Samsung India Case

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Channel Conflict at Samsung India
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Channel Conflict at Samsung India

“We have reached at a juncture where we are forced to take necessary steps to
safeguard the interest of general dealers. We formed our union now, and we were
talking about a ban... We have talked to Samsung and Apple, and asked them to
reduce the number of units being made available to online sellers, which will also
help bring fair play.”1
– Sanjay Sahani, President (South) of the Delhi Mobile Association, in 2014.

“We have taken action against many rogue distributors, who were dumping their
stocks online and beating down the price of our handsets. We are working hard to
bring back price hygiene in the market. Our revenues from online sales have come
down from 30% to single digit. We also have plans to stop billing WS Retail, the
largest reseller on Flipkarta.”2
– A senior executive with Samsung Electronics, addressing retailers from All

India Mobile Retailers Association (AIMRA), in 2014.
In mid-2014, Samsung Electronics, one of the leading mobile phone companies in India, said it
would take only the offline retail route to sell some of its mobile phone models in India.
Samsung’s announcement came in response to the threat from its dealers to boycott the sale of
Samsung mobiles unless the company took action to stop the predatory pricing of its products on
online sites. While its rivals like China-based Xiaomi and Motorola were busy selling millions of
handsets online, the South Korean giant gave in to mounting pressure from brick-and-mortar
retailers over predatory online pricing and decided to extend exclusivity on selling rights of 48
models, including its much-awaited Galaxy Alpha and Note 4, to offline retailers. The traditional
retailers couldn’t match the pricing and promotional strategy of online retailers, which reportedly
led to the formation of AIMRA in 2014, a body that was formed for the benefit of offline retail
stores. Some analysts felt that Samsung’s move toward offline mobile sales was regressive as
competitors like Xiaomi and Motorola were offering mobile phones with the same specifications at
lower rates online. However, with physical stores unlikely to match the heavy discounts offered by
online sites, the pressure was mounting on Samsung to resolve the issue. Samsung’s decision to
take the offline retail route to sell 48 models met with mixed reactions from analysts, with some of
them contending that the decision might work against Samsung’s interests.
BACKGROUND NOTE
Multinational electronics company Samsung Electronics Co., Ltd., headquartered in Suwon, South
Korea, had been the largest information technology company in the world since 2009. It also had
sales networks and assembly plants in around 80 countries with 370,000 employees.3
Samsung entered India in December 1995 as a 51:49 joint venture with Reasonable Computer
Solutions Pvt Ltd. With Samsung buying the total stake of RCSPL, it became a wholly-owned
subsidiary of its South Korean parent company. Samsung launched its operations in North India,
a
Flipkart is one of the leading e-commerce companies in India.
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and then slowly expanded. In 2002, it established manufacturing facilities for color televisions,
microwave ovens, washing machines, and air conditioners at Noida. It also had a presence in
consumer electronics, information technology products, mobile phones, and home appliances. But
it was not until 2007 that it started selling its mobile phones in India
In early 2012, Samsung overtook Nokia for the first time as the world’s biggest vendor of mobile
phones. With this, it ended Nokia’s 14-year run as the global leader.4 But it took Samsung another
one and a half years to emerge as the market leader in India, where Nokia had a vice like grip on
the market.5
Samsung Electronics reported operating profits of US$4.76 billion for the quarter ended December
31, 2014, with 37% of it coming from the IT & Mobile Communications Division (IM). This
division reported profits of US$1.76 billion from revenues of US$23.7 billion. Out of the total IM
earnings, the mobile business accounted for US$22.5 billion. Revenues from the mobile segment
were up 6% from US$21.2 billion in the quarter ended September 2014, but down 23.2% from
US$29.3 billion in the same quarter of 2013. The mobile business accounted for 47.4% of
Samsung’s overall revenues in 2014.6 Samsung Electronics posted a revenue of US$ 195.88 billion

for the year ended 20147 (See Exhibit I)

