Mobile Phone Company, ‘Specialist’ Vs ‘Generalist’
Introduction
Mobile phones were first invented in the twentieth century, and they have undergone evolution over the years. Mobile phones are devices working under a cellular network which is under the control of the mobile phone operator, and are also known as hand phones, cell phones or cellular phones. Mobile phone penetration in the world is exemplary, in the twenty first century they are considered to be a basic gadget with services ranging in voice calls, short messages, internet access, email access, MMS, wireless communication through a short range like Bluetooth and infrared, photography, business applications, gaming and diverse apps (Ling 2004 p. 173), this paper identifies with Millet (Xiaomi Tech) mobile phones and Samsung mobile phones.
Literature Review
Millet (Xiaomi Tech) mobile phones
Xiaomi means ‘millet’ in Chinese, Xiaomi was originally inspired by the Chinese Communist Party at the revolutionary phase (Reuters.com, 2012). The specifications of the Xiaomi mobile phones are among the global players but the product is mainly in China, Xiaomi mobile phones sell its products at a low price compared to other global players like Samsung and Apple. Xiaomi Tech is the producer of Xiaomi mobile phones based in Beijing China; the company was established in 2010 by Lei Jun (Reuters.com, 2012). Xiaomi Tech ‘specializes’ on mobile phones only, this is unlike Samsung that produces diverse products and services, in this case referred to as the ‘generalist’.
Market response on Xiaomi mobile phones and Samsung mobile phones has shown a different approach. MiBox is another brand with the same company (Reuters.com, 2012). Surveys indicated that Xiaomi mobile phones received wide coverage by the media after initialization of the company; this is after the company launched Xiaomi Phones in 2011, which was a low cost product. Xiaomi Tech also produced MIUI custom firmware, android based for mobile phones (Reuters.com, 2012). The presence of Xiaomi mobile phones is mainly online, although the sales cannot be compared to established brands like Apple and Samsung. The success of Xiaomi phones is mainly in China and it is pegged on low priced products, high quality products and to the fact that the product is readily available in China to the target customers.
Surveys have shown that Xiaomi MI-Two Smartphones are almost similar to iPhone 5 and Samsung Galaxy S3, while the selling price of the products is half price of those common brands in the market, mainly in Chinese market. Surveys have shown that Xiaomi mobile phones perform better in graphics, and are produced depending on the demand of the products and wants of the consumers (Reuters.com, 2012).
Samsung mobile phones
Samsung Group was founded by Lee Byung-chul in 1938, with its headquarters based in South Korea. Samsung Group is a multinational company serving the whole world. The common products are consumer electronics, Apparel, electronic components, chemicals, precision instruments, medical equipments, telecommunications, precision instruments, ships and semiconductors (Samsung.com, 2013). Services provided by the Samsung group deals in construction, advertising, financial services, entertainment, hospitality, medical services, retail services and information and communications technology. Samsung is the global leader in the mobile phone production. The Samsung brand has gained loyalty among the consumers.
It has been noted that Samsung is dominant in China, even more than Xiaomi mobile phones are in Chinese market. The common smart phone vendors in the world identify with Samsung, Apple, LG, Lenovo, ZTE, Huawei and Nokia among others (Samsung.com, 2013).
Marketing performance measurement and management (MPM)
Marketing performance measurement and management (MPM) is a common strategy applied by the marketing professionals in defining improvement and analysis of the effectiveness and efficiency of marketing products (Levinson, 2004 p. 101). Samsung has been marketing itself aggressively in the world as compared to Xiaomi Tech that limits itself to Chinese market only. MPM is accomplished through marketing strategies, activities, business goals and the metrics.
MPM is used in the metric framework creation used in effective monitoring of the performance of the market. The results obtained are used in developing and utilizing models used in marketing performance. Xiaomi Tech is a specialist company, only producing mobile phones, it has been noted that marketing the product has faced diverse challenges, as compared to Samsung Company which is a generalist. Marketing Samsung products have been easy as different departments share the marketing costs. Performance management is a critical tool in defining market performance, performance management has been common in product development, manufacturing and in logistics issues (Ling, 2004 p. 29).
