October 21st, 2016
Samsung Woes: Where Does the Mobile Giant Go From Here ?
The year started out well for Samsung. The release of the Galaxy S7 and the S7 Edge was a milestone move ahead of the competition.
Users marveled over the phones attractive metal design, ultra-sharp screen, blazing-fast performance and futuristic camera technology, just to name a few of their cutting-edge features. The handsets topped many reviewers’ lists of the best phones of the first quarter, while the Galaxy S7 and S7 Edge were bestsellers in retail stores and online market sites all over the world.
In fact, for the first time, Samsung even outsold Apple in the U.S. – its own backyard.
So where did it all go wrong?
The Rise and Fall of the Galaxy Note 7
Initially, Samsung wanted to wait until the end of the summer to unveil its next device, the Galaxy Note 7. However, given the number of flagship smarthones set for release in the fall, they settled on August 2nd, hoping to dominate the ever-competitive market.
And, like their other recent releases, the Galaxy Note 7 was one of the most anticipated smartphones of its time.
Its specs included Gorilla Glass 5 screen protection, the latest Exynos 8890 Octa CPU and the newest Android 7.0 Nougat software. Tech reviewers and smartphone enthusiasts had found a new favorite, and Samsung was ready to end the year on its highest note to date.
Unfortunately, things took an unexpected turn when reports of the Galaxy Note 7 spontaneously combusting began to surface. Many tried to downplay these incidents as a few isolated cases, perhaps simply caused by the users themselves. But as more and more reports came trickling in – with users taking to the Internet to post pictures and videos of their phones overheating, exploding or catching fire – the truth could no longer be ignored.
Samsung realized their only option was to address the issue, and address it quickly.
Citing faulty batteries from a company supplier, they announced a voluntary global recall in September, promising to either refund or replace the devices.
But as more reports surfaced describing various faults with even the replacement phones, Samsung knew their problems were just beginning.
Dealing with the Aftermath
Samsung announced the immediate shutdown of production on the Galaxy Note 7, urging its customers to stop using the phone completely.
To some, this was the right move. Others considered this too drastic a step, as many tech companies tend to work on fixing a product, rather than kill it altogether. Regardless of varying opinion, the damage on the company has clearly been severe.
Estimates already show billions of dollars in losses, with its mobile division’s profits for the third quarter having dipped almost 98% from the previous one.
Meanwhile, things are looking similarly dismal for their stock, showing Samsung’s traded shares falling more than 8% – even before Samsung announced it was ultimately ceasing production of the smartphone. This was its biggest daily drop since 2008, and it knocked $17 billion off the company’s market value.
Despite facing an immediate financial blow, perhaps Samsung’s biggest concern should be the number of people that have lost trust in the Samsung brand.
To date, despite excellent reviews across the web Samsung has not officially disclosed the exact cause of the Note 7’s malfunctioning issues, leaving their customers in the dark regarding the severity of the device’s hazardous nature.
To quote William Wallace, a policy analyst for Consumers Union, the advocacy firm of Consumer Reports:
“Samsung has not been communicative with consumers, regulators or the media as clearly as it should have during this recall, especially for a hazard as dangerous as this one where your phone can catch on fire, damage your property and harm your family.”
What’s Ahead for Samsung’s Future?
Although the bold decision to halt production of the smartphone may have been irregular for the industry, marketing experts are seeing it as an intelligent move that may save the brand name in the future.
Samsung’s timely response demonstrates the company’s absolute commitment to quality. Therefore, while the final consequences of the Galaxy Note 7’s failures remain unclear, the future may be brighter than expected.
Slowing Down to Commit to a New Game Plan
With the Galaxy Note 7, Samsung planned to send the competition packing. In light of the device’s missteps, though, Samsung’s engineering team and supply chain are now under intense scrutiny. Questions still need to be answered regarding whether or not the rush to the market may have resulted in technical problems, or unnecessary manufacturing shortcuts.
For this reason, Samsung should focus on making their next model perfectly functional, rather than simply cramming increasingly-sophisticated features into their product, purely for the sake of outdoing other mobile companies.
With this in mind, we are expecting Samsung to shake up its engineering and manufacturing sectors, quality-control processes, and eventually bring new ideas and policies into effect. What remains to be seen from this point forward is how much Samsung’s next big release will succeed or suffer in the marketplace, and how this will affect the future of Samsung overall.
Changing Course for the Better
While the fall of Samsung’s Galaxy Note 7, and the resulting bad press, certainly hit the company hard, their comeback story is definitely not impossible.
To see a safe return to the top with other industry leaders, Samsung need only reinstate the trust their customers had in the brand, ensuring that future releases will be at their finest, both on the surface and in operation.
So, while this latest blunder may not spell doom for the mobile giant, another major catastrophe would certainly leave an irreparable mark on the Samsung brand – a factor that could damage its name permanently.