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The Warsaw Voice » Other » June 17, 2009
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Crisis Strategy: Attack, Not Defense
June 17, 2009   
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Crisis or no crisis, Samsung aims to become the biggest supplier in its segment in Poland. But for that to happen, it must first build a strong brand image, Wojciech Wasilewski, marketing director of the telecom division of Samsung Electronics Polska Sp. z o.o., tells Bartosz Grzybiński.

Some experts say the global economic crisis offers new opportunities as well as posing a threat. Do you agree?
Yes, one hundred percent. Every crisis has an element of cleansing and verifying the viability of market. The strongest companies survive, those that are able to notice the symptoms of crisis early on and react to them with the promptness needed.

For that, you need an experienced and well prepared management organization. The market is ruled by the laws of supply and demand. The crisis felt by consumers in the form of the lower purchasing power of money and diminished access to cash is automatically transferred to manufacturers, as manifested by reduced demand for all goods and services. Companies' reactions to dropping demand, and therefore decreasing profits, can vary. Depending on the type of production and number of employees, one way out of the crisis situation could be to reduce employment, but layoffs are never a way of strengthening a company, though they are sometimes necessary for its survival, especially at companies where the human element plays the main profit-generating role. In the case of our company, a rapid reaction to the behavior of the market and the competition is more important. To tell the truth, no one knows when this crisis will end, but we need to prepare ourselves even today. One good example is the "human factor". Just two years ago companies in Poland fought for good staff because there was a shortage of competent people for hire. Today they are firing them. When the crisis ends, they could suffer because they won't be prepared for market changes and economic revival.

Another problem is money for investments. Limited access to capital means money has to be spent more rationally on one hand, and savings have to be made wherever possible on the other. Then there's the need for work reorganization and a mental shift to cope with tougher times for the company. It might sound like a paradox, but it's only in a crisis that we can really assess the company's condition and our own capacity. For some this will be an inspirational experience, for others, too much to deal with.

Isn't the crisis sometimes a convenient excuse for inept managers?
For some of them, probably yes. It's easy to use the crisis to justify a company's lack of profits or successes, but it's in tough times for the company, during a crisis, that a manager's worth is evaluated. Actually, crisis situations are a true test of knowledge, experience, skills and diligence for every employee in a company, not just managers.

Macroeconomic data confirms that the crisis has encompassed almost all the countries of Europe, while only Poland, Cyprus and Greece have positive GDP growth. Does this data from the Polish market give cause for optimism?
Yes and no. On one hand, it's optimistic that Poland's GDP is positive-just 0.8 percent but still positive-because this means that the domestic market is still the economy's driving force and Polish people's purchasing power is still strong. On the other hand, the lower exchange rate of the zloty to the main European and world currencies compared to just six months ago means that purchasing power is noticeably lower. Just last fall, the U.S. dollar cost little more than zl.2 and the euro was about zl.3.50. Today the exchange rates have soared to zl.3.30 for the dollar and zl.4.50 for the euro and are unstable. For someone who invests or acquires luxury goods, this is not the best of times. In a crisis, the purchase of a car, suit or TV set is not the top priority among consumers' needs.

Despite this, the market position and results of Samsung Telecom on the Polish market are very good. What is the source of this success?
Samsung phones have only been available in Poland for three years. We started with a 5-percent share of the market. Today with 25 percent we are second, but in other countries such as France, the Benelux countries or Britain, where we have been selling our phones for five years, we are in first place; it's the same in the United States, where Samsung is the dominating market brand. Also on eastern markets, mainly in Russia and Ukraine, Samsung is the most recognizable brand in the electronics sector. Samsung is a global corporation making technologically highly advanced electronic equipment, including mobile phones. Last year in Poland we sold over 2.3 million phones, our sales from these operations reached zl.1 billion. We make most elements and components such as LCD screens or processors ourselves, so being the final manufacturer makes us less reliant on suppliers. Another major factor is that the corporation's individual divisions can supplement one another during the crisis. Samsung's general strategy for the crisis is attack, not defense. Technologically, in many aspects we are ahead of the competition, offering the greatest number of the most advanced products on the market. Around the world today we are selling over 100 different telephone models. On the Polish market alone, we offer mobile network operators several dozen models. The key to success is understanding the needs of every customer. In the second half of last year Samsung in Poland had the highest average sales price in Europe-that means the greatest number of top-of-the-range phones sold on all European markets. These are the technically most innovative and modern models the manufacturer offers. We want to become the dominating supplier on the Polish market, but for this to happen we first have to build a strong brand image. This is what's the most important to us right now.

An image is built over many years and mainly thanks to products. What special features does Samsung offer in its phones? What can we expect as far as new models are concerned?
Samsung sells several dozen models in Poland. They are addressed to a wide group of buyers and have some very special, even unique features. Samsung is a pioneer in the use of many new technologies in its phones. These can be divided into several groups. The first comprises the Solid range, phones that are shock- and weather-resistant. The next line is Duoz, phones that can be used with two SIM cards. The third range, Touch, have touch screens and a touch keypad. The fourth group are Slider models with a sliding keypad. Of course all the phones are multimedia devices equipped with multiple functions. Today we already offer models with HD movie cameras and photo cameras with 8 megapixel resolution, and at the end of the third quarter we will unveil a photo camera with 12 megapixel resolution. I can also reveal that next year telephone users can expect a shock, not only due to the technology used but mainly because of new, even revolutionary design.

What direction will mobile telephony take? Is a phone still a phone, or is it a multimedia device?
Due to their possibilities, phones became multimedia devices a long time ago; in terms of use, they are still phones. Every user can find a phone with the functions he or she needs the most. For drivers, that will be GPS, for music lovers an MP3 player, and for those who enjoy documenting everything, a photo and movie camera.

What phone do you use?
A Samsung, of course. I have two models: an S7350 and an Omnia HD.
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