India was a key market for Samsung and the company offered a number of handsets at various
price points (See Exhibit II). By 2014, India was a 250 million units a year mobile handset market
with over 200 competing brands. It was the second largest mobile phone market in the world, and
the third largest for smartphones. For the year 2014, the smartphone market in India was expected
to be over 75 million units or worth US$11.2 billion. 8 Smartphone sales in India were expected to
grow to US$16 billion in 2015. According to Vineet Taneja (Taneja), Samsung India’s country
head for mobile phones and digital imaging, “The cell phone market in India was [Rs.9 800 billion]
last year and will touch [Rs.1000 billion] in 2014. It’s a huge opportunity and space for everyone.
However, top four players control 75% of the market and this will continue.”10
SAMSUNG’S DISTRIBUTION CHANNELS
India had a multi-layered distribution system which added to the costs of mobile phone companies.
By 2014, there were more than 400,000 retail outlets for mobile handsets and around 25% of these
outlets sold smartphones. 11
Samsung understood quite early that if it wanted to compete with companies like Nokia in India, it
had to have a strong distribution strategy. In 2008, it strengthened its position in the Indian market
by appointing regional distributors. As a result, its sales doubled and it was able to corner 8% of
the market share. The following year, the company revamped its sales and distribution structure in
India again. As part of the restructuring, 17 sales offices were set up in smaller markets. The
operations were decentralized till the branch level and efforts were made to rope in more
distributors. For instance, the number of distributors for the northern region was increased from
one to five. “We plan to have a zonal distribution structure from our earlier strategy of having just
a distributor for each of the regions. We have also appointed a dedicated national distributor for
the organized retail business to drive efficiency. Previously, the retail chains were serviced by the
regional distributors,”12 said Sunil Dutt, the then country head of Samsung Telecom.
The efforts to ramp up the distribution channels continued in the following years. “It is critical
that feature phones reach their target customers on time while smartphones need to be promoted in
metros and tier-1 towns. Distribution is everything in our business,” said Ranjit Yadav, country
head, Samsung Mobile and IT, Samsung India, in 2011.13 By early 2014, Samsung was running
over 2,000 exclusive brand stores in India under the franchisee model, of which 1,100 were of the
Smartphone Café format, where only smartphones and tablets were sold. These Smartphone Cafes
alone accounted for 15-20% of Samsung’s mobile phone sales in India.
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But in April 2014, Samsung decided to do away with the different kinds of retail branding and
announced that it would run all its stores under the Samsung brand. Faced with tough competition
from rivals Apple, Sony, Micromax, and Karbonn, the company planned to open 3,000-4,000
exclusive outlets across Indian towns with a population of less than 100,000, as part of its strategy
to boost sales in low-penetration but fast-growing markets for electronic devices. Around 1000
such stores were planned to be set up by the end of 2014. To keep costs down, these 300-400 sq ft
stores would carry inventory and demo units, and would be serviced by distributors on a daily
basis. According to Taneja, “It is indeed a big challenge since modern retailing is yet to make any
entry in these small towns and villages, and at best, there will be one small street that is the retail
hub. We have value-engineered our existing brand store format by lowering fixture costs so that
the owner can break-even these stores in one-fourth the time than the stores in larger towns and
metros.”14
Earlier in 2012, Samsung had also launched an eStore in India, where customers could buy mobile
phones, tablets, netbooks, laptops, and other related accessories (See Exhibit III). Payments could
be made via credit and debit cards, net banking, or cash on delivery. The site also offered a

customer support service and provided the customers with a toll free number and email ID. Both

