We are all going through a time of great difficulty and in all sectors. First, the pandemic, then the war in Ukraine has generated a lethal mix in exacerbating the peaks of one of the darkest moments in recent history, to which is added the inflation that bites without looking at anyone. It affects companies as well as consumers, and blows on fire, the component crisis, which does not need the inflation phenomenon to push prices up.
At Samsung, a reflection on the composition of revenues would have started. In Seoul, the product portfolio is varied, and unlike what happens in the parts of Cupertino, it is mid-range, medium-low, and medium-high range smartphones that grind the big numbers.
The point is that at a time like this there are two conditions: if the resources to build chips and components are limited, the suppliers even upstream of Samsung give priority to those who ensure the highest margins; and if there is at least part of the costs that have risen to be amortized, it can be done where there is profit margin to be eroded, so once again not in the mid-range, where there is a lot of competition and margins reduced to the bone.
In short, Samsung’s strategy fits little with the period, and this is the reason why, according to the indiscretions collected by the Korea Times, an attempt will be made to shift the center of gravity of sales upwards. The first useful opportunity to deviate from the sowing will be that of the launch of the new folding, Galaxy Z Fold 4 and Z Flip 4 which should be official in about a month.
Samsung, we have reported in recent days, would like to bring up the numbers of its leaflets considerably: Kim Ji-san, the chief researcher of Kiwoom Securities, reiterates the concept and adds that at the same time the company plans to reduce the estimated sales for 2022 of the products of the Galaxy S and A-lines so as to concentrate resources on the Galaxy Z, closing the gap with the rival of a lifetime, Apple, and putting a patch on the price race and the shortage of components.
Samsung will revise downward the sales targets of the Galaxy A and Galaxy S series to focus on the sale of the leaflets that will be unveiled in August – said Ji-san. Inflation has a greater impact on sales of cheaper phones than more expensive ones. In May, the percentage of smartphones over $ 600 was 19, up from the previous month, while phones under $ 100 were 26 percent. This is not in favor of Samsung, which is lagging behind Apple in the premium smartphone market.
It will not be easy, because the Galaxy Z has high prices and to sell more you need (also) a more kind price list for the pockets – try these days – of consumers.
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