The smartphone market in China is quickly growing, but mobile provider China Unicom is struggling to maintain consumer mindshare. As competitors China Mobile and China Telecom continue to grow their user base by leveraging new 4G and LTE networks, China Unicom’s growth is stagnant.
In the current scramble to provide high speed access to users in China, China Unicom was “unsure on whether to use the home-grown TD-LTE standard or wait for the FDD-LTE license to launch 4G services.” Forbes reported that their sporadic transition strategy from 3G to 4G and LTE service set them back in expansion. Examining consumer reviews confirms that consumer subscriptions are dropping along with consumer mindshare for China Unicom. Therefore, Forbes simply confirmed the decrease in consumer interest that our consumer data has been displaying for months!
Buzz about China Unicom by Brand
This chart displays smartphone buzz by brand for China Unicom over the past few months. The amount of buzz about all brands has shrunk showing a loss of interest in this specific provider. Is China Unicom’s inconsistent high speed internet upgrade to blame for the decline in consumer interest?
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Sales records have been a reliable indicator of the failure of Amazon’s Fire Phone. Although Amazon does not release exact sales data, analysts report that Amazon saw less than 35,000 phones sold in the first 20 days after its release in July of 2014. At the price of $199 with a 2-year contract, it seemed consumers were not interested in Amazon’s smartphone. After these less than impressive sales figures, Amazon dropped the price of the Fire to 99 cents the day before Apple unveiled their new iPhone 6 and iPhone 6 Plus. After this seemingly desperate move failed to fire up sales, it became clear that the retailer known for providing the best values fell short with the Fire. The Internet is ablaze with articles blaming everything from price to the operating system to AT&T exclusivity for the phone flop. Argus Insights aims to discover the true reasons for the Fire failure by going straight to source: the consumer base.
Examining consumer buzz and delight throughout the life of the Amazon Fire presents a clear image of the phone’s flop. Slashing the price helped Amazon briefly renew conversation about the Fire, but after people shelled out a measly $1 for the smartphone, they were even more disappointed than before. What exactly about this phone caused such distain?
There have been negative responses to several aspects of the phone. Looking to the content of consumer reviews, we found that people complain most about the speed and performance, but have the most animosity about needing to return the phones. Customers were unhappy with the support they received from both AT&T and Amazon when they decided they did not care to keep the Fire. Complaints warning others to “BEWARE” of the “35.00 (dollar) restocking fee,” and outlining AT&T’s “poor service” are prevalent, and seem to critically increase people’s frustration surrounding the Fire. The rest of the funnel represents the most common areas of complaints. Ranging from quality, to usability, to battery life, to price, there were an overwhelming amount of negative comments across the board.
This chart shows the specific areas in which the most consumer comments were concentrated.
Complaints regarding actually using the phone are more than abundant. Problems around the phone’s stability stemmed from “crashes during videos, calls (and) app usage,” resulting in the need for some to “reset the phone ~3x daily.” Several reviews detailed how the Fire fell short to other popular smartphones like the iPhone and Samsung Galaxy. With a smaller screen, less efficient apps, and a shorter battery life, Amazon’s Fire did not impress. The general consensus can be summed up by one review that stated: the “Fire’s interface is inelegant,” because it “fails more often than it works.”
Amazon released a subpar phone, and then failed to deal with returns in a satisfactory manner. The Fire phone was ultimately a disappointment, but Amazon’s good reputation as a retailer could carry them past this smartphone disaster. Positive comments about Amazon as a brand are still slightly more prevalent than negative ones. The Fire did not burn bright, but it may have burned some bridges. Amazon greatly disappointed their customers with this not-so-smart phone, and while consumers continue to talk about Amazon, the conversation is increasingly nasty. It’s said that all press is good press, but does Amazon have the brand strength to recover? With a recent launch of 6 new tablets on September 18th, they have a chance to impress.
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News of Samsung’s expected drop in profit is spreading quickly. The well-known electronics manufacturer is seeing intense competition. Samsung is losing global mindshare in all product sectors aside from Smartphones and Wearables. Perhaps most surprising is the loss of mindshare in sectors that Samsung has historically held a strong market share in, like appliances and tablets. Due to this far spread loss of consumer interest, they have been striving to beat Apple and others in the smartphone market to maintain profit, but in doing so, they are spending precious time and money promoting their Galaxy S5 and bashing Apple. Both high-end brands like Apple, and companies creating cheaper smartphones with similar capabilities and Android software, like the Chinese startup Xiaomi are gaining mindshare as Samsung losses it. The Verge reported an expected “big blow to Samsung’s bottom line due to” these competitive stresses. In an effort to stay ahead of the competition, Samsung has launched ad campaignsmocking Apple coupled with aggressive promotions for their new Galaxy S5 to stave off potential customers waiting for the much anticipated larger screened iPhone 6. Despite their focus on smartphones, Samsung is losing global mindshare.