Performance management is applied in enhancing objectives and outcomes in optimizing group, individual and the overall performance of the organization. It can be argued that Samsung has perfected in performance management in the global market, as compared to the Xiaomi Tech that specializes with the Chinese market. MPM has been influential in managing, measuring and in analyzing the performance of the market in enhancing better results in the Return on Investment (ROI) and maximizing the effectiveness of the marketing strategies. All these marketing models are influenced by metrics, data and analytics.
Samsung is a multinational company MNC, and it has been noted that the organization influence national and local policies in nations of operations, this is by causing the involved governments compete with each other in attracting the MNCs. It has been noted that Samsung holds power over national and local governments basing on the spirit of monopoly mainly of the intellectual and technological superiority.
Samsung is big in size as compared to the Xiaomi Tech which is a young company in the mobile telephony, Samsung can be a threat to governments through withdrawal threats; this is different in the case of Xiaomi Tech which operates in only one nation, an indication that its powers are limited.
Economic globalization
Economic globalization is another issue affecting the market performance of mobile phone companies. It is argued that Samsung has various products and services in the market, an indication that the brand name is strong and demands respect among the consumers (Hanson, 2007 p. 100). Economic globalization considering Samsung has evolved into economic interdependence on the part of the national economy in the world as the products move in and out of the national borders. This is different with Xiaomi Tech which targets mainly local customers in China, an indication that economic globalization is limited (Horst & Miller, 2006 p. 151). Economic globalization encourages growth of the Gross Domestic Product (GDP), decrease in poverty as most people are involved in trade and eventual narrowing of the gap between the rich people and the poor people in the society.
The negative attributes of the economic globalization identify with exploitation of the labour force in the host country, channelling of resources outside the host nation, encouraging foreign exports and over-dependency of nations developing on nations considered wealthy (Ries & Trout, 2004 p. 77). Samsung demands a significant influence on the economy of the world, in that it encourages global marketing of its products, a factor that has encouraged diversification of the global economic interdependence, basing on the constant cross border movement of Samsung products and capital.
Samsung is a company that has contributed significantly to globalization, where it has enabled the building of business links in diverse nations, a factor that has led to the development of the single global market or a global marketplace (Keegan & Green, 2012 p. 399), an indication that marketing Samsung mobile phones have been easier as compared to marketing Xiaomi mobile phones that has ventured into an already saturated market.
Globalization has led to integration of markets due to increased worldviews interchanges and increased human connectivity (Ries & Ries, 2002 p. 149). Products produced by Samsung have encouraged globalization, hence building strong links between the target consumers of the products and services. Samsung has managed to deal with multicultural societies in marketing its products as compared to Xiaomi mobile phones that are mainly limited to the Chinese culture.
Competitive Strategy
Different markets call for different marketing strategies, competitive strategy is applied in defining the distinctive approach directed at the target business areas. In the same way, it has been noted that Samsung has been sensitive on global marketing while Xiaomi Tech has concentrated on Chinese marketing, an indication that the marketing strategies are very different. Competitive strategy in Samsung has enabled the organization to remain at the top of the global market, to an extent that it topples Xiaomi Tech market in China. Samsung has managed to manipulate the competitive forces to its advantage (Cateora et al, 2012 p. 450).
Developing a competitive edge is defined by many variables; Samsung has managed to provide mobile phones that have superior value at affordable prices, in that the consumers feel satisfied purchasing the Samsung mobile phones. Samsung mobile phones have a combination of service, features and prices among other special attributes that are very attractive to the target buyers (Kotler & Keller, 2011 p. 199). Xiaomi Tech in China has managed to attain similar levels, although after Samsung had seized the market. Competitive strategy is critical in finding the desired competitive position, in a way that the business is sustainable and at the same time profitable. Samsung has built a sustainable and profitable business in the world while Xiaomi Tech has built a sustainable market in China only, although the market is slowly opening to other parts of the world, mainly in developing countries.
