Samsung Electronics is establishing a group that is in charge of digital signage to strengthen its signage business which was not very productive last year. Video Display (VD) division chose signage as an answer that will create profit in B2B business after their success in TV business. It is also fulfilling a unity effect at an early stage with an American company specializing in LED signage ‘Yesco’ that Samsung bought in last February.
Samsung Electronics held ‘Smart Signage Forum’ at Suwon Digital City on the 15th by inviting a person involved in digital signage business. Director Lee Hyun Shik of B2B department of Samsung Electronics introduced new 2015 signage product. As he was introducing LED and new outdoor product, he was saying that he will focus on expanding its signage market by creating LED technical skills and synergy from Yesco. As of this year, Yesco products will wear Samsung brand when they are released.
Samsung Electronics chose this year as a year to widen the gap in signage business from its competitors. Establishing a separate group for signage business under a governing body solidifies Samsung’s goal. Signage business was considered as a part of VD business’s product until last year and it ran Task Force Team (TFT). Samsung assigned this business to its regional B2B sole distributors and focused on development and supply of products and managing franchise network.
With buying Yesco in February, Samsung established a group of 26 people ‘Signage Sales Group’ under a governing body and promoted them. People in this business are saying that there’s a lot of importance regarding B2B business as Samsung put certain product’s name into its group’s name. Executive Director Kim Suk Ki of Enterprise Business of VD department directed buying of Yesco and raising importance of signage in B2B.
Samsung Electronics were regarded as an unrivaled best enterprise in signage business. But as its competitors were closing the gap, there was a serious need to widen the gap which led to taking over Yesco. LG Electronics, which was sitting on the fourth place in this business in 2013, pursued after Samsung by increasing products and strengthening ability of business under the leadership of Vice President Koo Bon Jun. Japanese business such as Panasonic also increased sales, which led to Samsung’s belief that it can’t sustain its position in this business with LCD alone.
Samsung is worried about Japan preoccupying the LED market because Japan turned its focus to LED as Samsung controls the LCD business. For example, Mitsubishi developed and built 100-meter 4K LED signage in New York Time Square in last November with its own technical skills. Because it’s easier and freer to build an outdoor billboard in Japan according to law, Japanese businesses were able to build more experience which became their steppingstones. Samsung thought time was too short to compete against Japan with its own development, and that is why Yesco became an attractive target to take over since it had a lot of experience in North America and Europe.
Samsung also showed a flexible business keynote that it will not stay within its boundary. It used American’s Cree Lighting on its LED product ‘Smart Signage’ that was introduced at CES in January. This was based on a judgment that its future in signage business is not a guarantee if it only relies on LCD line.
This judgment is paying off dividends. It won a bid in renewal business for SK Telecom’s all stores under direct management and provided around 1000 digital signage. They were used for store’s visual advertisement and customer information. Although it is a small-sized business worth of 2 million dollars, it is significant to find such business within a recession of advertisement market.
“Samsung Electronics prepared LED as its weapon to fight off its competitors. As VD department chose signage to replace TV which its profit is stagnant, one will see a different side of Samsung’s signage this year than any other years.” A person in this business who attended the forum said about importance of Samsung’s signage.
Staff Reporter Seo, Hyungsuk | hsseo@etnews.com