Samsung expects demand for consumer electronics to remain sluggish throughout the first half of the year due to rising interest rates and high inflation. However, the company expects the industry to start recovering in the second half of 2023 and views the recent downturn as an opportunity in disguise.
“A crisis usually creates a new opportunity. When everything’s stable, it’s hard to shake up the market order,” said Jong-Hee Han, head of the Samsung DX (Device eXperience) division, in an interview with The Wall Street Journal. The Co-CEO believes that the recent hurdles gave Samsung a new purpose to unify its device ecosystem and create richer connected experiences.
With this goal in mind and Mr. Han at the helm, Samsung founded DX in December 2021 by unifying the Digital Appliances (home appliances), Health & Medical Equipment, MX Business (Mobile eXperience), Visual Display (TV), and Samsung Networks divisions.
Overcoming the crisis through Samsung DX and “calm technology”
Before the DX division came about, Samsung’s various branches operated somewhat independently. Although this approach fostered internal competition, it also hindered the company’s efforts to create products that seamlessly work with each other. Internal conflicts between various Samsung divisions and their goals have held the company back. The strategy worked for the better part of the 2010s. But today, many analysts believe that smartphones, for example, can no longer make a big enough impact on the market as long as their primary or only focus is to deliver great specs in a vacuum. There needs to be more.
The DX division was created to overcome these challenges, unite Samsung’s divisions and, ultimately, develop products (smartphones, TVs, and home appliances) in a tighter ecosystem that can generate more value for customers and give them a reason to remain loyal to the brand. Powerful software and device interconnectivity are the key to this.
Some of the DX division’s efforts surfaced at CES 2023, where Samsung revealed its improved connected home strategy. Samsung also aims to develop more robust software capabilities and services. And although the company predicts that the economic downturn will continue to pose a problem for the first half of 2023, it believes that its new strategy will help it overcome financial difficulties in the second half of the year.
Mr. Han said that one of Samsung’s goals is to find the best device and method to “enable a certain connected feature in the most effortless, user-friendly way.” The new “calm technology” strategy is all about seamless interconnectivity and expanding its partners. Samsung was among the first to adopt the Matter standard last year. At CES 2023, the company also announced SmartThings Station — a hybrid device that acts as a wireless charger and a control hub for Matter-compatible products.