Samsung's share of the U.S. mobile phone market hit a new high. According to the statistics of counterpoint research, in Q1 2022, Samsung's share in the U.S. smartphone market reached 28%, an increase of three percentage points over the same period last year, becoming the highest in eight years, and the gap with Apple's market share narrowed significantly.
Why is Samsung's transparent phone doomed to failure?
How many people remember Galaxy?
Author / Zhao Chenxi
Editor / Li Xinma
Apple ranked first with 47% market share, down seven percentage points from the same period last year. At the same time, according to the research data of strategy analytics, in Q1 2022, Samsung ranked first in global mobile phone shipments with a market share of 23.4%, which is Samsung's best performance in Q1 in recent five years.
In the first quarter of 2022, Samsung topped the list with 24% of global smartphone shipments and market share. Source: strategy analytics official website
Compared with the US market and even the global market, Samsung's performance in the Chinese market presents a "double heaven of ice and fire" - there is almost no sense of existence, and its market share is below 1% all year round.
According to the statistical data of counterpoint research, the top five smartphone manufacturers in the Chinese market in 2021 were vivo, oppo, apple, Xiaomi and glory respectively. Samsung belongs to other categories due to its small share (the total market share of other categories is 4%).
In fact, since the galaxy Note7 explosion in 2016, Samsung's share in China's mobile phone market has declined all the way, from 2.4% (GfK data) in 2017 to 0.8% (strategy analytics data) in 2018. In the following years, Samsung has been "accompanying" China's mobile phone market and became a mobile phone manufacturer in other (other) categories. Therefore, returning to China's mobile phone market has become an important "proposition" for Samsung.
Samsung has repeatedly played slogan of "returning to the Chinese market" at the new mobile phone product press conference and even the mobile phone chip press conference. Since last year, Samsung's pace of returning to the Chinese market has accelerated. At the end of 2021, Samsung established a new Chinese team, named China business innovation team, which is committed to achieving sales breakthroughs in China, one of the world's largest markets, in various businesses from mobile phone terminals to semiconductor chips. At the beginning of this year, Samsung set up a new Department to boost its business in the fields of smart phones and home appliances by analyzing the business habits of the Chinese market and the preferences of consumers.
During the Winter Olympics, Samsung is not only a top sponsor, preparing gifts such as Galaxy Z flip3 5g mobile phones and galaxy buds2 headphones for athletes, but also building a Winter Olympics themed flash store in Beijing's core business districts, such as Sanlitun. Consumers can complete various ar games by using Samsung folding screen mobile phones in exchange for souvenirs such as Winter Olympic badge, blind box and stickers, which has attracted many consumers to participate
Samsung Sanlitun flash store source: DoNews
A series of team and department restructuring and marketing actions first point to China's smartphone market, where Samsung accounts for less than 1%.
Lost the Chinese market
In August 2016, there were many explosions after the global launch of Samsung Galaxy note 7 mobile phone. In September, Samsung held a press conference to apologize for the defect of mobile phone battery and launched the global replacement and recall plan. The Chinese market was excluded from the recall plan because the battery was different from other markets. In October, the Bank of China Version of note 7 also exploded. Under the interview and investigation of the law enforcement supervision department of AQSIQ, Samsung finally decided to launch the recall plan of Galaxy note 7 mobile phones in the Chinese market.
Due to differential treatment, Samsung mobile phones quickly fell from the altar in the Chinese market.
Changwen consulting Wang Changwen recalled to DoNews that after the explosion of the Samsung Galaxy note 7 mobile phone, a large number of domestic channels returned goods. On the one hand, many airports did not allow the mobile phone to board the plane, which was inconvenient for consumers to use, causing a wave of returns; On the other hand, from the perspective of the domestic mobile phone market, 2016 is the most rapid development period for domestic mobile phone manufacturers represented by Huawei. Compared with other mobile phone manufacturers, Samsung was also confused in terms of channels. Fleeing goods in various forms occurred. At that time, the price system was also relatively transparent, and the market profits of channel providers were low and did not make much money.
"Due to various reasons, Samsung has contracted and declined significantly in the Chinese market, and its sales volume has been pushed from the peak to the lowest in history, maintaining a share of less than 1% throughout the year." Wang Changwen said.
