As technology has developed, the ICT (Information Communication of technology) industry kept changing. For example, from pc to mobile devices and from mobile devices to wearable smartphones and IoT devices, it has been kept changing. In addition, according to IoT, machines require OS (operating system) which, has led to the consequence of various IoT to come out. Due to the following result, OS has developed for its subsequent need.
As I quote a blog named Drone-ver software management blog for a smart house, says IoT means the Internet of Things, which refers to the rapidly growing network of connected objects that can collect and exchange data in real-time using embedded sensors. Objects like thermostats, cars, lights, refrigerators, and more appliances connected to the IoT for provide a secure and comfortable life for humans.
Furthermore, these days smartphones have enabled us to do various tasks simultaneously. Quoting from google dictionary, a smartphone defines as a mobile phone device that performs many of the functions of a computer, typically having a touchscreen interface, internet access, and an operating system capable of running downloaded applications.
A smartphone is a handheld mobile computer for accessing and browsing the Web. We can check on breaking news, and shop online any time at any place. All this is possible because a mobile operating system (OS) supports the smartphone and provides the device with advanced computing capacities.
These have also enabled families to keep in closer touch with each other. It has certainly made our lives much more convenient. Smartphones have also changed the way how people interact with each other. This virtually changed our society’s concept of access and making information available to smartphone users anytime and anyplace.
As we can see, smartphones have become to be an important source of human lives and in the phone industry. LG and Samsung are the top phone companies. We can see their products everywhere. A lot of my friends around the world are using it too. These two companies have the world’s largest mobile phone consumption.
My aim is through this paper I would like to talk about the comparison between LG and Samsung, the world’s biggest phone companies, and analyze each of the companies.
1. About mobile business
1-1. LG
In 1995, LG started its first mobile phone business, LG Information Communication. At that time, they made several huge performances at global market share and got 3rd place by selling 15 million units of phone named chocolate and, etc. Over the past 26 years, LG has shown various mobile phones and smartphones. But unfortunately, from the year 2015 summer, they have made a continuous deficit which has caused accumulated losses of 5 trillion won in Korean currency.
As a result, the possibility of business withdrawal has emerged. Therefore, the company tried to dispose of the mobile business to several companies, such as Vin group Joint Stock Company from Vietnam, Volkswagen from Germany, etc. Eventually, the disposal chance got failed, and at last, the company decided on the final withdrawal.
1-2. SAMSUNG
In 1988, Samsung jumped into the analogue cellphone market and began with the slogan of Anycall. Anycall meant it is possible to call from anywhere and anytime aimed for Motorola, the first player to take over the market. They made this slogan to show the product is strong in Korean topography. Due to the regional characteristics of Korea, it had so many mountains and various heights of land, marketing as Anycall brought huge success. Starting from 2006 variety of smartphones came out, and then in 2008, their first smartphone, Omnia, was invented, and in 2010 the galaxy series came out. Until now, Samsung has kept rowing their boat in the race and made-up 1st and 2nd in the industry.
2. SWOT
2-1. LG
Strength
–High recognition and reliability for electronic products based on customer-centered and creative technology.
-Brand offers sound rational appeal: good product features and value for money.
-Good after-sales service and wide distribution network.
Weakness
–There is little confidence in instability because chronic problems like software, phone quality, battery issues and boundless booting exist from one model to another.
-Lack of renovation
– Brand lacks influence, especially in the social media environment
-Brand has limited market share compared to market leaders, ex) In Asian and European markets.
Opportunities
–Fast growth of home appliances, electronics goods market in emerging economies
-Convert improved brand image and awareness into market share.
-Increase the already wide product portfolio.
Threats
-Samsung
-Apple
-4 of the Chinese companies
Huawei, Vivo, Xiaomi, Oppo
Brands Globally well-known all around the world.
2-2. Samsung
Strength
-Integration of open-source operating system and software. The strongest strategy the Samsung took was adapting open-source technology like the Android Operating System. The world is moving with the Android open-source operating system.
– Globally known brand all around the world. Also, Samsung Galaxy series is the popular product line offered by the company.
-Largest Market Share in Mobile Phone Market.
