EXECUTIVE SUMMERY

SAMSUNG is a company that has been steadily growing throughout the past decade. The
following report will help SAMSUNG maintain the growth that has been enjoyed in the past
with a strong emphasis on the growth of the all consumer durables and mobile divisions.

By analysing customers and what they want_ strategies can be devised as to how SAMSUNG can
increase their share of the market. Furthermore_ by comparing SAMSUNG's strengths and
weaknesses to that of the competition. Opportunities can be identified and capitalised on.

SAMSUNG entered into Indian market with its technologically advanced home appliances.
But when it entered in an Indian market, it had to face very tough competition and still it's facing
tough competition. But 110 it has gained the top position among different companies in India.

Not only SAMSUNG has highest market share in home appliances_ but also in Smartphone
market. SAMSUNG created its own marketing strategies and a defined there target market to
penetrate into Indian market. SAMSUNG aims to have more market share in Indian market.

India is a country having its major consumers in high and medium income, as the poverty level is
declining the major group k turning into medium income group with some purchasing ability.
SAMSUNG India is now available with a big target market.

Already in the Market major companies are available which is having a trust among the
consumer with respect to the quality_ durability & price. The major competitors in
Electronic consumer goods market are LG. Sony, and Panasonic etc. and in Smartphone
market Apple. LG, One plus, Vivo, Oppo etc. are the major competitors of SAMSUNG.
In this project we try to find out some important thinks. The different kind of marketing strategies
of SAMSUNG in Indian market.
INTRODUCTION

Samsung Electronics is a South Korean multinational electronics and information

technology company headquartered in Samsung Town, Seoul. It is the flagship subsidiary of
the Samsung Group. With assembly plants and sales networks in 61 countries across the
world, Samsung has approximately 160,000 employees.

In 2009, the company took the position of the world's biggest IT maker by surpassing the
previous leader Hewlett-Packard. Its sales revenue in the areas of LCD and LED displays and
memory chips is number one in the world.

In the TV segment, Samsung market position is dominant for the five years since 2006, the
Company has been in the top spot in terms of the number of TVs sold, which is expected to
continue in 2010 and beyond.

In the global LCD panel market, the company has kept the leading position for eight years in
a row. With the Galaxy S model mobile phone, Samsung's smartphone line-up has retained
the second-best slot in the world market for some time. In competition to Apple's iPad tablet,
Samsung released the Android powered Samsung Galaxy Tablet.

Samsung India is the hub for Samsung's South West Asia Regional operations. The South
West Asia Headquarters, under the leadership of Mr_ J S Shin, President 8E CEO,
Samsung India which commenced its operations in India in December 1995 enjoys a
sales turnover of over 'US$ !Br,. In just a decade of operations in the country.

Headquartered in New Delhi, Samsung India has widespread network of sales

offices all over the country. The Samsung manufacturing complex housing
manufacturing facilities for Colour Televisions, Mobile phones, Refrigerators and
Washing Machines is located at Noida, near Delhi.

Employing approximately 138,000 people in 124 offices in 56 countries, Company consists

of live main business units:

a) Digital media Business

b) LCD Business
c) Semiconductor Business
d) Telecommunications
e) Digital Appliance Business
IDENTIFY THE VISION, MISSION, OBJECTIVES, AND STRATEGIES.

Samsung’s Mission Statement

Samsung’s mission statement is “We will devote our human resources and technology to create
superior products and services, thereby contributing to a better global society.” This corporate
mission was published in the 1990s, when the company was undergoing rapid global expansion in
various semiconductors, electronics, and related technology markets. Based on its business
operations and current international industry positioning,

Samsung focuses on the following components in its corporate mission:

a) Human resources and technological resources

b) Superiority of products and services
c) Improvement of the global society

In its mission statement, Samsung identifies human resources and technology as the two main assets
that it uses to pursue its purpose and strategic objectives in its global industries. This component of
the corporate mission requires that the company maintain highly competitive compensation
packages and related human resource administration and development programs to attract sufficient
talent while competing against technology giants like Apple Inc. and Google LLC.

