Samsung has a leadership problem - Shaun Rein

Shaun Rein

The global recall of the Samsung Galaxy Note 7 has plunged the Korean company into disarray. Samsung was already a long time without leadership, says business analyst Shaun Rein to Bloomberg, but the disaster has only become worse, after the latest disaster.

Bloomberg:

The debacle is testing Samsung’s management and raising questions about whether it needs stronger leadership. Lee Kun-hee, the family patriarch, remains chairman even though he suffered a heart attack more than two years ago and hasn’t been back at the company since. His son, Jay Y., is heir apparent but he hasn’t been able to take his father’s title because of Korean custom. 

“They have real management problem right now,” said Shaun Rein, managing director of Shanghai-based China Market Research Group. The lack of a clear leader “has slowed down decision making.”

More in Bloomberg.

Shaun Rein is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers´request form.

Are you looking for more strategy experts at the China Speakers Bureau? Do check out this list.  

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Samsung is done in China - Shaun Rein

Shaun Rein

China´s users of the Samsung Note 7 were already upset the Korean company did not pull back their faulty model from the Chinese market, like they did elsewhere. Now Samsung had to withdraw all Note 7 phones globally, they are in China done in their largest market, says business analyst Shaun Rein to Bloomberg.

Bloomberg:

There’s also the risk that the Note 7 troubles spill over to other smartphones in the Galaxy lineup, dampening overall sales momentum against key rivals such as Apple and Huawei Technologies Co. Samsung faces a serious image problem in China, where customers and government-owned media have railed about Samsung’s handling of its recall. 

"They’re done in China," said Shaun Rein, managing director of Shanghai-based China Market Research Group. "For the Chinese, they don’t differentiate between the Note 7 and all Samsung phones. So they’re not willing to buy any Samsung phones right now."

More in Bloomberg.

Shaun Rein is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers´request form. 

Are you looking for more experts on managing your China risk? Do check out this list.  

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How Samsung pissed off its Chinese users - Ben Cavender

Ben Cavender

Samsung had a loyal group of users in China, but its way of dealing with the latest security scare has shocked their loyal follower, says retail analyst Ben Cavender to AP. Samsung did not recall its Note 7, despite possible igniting batteries, and recalls in the rest of the world.

AP:

Chinese consumers are unusually alert to safety issues following an avalanche of scandals over shoddy or fake food, medicines and other goods. They also are sensitive about being treated as well as Western consumers. 

"I think consumers are pretty unhappy with Samsung," said Ben Cavender of China Market Research Group. "Consumers start to feel like they are being taken advantage of, that they are not being accorded the same respect here as they are abroad."... 

Working in Samsung's favor is the fact that phones are sold through retailers in China instead of carriers. That allows users to switch brands quickly and new competitors to enter the market. 

"In any given month, a brand is going to leapfrog another brand and come up with a brighter screen or bigger battery of faster charging," said Cavender... 

Longer term, the Note 7 in China is likely to "take a major sales hit," said Cavender. 

"People who want to buy a phone are going to switch to Apple or to a local brand like Huawei," said Cavender. "Or if they want a Samsung, they probably are going to wait for the next generation, because they don't want to take the risk that they will get a faulty product."

More in AP.

Ben Cavender is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers´request form.

Are you looking for more experts to deal with your China risk at the China Speakers Bureau? Do check out this list. 

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Xiaomi picks fight with Apple, Samsung - Ben Cavender

China´s smartphone maker Xiaomi has launched its first tablet and business analyst Ben Cavender sees the company doing well in the 15-35 year bracket of consumers who never used a PC. Apple and Samsung should start to worry, he explains in Bloomberg TV.

Ben Cavender is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers´ request form.

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Consumers continue to spend on home decoration - Shaun Rein

Shaun Rein

China's consumers continue to spend, despite a small dip in growth, also for decorating their homes, argues business analyst Shaun Rein, and goes against JWT executive Tom Doctoroff, who says Chinese consumers go for cheaper products. Shaun Rein dismantles three consumers myths in Business Week.

Shaun Rein:

Tom Doctoroff, chief executive officer of J. Walter Thompson Shanghai, argues that Chinese consumers are not willing to spend more than the minimum on items inside their homes. Concerned with the projection of outward status, Doctoroff believes Chinese won’t spring for foreign appliance brands if they can’t show them off to others and will instead opt for cheaper, good-enough domestic brands such as Haier or Gree. 

Doctoroff’s conclusions, however, don’t match the results of 500 interviews China Market Research Group conducted with people whose net worths are over $500,000. We found that 90 percent of well-off respondents preferred big-ticket item household appliances from foreign brands such as Samsung andSiemens (SI). In fact, most of them bought only foreign-brand appliances, explaining they felt the non-Chinese names had better functions and underlying technology. 

