Samsung stores close in Russia: is the second tier coming?

Last week, information was published about the bankruptcy (or rather, an application for such) of the retailer White Wind Digital, which ranks 16th in the top of Russian sellers of consumer electronics. Among more than fifty claims for debt repayment, Apple stood out especially with the desire to repay the most - 456.9 million rubles (~ $ 12.3 million). Today a curious information guide has appeared that is directly related to the given bankruptcy. Samsung's monobrand retail chain began to fade, 35 stores were discontinued. Why? The answer is simple - White Wind was in charge of managing these salons. According to Kommersant, since the beginning of the year, Samsung has suspended the work of about 20% of branded stores throughout Russia.



This is not the first case of “deactivation” of Samsung stores; earlier this year, up to ten stores (out of 66 points active at that time) were closed by Inventive Retail Group. As the reason for such a step, the CEO of the company Tikhon Smykov cites, on the one hand, the Samsung retail network growth too fast in 2012. On the other hand, there is a “radical change in the structure of the smartphone and tablet market”, an increase in the share of second and third tier brands and a decrease in consumer interest in products of market leaders, including Samsung and Apple.

All the same Kommersant, citing a certain employee of the "large retail network", claims that sales of the Samsung Galaxy S5 are almost two times inferior to the flagship predecessor. In principle, Samsung itself was hardly expecting mega-records. Slightly abstracting from Russia - in Ukraine, from the very beginning, there was an action with a completely “free” Samsung Galaxy Tab 3 8.0 in addition to buying a top-end smartphone. My colleague alexeystar spoke about this in April . An analogue of such a proposal reached Russia at the end of July, but with a less interesting “pill”. In stores, Master PC sold a pair of Samsung Galaxy S5 and Galaxy Tab 3 7.0 Lite for 31,000 rubles. Separately, the models cost almost 30,000 and 6,000 rubles.



The news that appeared is yet another confirmation of the harsh realities that have been taking shape in the mobile market for many months. Let me quote a May note by alexeystar: “The process of“ eating away ”the market share with local brands of A-brands is tired of the order, and the market mastodons cannot do anything against small, but daring companies. That is, going, for example, LG to develop a smartphone for 100 bucks. She will invest a lot of money in software, develop a unique design, select the right materials for the case, and ensure that there are no serious glitches even in the first firmware. And then it turns out that the budget is spent by two-thirds, and in this device you will have to put a frail processor, a 3-inch screen with a low resolution and 512 MB of RAM. The analogue from the Russian brand / Chinese manufacturer will have glitches, and materials are less wear-resistant, and the camera is worse, but the display is 5-inch and gigabyte RAM. As a result, customers increasingly prefer the “Russian Chinese.”

As a result, in May ABI Research announced a forecast that by 2019 two-thirds of smartphones will be based on the reference designs of chipset developers. 23 percent of such devices will cost more than $ 200 in retail, the rest will be cheaper. But at the same time, the flagships will still remain in the sole competence of A-brands, here no one intends to give slack.

It is unlikely that Samsung will ultimately repeat the fate of Nokia, which in 2012 closed absolutely all its stores in Russia. Although at one time such a future, Nokia also could hardly be predicted. What is happening is consistent with the IDC results for Russia for the second quarter, shipments of Samsung tablets alone fell by 48.3%. Not far away was Apple - 48.3% with a minus sign.



And again, the remarkable achievements of the second echelon are recalled. The Svyaznoy report was published a couple of weeks ago. In July, for six weeks, for the first time in Russia, the domestic B-brand took first place in sales and outperformed the A-brand represented by Samsung. Regarding tablet phones, the same “Svyaznoy” voiced for the first quarter of 2014: in all, B-brands account for 40% of sales.

What about smartphones? Svyaznoy, the same period: “The role of B-brands in the market has increased significantly, especially in the segment of smartphones worth up to 5 thousand rubles. According to the results of 3 months of 2014, this segment already occupied 42% of the market in physical terms, which is 20 pp more than in the same period last year. The share of B-brand devices in this price category is about 60% both in units and in monetary terms. ”

Out of curiosity, I was not too lazy, but looked in a very banal way - how are things going on with the manifestation of interest in different brands? We look at A-brands.







The picture is identical, an obvious decline almost exactly since the beginning of 2014, with much earlier assumptions. Only the seasonal New Year and Christmas peak helped, which only briefly improved the situation.

What about B-brands? Explay, Fly and Highscreen - only up, stable growth with a small corridor of fluctuations. Yandex is unanimous in its retail sales statistics.







Such a result cannot be called spontaneous. Moreover, the request “buy a smartphone” is only gaining popularity. That is, the demand in the smartphone market is constantly growing.



And after this starting point, people already purposefully prefer to look at what second-tier brands offer there. Do you think it worth waiting for fundamental changes in the emerging trend in the long run? Or is it that the mastodons of the smartphone market - A-brands will be able to turn the tide?