Considering the significance of human resources, Samsung’s corporate culture is a determining

factor in fulfilling its corporate mission. On the other hand, superiority of products and services is
at the core of fulfilling the consumer electronics company’s corporate mission.

Such superiority emphasizes the importance of strategic management that directs decisions at
Samsung’s headquarters toward operational effectiveness for high quality organizational outputs in
various technology markets. In a way, this component of the mission statement pushes the
corporation to ensure an effective value chain and achieve its value proposition, such as effective
and high quality consumer electronics.

Furthermore, the corporate mission targets positive contributions to improve the global society,
leading to Samsung’s generic strategy, intensive growth strategies, and strategic objectives that
include the provision of high quality products, such as smartphones, laptops, and home appliances.
In relation, to achieve a positive global impact, the company has embarked on various multinational
acquisitions, such as the purchase of Harman International Industries, which now operates as a
subsidiary of Samsung Electronics. Global scope and societal improvement are factors that link the
mission statement with the technology corporation’s vision statement.

Samsung’s Vision Statement

Samsung’s corporate vision is to “Inspire the world with our innovative technologies, products and
design that enrich people’s lives and contribute to social prosperity by creating a new future.” The
company follows this vision statement to maintain profitable technology business operations that
contribute to the improvement of people’s lives. Samsung frequently refers to a shortened version
of this corporate vision: “Vision 2020: Inspire the World, Create the Future.” The company
extensively implements this statement throughout its subsidiaries’ operations in the consumer
electronics, computing technology, and semiconductors industries. The following components are
contained in Samsung’s vision statement:

1. Global inspiration
2. Innovation
3. Improvement of lives and future social prosperity

Based on its vision statement, Samsung’s strategic objectives include the development of products
that inspire. This inspirational aspect requires the company to consider local and regional market
conditions to ensure that its technological products actually inspire people despite differences in
their societal situations. Samsung’s corporate vision also pushes for a high degree of innovation.
Technological innovation is especially notable in the company’s products, such as smartphones and
laptops. Moreover, the vision statement indicates strategic efforts that include Samsung’s corporate
social responsibility strategy for improving people’s lives and contributing to social prosperity. This
corporate vision means that the company sees itself as a mover and major contributor to the world’s
improvement through consumer electronics, semiconductors, and other products that add value to
people’s lives and society. In a way related to the mission statement, Samsung’s corporate vision
includes a global scope of application and the aim of contributing to societal improvement.
Positioning Strategies
The concept to position the brand may be based on the functions provided by the
product, the experience it offers or symbol it conveys.
Developing positioning strategy requires integrating the product, price, value
chain, and promotion strategy to focus them on the market target. The
positioning strategy matches the firm's capabilities with the buyer's preferences.

Due to Samsung's superiority in the general TV market, the threats as you

can tell arerninima. However, in the strategies and opportunities sections you will find what
we are doing to reduce the risk of these threats having an effect on Samsung’s market
share. Developing a partnership with Microsoft will be a vital component to
developing the 3Dgaming content availability, which is the only relevant competitive
advantage other than pricing.

As Samsung introduces new 3D products to the market, the price of their current products
will drop, making them more readily available to lower class consumers and expanding
the target market for their 3D products.
External opportunities and Threats

Opportunities:

The main opportunities of Samsung are the entry in the other markets and countries in the region
of Asia, Africa and America. The company would look to enter in the other countries to enhance
its sales and revenue. Moreover, Samsung would focus on the other industries to enhance the
overall revenue of the group. Moreover, a lot of opportunities in electronic and software segments
through innovate technology and introduce latest technological phones, tablets and laptops
(Krishnamacharyulu, 2011). Through providing the latest technologies, latest hardware and
software phones, laptops and tablets the company will improve its position in the global
competitive market.

