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BARCELONA, Spain — Gone was the glitz and glamour of last year’s Samsung Galaxy S4 launch.
Gone was the showy venue of Radio City Music Hall; in its place was Barcelona’s International Convention Center, more in the vein of a typical product launch, if a little larger.
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Gone were the musical numbers and over-the-top acting.
Gone were the whiz-bang features that didn’t really work.
Gone was the bloat.
To which I say, good riddance.
Samsung’s latest flagship smartphone, the Galaxy S5, arrived Monday in a streamlined presentation. The focus was on a few core specs and features that actually had practical value, including its water- and dust-proof coating, improved camera, adaptive display, and longer battery life. Rather than make people come to a separate standalone event, Samsung held its event at trade show Mobile World Congress here instead.
The undercurrent to the event: that Samsung was going back to basics and eschewing some of the flash and sizzle it so readily embraced last year. It’s almost as if Samsung was saying: We’re done with the hype; let’s get back to business.
The change is subtle, but notable. Samsung had been known for its overwhelming marketing campaigns, high-profile celebrity endorsers, and lots of splash and hype when it came to its product unveilings.
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Yet did any of that work? In many ways, the Galaxy S4 failed to live up to the hype and was criticized as a minor upgrade to its predecessor.
Indeed, the Galaxy S4 still failed to live up to expectations despite being flanked by a constant stream of TV and radio commercials, billboard posters, and print and online ads.
This year, there have been fewer clever ads, and the drumbeat of constant marketing has dulled out.
That’s not to say Samsung has completely hit the brakes on its campaign. Dozens of Samsung flags hung outside the entrance to the Fira Gran Via, home of Mobile World Congress. The event still drew a massive crowd that came early, eager to check out its latest wares. And Samsung even added the classy touch of a live performance by the Barcelona Opera House chamber orchestra before the event kicked off.
Of course, the easing off Samsung’s marketing may just come down to exhaustion and the natural letdown after the company had its promotional machine cranking nonstop ahead of last year’s event. No company — not even Samsung — could keep it going forever.
“Samsung went so over the top with the Galaxy S4 launch that there may not be another realistic hype ceiling left to break through,” said Ross Rubin, an analyst at Reticle Research.
Last year was (over) dramatically different
Let’s compare this year to the loud, obnoxious, and — to some — offensive display from the Galaxy S4 unveiling. The event at Radio City in Manhattan capped off a savvy and massive marketing campaign that bombarded consumers with all things Samsung, building up enough hype to the point that media, whether mainstream or tech, wanted to get in on the story.
Samsung touted the eye-tracking technology that was the buzz of the blogosphere ahead of the launch. The feature, which allowed you to scroll through pages or stop video with your eyes, didn’t really work well, and was quickly forgotten.
Yet last year, I called the Galaxy S4 an unstoppable hit. My conclusion wasn’t based on time with the phone, but on an analysis of just how much the company spent on marketing. Leading up to the launch, Samsung had spent $401 million on advertising just in the US, ahead of Apple, and more than several of its smaller competitors combined, according to Kantar.
When looking at the correlation between increased sales of Galaxy S phones and increased marketing for the phone, it was an apt way of predicting its potential sales.
And in some ways, I was right. Samsung and the Galaxy S4 broke through the cultural zeitgeist; average consumers who knew little else about the consumer electronics world suddenly needed and wanted a Galaxy S4. For the first time, there was a phone that could stand on par with the iPhone, at least in terms of expectations and visibility.
Still a disappointment…
But where it counts — actual sales — the Galaxy S4 was actually a disappointment, as pointed out by CNET’s Shara Tibken. The Galaxy S4 wasn’t considered a major leap over its predecessor, and many gravitated toward the discounted, but still popular, Galaxy S3. While sales of the Galaxy S4 popped immediately, it struggled to maintain that momentum.
It’s difficult to peg the exact expectation that Wall Street had for sales of the Galaxy S4, but some industry observers pointed to a “whisper number” of 100 million units.
Sarah Tew/CNET
Samsung hasn’t broken out sales of its individual phones, but the company did disclose that it sold 100 million units of Galaxy smartphones. That figure, however, includes sales from the Galaxy Note franchise, as well as sales of the older Galaxy S phones, which were a hot item because of their discount.
If you strip out those other phones, the Galaxy S4 still sold remarkably well by just about any standard — except for the heightened expectations of Wall Street and industry watchers.
In comparison, Apple shipped more than 153 million iPhones last year. Admittedly, Apple’s numbers were also bolstered by the discounts found on older models. But at least a healthy chunk of customers gravitated toward the newer, more expensive model, particularly after the iPhone 5S launched and the new iPhone 5C flopped. It sold 51 million iPhones in the fourth quarter alone.
As the smartphone that was supposed to stand toe-to-toe with the iPhone, the Galaxy S4 fell short.
The shortfall, meanwhile, was evident in Samsung’s financial results. In the fourth quarter, Samsung’s mobile division, which traditionally provides a majority of the company’s profits, saw its operating profit fall by 18 percent from a year ago as the company overall missed expectations.
Indeed, the company had struggled with slowing growth on the high end, while its budget phones faced pressure from more aggressive Chinese manufacturers.
Even in the US, where Samsung brand recognition is at an all-time high, the slowdown was evident. In fact, Samsung’s fourth-quarter market share in the US was 24 percent, flat from a year ago at a time when Apple, LG, and ZTE all made gains, according to NPD.
“It’s a mature generation,” said Jefferson Wang, who covers tech for IBB Consulting.
Lesson learned?
Samsung seemed to acknowledge some of its prior shortfalls during Monday’s presentation.
“Our consumers do not want eye-popping technology or the most complex technology,” said J.K. Shin, Samsung’s mobile chief, who could easily be talking about past Galaxy S phones.
Rather than any drama, the company and its executives were laser-focused on describing some of the key features, many of which seem useful off the bat.
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“Going back to basics helped us drive innovation in a way that makes sense for our customers,” Jean-Daniel Ayme, vice president of European telecom operations for Samsung, said during the presentation.
At less than an hour, the presentation was also remarkably lean, getting to the point and not lingering.
But how will the S5 do? The initial impression from CNET senior editor Jessica Dolcourt was positive, although she was critical that it lacked a fresh design or more dramatically overhauled software.
The similar design also led to some quick shots by its competitors, including Nokia and HTC.
Stand out from the crowd! #MWC14 #UNPACKED pic.twitter.com/NFPTd5vNzV
— Nokia UK (@nokia_uk) February 24, 2014
Indeed, it may suffer from the same dilemma as the Galaxy S4, which wasn’t deemed different enough.
At least with this year’s presentation, Samsung was a bit clearer on why you would want to buy its latest flagship. Perhaps those improvements will spark sustained sales in a way that its marketing hype failed to propel last year.
“It’ll do well,” IBB Consulting’s Wang said. “But you’re not going to see lines for it.”
