Samsung Customers Remain As Loyal As Apple, Despite Note 7 Fiasco [REPORT]

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Samsung Electronics Co Ltd. (KRX:005930) is the market leader in the smartphone segment, followed by its arch rival Apple Inc. (NASDAQ:AAPL). Currently, Samsung’s Galaxy S7 and S7 Edge are the best premium smartphones available after the recall of Galaxy Note 7 due to the global scandal of the device catching fire. Even after one of the biggest debacles in the smartphone history, according to a recent poll by Reuters and Ipsos, Samsung brand loyalty remains as good as Apple. A whopping 91% of the current Samsung smartphone users are likely to purchase their next smartphone from Samsung only. Also, 92% of the users are likely to buy another Samsung product in general. This percentage of loyalty is something that Samsung needed the most from their customers after Note 7 put the company’s image to fire.

The survey was conducted online between October 26th and November 9th including 2,375 Samsung phone users and 3,158 Apple phone users in 50 states of the US.

On the other hand, 92% of the current iPhone users, who participated in the survey said that they will buy their next phone from Apple only and 89% users would prefer another Apple product in general.

It is a huge achievement for Samsung to reach the same level of loyalty as Apple in the U.S. The Note 7 debacle, despite being life threatening to its users, could not stop Samsung from setting this milestone. The survey also reveals that 27% of users who were aware of the recall, would still prefer a Samsung device during their next purchase. Similarly, out of those who did not know about the recall, about 25% said they would buy a Samsung device. This clearly shows that despite knowing about the issue and recall, this group of buyers still want to opt for a Samsung device. What is even more surprising is that the percentage of people who knew about Note 7 debacle is greater than those who did not know about the recall. This indicates how well Samsung has managed the Note 7 debacle and regained the trust of its users.

What Was the Note 7 Debacle Again?

With time, people started considering the Note 7 debacle as a matter of the past. Earlier, a survey was conducted post the recall which highlighted that 40% of the Samsung customers would prefer to purchase a smartphone from brands other than Samsung, out of which 30% users had used only Samsung phones. It is the extraordinary design and abilities in Samsung devices that attract users.

If we keep the Note 7 debacle aside for a moment, the device had achieved a sales figure of 2.5 million in less than 15 days; courtesy the brilliant design and unmatched innovation. The device could have done wonders if it did not catch fire! Also, in the first half of the current year, Samsung had shipped 13.3 million units of Galaxy S7 Edge, making it the highest selling Android smartphone in the world.

Wounds Heal, Marks are Forever!

However much we call it a matter of the past, the Note 7 issue did leave a dent on the company’s reputation. The market share of Samsung went down by 2.4% point, from 22.4% in Q2 2016 to 20% in Q3 2016, worldwide. The shipment volume has also decreased from 77 million units in Q2 2016 to 72.5 million units in Q3 2016.

On the other hand, in Q3 2016, Apple’s market share has increased a 0.7% point quarter-over-quarter. But the poll results indicate that Apple cannot sit back and watch Samsung’s figures decreasing. Samsung is going to give Apple a tough competition in this holiday season. After all, the loyalty level of Samsung customers is at par with that of Apple.

Samsung All Set For the Holiday Season

This Holiday season is going to be very crucial for the OEMs. Samsung needs to put in extra effort to make up for what the Note 7 users went through. The company is focusing majorly on selling more and more numbers of Galaxy S7 and S7 Edge. Previously, Best buy had cut down the price of S7 and S7 Edge by $120. It was also offering a Samsung Fast Charge Wireless Charger worth $59.99 for free. Recently, Best Buy threw in another offer in which it is giving away a $450 gift card for trading in any working smartphone for Galaxy S7 or S7 Edge on a Sprint or Verizon instalment billing plan.

Samsung has put in great efforts, from immediate exchange/refund to offering $100 credit bills if exchanged with another Samsung smartphone, to win back its customers since the Note 7 fiasco. The company’s patience and apology have paid back and now; However, Samsung is living on the edge apparently, and one more similar incidents and the company will run out of luck immediately.

For now, Samsung is all set to compete during the holiday season sales. The fourth quarter results are highly awaited as the whole competition is set to reach to an interesting point!


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