Threats:
The high competitions in the smart phones, tablets and laptops segments are created threat of the
Samsung. Nokia, Apple, Sony Ericsson and BlackBerry are the main competitors of the company
in the Smartphone and tablet segments. Moreover, HP, Dell and Panasonic are the major
competitors in the laptops and computer industry and popular in the world will impact on the
revenue and profit of a Samsung (SAMSUNG, 2014). In addition, other companies leading in the
patent of new technology and innovation in software or hardware such as Apple is impacting on
its position in the global market.
PESTEL

Introduction

Samsung is a global conglomerate that operates in the “White Goods” market or the market for
consumer appliances and gadgets. The company that is a South Korean family owned business has
global aspirations and as the recent expansion into newer markets has shown, Samsung is not
content with operating in some markets in the world but instead, wants to cover as many countries
as possible. Therefore, the focus of this article is on the external environmental drivers of
Samsung’s strategy.

Political

In most of the markets where Samsung operates, the political environment is conducive to its
operations and though there are minor irritants in some of the foreign markets like India, overall
Samsung can be said to be operating in markets where the political factors are benign. However,
in recent months, it has faced significant political headwinds in its home country of South Korea
because of the country’s tensions with North Korea wherein the company has had to take into
account not only the political instability but also the threat of war breaking out in the Korean
Peninsula. Apart from this, Samsung faces political pressures in many African and Latin
American countries where the political environment is unstable and prone to frequent changes in
the governing structures. Of course, this is not yet a major cause for worry as the company has
more or less factored the political instability into its strategic calculations.

Economic

This dimension is especially critical for Samsung, as the opening up of many markets in the
developing world has meant that the company can expand its global footprint. However, this
dimension is also a worry since the ongoing global economic crisis has severely dented the
purchasing power of consumers in many developed markets forcing Samsung to seek profitable
ventures in the emerging markets. The key point to note here is that the macroeconomic
environment in which Samsung operates globally is beset with uncertainty and volatility leading
to the company having had to reorient its strategies accordingly. The saving grace for the
company is that it has adjusted rather well to the tapering off of the consumer disposable incomes
in the developed world by expanding into the emerging and the developing markets. Indeed, this
is the reason Samsung has begun an aggressive push into the emerging markets in the hope of
making up for lost business from the developed world.
Socio-Cultural

Samsung is primarily a South Korean Chaebol or a family owned multinational. This means that
despite its global footprint it still operates from the core as a Korean company. Therefore, there
are several aspects to its global operations some of which include adapting itself to the local
conditions. In other words, Samsung being a Global company has had to act locally meaning that
it has had to adopt a Glocal strategy in many emerging markets. Apart from this, Samsung has had
to tailor its products to the fast changing consumer preferences in the various markets where it
operates. The key point to note here is that Samsung operates in a market niche that is strongly
influenced by the lifestyle preferences of consumers and given the fact that socio cultural factors
are different in each country; it has had to reorient itself in each market accordingly.

Technological

Samsung can be considered as being among the world’s leading innovative companies. This
means that the company is at an advantage as far as harnessing the power of technology and
driving innovation for sustainable business advantage is concerned. This has translated into an
obsessive mission by the company to be ahead of the technological and innovation curve and a
vision to dominate its rivals and competitors as far being the first to reach the market with its
latest products is concerned. however, as we shall discuss later, this has also resulted in the
company cutting corners with its imitation of the legendary Apple’s product design and this has
brought legal and regulatory scrutiny and troubles for the company. There is a lesson here for
other technology driven companies from Samsung’s experiences and it is that no matter how fast
you are to reach the consumer in this age of Big Bang Disruption, doing the basics right is still the
key to success.

Legal

As mentioned in the last section, Samsung has had to face heavy penalties for its alleged imitation
of the Apple’s iPad and iPhone and this has led to the company taking a beating as far as public
perceptions and consumer approval of its strategies are concerned. It remains to be seen as to how
the company would wriggle out of the legal maze that it finds itself in the developed markets
because of the various lawsuits.

Environmental

With the rise of the ethical consumer who wants his or her brands to source and make the products
in a socially and environmentally responsible manner, Samsung has to be aware of the need to
make its products to satiate the ethical chic consumer. This means that it has to ensure that it does
not compromise on the working conditions or the wages it pays to its labor who are engaged in
making the final product.

