What’s the first thing that comes to your mind when you hear about Samsung nowadays? Samsung Galaxy Note 7 catching fire, right? This blow not only caused Samsung to have an anticipated sales loss of $17 billion but also created a major impact on the society.
Koh Dong-jin, president of Samsung’s mobile communications business declared that Samsung will ask all carrier and retail partners globally to stop sales and exchanges of “Galaxy Note 7”. Samsung is still trying to figure out what the exact problem is. They tried replacing the “Note 7”s but users still faced the same troublesome problem of the phone catching fire.
When we look at the Business canvas model of Samsung now, we can see that it has lost the “Value Proposition” it offers to the customers. As the Note 7 caused fire, and in an extreme case it burned the thigh of a passenger in an airplane, it caused a loss in “Customer Relationship” as Samsung couldn’t assure the safety of its loyal customers. Moreover, when we look into the “Key Partnership” segment, the U.S. mobile partners of Samsung are AT&T, Verizon, T-Mobile and Sprint who decided to suspend the sales of “Note 7”s creating a huge loss for these mobile carriers too. Overall Samsung suffered huge loss and also caused many other important areas to affected brutally.
And when we also talk about the brand positioning of Samsung, if Samsung considers a reproduction of “Note 7”s it will be nothing none other than a lost cause. As “Note 7” has already lost its image and there is no point trying to bring back the brand in favor. Another factor to take into consideration is the impact of the competitors. As Apple just launched the new “iPhone 7”, many customers of Samsung will be convinced to switch onto that phone.
Leaving the negative sides aside, Samsung did make the right move on suspending production of the according to Consumer Product Safety Commission Chairman Elliot F. Kaye. Samsung will stop the production of the “Note 7”s and it will also give a full refund to the customers who have bought the phone. Moreover, they also provided gift cards of $25 as a compensation to some customers. The decision take by Samsung is a right one as for now, the loyal customers of Samsung will keep their hopes high that Samsung will bounce back.
Word count: 402
End notes and sources
http://bgr.com/2016/10/11/galaxy-note-7-sales-stop/
http://money.cnn.com/2016/10/10/technology/samsung-galaxy-note-7-turn-off/
http://money.cnn.com/2016/10/09/technology/samsung-galaxy-note-7/?iid=EL
http://money.cnn.com/2016/09/02/technology/samsung-galaxy-note-7-recall/?iid=EL