Global Marketing Strategy

Chief Marketing Officer

Gregory Lee

Global Marketing Strategy

Global Marketing Strategy

Chief Marketing Officer

Gregory Lee

Contents

Marketing Performance

Marketing Performance

Marketing Vision

Marketing Vision

Marketing Strategies

Marketing Strategies

Marketing

Performance

Marketing

Performance

Rapid Growth in Brand Value

Rank Company _{US $ billion}Value

Rank Company _{US $ billion}Value

Samsung

20. 14.9

2005

Strength of Samsung Brand

Interbrand

Interbrand’’ss BrandBrand ValueValue

Brand Attitude Survey Dealer Attitude Survey

Customer Brand Value Customer Brand Value

Net present value of the brand’s future earnings Assessment of business and brand strengths

Consumer attitudes from awareness to purchase intent to brand loyalty Retail recommendations on marketing activities, product power, and brand preference

[Unit: %]

46

2005

2002

31

84

2002

75

2005

Brand Value According to Consumers

Positive Opinion Positive Opinion Unaided Awareness

Brand Value According to Dealers

Dealer Recommendation Rate

Color TV

Color TV Mobile PhonesMobile Phones

7.7

14.2

17.2

23.4

2005

2002

2002

2005

#1 Global Market Share Product

[Unit: 2004 Market Share] SRAM

34.0%

22.1%

14.9%

29.0%

20.6%

61.0%

19.0%

31.0%

Mobile Phones

Plasma TV LCD TV DLP Projection TV

7 Megapixel Camera Phone Satellite DMB Phone MP3 + Camera Phone

Flat TVs

Color TV Mobile Phone Monitor Refrigerator

155

150

129

116

Average Price Index

Average Price Index

Marketing

Vision

Marketing

Vision

Where We Are Headed – Marketing Vision

World Leading Company for

Digital Convergence Revolution

Product Leadership

Customer Leadership

Marketing Expertise & Organization Marketing Expertise & Organization

Create Create Platform Platform- -Based Based Hit Products Hit Products Win

Win--Win Win Partnership

Partnership

Maximize Marketing Efficiency Maximize Marketing Efficiency (Investment/System/Process) (Investment/System/Process) SAMSUNG SAMSUNG VISION VISION MARKETING MARKETING VISION VISION CORE AREAS CORE AREAS Brand Leadership Premium Premium Brand Brand Experience Experience

= Icon Brand

-Sony : 39 Nokia : 31 32 28 23 % Icon Index* N/A 120 110 104 Index s-API HHP CTV Sony: 62 Nokia: 43 60 53 44 % Unaided Awareness Brand Leadership Nokia : 28.8 30 28 25.7 % Customer Leadership Product Leadership N/A 23 19 8 EA No. 1 M/S Products Sony : 25.1 26 22 13.5 % Dealer Recommendation Rate 2010 2010 2005 2005 Competitors Competitors 2004 2004 2008 2008 Unit Unit Category Category *Purchase Intent

Increasing

Increasing ““SmartSmart”” customers who pursue intuitive simplicitycustomers who pursue intuitive simplicity

Technology is a given especially for young generation

Technology is a given especially for young generation

Reduced importance of traditional mass media

Reduced importance of traditional mass media

Expansion of B2C & B2B channels across regions

Expansion of B2C & B2B channels across regions

Changing Landscape of Market Environment

Intense cross

Marketing

Strategies

Marketing

Strategies

Evolution of Marketing Strategies

Similar benefits with competitors Discrepancy in price status Customer Customer Leadership Leadership Optional relationship without continuity Premium brand Consistent identity

Strong emotional bonding

Products meeting latent consumer needs

Value-added,

first-to-market launch

Long-term customer centric partnership

NOW & BEYOND

Marketing Strategies

Build Most Preferred and Loved Brand

Build Most Preferred and Loved Brand

Introduce

Introduce ““FirstFirst--toto--MarketMarket”” Products Reflecting ConsumersProducts Reflecting Consumers’’ Unmet NeedsUnmet Needs

Strengthen Partnerships by In

Strengthen Partnerships by In--Depth Understanding of Customers & ChannelsDepth Understanding of Customers & Channels

Advance Marketing Expertise and Investment Effectiveness

Brand Strategy – Past & Present

1999~2004

2005 ~

High Life Seekers Sensible

Brand Buyers

Wow, Simple, Inclusive Designing Sensational Technology

Easier, richer & more enjoyable life through

technology

Unlimited Living Awareness

Brand Target: High Life Seekers

Male and female (male skewed) Mid to high income Educated

Style conscious

Highest interest in CE Spend most money on CE Early adopter

Tech in everyday lives

Passionate, creative Appreciate excellence Crave things that give them a fuller, more engaged life

Time-out

Seek knowledge Seek community Work hard, play hard

Tech Attitude Tech Attitude Lifestyle Lifestyle Psychographics Psychographics Demographics Demographics

New Brand Essence

Design

Focus

Design

Focus

Sensory

Premium

Sensory

Premium

Technology

Leadership

Technology

Leadership

2005 Global Brand Campaigns

from Visual Identity to Sensory Identity

See

Hear

Touch

Smell

Advertising

Imagery, Color Scheme, Sound logo/Jingle

Product

Environments

Values of Sponsorship Marketing

Build premium brandship by leveraging first-class properties (global & local specific)

From building brand awareness to increasing brand preference

Strengthen and leverage channel relationships

Contribute to sales by connecting sponsorship events with sales programs (promotions, etc.)