Conclusion

The preceding analysis clearly indicates that Samsung has its task cut out for itself as it navigates
the treacherous global consumer market landmine. Indeed, as the company prepares to expand its
global footprint, the stakes could not have been higher in a recessionary era and an uber
competitive technological market landscape.
 Competitive profile matrix (CPM)

Best Buy RadioShack Amazon

Critical Success Factors Weight Rating Score Rating Score Rating Score
Net Income 0.14 1 0.14 2 0.28 4 0.56
Revenues 0.14 3 0.42 1 0.14 4 0.56
Customer Service 0.04 1 0.04 2 0.08 4 0.16
Store Locations 0.05 3 0.15 4 0.20 1 0.05
Price Competitiveness 0.12 2 0.24 1 0.12 4 0.48
International Presence 0.05 2 0.10 1 0.05 4 0.20
Product Variety 0.05 2 0.10 1 0.05 4 0.20
Installation Options for Customer 0.06 3 0.18 2 0.12 1 0.06
Market Share 0.07 2 0.14 1 0.07 4 0.28
Able to Avoid Sales Tax 0.12 2 0.24 1 0.12 4 0.48
Overhead 0.08 1 0.08 2 0.16 4 0.32
Nature of Long Term Lease Constraints 0.08 1 0.08 2 0.16 4 0.32
Totals 1.00 1.91 1.55 3.67
What is EFE?

External Factor Evaluation (EFE) matrix method is a strategic-management tool often used for
assessment of current business conditions. The EFE matrix is a good tool to visualize and
prioritize the opportunities and threats that a business is facing.

The EFE matrix is very similar to the IFE matrix. The major difference between the EFE matrix
and the IFE matrix is the type of factors that are included in the model. While the IFE matrix deals
with internal factors, the EFE matrix is concerned solely with external factors.

External factors assessed in the EFE matrix are the ones that are subjected to the will of social,
economic, political, legal, and other external forces.

How to create EFE Matrix

Developing an EFE matrix is an intuitive process which works conceptually very much the same
way like creating the IFE matrix. The EFE matrix process uses the same five steps as the IFE
matrix.

List factors: The first step is to gather a list of external factors. Divide factors into two groups:
opportunities and threats.

Assign weights: Assign a weight to each factor. The value of each weight should be between 0
and 1 (or alternatively between 10 and 100 if you use the 10 to 100 scale). Zero means the factor
is not important. One or hundred means that the factor is the most influential and critical one. The
total value of all weights together should equal 1 or 100.

Rate factors: Assign a rating to each factor. Rating should be between 1 and 4. Rating indicates
how effective the firm’s current strategies respond to the factor. 1 = the response is poor. 2 = the
response is below average. 3 = above average. 4 = superior. Weights are industry-specific.
Ratings are company-specific.
Multiply weights by ratings: Multiply each factor weight with its rating. This will calculate
the weighted score for each factor.

Total all weighted scores: Add all weighted scores for each factor. This will calculate the total
weighted score for the company.

EFE Matrix of Samsung

Samsung Internal Strength

Business strengths are internal strategic factors that, in this SWOT analysis, refer to competencies,
resources, and capabilities that support the company’s value chain, as well as growth and
profitability of the semiconductors, consumer electronics, and technology solutions businesses.
The organization capitalizes on these strengths to bring Samsung’s mission statement and vision
statement into fruition. These internal factors relate to market demand and related supply chains,
especially those linked to consumer electronics, which is the main source of the company’s
revenues. Samsung’s strengths are as follows:

 Strong global brand tied to consumer electronics

 Semiconductors and electronics manufacturing expertise
 Synergistic support among divisions or subsidiaries

The Samsung brand is one of the most competitive in the global market, especially for consumer
electronics. The brand rivals some of the biggest names in the industry, such as Apple, Google,
and Sony. This strength is an internal factor that supports Samsung’s ability to grow and expand
against competitors. This SWOT analysis also identifies the company’s design and manufacturing
expertise for the semiconductors and electronics markets. This strength is notable, considering
that major technology companies use Samsung electronic components in their respective finished
products. Another strength in this case is the synergistic support involving the technology
company’s divisions and subsidiaries. For example, Samsung Electronics benefits from the
conglomerate’s semiconductors business. This synergistic support is based on the divisions and
subsidiaries in Samsung’s organizational structure. The internal factors in this aspect of the
SWOT analysis are used in the enterprise’s strategies for growth and to compete in the saturated
global market for consumer electronics.
Samsung Internal weaknesses