Competitive strategy in Samsung focuses on product differentiation and cost leadership. Taking a critical look at Xiaomi Tech in China, the company is using cost leadership in seizing the target market, since its mobile phones are half price of Samsung’s mobile phones and mobile phones from Apple, this has made Xiaomi Tech to acquire a significant market in China, and the products are slowly moving out of the global market. The main challenge facing Xiaomi mobile phones is on sustainability and profitability of the business venture in the global market.
Global and Domestic Marketing
Global marketing reflects on the reconciling commercial advantage affecting the global similarities, differences and opportunities in meeting the objectives of the global market. Worldwide competition in the mobile industry is taking different angles with socialization and globalization. There are constant needs for companies involved in mobile telephony in devising ways of addressing the changes in the global technology. Samsung mobile phones has invested heavily in research and design and adapting fast to the technological changes in gaining a competitive edge. Over the years, Samsung products are known when referring to the quality of the mobile phones. In fact, all Samsung products are known basing on the quality of the products.
Xiaomi Tech on the other hand is not left out; the company has been producing products with similar features as those of Samsung and Apple. Samsung mobile phones specialize in global marketing while Xiaomi Tech specializes in domestic marketing in Chinese market. Surveys done on the Samsung mobile argues that global marketing is not a one day process; it takes time and evolution to reach the desired results. It has been noted that global marketing in Samsung mobile phones has undergone a revolution, at first it was domestic marketing, then to the international marketing and finally the global marketing.
Xiaomi Tech is still in the domestic market, meaning that it will have to face international marketing them to the global marketing (Reuters.com, 2012). Domestic marketing is within the political boundaries of the nation under consideration, in the same way, Samsung markets itself in Russia, which is considered to be domestic marketing (Samsung.com, 2013). Xiaomi Tech on the other hand markets itself in China, in the same way, it is considered as the domestic market. Domestic marketing considers doing away with domestic competition.
Xiaomi Tech competes with foreign products in the Chinese markets. Once a product has managed to overcome the home competition, then the product extends to the external market through introducing the product to a number of nations. Samsung products are diverse, and they share the same brand name, an indication that marketing Samsung brand is easy and diversified, as compared to the Xiaomi Tech that focuses only on the phones. The Samsung brand targets a wide clientele in the market through its products and services, an indication that the Samsung brand gets to interact with a wide market base, which triggers a response towards the purchase of its products.
If different Samsung products and services provide the expected results to the customers, in the same way the customers are attracted to the Samsung mobile phones expecting the same results, in other words, different products and services markets for one another depending on the performance. This is different from the Xiaomi Tech products that only concentrate on mobile phones, an indication that customers after other products and services are not able to interact with the Xiaomi Tech brand. Samsung on the other hand employ product differentiation and cost leadership in the global market. It has been noted that Samsung mobile phones are cheaper than the products of Apple.
Competitive strategies used by Samsung have led to competitive dominance of the Samsung mobile phones. Samsung has encouraged product differentiation through improving the value of the products. Porter argued that competitive edge can be realized through enabling an effective competitive position (Agar, 2004 p. 89).
Conclusion
Mobile phones have evolved to Smartphones, whose applications are similar to those of computers. Mobile penetration in the world is estimated to be increasing with each and every day. There are many companies involved in the production of phones. ‘Generalists’ have a better position in the market as compared to ‘Specialists’, an indication that Samsung mobile phones are strategically positioned as compared to the Millet (Xiaomi Tech) mobile phones.
List of References
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Reuters.com. (2012). China’s “millet” phone maker hits nearly $1 bln in H1 sales. Available: http://www.reuters.com/article/2012/07/26/china-smartphone-xiaomi-idUSL4E8IQ25D20120726. Last accessed 03rd August 2013.
Ries, A. & Ries, L (2002). The 22 Immutable Laws of Branding. New York: HarperBusiness. 100-156.
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Samsung.com. (2013). Mobile Phone. Available: http://www.samsung.com/in/consumer/mobile-phone/mobile-phone. Last accessed 03rd August 2013.
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