Samsung Continues to Think BIG!

By Carl Schell, Senior Writer, September 25, 2014

“An opportunity to disrupt means an opportunity to grow,” said Tim Baxter, president of Samsung Electronics America (SEA), during his presentation at the company’s 2014 National Dealer Summit in Dallas. This simple yet telling statement was an apropos precursor to the rest of his comments, which were rife with eye-opening statistics and lofty goals.

With over 300 people from around 100 U.S. dealers in attendance, Baxter explained that not only does the company have an aggressive approach in every segment that it plays in, but it also has a track record of success in the electronics industry that few can match. Take, for instance, that Samsung is the worldwide market-share leader in six categories, including smartphones, TVs and—a surprise to most, probably—refrigerators (Baxter noted that the company has the world’s fastest-growing appliance brand); it sits in the second position for tablets. Other impressive facts about Samsung: it ships 1.5 million mobile devices every day, sells 92 TVs every minute and has filed the second most number of patents (4,676 versus IBM’s 6,809) among tech companies.

The company is also the eighth most valuable brand on the BusinessWeek/Interbrand 2013 list of Top 100 brands (No. 19 in 2010)—and yet many don’t even know that Samsung manufactures printers and MFPs, an observation cited by Baxter and a couple of his fellow executives. While it’s been in the imaging space for 10 years, the company has certainly accomplished a lot, from B2C to B2B and A4 to A3, not to mention that it has a very good overall solutions portfolio that’s aligned vertically with a host of markets (education, finance, healthcare, retail, corporate/government, hospitality and legal, to name several). Kasey Kim, vice president of printing solutions for Samsung Electronics Corporation, reported that mobility, the virtual workplace, IT convergence and the cloud are the key planks in the company’s strategy, then said enthusiastically, “We want a paradigm shift as evidenced by our success with TVs and phones…now printers!”

Still, Samsung has a long way to go to attain its vision for its printing division of being No. 5 in overall market share in three years and No. 3 in five years. Based on IDC numbers from 2012 shared by Matt Smith, vice president of sales and marketing of printing solutions for SEA’s Enterprise Business Division, the company held a 0.6 percent worldwide share (HP was fifth, at 8.6). “There’s a high potential to achieve greater success in both the hardware and software arenas,” he said. “Our XOA platform allows for customization to get customers moving beyond the box, and we need to grow upstream—the MX7 series [slated for a Q2 2015 launch] will help there.”

Samsung appears to be well positioned for making deeper inroads, however. For one, it certainly has the money to invest, as evidenced by it spending 6.3 percent of last year’s revenue from all divisions on R&D (approximately $13.6 billion). Secondly, the company is No. 6 on the Gartner 2013 Top 25 list of best supply chains. Its device lineup and solutions offerings continue to evolve and expand, while giving dealers ancillary tools to sell, like tablets and large-format displays, provides differentiation. And Baxter’s claim that the company is “dealer and partner friendly” is buoyed by the fact that Samsung doesn’t sell direct. “We are a channel-fulfilled model,” Smith said. “We’re not going to bring on a ton of new dealers, but we need more of them, particularly in metro areas (the company has roughly 200 dealers in the United States).”

So Samsung is clearly committed to its dealers, and rightfully so, seeing as they have contributed to the company’s No. 2 position in global market share for A4 laser devices—in just a single decade of business. The proportion of sales derived from the dealer channel is 80 percent, compared with 20 percent for VARs, while there’s currently an 85/15 split between B2C and B2B (Samsung wants a more even 60/40 split by 2020). Winning more enterprise deals will of course be positive for both Samsung and the dealer community, a point driven home by Tod Pike, senior vice president of sales and marketing for SEA, when he said, “The changing nature of device placement within the enterprise will result in moving from color A3 devices to A4 or black-and-white devices in the workgroup, as well as a more centralized view on 11" x 17" color. It won’t affect environments with five to seven devices, but it will in settings that have 20 or more.” He went on to say that Samsung A3 installs are up 40 percent from 2013, with expectations set for 50-percent growth from 2015 to 2016 and then again from 2016 to 2017.

The company as a whole earned revenues of $217 billion last year, which was an improvement on the $188 billion for 2012; for the first half of 2014, the figure is $106 billion. By 2020, Samsung wants to eclipse $400 billion—a goal set in 2009 when it had revenues of “only” $70 to $80 billion—and be named the most innovative and most admired company. For all that to happen, though, the printing division has to be an even bigger contributor. But via the Smartify campaign, with its modern messaging of the “connected” office and interoperability, and by using a tablet as a control panel, all of which were major themes at the event, it’s clear that Samsung is thinking big with document imaging. No doubt it will have an impact on the industry, given its rate of success.

Republished with permission from Buyers Laboratory LLC ( ©2013 Buyers Laboratory LLC