Samsung will launch its new Galaxy model, the S4, at a lavish launch in Johannesburg today. But while it is a global launch, Samsung has a number of products that have been designed specifically for the African market.
ITNewsAfrica spoke to Samsung’s Chief Operating Officer for Africa George Ferreira, about Samsung’s strategy for Africa, market share on the continent and competition with Apple – as well the company’s “sexist” product launch.
What is Samsung’s strategy regarding Africa?
First and foremost, as a global consumer electronic company, we want to make sure that we bring the best of technology, best of products and best experience to the African consumer. We don’t believe that the African consumer should receive anything less than the global standard of our global product portfolio. With that said, we also understand that the South African and African consumer has become a very specific consumer with specific needs that are not necessarily the same as those of consumers from Europe or North America. So with the program that we have initially developed under the Built for Africa banner, we are taking the same products and same technology, and re-engineering and re-modifying them to meet the standards of African consumers. So from the handset like the Galaxy Pocket to solar powered notebooks and surge safe televisions, we cater for Africa needs. Our product is about how we can enhance and better the lifestyles of the African consumer, that is our ultimate goal. And we are looking at all consumers, whether they are at the top or the bottom, we want to make sure that our product speaks to those consumers.
Why specifically Africa? Does Samsung have similar initiatives across the globe?
Interesting question. We started this initiative called Built For Africa in 2010 and our headquarters liked the concept and are considering similar programs for Asia, South America. We will start to see programs like Built for Asia, Built for China and Built for America. Why are we doing that? Because those guys also have their own specific needs, especially in China. I would expect that in the next year or two we will probably see the same kind of concept being rolled out globally. We will always have the flagship products like the Samsung Galaxy S4 – it’s a global product… it’s not specific to anybody. But then we will probably have products made specifically for the Chinese market, for the Indian market, for the South American market and for the African market – due to the specific needs of those continents. If we look at Africa we built products that can withstand the power surges, the huge amounts of dust and the humidity. We thought about how we could re-engineer products to withstand all these conditions to last more than four years. I think the project will go global. The concept originated in South Africa at one of our company launches.
How does that influence Samsung’s market share in Africa?
The products that we have in South Africa are in line with the products that we have for global consumption. The rest of Africa is where the initiative is more prominent because that is where a huge amount of instability and power, dust and humidity happens. The initiatives we have launched have resulted in a huge uptake. Since 2010, each year we’ve had a wave of new products and 2013 is what we call the third wave. Towards the end of 2011 we went with the air conditioner called the Triple Protector and we had three players from Chelsea Football Club who officially endorsed the product. It was such a hit that consumers, especially in West Africa (where the three players are originally from) were walking into our stores asking for a Drogba air-conditioner. So we have seen huge uptake, and I also think that is the reason why, in 2011, Samsung was identified as the number one technology brand in Africa. We are listening to what the consumers want and by listening to them, we are able to deliver technology that really makes a difference in their lives.
How does Samsung compete with Apple?
I won’t get into the mechanics of our strategy against Apple, but in Africa we don’t see Apple as a competitor, and I say that with a lot of respect – not because we are better than them, but Apple isn’t really established in Africa. You don’t find a lot of distributors and shops or established retail across Africa for Apple. And I think there is probably because they haven’t decided to come into Africa yet. In South Africa I think they had about 4% market share in the smart phone industry, we have around 25%. In Africa I would say their market share is less than half percent, so they are really not the ones that we are targeting. But I have no doubt there is a place for them in Africa. We do compete with all the other Tier 1 mobile phone providers, such as Nokia, BlackBerry, Sony and HTC. Outside of South Africa those other four brands are probably our biggest competition for the smartphone business in Africa.
How did the partnership between Samsung and Always-On come about?
I started talking to Wireless G quite some while ago, and things were moving a little but slowly. So we thought that they might not be the right one. So we went and spoke to Always-On, and we told them about this concept and what we wanted to do. They are also fairly new and wanted to aggressively establish their brand. Today we have 1200 hotspots in South Africa and by this time next year, we will probably have close to 3000 hotspots. Which tells me by towards the middle of next year I’ll be able to find many hotspots where I can access the Internet for free. So it was a natural fit for both parties, as we are both very hungry to grow. Yes, the operators were not the keenest but if I look at the strategy globally for operators, they all setting up their own Wi-Fi strategy in combination with 3G connections, because they know people bounce in and out of that the whole time. So here I think our operators were a little bit naïve, but you should be able to move between the two – it’s like a hybrid vehicle. As I’m sitting here now there are 12 hotspots with in a 1 km radius from me. People will be able to go onto the Internet and locate their nearest hotspot. They can then choose an Always-On hotspot, and ask for directions. I think it just became a real win-win situation for both of us, and we will continue to grow. For us it it’s about one thing – building ecosystems around our devices which brings value to the consumer. So it’s not just a device anymore, it’s a device that connects to a whole ecosystem.
Why did Samsung feel the need to apologize for the models that were used at Africa Forum?
I think it was out of courtesy. If somebody writes an open letter to Samsung, complaining about their perception of what they saw, internally we looked at it and I think that we are a company that is mature enough and big enough to look at it and say “maybe we didn’t think this thing through” and we can apologise for it. So we published an apology to the person, but does that mean that we will change the way we do business going forward? In some cases yes and in some cases no. There will be times that we will still drive our strategy the way we want to do it, and there will be times where we don’t do it. But in that instance, I didn’t see it myself because I was in meetings all day with government officials. I don’t think the dancing was bad, maybe the choice of clothing was inappropriate for that specific item, but does that mean that we will stop using ladies in our events? Absolutely not! We are not a sexist company, as we use men and we use ladies, and we use everything and anything for marketing. But maybe we will just think it through a bit more carefully in the future. I insisted that we invite the person who complained and I have no issue with that. I think it was just the gentleman or the ladylike thing to do – to apologise. So somebody complained, and we apologise that we have offended your views. We are just an organisation that is trying to improve the way we do our launches, and it’s unfortunate that the lady was offended by it.
* Ferreira went into detail with IT News Africa about the new features and capabilities of Samsung’s new flagship mobile device, the Galaxy S4, which will be revealed in a separate article on Friday.
Charlie Fripp – Consumer Tech editor