Apple continues to defy the tech and market critics who declared the company mostly doomed at the feet of Samsung’s marketing and technology prowess. A funny thing happened along the way to reality, though. Apple didn’t stumble, as predicted by the technorati elite and market doomsayers, and, well, Samsung did.
The real question to ask the experts is, “How did you not see this coming?”
Apple is a premium brand. Samsung is not. So, Samsung’s smartphone and tablet business got caught in a squeeze between Apple at the high end of the spectrum (where all the profit is), and the low end where all the cheap Chinese knock-off manufacturers live (where profits are not important, apparently.
Guess what? It gets worse for Samsung.
Hot on the heels of Apple’s iPhone 6 and 6 Plus launch in Korea comes news that the iPhone is outselling Korea’s own Samsung Galaxy brand. Ouch. Apparently Samsung pulled some money from its shrinking marketing budget and got local media to talk up a potential recall of Apple’s hot selling iPhone models. Why? Some of the Samsung parts might be bad.
It’s probable that some of that marketing budget when to lawmakers in Korea who don’t want local cell phone carriers to subsidize the iPhone at the expense of Samsung sales, despite the fact that customers (and, ostensibly, voters) seem to prefer iPhones over Galaxy plastic.
Wait. There’s more!
Now there’s word from China that Samsung is no longer the number one brand in the world’s number one largest smartphone market. Guess who’s the new number one? Yeah, you guessed it. China Brand Research Center’s new 2014 index puts Apple atop Samsung in the latest rankings.
Here’s the problem.
Samsung sells to both ends of the product spectrum; from premium to entry level. Worse, those Samsung smartphones run Android OS, which is more or less or mostly the same Android OS that runs on cheaper Chinese knockoffs– but not on Apple’s really truly deeply premium brand, the iPhone.
That differentiation and branding problem is exactly the same as most PC manufacturers have faced for years. While all the Dells and Lenovos and HPs of the world run Windows and look and work much the same, Apple gobbles up the premium end of the product spectrum (where most of the profits are) with the hot selling Mac.
Poor Samsung just can’t catch a break recently. But neither can Dell, Lenovo, HP, Asus, Acer, HTC, Motorola, Microsoft, et al, so they’re in good company.