TBY talks to Seung Koo Kim, President of Samsung Electronics Kazakhstan and Central Asia, on innovation, Kazakhstan as a hub, and customer service infrastructure.
TBY What is the significance of innovation for Samsung?
SEUNG KOO KIM Innovation is vital for us. It has been noted even by our top management that, even if a product leads the market, it can disappear without constant creative innovation. This can be highlighted by the decline of one of the hugely successful Japanese brands 10 years ago, which has now lost its position due to a lack of investment in innovation. Samsung approaches innovation in three ways. The first is the product, the second is the process, and the third is personnel. Production innovation is very important. Without technical innovation we cannot survive, because we are an IT company. We invest a huge amount of money in this base area. We also invest in process innovation, such as supply chain management. We need to optimize to operate efficiently. The third way for innovation is personnel. We create innovation in this respect through advanced training methods and smart job placements.
To what extent is Kazakhstan a hub for Samsung in the region?
I am personally responsible for Samsung Electronics in Kazakhstan, Kyrgyzstan, Uzbekistan, Turkmenistan, Tajikistan, and Mongolia. The electronic products we provide include TVs, AV products, cameras, home appliances, PCs, printers, and monitors. In that respect, Kazakhstan is a significant hub for us in the region. Kazakhstan is the most important and fastest growing country in Central Asia. Other Central Asian countries try to be oriented on Kazakhstani market trends. I think that is the most significant point. Samsung believes that Kazakhstani consumers are very smart, and diversified from those after premium products to more price-orientated consumers. For Samsung, this is somewhat of a test market. We often launch products here first as the country is not a huge market, yet consumer demands are sophisticated.
What products have the highest demand, and how is Samsung positioned amongst its competitors?
The overall top-selling products are mid-range products, and we have dropped some of our cheapest products. For TVs, our market share is around 50%, and we dominate the market in high-end HD and 3D televisions. For mobile phones we are in second position, though are aiming to be number one. This can be achieved through a diverse range of products, and this is why we are focusing on smart phones and tablet PCs, for which other brands do not have to the same extent as we do. We are in the number one position for home appliances, except for microwave ovens. In IT products we are number one for monitors, number two for printers, and number three for notebook PCs, with plans to become number one, as our notebook PC business only started up in 2010. Our market share is about 20% already. That means that we are really confident in our aim to be number one very soon.
What are your strategic targets for Samsung in Kazakhstan?
I want Samsung to be strong and smart. Using smart products, customers can be smart. That is my first target and vision. We have even launched a vacuum cleaner that cleans by itself like a robot. My second target is to make Samsung a concrete number one in all areas.
How has Samsung developed its customer services infrastructure in the country?
One of Samsung’s strong points is service. Every year we formulate the Samsung Customer Service Satisfaction Index, and figures show that we rate highly in terms of customer satisfaction in relation to our competitors. In Kazakhstan, we have more than 100 service centers—even in small cities, which our competitors can only dream of. Our policy is to establish a service center in any city that has a population of more than 100,000. We have a huge service network. We always deliver spare parts very quickly, sometimes by airplane. Within three days, 95% of spare parts are delivered to customers. We solve our problems very quickly. We don’t outsource these services, and I think that is why our market share is increasing so rapidly.
How has ICT infrastructure developed in Kazakhstan in tandem with the increasing sophistication of products on the market?
Data traffic is increasing because of smart phones, tablet PCs, and even with our smart TV. This means that the government has had to begin establishing the necessary infrastructure—the lack of which would have severely damaged Kazakhstan’s competitiveness. Therefore, customers can finally enjoy well-developed infrastructure. In that respect we understand the importance of Samsung in the country, and strive to build our brand in a socially responsible way.
Have you had any support from the government for your products?
The Kazakhstani government is very interested in devices. Before we launched the Galaxy Tab, the government already had interest in Tablet PCs. However, officials find the Galaxy Tab more interesting than other tablet PCs, because it has Kazakh language support. They recognize that it is a useful tool for individuals and institutions in Kazakhstan. We have also recently found out that the government has the idea to use the Galaxy Tab in schools and universities, and this is a key aim of Samsung; to get the Galaxy Tab recognized as an educational tool, too. It can be superb for learning languages, mathematics, and even how to draw. We have also established service centers to provide customer support for this product.
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