IDC: Samsung moving out of the dark Note 7 woods

Samsung faces some “short-term challenges” but nothing that will “darken its long-term prospects” following the Galaxy Note 7 debacle, according to analyst IDC.

Samsung’s latest financial results were severely dented by the recall and the then ditching of the fire-prone gadget, but IDC has gone to the coal face to see what is really happening to the brand.

It surveyed 1,082 US consumers four days after Samsung decided to halt production on the Note 7. The survey focused on three groups of consumers: current Samsung smartphone owners (507), past Samsung smartphone owners (347), and smartphone owners who have never owned the Samsung brand (228).

Due to the limited installed base, just 24 Note 7 users were captured in the survey – as such, full conclusions should be viewed as “directional only”, said IDC.

“As challenging as the Note 7 recall has been for Samsung, the data in this survey indicates that most consumers are unaffected by this, which should be good news for Samsung,” said Ramon Llamas, an IDC analyst. “For the minority of Samsung customers who are unlikely to purchase a Samsung smartphone in the future, the company has to win back consumer trust.

“Thus far Samsung has offered monetary incentives but, at the heart of the matter, consumers want to learn the root causes of the problem and how Samsung intends to fix them.”

Half of the 24 Note 7 owners polled said they have or will choose an Apple iPhone to replace their recalled phone, while 17 percent said they would choose another Samsung. Most said they will return their phone through a carrier’s physical store.

The Note 7 recall doesn’t appear to be harming the broader Samsung brand so far though. A majority of respondents said it would not impact future decisions to buy other, non-smartphone Samsung products such as televisions and appliances.

And survey participants’ view of Samsung’s response to the Note 7 recall was largely “neutral to positive”, said IDC. Surprisingly, about 13 percent hadn’t even heard about the recall when polled.

“The Note 7 recall, along with all its repercussions, represents a significant event in the world of consumer electronics,” said Anthony Scarsella at IDC. “Although the recall may have an adverse impact on the brand in the short term, the truth is that Samsung remains the clear market leader in the worldwide smartphone market.”

He said: “Moving forward, Samsung will need to put the Note 7 to rest as quickly as possible and focus all efforts on producing a stellar Galaxy S8 come next spring. If successful, consumers will quickly forget the Note 7 fiasco if the upcoming S8 can deliver on all fronts.”

No doubt Samsung will not want to become another Ericsson, Motorola, BlackBerry and Nokia in the mobile dearly departed category.

@AntonySavvas