the online and offline services were managed by Sarvex Computers, which was Samsung
Electronics’ national distributor in India.15 However, industry observers noted that the prices of the
products offered at the eStore were not competitive and were way higher than those offered by the
likes of Flipkart. Some even wondered what the objective of having an eStore that did not offer
any discounts was, considering that the customers in India were price sensitive. 16
RISE OF E-COMMERCE IN INDIA
There were 173 million mobile internet users in India as of December 2014 and the total number
of mobile internet users in the country was expected to reach 213 million by June 2015, according
to Internet & Mobile Association of India (IAMAI) and market research firm IMRB
International. 17 In India, cash on delivery was the most preferred payment method, accumulating
75% of the e-retail activities.18 The Indian e-commerce market had grown at 88% and amounted to
US$16 billion in 2013, according to an Assocham (one of India’s apex trade associations) report.
“The increasing Internet penetration and availability of more payment options boosted the e-
commerce industry in 2013. Besides electronics gadgets, apparel, and jewelry, home and kitchen
appliances, lifestyle accessories like watches, books, beauty products and perfumes, baby products
witnessed significant upward movement in last one year,”19 said Assocham Secretary General, D S
Rawat.
With the entry of online shopping sites like Flipkart, Amazon, and Snapdeal, many consumers
preferred to shift to online shopping. Online shopping was a form of electronic commerce which
allowed consumers to directly buy goods or services from a seller over the Internet using a web
browser. The benefits like shopping from home, easy payment through credit or debit card, which
saved a lot of time, and free home delivery led to most consumers moving away from offline
shopping. “The consumer confidence to shop online has grown significantly in the last year and a
half. The behavior of Indian online buyers is fast mirroring that of buyers in more developed
markets as more subjective product categories have started seeing significant growth,”20 said Nitin
Bawankule, industry director for e-commerce, local and classifieds, at Google India. As of
quarter1of 2015, six Indian e-commerce companies had managed to achieve billion dollar
valuation. These were Flipkart, Snapdeal, InMobi, Quikr, OlaCabs, and Paytm. There were various
methods of e-commerce marketing such as blogs, forums, search engines, and some online
advertising sites like Google Adwords. Analysts felt that an increasing number of Indians were
ready to shed the importance given to touch-and-feel and were ready to buy a product from the
comfort of their couch. Moreover, consumers were more open to financial transactions over the
Internet. Although e-commerce accounted for less than 1% of the total retail market in India, it was
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by far the fastest growing retail channel. It was estimated to grow to as much as US$22 billion
(excluding travel) by 2019, according to a report by CLSA, an investment banking firm. Flipkart
topped the chart when it comes to successful e-commerce sites in India (See Exhibit IV).
While in 2013, the online channel accounted for just 4% of the smartphone sales in India, it
accounted for more than 10% in 2014. It was estimated that the online channel would account for
nearly 25% of the sales of smartphones by mid-2015.21
ONLINE-OFFLINE RETAIL CONFLICT
Online shopping had given rise to a concept called ‘showrooming’ in which the people physically
checked the product’s features in the showroom but finally bought it online at a discounted price.
Gagandeep Singh, owner of Lakshmi Electronics, a large-sized retail store in Delhi, said, “People
won’t buy anything at all now, unless it’s on discount. People come to the shop, and ask to see a
dozen different products. They ask my staff hundreds of questions. They take the best advice, try
out the latest products. And then when the time comes to finally buy, they say, ‘this is cheaper
online’.”22

