Unless you’ve been living under a rock these past few weeks, you’ve probably heard of the sometimes explosive nature of the Samsung Galaxy Note 7’s battery. The fiasco has resulted in Samsung recalling the millions of phones it had shipped out: not once, but twice. Samsung has been so careful with trying to salvage what’s left of the Note brand that they’ve even sent thermally-insulated return kits to press so any further news wouldn’t blow up in their faces (quite literally). Despite having weeks to investigate the issue, the company is still unsure why their Note 7 devices keep exploding. Estimates peg that the Note 7 fiasco will cost Samsung a catastrophic $9.5 billion in lost sales. Despite these setbacks, a new report by BayStreet indicates there may be a silver lining for Samsung amidst the Note 7 chaos. According to the report, 70% of prior Galaxy Note 7 owners will remain with Samsung and will likely purchase a Samsung branded smartphone in the future.
The report continues with its findings and tackles a different question: how many Note 7 owners will abandon the Android ecosystem in favor of the premium iPhone 7 Plus? The answer is, apparently, very few. BayStreet finds that despite the fact that Note 7 owners are “aspirational” and “value premium brands”, they are unlikely to favor switching to an Apple product due to their loyalty to Samsung. These findings are quite surprising, considering the fact that an exploding smartphone is quite literally one of the few things one would expect a consumer to abandon a brand over. Instead, BayStreet estimates that only 15% of total Note 7 owners (approximately 200-300k) will switch to an iOS device.
Another marketing information and analysis firm, CCS Insight, believes that Samsung will easily weather the storm of financial and reputational damage incurred by the Note 7’s PR disaster. They note that the company’s $70 billion war chest as well as the estimated 80 to 90 million non-Galaxy Note smartphones they will ship will more than make up for the lost revenue from the Note 7. But if there is one lesson to be learned from this mess, it’s that Samsung cannot rush its future products. The Note 7 seems to be an isolated incident among Samsung products, but any repeat disaster could spell doom for Samsung’s future in smartphone electronics.
Source: FierceWireless
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