Samsung Turns It Around In The U.S.



By Alex Bussani

Samsung is beating Apple at their own game on their home turf.

OK, sure — that may be a slight exaggeration.

But there’s certainly no debating the news reported by Kantar Worldwide Panel that Samsung's flagship duo of the Galaxy S7 and S7 Edge were outselling the iPhone 6s and 6s Plus in the United States. Brand loyalty also remained relatively level, with 88% of Apple users reporting their next purchase would be another Apple device, compared to 86% of Samsung owners reporting the same.

According to the data from Kantar, Samsung's flagships accounted for 16 percent of U.S. smartphone sales compared to Apple's 14.6 percent for the three-month period from March-May 2016. Due to the Galaxy S7 and S7 Edge release in March, this means, of course, that this time period spans the three debut months for the Samsung devices, while spanning months 6 through 9 of the Apple flagships — not a totally fair comparison, as a huge bulk of sales tends to follow a promoted, hyped-up release date.

However, to see the difference you only need to look back two device cycles ago. Just months after it’s release in Spring 2014, the Galaxy S5 was deemed a massive disappointment, one viewed so dimly by executives in Seoul that it resulted in the dismissal of a lead designer and a radical shift in the total design language of it’s successor, the Galaxy S6. While American sales of the S6 improved upon the S5, they still missed analyst expectations in their first two quarters on the market.

The Galaxy S7 has exceeded analyst expectations in it’s first quarter to market, breathing life into what was by all accounts a floundering Samsung mobile division. The face that the S7 and S7 Edge managed to outperform Apple's devices in the U.S. in any month at all — for the first time ever — is a big win for the Korean technology giant.

Samsung Mobile, however, still has it all to do when it comes to areas outside of the United States. For instance, it has faltered majorly in China, where Beijing's Xiaomi and Shenzhen's Huawei burst onto the scene, shrinking Samsung’s Chinese smartphone market share to just 9%. Apple, too, has become somewhat of a victim to the two Chinese upstarts, falling to 13% market share in China and losing Carl Icahn in the process.

The fact Samsung never held large ground in the Chinese market share does insulate opinions, to some degree, from turning too critical. In this sense, Apple is not as fortunate. Emerging markets are one thing, but simply performing well in a perceived stronghold is typically the antidote to investor concerns. Apple has failed to quell these concerns, as they continue to lose ground in the United States and China.

Samsung, though, once seemingly headed on a decidedly downward trajectory in both locales, has put together two very nice smartphones with the Galaxy S7 and S7 Edge. Appealing to it's long-time customers by bringing back a microSD slot in both devices, and adopting a more premium look and feel are design changes that seem to have brought the customers and some market share back — at least for now.

It remains to be seen if Samsung can replicate this sort of success on a global scale, and with future iterations of their hardware. The apparent high-cost Galaxy Note 7 will be a big test in determining whether or not this U.S. success was the beginning of a global turnaround, or just a slight bump in the United States as a result of Apple — smartphone king in the US — failing to release something compelling.

Blog PostAlexander Bussani