Samsung beats Apple in mobile handsets

Over the last three months Samsung has passed Apple as the largest manufacturer of smartphones, shipping an estimated 27.8m handsets compared with Apple’s 17.1m (in a total market of around 117m sets).

What makes this even more remarkable is that sales have increased four-fold over the past year.

How has Samsung been able to do achieve this?

  • By having strength in core technologies, to which new functionality (demanded by the market) can be added
  • By cooperating with other players to add that new functionality quickly (notably Android brings a wide range of services; useful to customers but in which Samsung has no capability)
  • By packaging them into “elegant designs” and “memorable sub-brands”
  • By having an established, global distribution network to bring them to customers
  • By charging lower prices — Samsung’s operating profit margins are around half those of Apple (16.9% compared with Apple’s 30.8%)

Success is about having a core strength, adding to it, cooperating with partners to deliver a product to customers, and moving quickly.

And perhaps the more important lesson from this case is that it is possible to increase sales fourfold, and pass the established market leader (at least in one segment), during a time when the world’s financial markets are in crisis and economies are stagnant. 

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