Apple and Sumsung decrease in market share

Samsung’s share of the market has receded slightly, going from 32.2 percent last year to 30.4 percent in Q2 2013 while Apple sees 13.1 percent share of the market, which is down on 16.6 percent in Q2 2012. In contrast, LG, Lenovo and ZTE saw greater year-on-year growth and quarterly growth than Apple or Samsung.

The consequences for Apple and Samsung can be far reaching as mobile devises account for major part of their businesses. iPhone and iPad account for two thirds of Apple's overall sales. A decline in market share will have substantial negative impact on its bottom line. Possible reasons attributing to the decline in the market share are products innovation, marketing strategies and responsiveness to consumers' ever-changing demands.

Innovation has been the competitive advantage for both companies The companies attracted new customers mainly because of attractive features and apps, and locking them in with must-have services and companion gadgets. Of late, this leadership position has been challenged. Apple is simply not catching up on innovation. The company hasn't launched a new smartphone or tablet in about a year before coming up with the iPhone 5S and 5C, while competitors are releasing new devices far more frequently.  If this advantage is eroded, then it has grave consequence to the company.
 
Both companies need to do more in developing markets such as China, where affordability is a major factor. Samsung’s smartphone market share in emerging market such as China is dwindling.  Xiaomi dethroned Samsung in December 2013 as the most popular smartphone brand in China, simply because it is more affordable to the locals. Although Apple launched the lower-cost iPhone 5C last year, the price of the product is still considered high to many.  To compete on price, Apple and Samsung may have to produce devices in the local market, taking advantage of lower cost resources.  If not, they face the consequences of losing more market share to local competitors.

Do Apple and Samsung know their customers well enough to enable them to response quickly to their changing needs?  In the digital age, both companies can certainly do more to profile and engage consumers through the various online platforms. Considering their cross-boundary businesses, this is crucial to come up with the right marketing mix for each of the markets.

Apple and Samsung both announced a decrease of market share yesterday, what are the consequences of this loss of market share for themselves, competitors?

Apple and Samsung both announced a decrease of market share yesterday, what are the consequences of this loss of market share for themselves, competitors?

The loss of market share for Apple and Samsung can indicated that there are lots of substitutes going into the market. Consumers are able to accept the substitutes due to lower costs and better quality than Apple & Samsung. The increasing of Chinese products brings the threats to both brands. For instance, Huawei for the same period kept a market share of 4.7 percent and Lenovo had an increase from 3.9 to 4.7 percent. As such, Apple introduced a lower cost Smartphone, iPhone 5C that tries to dominate back the market share. However, the price and spec doesn’t really appeal to the consumers and they would rather go for other substitutes.

The consequences of loss of market share can bring bigger competition among the existing and as well as new competitors. With the technology that is improving every day, it can reduce the barrier of entries of producing low cost and better quality smartphones. Some of upcoming Smartphone makers like Xiaomi and from report it indicated that revenue was up by 150 percent from the same quarter a year ago.

Another consequence will be retrenchment may occur in both brands if the market share continuing to decrease significantly.  Apple & Samsung will have lesser profit, thus, to reduce the high cost they may take consideration of retrenchment and result it may also affect their research & development as there will be lesser budget and talents for it. When lesser budgets are given to research & development, it may affect the quality of smartphone making them losing more market share.

In order for them to stay as leaders in the market share, Apple may look into producing a lower cost & good quality phone that pricing can fight against Huawei & Xiaomi Smartphones and having bigger screen size. In this way, Apple may able to capture new customers or retain existing customers.  Samsung may look into apps that are more unique to just Samsung users and not as Android user, since, they are quite a number of Smartphones maker are using Android as their operating system.

What are the benefits and drawbacks of Search Marketing?

Search Marketing = Search Engine Optimisation (organic) + Search Engine Marketing (paid)

Benefits:

1.  Amplify branding efforts:

Search Marketing helps amplify your branding efforts on digital media (e.g. website, Facebook page). Your brand may not be enjoying maximum visibility when you are not buying  related keywords on Search Engines like your competitor does. It helps protect your brand against competitors who may likely bid on your brand terms to increase their own brand visibility.

2. Maintenance of quality site for consumers:

Search Engine Optimisation forces you to think from the perspective of your target audience and guide us throughout a specific path on our website. E.g. using relevant keywords for site and hence maintaining a quality site for consumers. In addition, the constantly changing algorithms and criteria by search engines forces us to continuously improve and maintain a quality site that provides relevant information for consumers.

