It is certainly no secret that Samsung, still the largest producer of smartphones in the world, has not enjoyed its past meteoric growth in sales, revenues or profits the past couple years. Some of this can be attributed to market saturation in the developed nations as well as the improved completion from HTC, Motorola and LG. But much of it has to do with two major factors – the first is that Samsung is getting beat out by the China ‘connection’ of high quality smartphones at terrific pricing and this is cutting into Samsung sales in both China and India…where the potential for sales growth is phenomenal. The second problem is Samsung’s unwillingness to change the design of their bread and butter flagship, the Galaxy S series – while the Galaxy S5 is a terrific smartphone and stacks up well against the competition, most potential buyers would not even give it a chance because of its ‘ho-hum’ design.
Word was circulating that even President Shin Jong-kyun would be given his walking papers, but he was able to retain his post because, as Lee June, Samsung Groups’ communications chief, said at a media briefing, “Shin has made significant contribution in helping Samsung to become the global No.1 in the mobile market. The president will have another chance to reinvigorate the mobile business in a new business environment.” Those ‘resigning’ their posts due to disappointing performance will be, Lee Don-joo, chief of the mobile business unit’s strategic marketing office, Kim Jae-kwon, chief of the global operations office and Lee Chul-hwan, head of the mobile R&D office. The number of presidents in the mobile business will be reduced to three – Shin Jong-kyun, Kim Young-ky, and Kim Jong-ho.
When the Samsung Galaxy S5 went on sale earlier this year, it ended up missing projections between 40 – 50 percent, while at the same time, Apple’s new iPhone 6 and iPhone 6 Plus, sold as though it was the first smartphone to sport a display over 4-inches. That embarrassment is something that Samsung and the Korean business cultural cannot accept, so we knew that someone would have to be made the scapegoat.
Samsung is a proud and stubborn company – sometimes too stubborn to listen and accept change. It was their arrogance, pure and simple, that caused the downfall in sales of the Galaxy S5. Their unwillingness to get away from an all plastic design, not using the QHD display, not including 3GB of RAM, not taking the camera are as seriously as they should have…still no OIS, toning down the Samsung TouchWiz and bloatware that is forced upon the buyer, nothing to compete with BoomSound, and more. Potential new customers backed off and current Galaxy S owners said enough is enough – at a time when the Galaxy S3 buyer should have been ready to snatch them up.
The tide started to turn, ever so slightly, with the new Galaxy Note 4 – it is receiving critical acclaim and sales are brisk. Samsung also brought out the Galaxy Note Edge with a true innovated curved edge that can be programmed separately from the main display. The new Galaxy S6 will have to hit a homerun in order for Samsung to regain some of its lost ground. Let’s hope that the reshuffling done at Samsung was more than a Texas Two-Step and we will see some truly new results. Please hit us up on our Google+ Page and let us know what you think – is Samsung headed in the right direction? As always, we would love to hear from you.