Samsung Electronics is the world’s largest consumer electronics company. Producing everything from phones, TVs, cameras and laptops to microwaves and freezers, it is a top three brand in pretty much every category in which it is active. 2010 sales were in excess of $135 billion with net profits of over $14 billion. Samsung Electronics is now twice the size of Sony, the company which 20 years ago was the undisputed leader in the sector.
The company is part of the larger $200 billion revenue Samsung Group that accounts for a fifth of Korea’s exports. Samsung has become the flagship of the South Korean economy and the source of much of the innovation that is taking place across the consumer electronics sector. Given that it was a low-cost me-too manufacturer of imitations of Sharp’s microwaves in the 1970s this is a huge achievement. Pivotal to Samsung Electronics’ success over the past decade or so has been the way it has embraced design as the source of competition. Growing from 2 to 900, the Samsung Electronics design team now consistently takes most awards at the prestigious annual design events as the company’s products are time and time again seen as leading the category in performance, quality, and value.
While design has become an important part of the success, Samsung Electronics is a vertically integrated hardware company: it makes the product and pretty much every component that goes in it. And this means that Samsung Electronics is first and foremost a technology company. Samsung Electronics’ component business is the leading producer of many of the best technologies: whether it is memory, integrated circuits, storage, or LCD panels Samsung Electronics makes great products. And it doesn’t just make them for use in Samsung products – most of its competitors’ products also source their components from Samsung Electronics. Whether you buy a Samsung or another brand, chances are you are still buying Samsung Electronics’ technology and this brings efficiencies of scale and cost to Samsung over their competition.
Samsung Electronics have made a major success of product design, but this has not been done in isolation of great technology. As with Audi, it has been the increasingly close and symbiotic relationship between the engineering and the aesthetic design that has made the brands stand out more from the crowd.
Going forward, a big challenge for Samsung Electronics will be to utilise its competences in design, technology and integrated processes to continue pushing the technological boundaries, competing on quality with its Asian peers, and producing the products that the vast majority of the world’s consumers clearly want to buy.