Blue Ocean Strategy @ Samsung – Galaxy Note Series created Phablet Segment

Samsung has adopted successfully Blue Ocean Strategy and company has profited through this strategy in the past few years. Samsung has invested heavily in Research & Development that helps the company to innovate and create new products that helped the company to grow into a Global powerhouse. Samsung’s team of researchers and engineers include over 50,000 employees across 42 global research facilities—each one collaborating on strategic technologies to forge new market trends and set new standards of excellence. Blue Ocean Strategy visions the creation of uncontested markets with no competition through new product innovation leading to creation of new demand. Samsung Galaxy Note Series of phablets highlights the Blue Ocean Strategy of Samsung that created an uncontested phablet market and dominates it with its Galaxy Note II and Galaxy Note III with Galaxy Gear smart watch. Market Research Firm IHS reported that 25.6 million phablet devices were sold in 2012 and estimated that these figures would grow to 60.4 million in 2013, and 146 million by 2016. Wikipedia definition of Phablet, is a smartphone form factor describing tablets with a screen over 6.5 inches in size and has normal phone calling functions ,designed to combine or straddle the functionalities of a smartphone and tablet, eliminating the need for two devices. As of October 2013, Samsung has sold over 40 million Galaxy Note devices over the past two years. 30 million were of the Note II, while the Note (Original) sold around 10 million.

Value innovation is at the heart of blue ocean strategy. Value Innovation is defined as creating value for both the buyer and the company and the innovation (in product, service, or delivery) should be such that it raises and create value for the market and company and at the same time reduces or eliminates features or services that are less valued by the current or future customers. Samsung Galaxy Note phablet is a classic example of value innovation where it eliminates the need for two devices smartphones and tablets, raises the product utility through big screen that enhances the browsing and multimedia experience and Stylus that facilitates sketching, note-taking and annotation. In its latest Galaxy Note 3 Samsung added a smart watch Galaxy Gear that adds even more functionality. Stylus reduces the need for carrying the notebooks or papers for note taking during meetings and conferences. Galaxy Note phablets with accessories like stylus and Gear smart watch created a need for new applications which also allowed developers of apps to create innovative new apps that best suited for phablets. Samsung Galaxy Note phablet series created the phablet market that also encouraged its competitors like Sony, Lenovo, Nokia, Asus, Acer, etc. also enter the market with their own version of phablets. Competition has picked up in the phablet market but Samsung still dominates the market. Samsung Galaxy Note phablet series is focused on giving Apple Inc. a tough competition, as Apple dominates the smartphone market with iPhones and Tablet market with iPads. Samsung has been hugely successful with this strategy and is giving a tough competition for Apple and also launching timely upgraded versions of the phablet series and phablets are critical part of Samsung global mobile strategy. Phablet sales are slowly crossing the tablets and laptops sales in some markets like Asia as reported by IDC highlights that Samsung Blue Ocean Strategy is highly successful.