Samsung’s profits might be soaring despite the ill-fated Galaxy Note 7 fiasco last year, but the company has been struggling in China. Research firm Counterpoint notes that Samsung sold only 3.5 million smartphones in China in Q1, 2017 and managed to grab only 3.3 percent of the market — down from 8.6 percent a year ago.
Samsung’s dismissal performance can be attributed to the Galaxy Note 7 fiasco and the delayed launch of the Galaxy S8. However, the company has also been unable to do anything to slow down the onslaught from the likes of other local Chinese brands like Oppo, Huawei, and Vivo.
These companies have reported a staggering increase in their smartphone sales in China in the same time period and seem to have made the most of Samsung’s loss. Huawei reported a 25 percent increase in its sales, while Oppo and Vivo reported an 81 and 60 percent increase, respectively. The secret behind the success of the three local Chinese OEMs can be attributed to their wide range of smartphone offerings, aggressive marketing, and better distribution network and availability. Samsung’s smartphones, on the other hand, are more expensive than their Chinese competition and are not available online which is making them lose favor among Chinese consumers. The launch of the excellent Galaxy S8 should help Samsung in recapturing some of its lost market The launch of the excellent Galaxy S8 should help Samsung in recapturing some of its lost market share, but the company really needs to rethink its strategy in China if it wants to ensure that it remains competitive in the market.