Moreover, electronics unlike apparel could be bought without touching or feeling the product as
quality was assured by the brand. Hence, this segment had seen a 60% annual online growth in
India, a lot of which was because of the heavy discounts and slashed prices offered by online
retailers. Customers preferred online shopping for the convenience it offered (See Exhibit V).
However, this change in the consumer’s buying behavior was starting to hurt the lifeline of
manufacturers — offline retailers. Some analysts opined that online discounts and sales had come
to dictate pricing in India. While customers benefited from reduced pricing and increased
convenience, the extent of the impact that online retailers like Flipkart and Amazon were having
on the day-to-day operations of brick-and-mortar stores had kicked off a debate.
Wholesalers and brick-and-mortar retailers, the worst hit by the boom in online shopping, were
putting pressure on brands to help them compete more effectively with e-commerce websites.
Piyush Sharma, a retailer from Sarojini Nagar, New Delhi, said, “Yes, it (online sales) has affected
the market badly. I think some legal action should be taken against these people. I don’t
understand how they manage to sell a device so cheap. For instance, they were selling a 32-inch
LED TV (refused to mention the brand) for Rs. 15,000, whose buying price is Rs. 24,000. There
should be someone asking them from where they source these products and how do they manage
such big losses. The companies along with the government should set up a team to ask them about
all of this.”23 Many brick and mortar dealers were not happy with the predatory pricing practices
adopted by online shopping sites. “How can someone sell products below its manufacturing price?
This is legally not allowed in the country. Someone can do such undercutting only to destroy
competition. Just because they have foreign funding, they can’t kill local trade like that,” 24 said
Kishore Biyani, founder of Future Group, a leading Indian private retail conglomerate.
With a large supply chain and a logistics network that did not require middlemen in most cases,
online shopping sites had been enticing consumers with aggressive discounts, putting market share
ahead of profitability. Arun Sirdeshmukh, co-founder and CEO at online retailer Fashionara, said,
“Offline retailers and brands are showing concern because their offline business is getting hit and
to extent there is fear among brands that their image can get hurt if the prices are too low. When
online was small, this whole thing wasn’t a big issue. Now, because of the fast growth, it is.”25 But
the customers believed in the online shopping sites due to the affirmation these sites provided
regarding the quality of the products even though they were not able to inspect them physically.
According to an Amazon spokesperson, “Amazon.in is a marketplace platform that enables Indian
merchants to sell products to customers across India. Merchants on Amazon.in independently
decide price of their products. Amazon.in assures that its merchants list genuine products with
manufacturer warranty. This applies to all brands. Amazon.in also extends A to Z guarantee on all
products offered by its merchants. Customers of Amazon.in enjoy 100% purchase protection on
products bought under the A to Z guarantee.”26
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TURBULENT TIMES FOR SAMSUNG
Although Samsung was the largest handset vendor in India in 2013, it almost lost its position to
Micromax in 2014 (See Exhibit VI). A combination of lackluster device launches combined with
high pricing had led to a shift in the fortunes of the South Korean vendor. The introduction of
Motorola’s Moto G and Moto X, and the Nexus 5, and the more recent entry of devices like the
Xiaomi Mi 3 meant that Indian consumers were spoilt for choice when it came to handsets that
offered a great set of features at an affordable price. Samsung not only lost out in the mid-tier
segment in 2014, but also in the high-end category as the Galaxy S4 and Galaxy S5 failed to meet
the vendor’s sales targets.
Companies like Motorola and Xiaomi that had an online-only model in India had made rapid
inroads into the market by entering into exclusive arrangements with leading online players like
Flipkart. For instance, Motorola having re-entered the Indian market in February 2014 with an
online-only strategy, sold more than a million devices in just four months. Similarly, Xiaomi,
which sold its phones at near cost price, sold over 95,000 devices in the first month of its launch.
Analysts felt that smartphones in the price range of US$100-200 were the most in demand in India,

and these companies had been able to crack these markets by offering advanced features at this

price point compared to companies like Samsung27 (See Exhibit VII)
The pricing strategy adopted by Chinese players like Xiaomi, Huawei, and Lenovo and India-
based manufacturers like Micromax, Lava, Karbonn, and Xolo had significantly lowered the
Average Selling Price (ASP) of smartphones. Entry level smartphones were available to the
consumer for as low as Rs.6,000 (US$100). The price sensitive Indian audience who expected a
value for money device could be easily lured with the devices put on offer by the original
equipment manufacturers based in China. This made Samsung concentrate on mid-level phones
and to come down to the level of competitors in terms of price. According to Jaideep Mehta, Vice
President and General Manager – South Asia, IDC, “While Samsung has held on to its leadership
position in the market, it is noteworthy that Micromax is growing faster…Given the current
growth rates, there is a real possibility of seeing vendor positions change in the remaining quarters
this year.”28
In mid-2014, hundreds of Samsung dealers across the country threatened to boycott Samsung’s
products over pricing concerns. The dealers said they would stop stocking Samsung phones unless
the South Korean company took steps to narrow the wide gap in pricing between its phones sold at
various multibrand outlets and those sold on e-commerce sites. For instance, the Galaxy S5 price
online in India was Rs.35,400 whereas in an offline store it was in the vicinity of Rs.39,000. Sunil
Arora, a Samsung phone dealer in New Delhi, said, “How can the company expect us to meet
targets when customers can buy its phones online at huge discounts? Samsung gives us a 5.5%
margin, while the same phones are being sold online at 20-30% discount.”29 Delhi Mobile
Association sent an email to Samsung executives stating their difficulty in running the showrooms
in July 2014. Asked about the unrest in the company’s distribution network, Asim Warsi, VP
(marketing, mobiles and IT), Samsung India, said that dialog with channel partners was an
ongoing process.
However, Samsung was facing tough competition from Chinese phone makers in the mid-level
category and from Apple and Sony in the high-end category. Its market share in the Rs.30,000 and
above category dropped by around 50% - from 72% in 2012 to 34% in 2013, according to IDC (a
market research firm) figures while Sony’s market share grew from 1% to 18% and Apple’s from
18% to 22% during the same period. The distributors received higher targets from Samsung.
Sanjay Sahni, another Samsung phone dealer, said, “Forced by stiff targets set by Samsung, some
distributors used to offload their stocks in the wholesale market at big discounts and the same
phones used to find their way online. In the last 15 days, after we started our agitation, online price
of the S5 has stabilized. It has gone up from Rs.33,000 to Rs.38,000. But that’s not enough.
Samsung committed the biggest blunder by slashing the price of its flagship device by around 20%
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after just two months of its launch. We were caught in the lurch with unsold stocks and now loyal
Samsung customers don’t want to buy them because they are scared that the prices might fall
further.”30
In the latter part of 2013, Hari Rastogi (Rastogi), who used to distribute Samsung and Dell
products to bricks-and-mortar retailers in Karnataka, got together over 4,000 small offline retailers
selling books, electronics, and apparel, and formed an industry body called ‘We Will Act’ to lobby
against e-commerce firms. Rastogi said, “Margins have almost vanished and all offline retailers,
especially the small, regional ones are feeling the pain. It’s not possible for offline retailers to
compete against the predatory pricing of online retailers and there are several firms, including
mine, that have shut shop because of that.”31
However, the Samsung executives requested their dealers not to take any drastic step all of a
sudden and also assured them that the company would take some action. The organization was
given a deadline of August 15, 2014, by the dealers. If things did not change by that time, the
dealers said they would black out all the Samsung hoardings in their shops.

