Samsung Galaxy Note 7 was supposed to be Samsung’s flagship device with the introduction of retina scanners, which was absolutely new and innovative. The device was launched on August 19, globally and on August 11 in India. Samsung had already sold 2.5 million units of the device just when there were complaints of the device crashing and faulty S-Pen. However, the real problem started when they received 35 complaints (as of September 1) of the battery catching fire. The board room was the next hot-spot for the company to decide on the measures against the prevailing complaints. Samsung decided to halt the distribution of the device. They decided to replace their current device with the new units in the coming weeks to protect future customers. According to the company, an issue with battery cell caused the problem in the devices.
This came as a huge embarrassment for the Korean smartphone giant, Samsung. The company is in the second position in terms of spending on R&D, globally. They claim to invest 9% of their total sales revenue in R&D activities. In 2015, Samsung had spent $14.1 billion on R&D while Apple spent merely $6 billion, according to a report by PWC. With the recent incident coming into the limelight, a question arises that how can a company like Samsung, which has the highest smartphone market share of 22.4% with the sales of over 77 million units in Q2 2016 bear such a serious issue. 3 out of every 10 smartphones are tagged with Samsung band. At present, the company is coordinating with carriers like Verizon and AT&T on how the exchange will work. On the other hand, these carriers are likely to deliver the upcoming iPhone soon!
What Went Wrong With Samsung Galaxy Note 7?
Even though Samsung spends over double of what Apple does on R&D, it had to face such a serious issue with its devices. It seems like the focus for Samsung was to launch the device before the launch of the next iPhone, rather than to focus on the quality of the device. Before this issue of devices catching fire, there were complaints regarding the system crashing, boot looping surfaced and faulty S-Pen. Probably Samsung was in a hurry to launch the Note 7 due to which quality check was highly neglected, resulting in faults with the devices. Every device is supposed to be evaluated for days and months before launching it into the market to ensure the quality of the device. It seems that Note 7 devices were not tested before they were made available in the market. Apparently, the company has compromised with the quality of the device to stay ahead in the competition.
Will Note 7 Get a New Life?
Samsung might face a tough time re-introducing the device and win the trust of its customers once again. It will highly affect the further sales of the device globally. This will also affect the reputation of the company. Samsung’s challenges just increased in folds- Right from correcting the issue to making it reach to the end user once again with an extra challenge of winning trusts (probably the most difficult challenge). Samsung needs to address and solve this issue real quick to get Note 7 back to life. The product no doubt had an attractive design with some real time innovations which led to a sale of over 2 million units in a span of just 15 days.
Perfect Timing for Apple
Apple’s market share has been declining tremendously with the sales performance of iPhone 6S and 6S Plus. One of the major reasons for its failure was the launch of Samsung’s Galaxy S6 and S6 Edge with an innovative design and better features, and then the Galaxy S7 and S7 Edge to carry on the legacy. While Samsung’s Note 7 was also supposed to be their flagship device, they had to halt the distribution right when Apple is all set to launch iPhone 7 in less than a week. Apple’s iPhone 7, which is rumoured to have some major hardware developments, has a golden opportunity to kick-start its sales once again. All the strategies that Samsung had planned regarding the product’s sales & marketing will also be put on hold making the roads clear for iPhone 7.
To conclude, this is a very major issue that Samsung is facing which will cost the company heavily, that too on the product which was supposed to set a benchmark for other OEMs. Monetary costs, reputation, sales, trust and many more grounds are left shaken for both the company and the device. Samsung is definitely facing a lot of problems, but the level of the problem depends on how effectively and efficiently it can address and resolve it while there is time.