Case 2: Samsung: Building a Great Brand

Ten years ago, Samsung Electronics Company sold a bunch of low-end electronics under various brand names such as Wiseview, Tantus, and Yepp. New management decided to ditch these names and brand all of its products Samsung. At the same time, it invested heavily in design and product quality and in 10 years, it now makes top-of-the-line cell phones and digital TVs that showcase its technological advancements. These are products to which consumers form strong bonds because they use them so much. Between 2000 and 2005, Samsung grew its brand equity by 186 percent, the second-biggest gain in value (behind Google), passing Sony who once had the premier brand reputation in electronics. Good looks, ease of use, useful features—these are the keys to building a great brand reputation. The ultimate driver of brand reputation is a quality product development process.[footnoteRef:1][footnoteRef:2] [1: The history of Samsung’s development of its innovative design processes is drawn from: Cliff Edwards, Moon Ihlwan, and Pete Engardio, ?The Samsung Way,? BusinessWeek, June 16, 2003, pp. 56–64; David Rocks and Moon Ihlwan, ?Samsung Design,? BusinessWeek, Dec. 6, 2004, pp. 88–96; ?Brand new,? The Economist, Jan. 13, 2005, pp. ] [2: –11; Peter Lewis, ?The Perpetual Crisis Machine,? Fortune, Sept. 19, 2005, pp. 59–76; Moon Ihlwan, ?Camp Samsung,? BusinessWeek, July 3, 2006, pp. 46–48. ]

In 1993, then Samsung Chairman Lee Kun Hee visited the United States and saw for himself that Samsung products were also-rans, lost in the crowd, overshadowed by Sony’s standout design. He correctly concluded that great design and innovation were the ways to build Samsung into a great global brand.

Did he hire hundreds more great marketers to build a great brand? No. He hired hundreds more young hip designers, many trained in premier U.S. higher-education schools of design (the number of designers employed by Samsung increased from about 100 to more than 450 in the next decade, with an average age of 33). Designers were sent all over the world to great museums, art galleries, ancient ruins, and illustrious modern architecture. They now also spend sabbaticals with design consultancies, fashion houses, furniture designers, and other centers of design excellence abroad. Samsung designers come back with their minds loaded with great design ideas; they lead the product development, not marketers. It is hard to argue with this process of inspiring great design innovation: hire creative, well-trained young designers who are willing to take risks and light up their minds.

But the Samsung product development process also involves a very grounded ?usability laboratory? in downtown Seoul to study how consumers get products out of boxes, read or do not read instruction guides, and follow icons and instructions on cell-phone screens. Understanding the user interface is key to Samsung, and has been key to its success.Instructions:

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