Samsung’s weaknesses are internal factors that reduce business capabilities in capturing the
opportunities shown in this SWOT analysis. These weaknesses impose limits on the long-term
success of the company’s semiconductors and consumer electronics business. The following are
the weaknesses of Samsung:

 Dependence on Android OS
 Lack of a competitive comprehensive platform for hardware, software, and services

Samsung’s dependence on Android OS is a weakness that limits business capabilities. For

example, the company’s smartphone’s operating-system functions and related licenses are
restricted because of Google’s licensing of Android. Also, Google’s influence on Android
development weakens Samsung’s competitive position, as both of these companies directly
compete in the market for smartphones and other mobile computing devices. In relation, this
SWOT analysis points to the lack of a competitive platform to rival Apple’s ecosystem of
hardware, software, and services. This internal strategic factor makes Samsung relatively weak in
increasing the switching cost of its customers when deciding to purchase consumer electronics
from the competition. The weaknesses shown in this aspect of the SWOT analysis are internal
strategic factors that prevent the company from offering an expansive product range and further
strengthening customer loyalty relative to Apple and Google.
What is IFE Matrix?

Internal Factor Evaluation (IFE) matrix is a strategic management tool for auditing or evaluating
major strengths and weaknesses in functional areas of a business.

IFE matrix also provides a basis for identifying and evaluating relationships among those
areas. The Internal Factor Evaluation matrix or short IFE matrix is used in strategy formulation.

The IFE Matrix together with the EFE matrix is a strategy-formulation tool that can be utilized to
evaluate how a company is performing in regards to identified internal strengths and
weaknesses of a company. The IFE matrix method conceptually relates to the Balanced
Scorecard method in some aspects.

How to create IFE Matrix

The IFE matrix can be created using the following five steps:

Key internal factors: Conduct internal audit and identify both strengths and weaknesses in all
your business areas. It is suggested you identify 10 to 20 internal factors, but the more you can
provide for the IFE matrix, the better. The number of factors has no effect on the range of total
weighted scores (discussed below) because the weights always sum to 1.0, but it helps to diminish
estimate errors resulting from subjective ratings. First, list strengths and then weaknesses. It is
wise to be as specific and objective as possible. You can for example use percentages, ratios, and
comparative numbers.

Weights: Having identified strengths and weaknesses, the core of the IFE matrix, assign a weight
that ranges from 0.00 to 1.00 to each factor. The weight assigned to a given factor indicates the
relative importance of the factor. Zero means not important. One indicates very important. If you
work with more than 10 factors in your IFE matrix, it can be easier to assign weights using the 0
to 100 scale instead of 0.00 to 1.00. Regardless of whether a key factor is an internal strength or
weakness, factors with the greatest importance in your organizational performance should be
assigned the highest weights. After you assign weight to individual factors, make sure the sum of
all weights equals 1.00 (or 100 if using the 0 to 100 scale weights).

The weight assigned to a given factor indicates the relative importance of the factor to being
successful in the firm's industry. Weights are industry based.

Rating: Assign a 1 to X rating to each factor. Your rating scale can be per your preference.
Practitioners usually use rating on the scale from 1 to 4. Rating captures whether the factor
represents a major weakness (rating = 1), a minor weakness (rating = 2), a minor strength (rating
= 3), or a major strength (rating = 4). If you use the rating scale 1 to 4, then strengths must receive
a 4 or 3 rating and weaknesses must receive a 1 or 2 rating.

Note, the weights determined in the previous step are industry based. Ratings are company based.

Multiply: Now we can get to the IFE matrix math. Multiply each factor's weight by its rating.
This will give you a weighted score for each factor.

Sum: The last step in constructing the IFE matrix is to sum the weighted scores for each factor.
This provides the total weighted score for your business.