SAMSUNG CHANGES CHANNEL STRATEGY

Responding to the threat, Samsung decided to stop selling 48 phone models online to focus on
offline retail in September 2014.32 Looking at the growing complaints, Samsung was reported to
have set up a ‘brand store’ on the websites of its e-retailers including Amazon, Snapdeal, and
Flipkart, where only sellers authorized by the vendor could offer its products at prices mandated by
the company, preventing predatory discounting. An executive from Samsung revealed that the
company was planning to have an exclusive tie up with some online retailers on the condition that
they kept the price at a level equivalent to those in offline stores. Samsung India’s vice-president
of IT and mobile marketing, Mohammad Asim Warsi, said, “Samsung is keen to see stable and
even pricing across channels so that consumers are assured about the price points. We do
understand that brick-and-mortar stores face challenges and we are aware and sensitive to these
challenges. But, as far as our new models are concerned we will make it available across all
channels, be it brick-and-mortar stores or e-retailers.”33
In addition to Samsung, companies like Sony entered into “unwritten” agreements with online
stores, forbidding them to sell electronics at lower than a manufacturer recommended price. Two
industry executives, who did not wish to be named, said brands such as Sony and Samsung had
entered into this unwritten "gentleman’s agreement" with some online stores to ensure that
products were not sold below the manufacturer-recommended price or the dealer price. 34 Ashish
Jhalani, Founder, eTailing India, said, “Samsung is trying to balance their growth in online sales
versus the current offline sales. Though growth online is faster, offline still contributes much larger
revenues. This move was necessary to ensure the bulk of their current business through distributors
does not suffer for future growth online.”35
Samsung had worked out deals with a couple of online retailers such that offline retailers would
not lose out on sales. In exchange for maintaining the price sanctity of Samsung handsets, online
retailers would get exclusive rights to sell some Samsung models. In September 2014, Samsung
made Flipkart the executive launch partner for the Galaxy S5 Mini. According to the retailers, the
price of the handset online was Rs.36,000 and offline, it was Rs.38,000 in retail stores. “Now,
there is hardly any difference,”36 an AIMRA spokesperson said.
THE REACTIONS
Samsung’s decision received mixed reactions from analysts. Experts also believed the move was
risky. “It is indeed a very risky decision, especially because online shoppers tend to be composed
of early adopters. Their buying patterns tend to trickle down to the rest of the market over time.
This is especially the case in the Rs. 20,000 and above category. Instead of restricting sales of
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select mobiles online, the better move would be to come to an agreement to not allow their direct
online partners to sell below a certain price. In doing so, Samsung would still receive the
additional brand awareness of those mobiles being available online, but the competition to brick
and mortar retailers would be reduced,”37 said Sameer Parwani, Founder and CEO, CouponDunia,
an Indian discount coupon website. Some analysts felt that Samsung should not totally depend on
offline retail. Arvind Singhal, founder and chairman of retail consultancy Technopak, said, “It’s a
regressive move, especially before the festive season when you are going to see a lot of discounts
online. Perhaps the fact that around 80% of India’s [Rs.600 billion] handset business is still done
through offline retail might be reason for the company to shy away from online trade. But,
Samsung needs to wake up to the fact that it’s not the future since Chinese manufacturers are
offering same spec handsets at one third of the price.”38
Some experts opined that brands went for the online route when they did not have the capacity to
launch offline. Chinese mobile phone maker Gionee’s India head Arvind Vohra said, “Online is
obviously important, but the marketplace model doesn’t allow you to control your pricing, and so
for us right now, it is best to tell our customers to buy offline. The brands that are launching only