Deliver specific business goals

Sports

Sports

Arts

Arts

Entertain-

Entertain

-ment

ment

Cause

Cause

Marketing

Marketing

Events &

Events &

Shows

Shows

Components of Sponsorship Activities

Sponsorship since 1996 Nagano to 2008 Beijing Games 2004 Athens Games

- Torch relay in 27 countries, 34 major cities, reached more than 50 million - Brand Awareness: 7% ↑ in Awareness, 15% ↑ in Purchase Intention

Awareness of Samsung’s sponsorship in 2005 is one of the highest among European teams

Media value to date estimated at US$ 32 Million

Cause marketing program for North America since 2001

Fund raising with key channel partners (Best Buy, Circuit City, etc.) and key celebrity foundations (Magic Johnson Foundation)

World’s First-to-Market Products

Mobile Phones

2000

Dual Screen Phone

2005

7 Mega Camera Phone

2004

5 Mega Camera Phone Satellite DMB Phone

64Gb 3xnm 4Gb 70nm 1Gb 120nm ‘01 ‘03 ‘‘0505 ‘07

16Gb

16Gb

50nm

50nm

First-to-Market in Core Components

NAND Flash Memory

Core Components in Premium Products

Camcorder + TV

Camcorder + TV Portable Media Player + TVPortable Media Player + TV Portable DVD Player + TVPortable DVD Player + TV

Introduce Samsung’s “Signature” Devices

Product Development Process

Areas of Improvement Market Research/ Analysis Ideation Idea Screening Concep-tualization Product Planning Development Launching Plan Ideation Idea Screening

Ways to Gather Customer Insight

Trend

Trend

-

-

Setter

Setter

Hives

Hives

Creative User

Group

Mania Group

Dynamics

Internal

Workshop

Expert Group

Seminar

New Market

Opportunity

FashionTech.EnterSports. Music

Under ground Mai n Str eam 6 _Alu m ni D ist rib ut io n De ve lo pm en t MUSIC MUSIC Mania Samsung Team Interactive Dynamics Consumer Needs

Tech-Capturing IT B2B Business Market Opportunity

Monitor

Laser Beam Printer

Total Market Size = $30B Total Market Size = $60B

* Includes toner cartridges Commercial Market 67% 33% Consumer Market 20% Consumer Market 80% Commercial Market

IT B2B Business Strategies

Differentiate line-up by channels

Increase commercial market-oriented product development

Products Products

Obtain sizeable & loyal reseller customer base

Improve management of commercial channels (e.g. PRM system)

Channel Development Channel Development

Improve brand awareness and perception in IT market

Strengthen marketing for IT products (e.g. systematic reseller prgm.)

IT Brand IT Brand

Increase synergy in IT-cluster by creating channel driven organization Increase expertise for IT market

Organization Organization

Steering Market Driven Change in the Organization

Increase marketing expertise Establish skills management tools

Improve coherence throughout the processes

Strengthen marketing-NPD ties

MARKETING CAPABILITY

MARKET DRIVEN PROCESS

Strengthen HQ & local collaboration Ensure integration of Market Driven Culture in the organization

Strengthening Market Intelligence Capability

91 MI personnel with specialties (’05): Extend up to 150 MI personnel by 2007 Market Research Spending: 110% increase from 2004 to 2005

HQ (GBM/GMO) MEA _SWAsia SEAsia Latin America CIS Europe China North America

2002 2003 2004 2005 1,103

1,466

2,046 2,358

Short-term Sales Promotion Strategic Brand Building

Marketing Spending 2002 ~ 2005

* Based on Samsung branded set product sales

54% 57% 56% 56% [US$ mil.] 33% 40% 15% 6.3% SEC Mktg. Investment as % of sales* 6.7% 6.9% 6.8%

Develop impactful and scalable ME methodology, tools & templates

Tools & Metrics Tools & Metrics

Process Process

Refine & apply optimal investment processes

(planning, budgeting, execution and measurement)

Capabilities Capabilities

Develop required ME capabilities (skills, resources) Continuous improvement of investment IT systems Expand data quality & coverage

Marketing Experts & Org.’s Efficiency

Product Innovation

B2B Mktg./Sales

Expertise

Market Intelligence

Brand Management

Product Innovation

B2B Mktg./Sales

Expertise

Market Intelligence

Brand Management

“Most Preferred & Loved Brand”