-Samsung has the widest range of products which includes mobile phones, tablets, tv/audio /video, cameras, camcorders, home appliances, printers, memory cards and other accessories.
Weakness
-Low-Profit Margin. It always keeps a low-profit market. So, many competitors are in this industry. To keep customers, they must offer the products low.
– The reason why Apple is more popular than Samsung in some parts that they have better quality. Apple offers better in the handset field.
-Samsung is a hardware leader but has too much dependence on software from other parties.
Opportunities
-Samsung can innovate more compared to other competitors like Apple.
-Adopting newer technologies to improve upon products.
-Samsung is India’s official Olympic partner for the 2012 London Olympics and has launched the Olympic Ratna Program. This project will result in enhanced brand awareness and increase sales. The younger generation rate in India is growing, and mobile phone sales is expected to increase.
Threats
-Apple
-4 of the Chinese companies
Huawei, Vivo, Xiaomi, Oppo
So many competitors are in this industry, so to keep customers they must offer the products low.
3. Phone market share
LG and Samsung showed different paths during the decades.
In 2014 Samsung got 1st, and LG got 5th place. In 2015 Samsung maintained its position, and on the contrary, LG got out from 5th place and went below. They were struggling with problems of competitors and domestic because it didn’t show good share. But just because Samsung got 1st place doesn’t mean they could be reliable because compared to Apple, Apple was offering other products in the market as the Apple watch, while Samsung was only trusting and kept pushing ahead with galaxy 6, which was the only product they had with no other alternatives, which was shading.
In 2018 as Samsung launched Galaxy S9 and S9+, they have improved 5% of the share compared to the last quarter. Also, they were going ahead by having 30% of the claim in South America. According to modifying the strategy of the smartphone launch, LG had no new upcoming models. Consequently, it led to an 18% decrease in share compared to last quarter.
Year in 2020, according to the market research company named Count point research said, the brand that got in 1st place of the global smartphone market share was Samsung. Samsung made 19% of shares all around the world. Especially Samsung showed a high rate of 41% in Europe, mid-south America, and the mid-east. In Europe, Samsung had 23% more than Apple, who got 2nd place with 23% of the share. Except for Apple’s home ground in North America, Apple gained 50% of the stake, and Samsung earned got 25% in 2nd place. In addition, in the Asia market, the 1st place corporate that got the most share was Huawei, then Vivo, Xiaomi, Oppo, and Samsung. On the other hand, LG was in 7th place, and the percentage decreased, and eventually, they dropped out of the race.
4. Analyze
When we compare those two companies, each had a different conclusion about this industry. In 2019 Samsung reached 1st place in the global smartphone market share, until the present. On the contrary, LG isn’t in the line. For the main reason, experts say the biggest impact contributing to LG’s end would be the advice from the global consulting company McKinsey. People say the incident was what we couldn’t leave out from LG’s history when McKinsey gave LG consulting advice be shelved in focusing on smartphones. In 2007 when Apple launched iPhone, the mobile phone industry got shocked. Because it was so well-made that nobody could copy it at that time. That’s when LG and Samsung started to view the phone market with smartphones with windows. Unfortunately, at that current moment, McKinsey oversaw LG’s mobile business consulting, and they told LG to focus on a feature phone, because they judged feature phones were better than smartphones at that time. When we look through the present perspective, it was a mistake. But still, in the past, as a consulting company that must make progress in the short-term progress, they would advise trying to focus on something more competitive to expand the business instead of the uncertain future. As smartphones were getting universal, LG was way back in the technology since they started late inventing smartphones. As a result, they were behind in the field. Even though LG was making losses they were holding on to the business as much as they could. The reason was although LG was not making a good profit in the smartphone business, they were famous in-home appliances which brought the result of lots of consumption. Especially these, people were controlling devices and machines by phone, so LG wanted to make compatible between their telephone and home appliance products. As a result, eventually, LG got fell behind in the smartphone business, and it led to a massive loss and company withdrawal in the mobile industry.
5. Conclusion
In conclusion, Samsung and LG are represented Korean brands and they have reached the highest rank in the phone market share. Even though they had different findings, in the end we still could see they have made what’s best for themselves.
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