online now which are the ones which don’t have the capacity to launch offline. Whether it is

because they don’t have the bandwidth, or whether there’s a bad history in India, there are strong
reasons for certain brands to take the online only route. And for the customers, it obviously makes
sense. But the offline guys are the ones that made it possible to make inroads in the market, and
now that they have built the market, it is wrong to cut the floor out under them.” 39 Analysts felt
that Samsung should have evaluated the opportunities and threats of each channel and determined
how to extract the most value from them. They also contended that Samsung, despite having a
large physical reach in India, needed to cater to the community who would prefer to buy online
and the company could have their own dedicated e-stores.
THE ROAD AHEAD
Analysts opined that the move did not mean that Samsung would cease to sell all products online,
as it had stated that it would look to offer exclusive deals to e-commerce stores in selling select
devices. For instance, the Galaxy K Zoom was available exclusively via Amazon in India.
However, it was unlikely that devices in the Galaxy Note line would be available online in the
future, they said. Samsung wanted more control on setting the prices of its devices, which it did
not have online. Samsung did not have to worry about market presence, as its mobile brands were
constantly featured in advertisements and billboards. With a total of 48 devices available to
consumers across all price segments in India, the manufacturer offered an abundance of choice.
According to some experts, what customers did not get with Samsung was great value for money,
which according to them, led the manufacturer to shift to an offline-only strategy for many of its
models. They felt that by going offline, Samsung could assert more control in terms of pricing its
handsets and setting limits on the extent to which retailers could offer discounts. With Samsung
mobiles losing ground in India as well as other global markets in light of stiffer competition, it
remained to be seen whether a move to offline-only sales was a smart choice in the long run for the
company.
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Exhibit I
Key Financials of Samsung Electronics Co., Ltd.
In Thousands of US$ 2014 2013 2012 2011
Revenue 195,882,955 217,243,913 190,565,349 154,048,895
Operating profit 23,772,272 34,943,492 187,754,283 14,605,817
Net Profit 22,223,194 28,949,145 22,262,426 12,845,713
*For the year ending December 31.
Source:http://www.samsung.com/us/aboutsamsung/investor_relations/financial_information/financial_state
ment.html
Exhibit II
Samsung’s Offerings and Pricelist in India

Samsung Galaxy Note 10.1 2014 Edition Rs.49,990

Samsung Galaxy Golden Rs.49,900
Samsung Galaxy Note 3 Rs.46,330
Samsung Galaxy S4 Rs.39,530
Samsung Galaxy Note 10.1 Rs.35,200

Samsung Galaxy Mega 6.3 Rs.30,890

Samsung Galaxy S4 Zoom Rs.28,500
Samsung Galaxy Tab 3 311 Rs.24,900
Samsung Galaxy S III Rs.24,673
Samsung Galaxy Mega 5.8 Rs.23,635
Samsung Galaxy S4 Mini Rs.23,130
Samsung Galaxy S Advance Rs.19,500
Samsung Galaxy Grand Duos Rs.18,307
Samsung Galaxy Grand Quattro Rs.16,060
Samsung Galaxy Core Rs.13,335
Samsung Galaxy Ace Duos Rs.11,700
Samsung Galaxy Ace Duos Rs.9700
Contd…
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Contd…
Samsung Galaxy S Duos Rs.9650
Samsung Galaxy Trend Duos Rs.7800
Samsung Galaxy Y Duos Rs.7600
Samsung Galaxy Y CDMA Rs.7350
Samsung Galaxy Star Pro Rs.6580
Samsung Galaxy Music Duos Rs.6500
Samsung Galaxy Y Rs.5975
Samsung Galaxy Pocket Neo Rs.5600
Samsung Galaxy Y Plus Rs.5499
Samsung Rex 90 Rs.4900
Samsung Galaxy Star Rs.4845

