Samsung to slash 30% of product launches in 2015

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Samsung to slash 30% of product launches in 2015

No more shotgun approach to product development as the company faces stiff competition from both low- and high-end smartphone manufacturers.

November 20, 2014

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No more shotgun approach to product development as the company faces stiff competition from both low- and high-end smartphone manufacturers.

Samsung head of investor relations Robert Yi stated that the company would reduce the number of products it offers by 30 percent in 2015, reported the Wall Street Journal. Given that Samsung’s approach has always been to flood the market with a variety of devices in each category, this signals a significant shift in its strategy.

Despite becoming the No. 1 smartphone maker by units shipped, Samsung’s margins have been hurt by challenges from both lower-cost smartphone manufacturers, as well as those on the high end. Unit shipments and profits have been significantly down in 2014 as a number of companies have eaten into their market share and marketing and inventory expenses have increased. As GigaOm writer KifLeswing put it, “[the number of products] introduces inventory risk and consumer confusion: After all, what are the salient differences between the Galaxy S5 and the Galaxy S5 Active, and the Galaxy Note 4 and the Galaxy Alpha—all high-end devices currently sold in the United States market?”

It remains to be seen which 30 percent will be cut, but speculation on the matter indicates that focusing on the high-end Android market rather than easily-copied mid- to low-end smartphones and tablets may be the direction it is heading. Wearables are less likely to feel the cut, as the emerging market seems amenable to a shotgun approach since no one product or design has been dominant yet.

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