Samsung in consumer electronics: from products to ecosystems

Samsung in consumer electronics: from products to ecosystems

Samsung experienced a stellar 2021, as high demand continued to be driven by pandemic-related interest in TVs, smart wearables, and headphones. However, Samsung continues to feel the intensification of competition from China, especially in smartphones.

Revenue increases for Samsung in 2021 after the initial pandemic shock

After the disruption caused by the pandemic for smartphones, the key category for Samsung, in 2020 the company managed to generate strong double-digit growth in 2021. In particular, Samsung TVs, tablets and smart wearables have seen an ongoing increase linked to the pandemic, as consumers have shifted shopping away from home to electronics and appliances. The rapidly growing headphone category, especially the TWS earbuds, has contributed to Samsung’s growth in portable electronics. The 2017 acquisition of Harman with its JBL brand helped Samsung increase its share in this category, especially in European markets. Samsung also benefited heavily from its semiconductor and memory business, the fastest growing division in 2021, supported by global demand for PCs, gaming laptops and new 5G product launches, including smartphones.

Source: Euromonitor Consumer Electronics Research, 22ed

Preserving the ecosystem and offering a range of services

Samsung is investing in building a cross ecosystem, starting with its Galaxy Ecosystem, as ecosystem conservation becomes more crucial than keeping consumers in a particular product category. Also spurred on by its closest rival Apple, Samsung has expanded the services and content offered on its smart TVs.

Samsung is investing heavily in research and development and directly owns many parts of the production chain. The company has its own foundries and display panel manufacturing capabilities under its Device Solutions unit. This benefits Samsung in terms of early access to new technologies and ensures better cost control than buying components from its competitors.

image5mwb.pngSource: Euromonitor Consumer Electronics Research, 22ed

From products to ecosystem: Will Samsung leverage its broad product portfolio?

Samsung, however, has chosen a different path in terms of content and revenue generation from services than rival Apple. While Apple TV + is a monthly paid service, primarily offering its own content, Samsung’s Plus TV content service is a free, ad-supported service, primarily offering third-party content. It expanded to more regions in 2021, now available in 23 countries, and continues to add services. In 2021, for example, Canela.TV, one of the first AVOD streaming services for US Hispanics, became available.

Generating significant interest, Samsung also announced Samsung Gaming Hub, which will launch in 2022 on its smart TVs, in partnership with NVIDIA GeForce NOW, Stadia and Utomik. The game streaming platform will allow users to discover and stream video games and quickly launch them with connected consoles. As games are growing dynamically around the world, this could give Samsung a huge competitive edge, provided it continues to expand its partnerships with major console players, such as Microsoft and Sony.

For more insights, read our Global Company Profile, Samsung Corp in Consumer Electronics (World).


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