Strategy Changes
Samsung and LG Electronics have modified their strategy for smartphones to overcome the crisis of the smartphone market.
According to industry sources on July 14, Samsung has changed its strategy with various spinoff products, as shown by its early release of the tri-band LTE version, only one month after the launch of the Galaxy S5 in late May. The Korean handset maker is also planning to introduce the Galaxy Alpha, an upgraded version of the Galaxy S5, during this month at the earliest. In the past, the largest smartphone vendor rolled out a new Galaxy S version in the first half, a new Galaxy Note model in the latter half, and finally entry-level or specialized spinoff products. However, the company has changed its strategy in a way that releases a variety of spinoff products one after another, because of a slump in the premium smartphone market and a decline in sales.
LG is also trying to change its strategy for its lineup of smartphones. The Korean handset maker is focusing on the G series (premium phones), the L series (entry-level and mid-range 3G smartphones), the F series (entry-level LTE smartphones), and the View series with a 4:3 aspect ratio. Among these, the View series are expected to be changed. Industry analysts are saying that the Android phone manufacturer will not launch the View series this year, or the series will be integrated into the line with a built-in pen category.
Unlike Samsung, LG is trying to change its strategy in a way that simplifies its lineup and focuses on a few products. As a result, it will change the name of the View series with the G-Stylus, equipped with a built-in pen, so that the View series can compete with the Galaxy Note series. In particular, it is urgent for LG to maintain its market share, given unfavorable factors in the smartphone market, including the launch of the iPhone 6 scheduled in the latter half of this year and Chinese handset makers' exponential growth. Thus, the Korean smartphone maker is aiming at occupying the third smartphone seller spot this year. Currently, LG is the fourth largest smartphone manufacturer with a 4.8 share, following Huawei with a 5.1 share.
An industry source remarked, “As the popularity life cycle of smartphones is shorter, it is increasingly difficult to overtake market growth with just a few premium models.” The source concluded by saying, “One of the reasons for local handset makers' change in their strategy lies in the fact that they are exhibiting poor performance in emerging markets, despite a huge amount of marketing costs.”