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Segmentation Strategies used by Apple and Samsung

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Daniyal Ali

on 28 September 2014

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Transcript of Segmentation Strategies used by Apple and Samsung

Apple TV

PC and Office
Mobile Phone
Samsung Gear Fit
TV and AV

Segmentation Strategies used by Apple and Samsung
A Bit about Apple and Samsung
The smartphone industry is dominated by two giant companies: Apple and Samsung.
While Apple leads by profits, Samsung leads by market share.
Samsung has been able to reach different market segments and price points, while Apple has remained restricted due to targeting the premium segment (smartphone).
While Apple used to dominate the tablet, PC, smartphone markets, Samsung has now taken the lead.
The two have been fighting battles over patents, with Apple accusing Samsung of copying their product designs and ideas, and Samsung accusing Apple as well.
Samsung dominates the Android market (65% share of all android devices).
Segmentation Strategies: Apple
Geographic Segmentation: Apple's retail stores are located in highly populated cities around the world. Global presence, with online presence/ official websites in 88 countries.
Demographic Segmentation: Ages 14 - 55, students and business professionals, etc. Plus most Apple stores in the U.S. are concentrated in New York and California, showing that apple caters to high income and posh lifestyle segments.
Psychographic Segmentation: Most used type of segmentation by Apple. segment users according to their lifestyle.
Product related segmentation: Another major marketing strategy used extensively by the company. Every Apple device is targeted specifically to different groups of consumers and businesses and features in the products are built around their needs. Apple has segmented products vertically, creating on product for one particular use.
Apple also targets according to brand loyalty, considering that Apple has quite a cult-like following just due to it's image/brand name.
Benefit Segmentation: Apple brings newness and innovation with each of it products.
Business Professionals (Mac, iPads, iPhones, etc).
Young Adults and Students (iPads, iPhones, MacBooks, etc).
Teenagers/Music Enthusiasts/Gamers (iPods, iPhones, etc).
Middle/Upper Income (eg: iPhone 6).
Technology Enthusiasts.
Media/Design Professionals.
Entertainment Enthusiasts/Teenagers (Home Cinema, MP3 Players, Projector, etc).
Housewives/Couples/Families (Home Appliances).
Not just targeting premium/high class, but mostly medium and even lower.
Business Professionals (Galaxy range, Note, etc).
Young Adults and Students.
Segmentation Strategies: Samsung
Apple iPhone prefers form over function, and heavily controlled user experience. Samsung opts for function over form, and customizability. Thus the two target different segments.
Samsung has a wide portfolio of products. It has the opportunity to connect people's homes and appliances with their smartphones, and create a Samsung ecosystem in People's homes. Apple has a narrow product line, which if diversified can lead to tarnishing its premium image.
Apple is an innovator while Samsung sticks to tried and tested formulas.
Apple has a cult like following, while Samsung has a larger mass market appeal.
Differentiation between Apple and Samsung
Geographic Segmentation: World wide, sell their phones in 61 different countries. Make slight variations in languages and applications but the physical appearance of their phones is universal. 
Demographic Segmentation: Age of 16-29, for businessmen, for middleclass, youth, etc. Target middle class and high class income segments.
Family Life Cycle Segmentation : Target young single, young married or divorced with or without children.
Psychographic Segmentation:Individuals from teens to mid 30's who like new technology, tech savvy and can afford to buy it, plus pink range of mobile phones for girls and cheaper touch screen stylish phones for lower income.
Benefit Segmentation:When Samsung customers buy their phones the benefit they expect from it is simple appearance, new and updated features and reasonably priced.
Usage- Rate Segmentation: The smartphones market has a lot of heavy users because of the convenience of it, you can call, text, send pictures, play games, listen to music and surf the web all from a smartphone. Samsung has a large percentage of heavy users .

Both strategies are effective in their own right. However, recently Apple has been losing out on sales to Samsung, due to it's narrow product line, premium image, and focus on bringing out one product at a time. But then this is the differentiation between Samsung and Apple.
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