The main reason for Samsung's defeat

January 8, Samsung Electronics released the fourth quarter of 2014 forecast, the fourth quarter operating profit is expected to reduce 37.42% year-on-year growth of 28.08%, to 5.2 trillion won (about 29.4 billion yuan). In the same period, sales growth of 9.59%, year-on-year decrease of 12.28%, to 52 trillion won.

The industry generally believes that Samsung Electronics quarterly operating profit can increase the chain because of its main mobile phone business information Mobile division's performance has been improved. In the third quarter of 2014, the division's operating profit of 1.75 trillion won, the chain significantly reduced by more than 50%, the fourth quarter was improved, one because of the Galaxy Note4 and other high-end products sales have increased, followed by the Department's substantial reduction in marketing costs, But in fact, Samsung mobile phones in the fourth quarter of total handset sales continue to decline. According to statistics, Samsung Electronics 2014 annual operating profit of 24.94 trillion won, reduced by 32.21% compared with 2013, the annual sales of 205.48 trillion won, compared to 2013 10.15%, which means Samsung 5 consecutive quarterly profit decline, That is to say, although Samsung is still the boss of the mobile phone industry in sales, the slump is still continuing.

The main reason for Samsung's defeat

Samsung's current predicament is Apple and mainland Chinese manufacturers to the top and bottom of the crossfire. Just after Apple launched its iphone 6 and iphone 6 Plus in September, Samsung's big-screen dominance is no longer apparent. According to the news, the Swiss bank expects Apple to sell 69.3 million iphone devices in the fourth quarter of 2014. That figure, though slightly lower than the Swiss bank's earlier estimate of 70.9 million, is still more than 65.5 million of what Wall Street generally expects. "Recent data show a glut of demand for iphones in the Chinese market, and even signs that China accounted for 35% of the total iphone shipments in the last quarter (in the fourth quarter of 2014), compared to 22% in the previous year," said Stephen Milunovichi, an analyst at UBS. "And China is Samsung's main market. According to a Gartner analysis of Samsung handsets in the third quarter of 2014, Samsung smartphone demand is weak in western Europe and much of Asia, and its smartphone sales have fallen by 28.6% in China, while much of the reduction has been eaten by Apple and Chinese domestic manufacturers.

Facing Apple in the high-end competition, in the low-end market, Samsung is the mainland's domestic mobile phone companies to fight the price of the game has no advantage. In fact, in the face of competition, Samsung also has a positive response. The first was the introduction of the Galaxy Alpha, which was absolutely beautiful in appearance, but the result was a fiasco, even in South Korea, where sales were extremely bleak. The Galaxy a series is then launched, although it is still a little early to assert that Galaxy A has failed, but it is highly likely to repeat the same fate of Galaxy Alpha from its configuration and price. The Galaxy A5, for example, uses the Gaotong 410 processor, 2GB RAM, 16GB fuselage storage, 13 million/5 million pixel rear/front camera, 5-inch 720p, and a price of up to 2599 yuan. And the domestic handset configuration is much higher, but the price is much cheaper than the Galaxy A5. Take the Big God X7 just released for example, its full netcom version of the configuration for Gaotong 801 processor, 3GB DDR3 RAM, 16GB fuselage storage, Sony 1.8 aperture 13 million rear camera, 8 million pixel rear camera, 5.2-inch 1080p screen, The total price is only 1999 yuan, and its configuration slightly adjusted mobile Unicom dual Netcom 4G version and mobile 4G version is only 1699 Yuan and 1599 yuan, with the Galaxy A5 price difference up to thousands of dollars, but its configuration is much higher than the Galaxy A5, and in the design of silk no less inferior to the Galaxy A5, Pure Color aero-aluminum in the edge of the box integrated molding design is also significantly better than the Galaxy A5 metal border. Even the previously released Millet 4 and the MX4 are better equipped than the Galaxy A5, and their prices are only 1799 yuan. So in the face of the shape, materials, crafts and so on have a great increase in domestic mobile phones, Samsung's low-end mobile phones low configuration, high selling price strategy is obviously not workable, and this is the reason for the decline of HTC. Too high a premium is clearly not a good way to compete in the current mobile phone market, especially in the low-end market, and Samsung really should wake up.

Samsung wants to change, but don't imitate millet

In the face of the upper and lower, Samsung really should change. Samsung, as a baby-style design is clearly not suitable for the current market, and its users have been criticized for the plastic fuselage has made it uncompetitive. Samsung, it is rumored, has been brewing big moves. First on high-end mobile phones, Samsung's Galaxy S6 will be a big change, according to reliable information, Galaxy S6 will be a 5.5-inch 2K screen, with 3GB RAM and ROM storage combination, the rear camera will be upgraded to 20 million pixels, and will run Android 5.0 Lollipop operating system. In addition, Samsung is also developing cat.10 LTE module, Samsung Galaxy S6 will support the cat.10 LTE network, said Galaxy S6 will also be used metal fuselage. Samsung will also have a change in its marketing strategy, and there are signs that Samsung might also try to adopt the Millet model, which in fact is not suitable for big companies like Samsung. Millet mode lets millet start from scratch, and then to learn millet is also mostly from the domestic mobile phone manufacturers, they lack of channels, the lack of upstream accessories control, and Samsung itself is a mobile phone accessories suppliers, in the industry upstream, there is a good line under the channel, In fact, as long as its products are more competitive in design and price/performance, Samsung will be able to recover. and millet mode of the current booking to buy the model has let the user began to tire, Samsung against its way to do, to achieve products, supply channels sufficient, it is bound to be through an appointment to ease the production and channel pressure of the handset manufacturers to get a wake-up call.