In addition, Samsung's corporate culture is also incompatible with the Chinese market. Shortly after the explosion of Samsung Galaxy note 7, several media disclosed that at the Samsung provincial dealer conference, in order to make dealers place more orders, Samsung executives knelt down and saluted the dealers, saying that they were out of gratitude and respect for the dealers, causing an uproar.
"In the past, Samsung's global playing method and strategy were the same. In the Chinese market, some management methods and leadership methods were not in line with the actual situation of the market. The way of thinking was biased towards Party A's thinking. Just like Nokia in the past, it was implemented from top to bottom and obeyed. Customers basically had no voice." Wang Changwen said that the difference in management and thinking mode also caused Samsung to not break through 1% in the Chinese market.
Ms. Li Meng, who lives in Guangzhou and bought a Samsung Galaxy note 7 mobile phone six years ago and exploded, told DoNews that after the explosion of her mobile phone, Samsung forcibly recovered the mobile phone and claimed to carry out problem detection, but finally failed to carry out any after-sales service and claim settlement for Li Meng on the ground that the mobile phone fell and caused the explosion. Afterwards, Ms. Li Meng was very dissatisfied with Samsung's service attitude and replacement process. So far, she has not purchased any Samsung terminal products.
With such a heavy historical burden, can Samsung still come back?
Samsung Galaxy note10 press conference photo source: Samsung official
Difficult to break through
At the end of 2018, at the Samsung Galaxy a8s press conference, Samsung first proposed to "return to the Chinese battlefield". Since then, Samsung mentioned that "it has returned to the battlefield (China)" at the new product launches of Samsung folding screen mobile phone Galaxy fold, Samsung Galaxy S10 series and galaxy note10 in 2019.
Quan Guixian of Samsung Electronics Greater China also mentioned many times that Samsung will comprehensively accelerate the localization process and deepen cooperation with domestic operators and other partners. Including technology, product, retail and marketing, such as upgrading of core business district channels, cooperation with the IOC, signing new spokesmen, etc. In addition, for the Chinese market, Samsung has also stepped up cooperation with domestic mobile phone manufacturers, not only in the field of mobile phone terminals, but also in mobile phone chips.
At the end of 2019, Samsung and vivo jointly launched 5g chip exynos 980. Subsequently, in November 2020, Samsung launched the chip exynos1080 with 5nm process specifically for the Chinese market, becoming the third manufacturer to launch the 5nm process after Huawei and Qualcomm. More importantly, exynos1080 abandoned its self-developed architecture and is a landmark product of Samsung's mobile phone chip tactical change.
On the one hand, China is in the node of 4G to 5g technology change. R15 standard (mainly for enhanced mobile broadband embB) is frozen. 5g has just begun to be commercialized at the C-end and is in the stage of consumer switching tide. It is the best time for mobile phone manufacturers to rearrange their order. On the other hand, whether mobile phones or chips, the Chinese market has become a key market for Samsung's business breakthrough.
Despite many actions, Samsung has not reversed its predicament in the Chinese market and got rid of the quagmire of less than 1% market share.
Li Fei, a mobile phone sales channel, observed that Samsung's mobile phone sales have improved, but there is still a big gap compared with other brands of mobile phones. Especially when the high-end models were just launched, the sales were still good. Once a period of time passed, the sales began to decline rapidly. "The main problem is Samsung's product line. Samsung's mobile phone product line is short, there are very few products, and the price is relatively high." Li Fei said.
Sun Yanbiao, chairman of Xuri big data, said, "Samsung's core problem lies not only in the lack of a complete product line array, but also in channels. Samsung has forgotten in the hearts of domestic consumers for a long time in the past. Dealers now not only need advertisers to vigorously promote, but also really realize the revitalization of the Chinese market by expanding market share."
Zhang Zhang, who lives in Guangzhou, told DoNews that he would not consider buying Samsung mobile phones for the time being. "It mainly depends on the second-hand mobile phone market. After the launch of Samsung mobile phone, the price plunged seriously." The data also confirmed this phenomenon. According to sellcell research data, the price decline of Samsung Galaxy S22 series is [iPhone] two months after its listing( https://apple.pvxt.net/c/1251234/435400/7639?u=https%3A%2F%2Fwww.apple.com%2Fcn%2Fiphone%2F ) 13, the overall value loss is as high as 46.8%.
