First Ominous Signs, Samsung Smartphone Market Share Drops By 7.1%
The growth of Chinese mobile brands across the world is threatening Samsung’s Numero Uno position in Smartphone Market and the signs are looking ominous. According to the latest Worldwide Quarterly Mobile Phone Tracker by IDC, Samsung’s market share has dropped to 25.2 percent in 2014 as compared to 32.3 percent in 2013.
7.1 percent market share drop in one year quite significant for Samsung, especially given the fact that Smartphone market is still in the growth stage across the world, especially in developing nations like India .
According to IDC report, worldwide smartphone market grew 23.1% year over year in the second quarter of 2014 (2Q14), creating a new single quarter record of 295.3 million shipments. The sequential growth over 1Q2014 was registered at 2.6 percent. The report expects that in 3rd quarter, smartphones shipments will cross 300 million for the first time on back of strong sales in low-cost smartphone segment.
Samsung is facing the maximum brunt due to rise of Chinese vendors who are churning out high specification smartphones at rock bottom prices. The latest example could be Xiaomi, who have managed to sell their flagship smartphone Mi 3 in matter of minutes.
While, Samsung has been launching smartphones in every segment, they are unable to match the prices offered by Chinese vendors. This is clearly seen from the fact that they sold lesser smartphones (74,3 million) in 2Q2014 compared to 2Q2013 when they sold 77.3 million units.
As you can see from the smartphone shipment volumes, Samsung is the only vendor among top 5 that witnessed fall in the number of shipments. Among top 5 vendors, Huawei managed to growth the maximum (95.1%) growing their shipments from 10.4 million to 20.3 million.
Apple generally has low numbers in second quarter and yet managed to increase their shipments from 31.2 million to 35.2 million.
However, “others” section is something that majorly consists of smaller Chinese vendors is hurting Samsung the most. Their shipments grew from 97.5 million to cool 135.3 million in a year.
Samsung lost 7.1% market share compared to a year ago, despite having one of the largest smartphone portfolios of all OEMs. To maintain its position at the top, Samsung will need to focus on building momentum in markets dominated by Chinese and local brands.
Even though Apple shipments great, their market share dropped from 13 percent to 11.90 percent. On the other hand Huawei, Lenovo and LG all saw double digit growth in their market share.
The “Others” section saw their market share rise from 40.6 percent in 2013 to 45.8 percent in 2014.
One thing is sure, Samsung needs to pull their socks otherwise they may end up becoming another “Fall from the grace” stories so famously attached with Nokia!
What do you think?