As displayed in the chart above, Samsung’s aggressive tactics have noticeably driven consumer interest in smartphones and wearables, but interest in all other Samsung product sectors is decreasing. On the product level, demand for the Galaxy S5 is robust. With that however, the Galaxy S4 and the Galaxy Note 3 did not fall off as expected when the newer handsets were announced. In the past, for both Apple and Samsung, this indicated interest in the lower priced, older handsets over the newer higher priced handsets. Smartphones are one of Samsung’s only growing markets, and if consumers continue to put price over novelty, Samsung’s overall gross revenues will be significantly affected.
Looking to the Smartphone Market Landscape in China, it is clear that local manufacturer Xiaomi is overtaking both Samsung and Apple. Xiaomi offers smartphones that run on Android software for nearly half as much as Samsung’s fairly similar handsets. Consumers are showing interest in cheaper phones, and with this Samsung and Apple are losing their brand strength abroad.
Samsung’s anticipation of lower profits is to be expected. Their brand is weakening as other manufacturers are filling the void of quality at a lower price. While Samsung has had fun sniping at Apple in commercials, these ads have done little to shift the brand from top of mind to top of shopping list. Samsung is losing mindshare, and should be addressing consumer product concerns instead of turning their attention to competitors.
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September was a big month for Apple. They revealed the new iPhone 6 and 6 plus on the 9th then sold a record-breaking amount of phones less than a week later. Always anticipating the newest product, Apple groupies shelled out cash for the phones before they were available, only to encounter iOS glitches and #bendgate. Despite the problems Apple has faced with this launch, their consumers continue to endorse their products
Once people began to receive their iPhones, delight levels soared. The iPhone 6 even achieved higher levels of delight than the average of all Apple smartphones. Negative comments were far outweighed by positive ones, as is demonstrated in the funnel below. Customers were happy with the size and weight of these rather large devices, and found them easy to use. The highest volume of negative comments surround the speed and performance, even so, positive comments overshadow the negative even in that category.
While consumer reviews show an increase in delight, this story can be supplemented by examining social media. Delving into the phrases people used most in relation to Apple in the weeks after the iPhone 6 and 6 plus release; we can see discussion of ‘bendgate’ and software malfunctions. These setbacks caused considerable buzz on twitter and blogs during the same time period in which consumers were writing positive reviews.
Apple has such a large following, and their phones are so widely discussed, that social media conversation from the general public noticeably differs from reviews that consumers actually using the products write. Apple’s popularity as a brand has been driving awareness, even if some of it is derived from malfunctions, and when people purchase and review the products, they are delighted regardless of trending problems like ‘bendgate.’
The negative social discussion surrounding the iPhone 6 and 6 Plus is not reflected as negativity in the product reviews. It seems that tweets of #bendgate and iOS malfunctions, although representative of existing problems, do not seem to be affecting consumer praise of the new iPhones.
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With the annual consumer electronics convention IFA right around the corner, tech companies are scrambling to catch consumer’s attention. Countless new product teasers are being released, but Lenovo’s teaser for its new Vibe X2 smartphone is creating quite a buzz.
The image of a lollipop is a nod to the upcoming Android L (it’s rumored codename being lollipop) and the tagline “we can’t say anything either” is a play on Apple’s recent comment “wish we could say more” with regard to the iPhone 6. Assuming the participating companies do not want to give away details about their products before they are launched, they are relying on these clever marketing techniques to peak consumer interests.
This teaser appeared to be instrumental in creating discussion about the new Vibe X2. People tweeted about Lenovo’s subtle jabs at Apple and Android, and in return created a notable peak in interest surrounding the Vibe X2. By sharing articles that speculated the meaning behind the Vibe X2 teaser, along with personal inquiries about Lenovo’s new smartphone, the advertisement was successful at getting consumer’s talking. In the competitive smartphone market, Lenovo found a way to use the prominence of other popular companies to move the focus to their announcement.