlights Samsung's broad product range and market research as key factors in maintaining competitiveness, concluding that the Note 8 launch successfully bolstered Samsung's position in the electronics industry.

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Introduction
Samsung, is a South Korean company that deals with different types of electronics. Due
to its proper operational strategies and consideration of quality, the company is termed as one of
the world largest producers of electronic devices. Over the years, large screen smartphones have
increasingly become popular, a trend that is largely attributed to galaxy note phones being
introduced to the market by Samsung. The purpose of this study is to provide a discussion how
introduction of Samsung Note 8 to the market has affected the company. The report will also
discuss the circumstances leading to its launch and whether or not the company has succeeded
from the launch.
The recall and discontinuation of Galaxy Note 7 was one of the reasons why Note 8
was introduced. The primary reason for this introduction was that the company needed to recover
from the stained reputation following Galaxy Note 7 failure as there we reports that the phone
overheated to the extent where, in some cases, it busted (Eadicicco 2017). The company’s
stained reputation was so severe that there was doubt whether the company, the Note line to be
specific, would ever recover. Hence the need to introduce a much-needed updated Note 8
smartphone phone.
Introduction of this device was aimed at strengthening Samsung’s competition with iPhone, one
of the firms that is believed to have dominated the mobile phone industry. Apart from
competition, the company also wanted to address the changes in consumer perceptions. Some of
the features portratyed by this device include display of 5.70 inch, a RAM of 4GM, Storage
capacity of 64 GB, Resolution of 1140x2560, among other enhanced features

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After multiple complains concerning the functionality of this device especially the quality
of its battery, the company did various enhancements with aim of regaining customer trust on
their Note phones (Reuter 2017). They pledged multiple improvements on the phones to ensure
product and customer safety which included rigorous battery tests plus more improved standards.
All these was to ensure that the next note phone they produced, which is note 8, was of higher
standards meeting all the customer expectations and avoiding another disaster (Francisco 2017).
Also the company wanted to be ahead of the competitors like apple who had launched IPhone 8.
For that reason, Samsung needed to launch galaxy note 8 so as to maintain the competition.
While trying to make itself one of the most innovative and quality brands within the
industry of electronics, Samsung strives to achieve a competitive advantage that is sustainable by
ensuring that it remains number one in the digital market. Their policy is “we will devote out
human resources and technologies to create superior products and services thereby contributing
to a better global society” (Rudenko 2014). Through this policy, the company has remained in
operation for several decades even with stiff competition that comes from various firms.
Based on its policy on attaining and achieving a competitive advantage, they have
differentiated their products from their competitors in three categories (TMS 2016). The
categories are firm linkages, product attributes and firm-customer relationships. Samsung’s
products are similar to their competitors’ products, therefore, the company deals with this kind of
competition within five industries that are different. Hence they ensure that features incorporated
in its products are unique and different. A good example is the pod cast feature that is added
within their headsets to give their customers more functionality.

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Product differentiation strategy by Samsung can be vertically and horizontally seen. For
analysis of product differentiation, considering the different types of smartphones that they offer
is very significant. Technology sector is dynamic as change of mind by the consumers do happen
very often, hence, the need for companies to change their products with the same pace so as to
keep up with their customers’ needs (TMS 2016). They succeed in doing so because adaptability
to its consumer demand is one their main powers.
Samsung can produce different product designs to match perfectly with each target that
coexist in the same industry. Smartphone consumers tend to vary when it comes to paying for
quality (Altavilla 2017). A good example is, people who are in their 70s have different
preferences regarding smartphones compared to those people who are in their 20s.
Samsung, in its endeavors on ensuring success and competitiveness in the digital
industry has also adopted the cost strategy (MASS 2016). The management of the company has
drawn strategies and policies with the aim of ensuring that they have the lowest cost. By
lowering production cost, Samsung has the golden opportunity of determining their products’
prices enhancing their competitive edge in the process. Minimizing operation and distribution
costs and also controlling their labor cost tightly are practices that the company has adopted in
executing their cost leadership strategy.
Vertical integration is a cost driver that benefits Samsung and to seek cost advantage
within the company’s production facilities (Neha 2014, P. 25). Vertical integration, in
microeconomics, is known as a strategy that is used by manufactures to gain control over chain
of production. Samsung’s cost leadership is achieved through manufacturing their mobile
devices major components. Also the company does not compromise the profitability of their core

