Samsung Electronics cooperates with China’s biggest online and offline distributor business called Suning and plans to target China’s TV market. Samsung Electronics is very recognized in TV market as it is the top business by recording market share that closed upon 30% in last first quarter. However its sales volume in China, which is biggest TV market, is very insignificant and it definitely needs to preoccupy Chinese market in order for them to continually grow.
According to industry on the 27th, Samsung Electronics made a strategic partnership with China’s Suning and will sequentially proceed its promotion to expand TV sales in China. Samsung Electronics and Suning are expanding their cooperation bounds not only to sales of premium products, but also to custom-made TVs that will be outbound to China, ex post facto management, and etc. They also set up plans to co-sell every year.
Starting from the 31st, Samsung Electronics and Suning are proceeding their TV promotion, and Samsung Electronics is doing marketing with Suning, which its strength is online and offline distribution, through ‘O2O412 (Online to Offline) strategy’. Suning is displaying products with Samsung Electronics TV brand at 1,600 offline stores and is running experience room, purchase, and service corner.
Online Suning.com is doing sales promotion by setting Samsung Electronics as its major brand in TV field. Just an amount of supply in early stage is 500,000, and Suning is selling Samsung TV during this period at a discounted price of up to 30% by applying many sources. It is planning to do a separate TV sales promotion called ‘818 Promotion (tentative name)’ in August.
Samsung Electronics and Suning are strengthening their cooperation through almost all of their businesses and also co-planning specialized products for Chinese customers.
“By using headquarters’ online and offline members’ database (DB) system, which comes to almost 100 million people, we are going to analyze along with Samsung Electronics consumers’ demands in many areas and announced new products that correspond to these demands. We are going to also release TV that will satisfy Chinese consumers and Samsung.” Suning said that it will work with Samsung Electronics to meet their consumers’ demands.
Cooperative strategy that Samsung Electronics and Suning are using can be seen as a win-win method for both manufacturer and distributor to overcome depression in all of TV market. According to market investigative company called HIS (Display Search), size of global TV market in first half of 2015 will be 99 million copies. As it falls short of 100 million, it is the worst time ever since 2009 when U.S. financial crisis was happening.
Samsung Electronics secured 30 to 40% of market shares in European and North American premium markets, but it is hard to increase its sales volume even more in other advanced markets. China is world’s biggest place where demand for TVs is the highest. Suning is not just selling Samsung Electronics’ TVs in China, but it definitely is an opportunity to work comprehensively with China’s biggest distributor.
“As Japanese businesses started to fall back, it appears that global TV market is starting to change as Korea and China businesses are the only ones competing. It is interesting to see how much of success can Samsung Electronics can bring out by working with China’s specialized distributor business so-called Korea’s enemy.” A person affiliated with Korea’s electronic industry said that it is interesting to see how Korea is working with China when they are supposed to compete against each other.
Suning is a distributor that specializes in China’s electronics and home appliances. By making sales of 279.8 billion Yuan (about 46.3761 trillion KRW (39.7 billion dollars)), it made the most sales out of private businesses in China and held number 1 for 2 years in a row. After starting off as an air conditioner store in a corner of Nanjing City of Jiangsu in 1987 with 100,000 Yuan (about 16.6 million KRW (14,205 dollars)), now it became China’s biggest electronic products distributor that has 180,000 employees and 1,800 stores in all of China.
Senior Reporter Kim, Seungkyu | seung@etnews.com
