Samsung apologizes for poor performance in China, vows to do more

Samsung was once the dominant player in China, the most lucrative smartphone market on the planet. However, not only did Samsung lose its lead in the country but its market share in China is now in the low single digits. Samsung predicts a reversal in its fortunes in this key market as it acknowledged today that it had failed to fully understand China’s retail and commerce customs earlier. He previously said that Samsung will continue to make efforts to grow as a “truly localized” Chinese company.

Head of Samsung’s mobile division DJ Koh apologized to shareholders for the falling market share in China at the company’s annual shareholders meeting today. He said that China is a more complicated market and that Samsung is now trying different approaches to bring in new customers.

Samsung’s market share in China is less than 2 percent

It’s mission-critical for Samsung in China as its market share dropped below 2 percent in the fourth quarter of last year. Not one Samsung handset could make it on the 2017 list of bestselling smartphones in the country. It has almost been driven out of the market by Apple in the high-end segment and local manufacturers who have not only captured the premium segment but also dominate the mid-range and low-end segments. These manufacturers have also proven to be a headache for Samsung in key markets outside China.

Samsung decided to make some organizational changes to its China division in September last year in a bid to reignite growth. It streamlined operations and replaced the local chiefs but it might be a while before the results of these actions, positive or otherwise, become visible.

The company said during the Galaxy S9 launch in China two weeks ago that its strategy for the country now involves more focus on customers that are willing to purchase premium handsets. It has also inked partnerships with local service providers such as Mobike, Alibaba, WeChat, Baidu and others to provide enhanced artificial intelligence features and additional IoT-based services to customers in the country.

It remains to be seen, though, if these measures pay off. Given the sheer size of the Chinese smartphone market if Samsung is able to regain some of its lost market share it would only help cement its position as the top smartphone vendor in the world even further.

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