IFE Matrix of Samsung

Objective:

Marketing objective of the Samsung that the future of electronics is inspiring the world and create
the future. The objective of the company is to lead innovations in technology, solution and
product that inspire communities all over the world to create a better world (SAMSUNG, 2014).
The company is dedicated to offering new values and standards in the industry and people as well
as fulfil the values of its employees, partners and clients. Samsung Electronics wants to produce a
future that is promising and join the different countries people together through technology.
Moreover, the Samsung objective of 2020 is to achieve annual sales of USD 400 billion and
develop brand value of Samsung Electronics among the top five in the world. Samsung main
pillars of organizational culture are creativity, partnership and great people. The company mainly
focused on delivering the world’s best quality products and services through innovative process
and operational excellence (Michell, 2010). Moreover, Samsung looks forward in healthcare and
biotechnology areas to exploring its business in these segments. The company will look for
continuous improve its capacity, competitiveness and innovation. Although, Secondary market
research is re-use of a second party of any data collected by a first party or parties. So the above
discussion explains a manner of secondary market research.

Goal: Samsung has decided its quantitative and qualitative goals for futures. The company
quantitative goal is attained the USD 400 billion figure of sales and become No.1 in IT industry at
global level (Butow & Watson, 2013). In addition, Samsung qualitative goals are known as a
creative leader in the world and becoming position in top 10 world’s best workplaces that attracts
the world’s best talented people. Further marketing mix like –price, promotion, product, place
have a good way to reach the target market by the selecting of above marketing goals.

The Key method of the Company for implementing of the marketing mix: Product, price,
promotion and place these are four elements of the marketing mix. So that customers always
demand of the products and services those are attracting them. Demand of the customers is
changed regularly due to new products available in the market. The customers take the decision of
purchasing a product or brand on the basis of post purchase evaluations. Samsung research team
has estimated the factors those influences the buying behaviour of the customers. Samsung made
attractive and careful design, electronic products and gadgets as well as different features to attract
the more customers in international markets (Chang, 2011). Further, it provides cheap price for
product to influence the buying behaviour of the customers. Moreover, it adopts different kinds of
marketing tactics and strategies for influencing customers buying decisions and it does
advertisement for increase sales and provides labour & an employee friendly environment where
they can work in a team.
 SWOT ANALYSIS

STRENGTHS
 Samsung is the world’s most successful electronics manufacturer. It is the world’s largest
manufacturer of television sets, liquid crystal display (LCD) panels, mobile phones and
smartphones.
 Samsung is the world’s number one marketer of mobile phones with 21.4% of the world’s largest
market share in the second quarter of 2015. Apple is number two with 13.9%[2]
 Samsung has impressive research and design capabilities. It was able to create and roll out Samsung
Pay, a payment app with similar capabilities to Apple Pay, in less than a year. Samsung has been
able to replicate many of the capabilities of both Apple Inc.’s phones and Google Inc.’s Android
operating system for mobile devices.
 Samsung has strong manufacturing and marketing capabilities.
 Samsung has long-standing relationships with retailers in the United States and Europe that provide
a steady sales channel for its products.

WEAKNESSES
 Samsung has not been able to match Apple Inc.’s marketing capabilities for smartphones. Its share
of the U.S. smartphone market fell by 2.3% between 2014 and 2015. In contrast, Apple’s share price
grew by 34.9%.
 Some Chinese competitors are catching up to Samsung in the smartphone market. Between 2014
and 2015 Huawei’s share grew by 48.1%, and Xiaomi’s share grew by 29.4%.
 Samsung is heavily dependent upon consumer electronics sales in markets with limited potential
for growth, such as the United States and Europe, for much of its revenue.
 Samsung’s devices use the Google Android open source operating system. Many consumers seem
to view Android as an inferior product to Apple’s iOS. The public has not been as accepting of
Android as the tech community has.
 Some consumers view Apple products as more advanced and dependable than Samsung products.
 Samsung’s marketing efforts are not as sophisticated as Apple’s.

