The rise and rise of Samsung (page 2 of 2)

The company recently launched the T-500, a mobile phone aimed at women, with a lot of fairly silly gadgets - including a calorie counter and makeup mirror - thrown in. Samsung will also be launching its camera phone, which will also enable the users to record karaoke music.

Samsung has also seen rapid growth in its consumer electronics business. The Korean company claims it has already captured 35 percent of the top-end television market in the United States and Europe, with its latest cutting-edge offerings. The company hopes to repeat its performance in the Middle East with massive marketing and promotion of its products. Lee says that the company saw 100 percent growth in the sales of LCD monitors last year; DVD player sales also grew.

Samsung has also launched so-called "white goods," like Internet-capable refrigerators and other kitchen appliances that can "talk to each other." The company's HomePAD refrigerator not only stores food but also allows consumers to send and receive e-mail, surf the web or watch a movie by using the touch screen panel of the refrigerator, which can be used as a detachable hand-held computer.

No one needs to watch a film on their fridge, of course, but that's precisely the point. For Samsung, this is an exercise in branding, a statement about how the company hopes to be seen.

As part of its aggressive marketing campaign, the company organized a road show, entitled "DigitALL Inspiration 2002 Samsung World Tour." The tour was one of the company's big moves to boost its brand image. Indeed, marketing has been the key to Samsung's success: the company spends nearly five percent of its sales each year in marketing promotion.

"There are three elements behind our success," says Lee. "First, our products are highly saleable. The second factor is design. We also try to localize our products, adapting them for the region. The third is promotion, which is very important for us." With over $75 million in its war chest for the Middle East, Samsung has an edge over its bigger and better-known rivals when it comes to marketing.

Lee says setting up a reliable and efficient distribution chain and after-sales service network has also been crucial to the company's success. "We like to ensure that these elements are in place before we introduce any new product line in the region," says Lee.

The same approach is being used as Samsung gears up to launch its laptops in the Middle East in the first half of the year. Lee and his team are busy putting the support systems in place before launching the machines, which will be positioned at the top end of the market.

Lee says that his target is to reach a turnover of $3 billion in the region by 2005, with an even distribution among the product lines: "I expect that our sales in 2005 will be equally divided between digital media, mobile phones, white goods and IT products." Given the company's recent performance, it looks like Lee will have little problem achieving his goal.