The company that sells the most smartphones in the world needs to start acting like they sell the most smartphones in the world.
According to IDC (a company who does nothing but assemble data and provide information about technology and telecommunications), "Samsung remained the leader in the worldwide smartphone market for the quarter and the year with 85.6 million units shipped in 4Q15, up 14% from last year."
85 million phones left Samsung's factories in the final three months of 2015. The total number of phones they shipped out in 2015 was 324.8 million. While that's sinking in, compare it to the next company on that list — Apple, who also had a stellar 2015 — at 231.5 million. Those numbers are astonishing to say the least, and unless you're a mathematician or some sort of robot, something you can't really visualize. Simply put, Samsung sells a shit-ton of phones. And they sell more — by a significant margin — than anyone else.
There's no reason why I shouldn't be able to buy an unlocked Galaxy S7 designed to work best in America.
But this isn't the whole story. In the United States and Canada, Apple owns about 40 percent of the market compared to Samsung's 30-ish percent. Numbers in China will likely soon look similar with Apple and Samsung fighting over the premium market. And the low-end market is also turning into a battleground, with companies like Huawei and Xiaomi selling more and more phones every day. Competition between the companies that make the phones we love to use is fierce, and a saturated market means things will get even more interesting — most people that want a smartphone already have one. The key is going to be retaining customers.
All this is great news for us as consumers. We want companies like Samsung fighting tooth and nail to get our money, because that means they will build compelling products at a price we want to pay. But it also means that Samsung — and everyone else building smartphones — will need to change tactics to continue to rake in the money.
Like any good business, Samsung already has plans in the works to continue to be successful. We recently heard Samsung say they are reforming their business culture and want to think more like a startup than a mega-global conglomerate. That's all well and good, and I'm sure Samsung has enough business savvy to stay in the black in a more competitive environment, but I think a change in the way they do business with carriers in the U.S. and Canada can also have a significant impact.
For starters, there's no reason why I shouldn't be able to go to Amazon or Samsung's own web portal and buy an unlocked Galaxy S7. That's absolutely ridiculous. I imagine it has to do with business deals and clauses with people like AT&T or Verizon, who really like to keep control over the phones you and I buy. If that's the case, it works. Few of us want to import an unlocked and unbranded Galaxy S7 that won't work with Samsung Pay, might not have a warranty and is optimized to work better on a carrier in Europe or the Far East instead of the one we send money to every month. So we end up buying one that has another company's name on the back, and they get to control what software we see and when we get access to something newer and better. I get why the carriers like this arrangement, and I understand why it was a good business strategy five years ago. But times have changed.
A change in the way Samsung does business with carriers in the U.S. and Canada could have a significant impact on customer retention.
We're a more informed and more savvy buying public now. Everyone you know probably has a smartphone, and everyone has complaints about the company they pay to get monthly service. But for most of us, we can't just pack up and move somewhere different and have new complaints, because we're paying a monthly installment or on a carrier contract with Sprint or Rogers or whoever. And if that phone in our hands is an Android, chances are it's made by Samsung and that's how we had to buy it. Even if we paid full price upfront for our new phone, the carrier who has their name on the back has control. It's clear just who is the winner in this relationship.
It doesn't have to be this way. Samsung has enough brand power to do something different. In fact, they should follow Apple's lead and leverage their position in the industry. While Samsung is selling me a Galaxy phone that works where I live outright at their Best Buy "experience" stores, let Verizon or T-Mobile continue to resell Samsung phones. Let carriers keep their lengthy contracts or crazy leasing schemes in place. Some folks are comfortable buying their phone this way. But take control of the Samsung brand away and stop letting them dictate when a critical patch can be sent to the users, or who gets access to cool new features. One model. One software path. No interference from companies that don't build phones, and are only really proficient at being a data-pipe. Apple — your biggest competitor — can do it. So can you.
Everyone's experience will be better this way, and a better experience turns into customer loyalty. We will want to continue to buy the Samsung brand when it's time to get a new phone even more than we do now, because we can feel like your customer instead of some phone company's. We will influence people who have questions to buy your products because you can take better care of us. We will remember your name when we buy things that aren't smartphones because we like the way you treat us as a customer.
You're the big dog, Samsung. Act like it.