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When Samsung Slips on a Smartphone Business

Barclays Center, a covered arena located in the Brooklyn area of ​​New York, USA, for a moment of silence sports activities, including basketball. The headquarters of the Brooklyn Nets, a club participating in the NBA, has been temporarily taken over by Samsung to become the arena of "Galaxy Unpacked". DJ Koh, President and CEO of Samsung Electronics, is the star of the show. That day, August 9, 2018, Samsung launched the latest flagship product of the Galaxy series: Galaxy Note9.

In the midst of the frantic launch of Note9, a discordant tone appeared. The reason Note9's launch schedule is faster than the same series from the previous year.

The Galaxy Note8, a series under Note9, slipped on August 23rd. According to BGR, Samsung's move is due to the fact that "sales of the Galaxy S9 and Galaxy S9 + are bad, forcing Samsung's mobile division to demand an increase in sales as soon as possible."

Citing the results of research presented by IDC, Samsung is indeed in an uncomfortable area. Samsung experienced a slowdown in growth, especially in the second quarter of 2018. In the second quarter of 2018, Samsung sold 71.5 million units, down 10.4% from the number of units same quarter of the previous year, to 79.8 million. Despite its decline, Samsung still has control of the global smartphone market share with a percentage of 20.9%.

Jebloknya Samsung's performance in the second quarter confirmed its inability to secure the most valuable markets other than the United States, namely China. Citing Kim Jaewon's report on the Nikkei, Samsung gained only a 1% market share in the country of the bamboo curtain in the second quarter of 2018. Counterpoint, a market research firm, said in one of his reports that a combination of Huawei, OPPO and Vivo and Xiaomi gained 76% of market share in China, Huawei being the main contributor. Beyond local brands, Apple has a 9% market share.

"The situation is making it difficult for Samsung, which has felt a double-digit market share in the world's largest smartphone market," Jaewon wrote in its report.

Samsung's stress during the 2018 quarter was inversely proportional to Huawei, a Chinese technology company. During this quarter, they sold 54.2 million units, up 40.9% from the same quarter last year, which amounted to 38.5 million units. Thanks to these successes, Huawei has changed Apple's position as the second largest global smartphone manufacturer with a 15.8% market share.

Huawei's positive achievements are supported by good results in China and India. In China, Huawei gained a 26% market share. In India, Huawei gets a 3% share. Although low, this result represents a 3-fold increase over the same quarter of the previous year, which gained only 1% of India's market share.

So, why did Samsung and Huawei have a different spell in the second quarter of 2018?

Between saturation points and branding strategies

Jaewon, in its report, cited an internal source to Samsung, saying that "the series of notes is the most important premium product for Samsung, able to retain consumers." Unfortunately, at the time of the birth of the latest series of Notes notes, the smartphone has not given birth to an aspect of novelty that could lead consumers to buy en masse.

Quartz, in its review of Note 9, said: "There is no reason to update Note 9 if the customer has a previous model." At the same time, The Verge said that "Note9 does not offer novelty [...] No new technology or design idea were born in this series".