Welcome to my world. The intriguing, complex world of marketing: How to get people things they need and love but also how to make them find it. Being one of the biggest players in the market implies you're spending a small percentage of profits on advertising in all of it's ways, like advertising and sales promotion.
Samsung is no exception to that rule. With their numbers even a few cents per device adds up to a nice bundle! Compared to last years 650.000.000 USD the budget for sales promotion grew to a mind blowing 900 million greenbacks. (rounded numbers, yep.) Which ,I need to add, is for the first three quarters of the year.
Nice all that money but we all know that the more they sell the more they spend. So what's the useful news here? Traditional advertising, most likely ads in print and on TV, dropped from 1.6 billion to 700 million USD. That means a lot of money has been released for more effective ways of winning over customers and make the current customers very happy people as well.
It's not just the amount, it's the way it's being used. With traditional advertising budget spiraling downwards more money is being used in sales promotion. Sales promotion is just a container for all kinds of promotional activities that will draw a customer to your new product, both existing customers as well as those of your competitor. Giving instant rebates, make deals with telecom providers, help sales people to win customers to your products and the odd trade-in.
Some people would suggest that devices that have a lower price to start with will be easier to shift. In a way that might seems right but say an average device will add $1 to the advertising budget. Do you really believe $1 or $10, whatever, will make a dent? On a thing that has a retail price of $500? Writing for myself I couldn't really care. If I want to go cheap I'll buy a second hand one. That's a serious difference. If you can live without a smartphone you might find a phone for less than a tenner.
However, most consumers, even those that are no gadget geeks, want a speedier device. Newer. Shinier. A device that connects better, has a finger fitting screen and apps that makes you smile or make your life easier. Whether on a smartphone, a tablet or the screen in the dashboard, or, in a car not too far away from now, on a windscreen. And that is why companies like Samsung will keep on promoting their brand, their products and their message. Not just on the well being you as a user can benefit from but also how new technology will even be more effective in pleasing you. To convey that message Samsung, as one of the biggest advertisers in the telecom industry, if not in all industries, will always find ways to reach you. Way beyond the tunes of billions of Korean wons a day!
And let's face it: We as Tizen experts are happy that Samsung takes care of that great OS. If they had not, it probably would be remembered fondly, like I remember Symbian and Maemo.