Samsung had to pin point the loophole in their smartphone strategy and gave their word regarding the fixation of their faults. They vowed after the profits tumbling to the lowest within three years. Role of a South Korean and other Competitors A South Korean Company is the one straggler who climbed up Samsung and became a top seller in just three years. They are proud of their marketing strategy as they have swiftly met the demand and supply of smart phones intelligently. As a far as being Apple’s rival, it is facing a tough competition. Samsung’s business is going in downwards direction and in this year they had faced undermined rates of sales of Samsung Galaxy S5. This is majorly due to an onslaught from local brands of China and Sub-Continent. Considering Apple’s role in this regard is never less than a fierce enemy. Samsung’s Confession of a Misstep Samsung’s head of investor relations called a conference call and explained about why Samsung is lagging behind with respect to the growing market situations. According to the executive Robert Yi, the response of the company was not quick enough. Spanking Strategy of Samsung Now, the company is planning to change the strategy by focusing more on efficiency rather than on number of new models of handsets. By this approach, the company will be able to focus more on each component’s cost. The company will purchase low-priced machinery and in return will save a lot of costs. Samsung’s new aim is to provide consumers with flagship models on annual basis. At least two models will be presented with smartphone variety. Various exciting features including a great diversity in screen sizes will be offered. Earning Evaluation Samsung’s drop in income in Samsung mobile phones business stroke the South Korea Company’s quarterly generated total revenue that fall from forty nine percent to 4.2 trillion KRW. You can say approximately Rs. 24,570 Crores. Although it was the minimum since the 1st quarter of year 2012, but ahead of market expectations. The analyst of FactSet polled and predicted a net income of 3.7 trillion KRW. Operating earnings from mobile dealings, which earlier had contributed up to 60% of its intact income, knocked down to 1.75 trillion KRW from 6.7 trillion KRW (in earlier year). Quarterly sales chopped down from 20 percent to 47.4 trillion KRW while operating income minimized from 60 percent to 4.1 trillion KRW. Samsung’s Study about Sales Earlier this month, a warning message about the handsets profit reduction was provided to Samsung. Instead of this fact, there is a marginal increase in the shipments. According to the analysts, Samsung Galaxy S5 inaugurated in April did not got much attention of the buyers. Many consumers just did upgrading of their smartphones instead of hanging around for latest iPhones. A senior Vice President of Samsung, Kyun-Joon Said: “High-end smartphone sales result was somewhat weak. We will fundamentally reform our product portfolio.” A leading position of Samsung was preserved at global level of smartphone market at the stage of 3rd quarter, but it was just five top level handset vendors to record a decline in sales. According to IDC (a market research firm); Apple, Lenovo, Xiaomi and LG products all possessed an excess of 15% growth in the shipments of their smartphone. As far as Samsung’s shipments are concerned, it fell 8% to 78.1 million smartphone in 3rd quarter. The market share of Samsung was eroded to 24% while it was 33% in earlier year. Rise and fall of Samsung due to its Features and OS Samsung got a rise to a level of top smartphone at global level because of its early gambling on Google’s Android OS. The monopoly ended soon when other handset makers adopt android OS with elegant features, design and elite performance. Samsung is now facing a great pressure in inspiring its customers with diversity in features to its upcoming phones. Galaxy Note Edge was one of the answers. It was with curved side screen that could exhibit icons, weather and new flashes. The uncertainty is the limited supply of curved displays. Due to this, the production of Galaxy Note Edge will remain minute. The Samsung Corporation gave slight details regarding how it would distinguish upcoming smartphone's software or else the user experiences. In case of hardware, Samsung proposed flexible displays and metal case will aid its latest phones to stand out. Samsung is more and more depending on semiconductors. Since the third quarter of 2011, for the 1st time, the semiconductor division reported a better quarterly revenue generation - 2.3 trillion KRW – comparing with the mobile communication division. Samsung’s Predictions According to Samsung’s expectations, the earnings will increase in the current year (October - December) driven by their memory chip. But! There is no certainty that smartphone business of Samsung will recover. The reason behind this vagueness is the need of increasing marketing expenses that the business might face because of rival handsets as well to clear the inventory earlier than 2015. The Samsung Galaxy Note 4 will be competing with iPhone Plus’s big screen, will be available for sale in many countries by the end of 2014. Samsung Said that this will satisfy the likings of those who love smartphones as large as tablets. In the third world countries like Pakistan, a serious decline in Samsung mobile price is seen. The difference of Samsung mobile rates in Pakistan is helping the local user as people can buy now their favorite cell phone at low prices.
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