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business for its mobile business purposes, because their businesses are treated as separate
entities.
The launch of galaxy note 8 strengthened Samsung’s competitive advantage as it actually
made the rivalry between them and other competitors fiercer. This is because Note 8 boost many
features that are offered by their competitors especially apple, their fierce rivals, who launched
their IPhone X around the same time as galaxy note 8. Both phone cost around 1000 dollars;
Samsung cost 960 dollars while IPhone X cost 999 dollars (Shukla 2017). The competition
between the two has been intense for years. Samsung struggled with note 7 but they have won
back users with galaxy note 8 therefore increasing their competitive advantage.
The success of galaxy S8 following note 7 disaster proved that Samsung are good in
regaining customers’ faith (Shukla 2011). Unlike others phones from competitors, note 8 would
be the strongest phone for multimedia consumption and also multitasking which Notes phone are
well known for strengthening their competitive advantage even further.
Upon making various advancements on this device, the company has realized a
significant growth in revenue, as the device is termed as among those that have pleased the
customer most (Passingha 2018). Some of the features that have pleased the consumer include its
extra ordinary camera, huge memory, fast operation speed among others. As time goes on,
mobile phone users are changing their taste of size of cell phones from small to big, and
therefore designing this device in large size has seen it being purchased most in different
countries.
According to Shukla (2011), considering the desires of consumers is essential because
they are the reasons why businesses remain in operation. Samsung is one of the companies that

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studies the market before introducing new devices and this has been one of the reasons why it
remained competitive over the years.
In conclusion, having a broad range of products is the biggest competitive advantage
that Samsung has because it helps them stay in balance when one of the product is not doing
well. In addition to that their brand is respected as they have business experience and their
products are top quality.

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References
Neha, P 2014. How Media Got the Biggest Bite of (the) Apple: A Look at the Media
Misperception in the Apple-Samsung Case. Marquette Intellectual Property Law Review, vol
18, no.1, pp. 23-45.
LEADERSHIP, C 2013, Business level strategy SAMSUNG, viewed 10th September 2018
<http://www.academia.edu/5220714/Business_level_strategy_SAMSUNG>
MASS, B 2016, Samsung: Product differentiation, competition, strategies, viewed 10th
September 2018 <https://brainmass.com/business/differentiation-strategies/samsung-product-
differentiation-competition-strategies-381891>
TMS, T 2016, Innovation vs quality, viewed 10th September 2018
<https://themarkertingscope.com/business/innovationvsquality-381891>
Reuter, M 2017, How Samsung Plans to Win Back Consumer Trust after the Note 7 Debacle,
viewed 10th September 2018 <http://howsamsung8plansto\wincustomertrust\0-667 >
Shukla, V 2017, Galaxy note 8 vs iphone 8, viewed 10th September 2018
<https://brainmass.com/business/differentiation-strategies/samsung-product-differentiation-
competition-strategies-381891>
Eadicicco, L 2017,Here's Your First Look at Samsung's Galaxy Note 8, viewed 10th September
2018 <http://videonewsindex.com/play/firstlook\atgalaxynote8-3-59-ep-440--cnettv>
Altavilla, D 2017, Samsung galaxy note launch event showcases company's ability to innovate
under pressure.
Francisco, S 2011, Rivalry between Apple and Samsung in smartphone grow fiercer.

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Passingham, M 2018. Samsung galaxy note 8, viewed 10th September 2018 <Available at
http://videonewsindex.com/play-s-galaxy-note8-get-your-questions-answered-here-the--ep-460--
cnettv>