Liu Ming told DoNews that although Samsung has no share of opportunities in China and few of his friends use Samsung mobile phones, he is still paying attention to Samsung. However, there are too few physical stores in China. He can only watch some evaluation videos on the Internet. In addition, the price of Samsung's new machine is higher than that of domestic mobile phones, there are not many bright spots, and the folding screen crease is more serious than that of Huawei. In addition, the replacement cycle of consumers is longer, so it is less likely to change the brand of mobile phones at will.
DoNews checked Samsung's official website and found that Samsung has only one full product store in Beijing, located in Middle East Third Ring Road, Chaoyang District; There are 21 Galaxy authorized experience stores; There are only 14 mobile phone / tablet after-sales centers (all outsourced, and some belong to pick-up stations, which are only responsible for receiving, sending and returning faulty machines). In contrast, Xiaomi has 126 exclusive stores + Direct stores and 18 service outlets in Beijing; Oppo has 64 authorized experience stores and 12 official service centers in Beijing; Vivo has 56 experience stores and 15 official after-sales service centers in Beijing.
There is a wide gap in the number of stores between Samsung and other mobile phone manufacturers.
"Samsung's return to China has indeed made some changes in offline channels and retail, but it seems that the strength is not great.", Sunyanbiao, chairman of Xuri big data, also mentioned the impact of the COVID-19 on Samsung. "In February this year, Samsung just held a galaxy S22 series new product launch, but then because of some objective factors (epidemic and other reasons), many policies could not be implemented at all. Moreover, the channel and brand construction could not be built overnight."
Where are Samsung's opportunities
Galaxy Z flip 5g display picture source: Samsung official
How to restart the Chinese market
Folding screen mobile phone is the top priority of Samsung mobile phone product line.
At the beginning of this year, Feifei, who has experienced the Samsung flash store, told DoNews that all the experience machines in the flash store are Samsung Galaxy Z flip 3 folding screen phones, and most of the commemorative badges are themed with folding screen phones, including Galaxy Z flip and Galaxy Z fold series.
"Folding screen mobile phones must be an entry point. The screens of folding screen mobile phones launched by Xiaomi, oppo and vivo all come from Samsung. Samsung's folding screen technology covers almost all mobile phone manufacturers in China." Wang Changwen said.
Samsung's folding screen mobile phones have performed well in the Chinese market and the global market. According to IDC data, in 2021, China's folding screen mobile phone market showed a two strong pattern. Huawei ranked first with 49.3% market share and Samsung ranked second with 28.8% market share. In terms of the global market, omdia data shows that Samsung's shipments of folding screen mobile phones exceed 10 million, accounting for 88% of the global sales of folding screen mobile phones.
At the high-end market level, Samsung on the channel side also began to take action.
Wang Changwen found that from January this year, Samsung's support for channels began to increase. "Once Samsung's store opening standard is met, in addition to the provision and support of all experience machine hardware, Samsung will help support even the basic decoration of the store, such as bag check-in. In addition, it will provide housing subsidies according to the level and sales volume of channel providers."
"From the overall layout of Samsung, it is certain to increase the layout of the Chinese market, and there have been some changes in the channels." Wang Changwen believes that if Samsung wants to return to China, in addition to the change of business model and attitude, more importantly, it needs to build a management mode and channel mode with more local characteristics in China.
Li Fei also said that because Samsung's goods volume in the Chinese market is very small, there is no supply in many channels, and there is no price war. Samsung's single machine gross profit is between 800-1000 yuan. The single machine gross profit and profit are very good, which has a certain attraction to the channels. "Many businesses on the channel side began to actively contact Samsung, because after all, Huawei's mobile phones were trapped, leaving a market vacancy. When customers need high-end computers, Samsung has become another choice for high-end products because of its irreplaceable nature."
For Samsung's real return, sun Yanbiao concluded: "the high-end market and women's market are indeed Samsung's cuts, but Samsung needs to give full play to its unique advantages, such as optics and cameras, in order to really change the current situation of low market share."
(Li Meng, Li Fei, Zhang Zhang, Liu Ming and Feifei are pseudonyms)