OPPORTUNITIES
 Growing market for smartphones, tablets and other mobile devices, especially in developing regions
such as Africa and India, where consumers are unfamiliar with PCs. Sales of tablets finally overtook
sales of traditional personal computers in 2015.[3]
 Increased demand for tablet and smartphone-based solutions such as Samsung Pay
 New technologies such as wearable tech
 Growing middle class in developing world will increase market for consumer electronics.
 Growing online market from sales channels such as Amazon.com
 THREATS:
 Apple has emerged as the dominant smartphone and tablet brand in some markets, such as the
United States. Samsung has not been able to overcome Apple’s reputation for reliability.
 Apple’s reputation for quality, reliability and sophistication seems to be growing.
 The Google Android operating system, which Galaxy devices depend upon, is not as popular with
average people as iOS is.
 Declining or stagnating middle-class incomes in North America and the United States could reduce
consumer buying power in those key markets for Samsung.
 Chinese manufacturers such as Huawei and Xiaomi could emerge as serious rivals to Samsung.
These companies’ share of the critical mobile device market is growing while Samsung’s is falling.
 Apple could enter more consumer products areas such as home appliances and cameras and directly
compete with Samsung in those markets.
Samsung maintains impressive research, design and manufacturing capabilities, but it appears to
have lost its edge in marketing. This company may need to revamp its smartphone marketing and
perhaps design efforts in order to maintain market share in critical arenas like the U.S.
BCG matrix
SPACE Matrix
FP
Conservative Aggressive
7

4
X = 0.2
Y = -2.6 3

CP IP
-7 -6 -5 -4 -3 -2 -1 1 2 3 4 5 6 7
-1

-2

-3

-4

-5

-6

-7
Defensive Competitive
SP

Internal Analysis: External Analysis:

Financial Position (FP) Stability Position (SP)
Net Income 1 Tax Free Internet Purchase -7
Revenue 5 Technological Changes -6
Long Term Debt 3 Price Elasticity of Demand -3
Goodwill 2 Competitive Pressure -7
Net Worth 5 Capital Required to Open a Store -6
Financial Position (FP) Average 3.2 Stability Position (SP) Average -5.8

Internal Analysis: External Analysis:

Competitive Position (CP) Industry Position (IP)
Market Share -4 Growth Potential 4
Product Quality -2 Lower Margins on TVs 2
Customer Loyalty -5 People Using Stores as Showrooms 1
Helpfulness of Staff -2 Product Installation Profit Potential 5
Control over Suppliers and Distributors -3 Trend Toward Smart Phones over Computers 5
Competitive Position (CP) Average -3.2 Industry Position (IP) Average 3.4

Best Buy lands in the Conservative Quadrant. Major factors preventing Best Buy from moving toward the
right in the matrix are the low margins on TV’s and people using stores solely as showrooms. Competitive
pressures and a state sales tax free environment hurt Best Buy along the Y axis. Allowing mobile phone
boutiques inside stores could be an attractive option for Best Buy.
Grand Strategy Matrix
Rapid Market Growth

Quadrant II Quadrant I

Weak Strong
Competitive Competitive
Position Position

Quadrant III Quadrant IV

Slow Market Growth

Best Buy lands in Quadrant III of the Grand Strategy Matrix. Weak competitive position relative to Amazon
and lower demand for computers and other consumer electronics is hindering the industry. One area of
growth is in appliances and mobile phones. Best Buy should allocated more resources to these two areas.
The Internal-External (IE) Matrix

The Total IFE Weighted Scores

Strong Average Weak
4.0 to 3.0 2.99 to 2.0 1.99 to 1.0
4.0 I II III

High

3.0 IV V VI

5
The
EFE
Total Medium
Weighted
Scores Best Buy

2.0 VII VIII IX

Low
2

1.0

Business Segments Percent

Revenue 2013
(1) Computing and Mobile Phones 44%
(2) Consumer Electronics 33%
(3) Entertainment 10%
(4) Appliances 6%
(5) Services 6%
TOTAL 99%

Best Buy is located in Cell V with an overall recommendation of hold and maintain.
However, the company is doing quite well with Computing and Mobile Phones and
Appliances. Services are doing fairly well and should be expanded. Consumer Electronics
experienced same store sale decreases of 5.7% and 7.5% in 2012 and 2013. Entertainment
was even worse with same store sales decreasing 16% and 21% over the same period.