Samsung became one of the major players in the smartphone industry through sheer brute force, throwing dozens of billions of dollars into its monstrous marketing budget. This, coupled with a product strategy to roll out iterative new gadgets every few weeks, made it the number one handset seller in the world with nearly 25% of the global marketshare, according to IDC. (Apple controls a mere 12%.)
Last night, for example, Samsung partnered with Snapchat at the American Music Awards for what looks to be the first-ever sponsored “Our Story,” which splices together different Snapchats taken at the AMA’s into a storybook, giving Snapchat users an insider glimpse at the award show. Samsung’s love for influencers and celebrities is well-treaded territory. But customers seem to like this ad treatment, mostly because they don’t have to play the video if they don’t want to.
But this year Samsung sales hit a wall. The Wall Street Journal reports that the Samsung Galaxy S5, a very good and waterproof Android flagship that went on sale in April, was a huge disappointment, selling 40% fewer units than the company anticipated. Now Samsung is reportedly considering “a major leadership shake-up,” one of which might included the demotion of co-CEO J.K. Shin.
Samsung’s undoing could be traced to smaller and more nimble Chinese smartphone makers like Huawei, which make high-end Android devices at cheaper prices, and is seeing its marketshare explode throughout Asia. Tucked into the Journal’s report, however, was a small but significant bright spot for Samsung: The S5 actually outsold its predecessor, the Galaxy S4, in the United States, during a similar time period right after their launches.CG