Samsung bets on product, biz diversity

Samsung bets on product, biz diversity

Summary: South Korean electronics giant is eyeing a bigger presence in new businesses including enterprise products, LED lighting, mobile networks, set-top boxes, and medical devices. It is also looking to expand in Myanmar.

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TOPICS: Hardware, Samsung
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JAKARTA--Despite an already wide portfolio of products and business segments, Samsung is aiming to add even more because the company believes it can leverage on its diverse range.

According to Gregory Lee, Samsung Asia's president and CEO, while it is a challenge to be successful in so many businesses, the company tries to work that to its advantage. "We have one brand, and we spread a little bit of that brand preference and presence across different products," said Lee.

He added many of the product segments Samsung was in were starting to converge, making the boundaries less clear. For example, there is a blurring of lines between mobile phones and tablets; tablets and TVs, TVs and home appliances, the CEO pointed out. He was speaking at a roundtable interview at the Samsung Forum 2013 held here Wednesday.

Samsung roundtable with Gregory Lee
Gregory Lee, president and CEO at Samsung Asia. (credit: ZDNet)

8 pillars for success

Lee outlined key areas Samsung had identified for sustaining its success:

1. Flagship products
2. Shopper retail experience
3. Local content/services
4. Local product innovation
5. Customer partnerships
6. Media relations
7. Talented team
8. Contribution to community

"You can see that mobile to home, and the convergence of work and play, all of that coming in to play, and sometimes one product disappears but the need for the human beings to interact together, and for machines to machines to connect with each other, to control devices are all growing so we can use our technology, design and brand to win in all those spaces," he said.

The CEO outlined new businesses Samsung was trying to start up areas such as enterprise products, LED lighting, network technology for faster mobile communications, set top boxes and medical devices. "We have not started all of them but we're looking at all those businesses."

The expansion is in contrast with Japanese counterparts such as Panasonic, Sony and Sharp who have been streamlining their businesses to survive. Embattled Panasonic has pledged to close or sell off units which do not achieve an operating profit of 5 percent in order to revive its fortunes.

Building presence in Myanmar

Besides new business segments, Samsung is also ramping up its presence in new markets such as Myanmar. One area with "big promise" is the mobile phones where its sales have been growing by leaps and bounds, said Lee.

"Even though our industry is fast moving and hard to predict, we plan things 10 years out and we think Myanmar is a very, very big priority for us," said the Samsung executive. He added the company was already engaged in business there, with a sales and marketing office staffed by local employees building its brand and understanding of the market.  

Particularly in Asia, one of the key challenges in the variety across the region, the CEO noted. "We cannot take on a solution and apply it to all our markets. So what we do is we move around the market and look at what works and reapply that very, very slightly differently across this market," he elaborated.

In order to survive in the electronics industry, constant change is needed, said Lee. "Many companies do not succeed or they fail because they fail to change, Samsung Electronics has to change, in order to be successful continuously. We have luckily so far made [those] changes," he said.  

Digital marketing, content and services lacking

In response to ZDNet's query on what areas were lacking and needed improvement, Lee highlighted Samsung's marketing push into digital was not as fast it liked. "That's not because we don't want to, it's because we don’t have all the skills we need to move."

"If you try to run a marathon, unless you're very fit and trained you're not going to run a marathon. So unless we know how to do digital, have the skills to do it, have the fitness to do it--we're not going to do digital, right? These are all the kind of new skills that we are all embarking upon," said Lee.

The CEO noted other areas that needed to be beefed up included content and applications where it had a "long way to go" and its enterprise business which currently only contributes 6 percent of global revenue.

"We're not saying by any means that we're very comfortable with where we are," said Lee, adding Samsung wanted to be the market leader for all its products.

Ryan Huang of ZDNet Asia reported from Samsung Forum 2013 in Jakarta, Indonesia, on the invitation of Samsung.

Topics: Hardware, Samsung

About

Loves caption contests, leisurely strolls along supermarket aisles and watching How It's Made. Ryan has covered finance, politics, tech and sports for TV, radio and print. He is also co-author of best seller "Profit from the Panic". Ryan is an editor at ZDNet's Asia/Singapore office.

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