Research and Development (R&D) spending and marketing are two of the most important factors for any successful business. R&D helps keep products innovative and ahead of the competition while marketing peaks the consumers’ interest and entices them to purchase the product. The EU Industrial R&D Investment Scoreboard ranks Samsung as the number one spender in R&D when it comes to the tech companies, spending €12.53 billion ($13 billion) in the 2016 fiscal year. When it comes to advertising in 2016, Samsung will spend $3.3 billion to grace the TV ads, online ads, and even paper advertising. This is what makes Samsung so good at what they do and why it is so hard for other companies to compete with them in the advertising field.
Samsung did however suffer a mighty setback in 2016 with the launch of its Galaxy Note 7. A slight percentage of devices heated up and caught fire, causing Samsung to stop selling the Note 7, then issuing a recall, and finally, a decision was made to halt production and scrap this year’s Note 7 model altogether. Samsung promptly reinvented their older Galaxy S7 and S7 Edge models and used that marketing budget to reintroduce the two models, put on some promotions, and added a couple of new colors – the Blue Coral from the Note 7 comes to mind – and sales picked up and are still reportedly strong. A problem like this with any other smartphone manufacturer might have put them out of business, but for Samsung, it is expected to have a limited impact on its bottom line due to their diversity in the electronics field. Processors are developed and produced out of their semiconductor division, batteries are made in their SDI division, and displays – both LCD and AMOLED – are made in their display division. They make parts and pieces for many different smartphone manufacturers, including Apple. It is their tremendous R&D budget that allows them to develop and produce some of the most sought after electronics parts.
In the tech field, Intel came in second at €11.14 billion, Google’s parent company, Alphabet, came in third at €11.05 billion, and Microsoft came in fourth at €11.01 billion. China’s massive electronics giant, Huawei came in fifth at €8.35 billion, to round out the top ten companies. It is worth pointing out that we are only talking about the tech companies here as the list also includes companies from other fields as well, with Volkswagen taking the top spot, overall – as can be seen below.