Africa: Samsung Positions Itself to Take over Market Leadership
By Zachary Ochieng
NAIROBI - Global consumer electronics manufacturer Samsung Electronics is all set to take market leadership on the continent as it continues to roll out innovative products designed specifically for the African consumer market, hence the tagline, ‘built in Africa, for Africa’. In his keynote address at the five-day Samsung Forum 2011 currently underway in the Kenyan capital Nairobi, Mr Kwang Kee Park, Samsung Electronics Africa President noted that the firm’s business philosophy in 2010 had helped Samsung achieve a remarkable 31 per cent growth rate in revenue for its Africa operations ($1.23 billion), contributing to the company‘s $135.8 billion in global revenues – the most successful in Samsung’s history. According to Mr Park, this rapid growth can be explained by the fact that the company extended its business footprint from 15 countries in 2009 to 42 in 2010, its distributors from 32 to 80 as well as increasing service centres from 18 in 2009 to 36 in 2010 respectively.
“We‘re just getting started, and our vision is ambitious. Through our Samsung Blue Project, we intend to become a $10 billion region by 2015, growing the market to the size of China‘s. To achieve this, we will start by more than doubling our 2010 growth to 63 per cent in 2011. Furthermore, in reaching the above target, we are hoping to grow our workforce to 5 000 people by 2015. While, these goals are aggressive, they are the result of a strategy that like our corporate social responsibility programmes, are built in Africa, for Africa.”
Sharing in Mr Park’s joy, Mr George Ferreira, Chief Operating Officer, Samsung Electronics, South Africa, said 2010 was the best year for Samsung in terms of revenues.
“We are confident of becoming a $10billion region by 2015 since our Durban hub has gone a long way in increasing product varieties. We cannot afford to look back”, said Mr Ferreira.
However, he admitted that one of the major challenges stems from the emergence of counterfeits, which, the company was struggling to tame.
Ms Julie Burdis, Head of Marketing, Samsung Africa, said the company’s vision was to inspire the world and create the future by investing in innovative products. From 2011onwards, the company will focus much of its marketing dollars on 30 cities in 14 countries, developing customised messages that will connect with the African people and support its global and regional products.
Mr Park told the forum that as part of the firm’s continental growth strategy, Samsung will be focusing on Africa’s top 10 economies, which together generate 79 per cent of the continent’s wealth and house almost 47 per cent of the population.
“Our aim is to promote co-operation, innovation and the exchange of new ideas in technology so that our products and technologies continue to respond to the real needs and conditions of the continent,” he said.
Besides its innovative products, Samsung also pays great attention to corporate social investment. It is for this reason that Mr Idorenyen Enang, Managing Director, Samsung Electronics West Afriica, said the company will strive to be an advocate of green energy solutions by producing solar powered equipment or those that consume less energy.
Still, the company’s tremendous growth can be attributed to its heavy investment in Research and Development (R&D) to develop technology innovations, specific to the African consumers’ needs. These include, TVs with built in power surge protectors, triple protector technology for air conditioners to ensure durability, power surge protection and safeguarding against high temperatures and humidity, deep foam washing machines that are 70 per cent energy efficient - saving up to 30 per cent water use, dura-cool refrigerators with cool pack - allowing the refrigerators to stay cool without power, as well as dual-sim technology and long battery life phones with battery standby times of up to 25 days.
“We take R&D seriously. Samsung has been investing heavily in R&D despite harsh economic conditions since we realise this is the only way we can stay ahead of the game. Towards this end, we have come up with products for both the high and low end markets”, Mr Paulo Ferreira, Head of mobile products and software solutions, told NewsfromAfrica in an interview.
Such technology innovation has been developed over time as not only has Samsung dispatched Korean Headquarter resources in Africa to fully understand the continent and its people, but also has African Country Managing Directors to ensure local flavour and insight is added into every element of the company’s operations in Africa.
“In line with our key value of co-prosperity, coupled with our Business and development sector partnerships, we have a vision of developing technology that is built in Africa, for Africa, by Africa and as such, we will over the next few years be allocating more local R&D investment for further local product planning, design and development,” said Mr George Ferreira, Chief Operating Officer, Samsung Electronics SA.
The commitment to this vision was demonstrated when Samsung teamed up with the University of Cape Town in South Africa and Strathmore University in Kenya this year to develop unique mobile phone applications that will satisfy the needs of people living in Africa.