Samsung Champ Deluxe Duos C3312 Rs.3749
Samsung Champ Neo DUOS Rs.2950

Samsung Metro 2252 Rs.2760

*Data as of October 2013. These prices are sourced from various
mobile dealers in India. Prices indicated are with bill and warranty.
Taxes are not included as they vary from state to state.
Source: http://www.fonearena.com/mobile_phone_pricelist.html
Exhibit III
A Screenshot of the Samsung eStore
Source: “Samsung Launches eStore in India for Mobiles, Tablets & Laptops,” www.mobilemadly.com,
March 20, 2012.
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Exhibit IV
Top 10 E-Commerce Websites in India 2015 based on Number of Daily Unique
Visitors
Shopclues 14,028,980
Myntra 15,725,633
Paytm 19,221,146
Ebay 31,222,406
Rediff 38,446,465
Jabong 44,854,905

Snapdeal 154,380,132

Amazon 262,104,622
Indiatimes 288,437,275
Flipkart 319,557,683
Source :http://www.digitalgalleryindia.com/blog/2015/04/06/top-10-e-commerce-websites-in-india-
companies-online-shopping-portals-marketplace-best-10-rank-traffic-google-page-alexa-global-rank-site-
ip-world/#sthash.OL5ra8jx.E7zg9YR7.dpbs
Exhibit V
Reasons attributed by Consumers for preferring Online Shopping
Adapted from http://www.pwc.in/press-releases/2014/technology-making-online-shopping-popular-but-

trust-will-be-the-biggest-driver.jhtml
11
516-0063-1
Exhibit VI
Top Mobile Phone Companies Market Share in India for the 4th Quarter of 2014

Source from http://www.financialexpress.com/article/industry/tech/for-first-time-ever-smartphone-market-
in-india-shrinks-says-idc/46740/
Exhibit VII
Comparison between Samsung and Rival Brands Like Xioami and Motorola
Moto E Galaxy Galaxy S A120 Moto G Galaxy Xperia Mi3

Trend Duos Canvas 2 Core M
Dual
Brand Motorola Samsung Samsung Micromax Motorola Samsung SONY XIOAMI
Price (Rs.) 6,999 7,500 9,300 9,600 11,999 12,500 12,750 13,999
SIM DUAL DUAL DUAL DUAL DUAL DUAL DUAL SINGLE
Display 4.3”, 256ppi 4”, 233ppi 4”, 233ppi 5”, 294ppi 4.5”725p, 4.3”, 4”, 5”,
Size Corning 326ppi, 217ppi 245ppi, 1080p,
Gorilla Corning Scratch 441ppi,
Glass 3 Gorilla Glass resistant Corning
3 glass Gorilla
Glass 3
Camera 5MP 3.2MP 5MP LED 8MP LED 5MP WITH 5MP LED 5MP 13MP
Flash Flash Flash Flash LED Dual
Flash Flash
Secondary NO NO VGA 2MP 1.3MP VGA VGA 2MP
Processor Dual Core Dual Core Dual Core Quad Core Quad Core Dual Core Dual Quad
1.2 Ghz 1 Ghz 1.2 Ghz 1.3 Ghz 1.2 Ghz 1.2 Ghz Core 1 Core 2.3
Ghz Ghz
RAM 1GB 512MB 768MB 1GB 1GB 1GB 1GB 2GB
Source: Mohit Agrawal, “India Market Entry Strategy for Mobile Phones Brands,” www.telecomcircle.com,
September 2, 2014.
12
516-0063-1
End Notes
1
Gopal Sathe, “Online-Offline Retail Battle in India Nears a Tipping Point,” www.gadgets.ndtv.com,
August 1, 2014.
2
Kul Bhushan, “Samsung to Stop Selling 48 Phone Models Online to Focus on Offline Retail,”
www.digit.in, September 19, 2014.
3
“Samsung Dealers Threaten Boycott Over E-pricing,” www.buzzom.com, August 10, 2014.
4
Jun Yang and Mark Lee, “Samsung Ends Nokia’s 14-Year Run as Biggest Handset Maker,”
www.bloomberg.com, April 27, 2012.
5
Writankar Mukherjee, “Samsung Overthrows Nokia to Become the Largest Seller of Mobile Phones in
India,” http://articles.economictimes.indiatimes.com, April 26, 2013.
6
Riddhi Mukherjee, “47.4% Of Samsung’s Revenue Came From Mobile Devices Business In Q4 2014,”
www.medianama.com,February 12, 2015.
7
www.samsung.com/us/aboutsamsung/investor_relations/financial_information/financial_statement.html
8
Mohit Agrawal, “India Market Entry Strategy for Mobile Phones Brands,” www.telecomcircle.com,