3.  Targeted marketing

Marketing dollars can be spent efficiently through Search Engine Marketing as it can be targeted at audiences with a specific set of demographics and behaviour. It is then only shown to captive audience who are actively searching for goods and services that your brand offers. E.g. A pregnant woman is more likely to see your product's ad on Google results page compared to a 15 year-old teenage boy as they search for different categories of information that are of interest to them.

Drawbacks:

1.   Reduced brand value:

Not all consumers fully understand how Search Marketing works and tend to assume that it is for companies with big marketing budgets (i.e. that there is no consideration of website quality). This reduces brand value in the perspective of consumers who don’t trust paid advertising and you're likely to lose this group of customers if your brand is not turning up also as an organic result.

2.   The Internet remembers everything:

Search Engine Optimisation produces truly organic results that can be contributed by other sources. This means that consumers can also easily find other sources of information through organic results that might be detrimental to your brand (i.e. past history).

3.   Challenge for Small Start Ups

Assuming that every brand in a reasonably competitive industry is on the same starting line for Search Engine Optimisation big companies with big marketing budgets are more likely to dominate advertising spaces on search engines through search engine marketing compared to smaller entrepreneurs.

Mabelline Tan

• Apple and Samsung both announced a decrease of market share yesterday, what are the consequences of this loss of market share for themselves, competitors??

Apple and Samsung are both market leaders in the smartphone market share. However, it appears that they are losing the market share to lesser known players like Huawei, Lenovo and LG.

I think Apple and Samsung are losing market share because consumers are looking for quality phones at a cheaper price. 

For Apple, it might be losing market share because they do not have varied sizes of phones like what Samsung or other phone makers has. Thus, for Apple to gain market share, they need to compete by making larger screen phones. 

Perhaps, phone sales these days are saturated and there is hardly any new/ innovative/ ground-breaking technology that could attract consumers to spend more. 

I guess for Apple and Samsung to compete with Huawei, Lenovo and LG, they will need to slash prices of their phones and make phones value for money in order to gain market share,

Perhaps for people for buy a phone, they do want to read reviews or do some research when they purchase.

So i tried typing in my Google search for the search words 'Apple Phones'. And this search page showed up.

I found it peculiar that Apple (though it is the market leader for its iphones ), appeared first and second in organic search but it did not appear in paid search at all. Now that Apple has announced that it has a decrease in its market share, perhaps it is time that Apple starts to regain its market share by doing search marketing. Apple could use paid search to regain its market share. 

A search with the words 'Samsung Phones' appeared in the following..

Samsung is still the market leader for smart phones. In the Google search results page, it is shown that Samsung did use paid search to market its latest Samsung galaxy S5. If Samsung continues to use paid and organic search to market its phones, it will not lose its market share.

I think Samsung should come up with phones that matches the cheaper price of Huawei, Lenovo and Lg phones in order to retain market share.

Huawei, Lenovo and LG will continue with paid and organic marketing to retain their market shares. 

What are the benefits and drawbacks of a search marketing?

What are the benefits and drawbacks of a search marketing?

Search marketing is the methodology of increasing traffic and visibility from search engines, be it from paid and unpaid efforts. Paid efforts will be Search engine marketing (SEM) that we are buying traffic through paid ads. Unpaid efforts will be Search engine optimisation (SEO) that we have gained traffic through organic.

Benefits of SEO

One of the biggest benefits of SEO will be that it is rather cost-effective as there is no payment to the search engines for your website to be showing at the organic search.  As the ranking of the organic usually base on the search algorithm or relevancy of the website contents.

Secondly, it is more credible, 70% of most people will choose to click on the organic than the paid ads. The users trust organic results more than paid ads.

Disadvantages of SEO

The difficulties that SEO may face will be lack of control due to the rapid change in the search algorithm or even the changes in the policy of the search browsers may affect the ranking.

Another problem will be lots of competition that will be going through not just locally and as well as international. There will be big pool of companies to fight against to be top in the rank. Beside that if the competitors often update their relevancy of the website contents, it may increase in their ranking as well.

Lastly, 75% of the users will tend not to scroll passed the first page of search results. Thus, if the ranking landed on page 2 and below, most of the users will miss it or don’t even know the business existed.

Benefits of SEM

One of the benefit of SEM will be that it is more targeted and accuracy of the searching due to the keywords that they imply in.

SEM will have more control over the ranking. The position of the ranking is able to modify on the real time basis, as such if the ranking has drop, we are able to bid for higher price to push the ranking back to the top.

The effect of earning traffic through SEM will be instant; you are able to set up the campaign instantly and get placements that you have paid for.

Disadvantages of SEM

Biggest fear of SEM will be missing opportunity due to the 70% of the users do not click on it, thus not to able to fully maximise the effect.

