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| Details |
Case Code: CLBS155
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| Case Length: 05 Pages |
| Period: 2016 |
| Pub Date: 2017 |
| Teaching Note: Available |
| Subject :Business Strategy |
| Price:Rs.100 |
| Organization :Samsung Electronics |
| Industry :Smartphone Industry |
| Countries : USA |
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Samsung Galaxy Note 7: Crisis Management and Beyond |
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Samsung, the world’s leading Smartphone maker, launched its most awaited Galaxy Note 7 smartphones, in 10 major markets, including the US and South Korea in August 2016. Within a week of its launch, there were incidents of Note 7s catching fire. Koh, the president of Samsung’s mobile business announced a recall and replacement of Note 7. But the replaced Notes also caught fire. The company had to announce a second recall and abandon the production of Note 7.
With holiday season fast approaching Samsung had to come up with a strategy to retain its loyal customers. Also its competitor Apple had just launched iPhone 7 and Google launched its first smartphone – Google Pixel. The company had to also work on rebuilding its lost brand value and instill confidence in the customers, which was essential for Samsung to retain its position in the smartphone market.
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Issues: |
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- Apply how to deal with crisis and manage the emergency situation effectively.
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- Understand the ways a company can communicate and effectively retain its customer’s loyalty.
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- Understand the importance of quality control checks.
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- Evaluate the short term and long term impact on the brand’s market share.
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- Evaluate the impact on the smartphone business where customers shift to a new ecosystem itself.
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| Introduction |
Samsung, the world’s leading smartphone maker, was founded in 1938 as a trading company in South Korea. Over the decades, the company expanded into various businesses, and by 1969 it was also in the electronics business. In 1988, Samsung started manufacturing mobile phones and by 2007, it had become the world’s second largest mobile phone manufacturer and the supplier of electronic components to Apple, Sony, HTC, Nokia, and other global companies. Its flagship smartphone, the Samsung Galaxy S series, (Galaxy), was launched in 2009.
At the end of the first quarter of 2012, Galaxy toppled Apple iPhone to make Samsung the largest smartphone maker in the world. With 95 million handsets being sold in 80 countries and 50 models, Galaxy accounted for 70% of the Samsung Group's revenues. The Galaxy handsets were known for their high quality and low prices. According to Interbrand’s report in 2012, Samsung was the 9th most valuable global brand with an estimated worth of $32.8 billion. However, in 2015, Galaxy sales were showing signs of slowing down and Dongjin Koh, (Koh), who was instrumental in launching the Galaxy models, was made president of Samsung’s mobile business. . |
Keywords |
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Consumer Product Safety Commission (CPSC), Federal Aviation Authority (FAA),Dongjin Koh,Apple iPhone 7, Samsung Galaxy Note 7, Google Pixel, Catching Fire, Product specifications, Lithium-ion batteries, Product replacement, Ecosystem, Crisis "
* This caselet is intended for use only in class discussions.
** More comprehensive case studies are priced at Rs.200 to Rs.700 (US $5 to US
$16) per copy.
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