September 2, 2014.

9
Rs. = Indian rupees or INR. As of 2014, US$1 was approximately equal to Rs.62.
10
Writankar Mukherjee, “Samsung India Electronics to Open 4,000 Exclusive Outlets in Smaller Towns,”
http://articles.economictimes.indiatimes.com, April 8, 2014.
11
September 2, 2014.
12
Writankar Mukherjee, “Samsung Mobile Revamps Sales and Distribution in India,”
http://articles.economictimes.indiatimes.com, January 23, 2009.

13
“How Samsung is Making it Big in India,” www.rediff.com, May 5, 2011.
14
Writankar Mukherjee, “Samsung India Electronics to Open 4,000 Exclusive Outlets in Smaller Towns,”
http://articles.economictimes.indiatimes.com, April 8, 2014.
15
“Samsung Launches eStore in India for Mobiles, Tablets & Laptops,” www.mobilemadly.com, March
20, 2012.
16
Arun Prabhudesai, “Samsung Launches its Online Store in India – But why?” http://trak.in, March 20,
2012.
17
ET Bureau, “Mobile Internet Users Expected to Cross 213 Million in India in 2015,”
www.articles.economictimes.indiatimes.com, January 15, 2015.
18
“In COD We Trust,” www.translatemedia.com, February 6, 2015.
19
“Rising Online Retail to Boost India's E-commerce Growth,” www.cxotoday.com, January 2, 2014.
20
Suneera Tandon, “100 Million Online Shoppers in India by 2016: Report,” www.livemint.com,
November 20, 2014
21
September 2, 2014.
22
August 1, 2014.
23
“Can Offline Retailers in India Compete with Amazon, Flipkart and Snapdeal?” www.tech.firstpost.com,
October 2, 2014.
24
“Online retail vs Offline retail – Let the Games begin!” www.gavinremedios.wordpress.com, November
6, 2014.
25
Mihir Dalal and Suneera Tandon, “E-Commerce Boom Hurts Brick-and-Mortar Retailers,”
www.livemint.com, March 16, 2014.
26
Gopal Sathe, “Where's My Warranty? The Growing Perils of Shopping Online in India,”
www.gadgets.ndtv.com, February 28, 2014.
27
September 2, 2014.
13
516-0063-1
28
“Samsung Still No.1 in India, But Micromax is Catching Up: IDC,” www.tech.firstpost.com, August 20,
2014.
29
John Sarkar, “Samsung Dealers Threaten Boycott Over E-Pricing,” www.timesofindia.indiatimes.com,
August 5, 2014.
30
Ibid.
31
Mihir Dalal and Suneera Tandon, “E-Commerce Boom Hurts Brick-And-Mortar Retailers,”
www.livemint.com, March 16, 2014.
32
33
Rhik Kundu, “Keen to See Even Pricing across Channels,” www.financialexpress.com, January 7, 2015.
34
Writankar Mukherjee, “Sony, Samsung and Canon Ban Stores from Selling Items via E-Commerce
Sites,” www.articles.economictimes.indiatimes.com, August 6, 2014.
35

36
Economic times, www.xedknowledge.com,2014.

37
38
Pooja Vishant, “Samsung Takes a U-Turn, Goes from Online to Offline,” www.indianonlineseller.com,
September 19, 2014.
39
August 1, 2014.
14

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Moto E Galaxy Galaxy S A120 Moto G Galaxy Xperia Mi3

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