SEM tends to be more costly and fluctuate more often, due to the bidding wars that occur between the competitors. If the competitors have bigger budgets, they are able to increase the bidding rate to dominate the top ranking making the bidding rate much higher.

Mabelline Tan

• What are the benefits and drawbacks of a search marketing

Search Engine Marketing or SEM is an internet marketing strategy used to optimize websites and essentially make them 'search engine' friendly. By conducting search marketing, it can result for businesses an increase in website ranking, better page rankings in a search page an possibly sales for the company.

Benefits

Search marketing can drive targeted traffic to your site all the time. When the site has a digital presence on internet searches, we can forget about selling our products by cold-calling or by knocking doors. We can depend on search marketing to give us leads. 

Search marketing allows businesses to reach out to a global audience. We can now do business globally as there is no geographical boundaries anymore.

Get more targeted traffic to your website. Search engine is the number one traffic referral source for most websites. Millions of searches are conducted every day as people look for websites, information, products and services. With search marketing, you can definitely get more targeted traffic to your website. 

Search marketing is cost effective. When compared to other traditional advertising media, search marketing is definitely more cost effective. Search engine traffic is more targeted which makes it easier for you to convert prospects to customers

Search marketing allows business to build their brand. When your website has high visibility on search engines, you are showing your prospects that your business is an authority brand. When earchers seee your website often, they will remember your brand. Even if they do not need the product or service now, they will still think of your brand first when they need it in the near future. 

(retrieved from http://www.webdynamic.com.au/references/search-engine-marketing/the-benefits-of-search-engine-marketing.html)

Disadvantages

The challenge of SEO is that there are over 8 billion pages in the search engine indexes with your position in the SERPs dependent on a constantly changing algorithm which is not published. So making your pages visible may require specialist knowledge, constant monitoring and the ability to respond. As a consequence, the biggest disadvantage of SEO is a lack of control. You are subject to changes in the algorithm.

Favours big players. For companies with a lower budget or a narrower range of products on which to increase lifetime value it may be not possible to compete. Large players can also get deals on their media spend through their agencies.

Search marketing can be time consuming. It can take a long time for page rankings to improve a notch. 

Advertisers may be prevented from competing on a level playing field, because competitors and even affiliates may use less ethical black hat SEO techniques.

In competitive sectors it may be very difficult to get listed in the top few results for competitive phrases. This is when PPC may have to be used, although this can be expensive in a competitive sector.

The loss of market share for both Samsung and Apple points very clearly to the fact that the smartphones has clearly entered the era of commodification. There are many implications for both companies

Bloody battlefield in emerging markets and continued fragmentation of market
In advanced economies, everyone who wants a smartphone already owns one. The emerging market is where the next battlefield will be. No everyone will be able to afford an Apple or Samsung but the emerging middle class in emerging markets will want smartphones of their own.

Nobody is wasting any time on this - So everyone already fighting for a foothold.

It will be interesting to see if Tim Cook bows to pressure to come up with "low-cost" Apple phone for emerging markets that goes against the grain Apple's long-held strategy of releasing only premium products (I am sure most people agree with me that Iphone 5c was a very blotched attempt - the phone wasn't "cheap" and most people who could afford an Iphone 5c would have bought an 5s for its superior features).

In China, companies like Xiaomi and Oneplus are already trying to eat Apple's and Samsung's lunch. We will continue to see fragmentation of the market and continued erosion of market share of Apple/Samsung. Overall it's great news for consumers when it comes to consumer choice (possibly means lower prices and intensification of innovation)


Continuation of the proxy war between (Google) Android and (Apple) iOS and it's importance
With Samsung's 63% or more share of Android, it's clear that this is clearly a proxy war between Andriod and iOS to be the dominant mobile operating system of the phone in people's pocket.

Why is this war so important?

Not too long ago, whomever owned the content won until Apple figured out that whomever owned the customer relationship that could deliver that content won - App Store/iTunes is a very good example ($10 billion is close to GDP of Mongolia)

Both Google and Apple have an eye is clearly going to be the next biggest differentiator in the mobile phone business - Mobile payments.

Apple already owns 800 million credit cards on file through the App Store. Imagine if one could walk into NTUC, authorise the purchase with your mobile phone (and still earn rewards points on your credit card) and they just take a cut of that purchase... (or they could negotiate their own merchant discount rate with the bank...)

This relationship is also key in helping marketers piece together information between online digital behaviour and physical behaviour. Marketers would like know if a purchase in a store was linked to a earlier web search, or a click on banner ad, or location-based promotions etc.