What’s more, as we broke down home spending room by room, one of the key areas female consumers focused on—and where spending was growing fastest—was the bedroom. They particularly were interested in high-quality sheets and mattresses. These are items that have nothing to do with showing off to friends, most of whom would likely never see the inside of their bedrooms. These purchases are all about consumers pampering themselves. One 28-year-old Shanghai woman told me why she spends so much on linens: “I work hard and want to feel like a princess at home.” 

While it is true that “showing you’ve arrived” is often an important driver in spending patterns, companies should not be so fixated on this concept that they ignore an important shift that is going on: Consumers are increasingly willing to spend extra to indulge themselves.

More in Business Week.

Shaun Rein and Tom Doctoroff are both speakers at the China Speakers Bureau. Do you need one of them (or both) at your meeting or conference? Do get in touch or fill in our speakers' request form.

Apple is under-performing - Shaun Rein

Shaun Rein

Apple's recent success in China might have gained it a lot of admirers, and Apple even promised to focused more on the country during the WWDC conference. But the company could have done much better and could have turned China into its largest market, retail analyst Shaun Rein tells in the Pandodaily. 

The Pandodaily:

 “Even though Apple quadrupled sales in China and it’s their second largest market, they only have five Apple stores in the country,” Rein told me over Vietnamese food in an upscale shopping mall. “We think the market can sustain about 100, and they have 300 globally. So they’re not taking what I call a China-first strategy.” This is, after all, a country of 1.3 billion people and 1.4 million US-dollar millionaires. 

While iOS voice-assistant Siri is soon to be available in Mandarin, it’s still not physically in the country, Rein points out. The company releases products in China half a year after they’re available in Hong Kong, which is just over the border, and sales of Android-powered handsets are growing faster than Apple in the smartphone market... 

“Apple needs to move a lot faster, and because they’re moving so slow, you’re getting the emergence of Samsung at the high end, and then Xiaomi at the low end, which is just absolutely booming, and they’re positioning at a great price-point for consumers,” says Rein. Chinese consumers love the Xiaomi phones in particular. The high-spec and homegrown smartphones not only have buyers, but also fans, and they sell for as much as $470 per device cheaper than the iPhone. Last week, the company announced that it had sold 3 million devices in just two years of existence and with only one model (although the company did release a second model recently). 

Is Apple, then, at risk of getting left behind? “If they don’t make massive changes, in two or three years they could run into serious challenges,” says Rein. “Three years ago, the iPhone was far superior to any other handset in the marketplace. Now it’s not.”

Much more in the Pandodaily.

Shaun Rein is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Shaun Rein is the author of "The End of Cheap China: Economic and Cultural Trends that Will Disrupt the World". More about Shaun Rein and his recent book at Storify.

Apple still lagging in China - Shaun Rein

Apple might be doing well in the China market, they could do better, tells business analyst Shaun Rein in Bloomberg. Apple is losing ground to the competition, because they focus better on the Chinese consumer.

Bloomberg:

The company is hardly alone in attempting to benefit from the spending power of Chinese consumers. Samsung Electronics Co. and other phone makers using Google Inc.’s Android operating system are outselling Apple, said Shaun Rein, managing director of the China Market Research Group. The company ought to release its products sooner in the Chinese market, he said. 

“Apple is a good story in China, but they are succeeding in spite of themselves,” Rein said. “They are winning because they have a great product, but they are underperforming when it comes to localizing and understanding the China market. They should be releasing products in China first.”

More at Bloomberg.

Shaun Rein is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Shaun Rein is the author of The End of Cheap China: Economic and Cultural Trends that will Disrupt the World. More about him and his book at Storify.

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Apple is lagging behind Google's android - Shaun Rein

Shaun Rein

Apple might look like the big technology winner, gaining unprecedented access to the Chinese consumer, but it is lagging as Google's Android moves ahead, tells business analyst Shaun Rein Bloomberg. Bloomberg:

The iPhone maker is only “scratching the surface” of Chinese demand after sales in the region surged six-fold to $3.8 billion last quarter, Apple Chief Executive Officer Tim Cook said in July. Still, delays in store openings may give makers of smartphones and tablets equipped with Google Inc. (GOOG)’s Android software room to gain market share, said Shaun Rein, managing director of China Market Research Group. “In many ways they are still behind the curve, and they are opening stores too slowly,” said Rein, whose Shanghai-based company advises retailers and other clients about operating businesses in China. “Before, Apple had clear dominance in terms of technology, but now the gap is being lowered because of Android.” Apple is expanding distribution of its products including the iPhone and iPad in China as competition with Android device makers including Samsung Electronics Co. and Lenovo Group Ltd. (992) intensifies. Kristin Huguet, a spokeswoman at Apple, declined to give the company’s latest target for store openings in China.

 More in Bloomberg Shaun Rein is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch.

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