Samsung Galaxy Note 7 recall, poor Quality Control, and the Nigerian smartphone market

Galaxy Note 7

The Samsung Galaxy Note 7, one of the most expensive and top tech in its category has been found with faulty batteries which cause them to emit smoke or catch fire; consequently, the South Korean tech giant is recalling over 2.5 million pieces of the phone already sold around the world.

Samsung which had seen its profits jump by 14% on the success of its Galaxy S7, enjoying positive reviews with it, is now witnessing a share downturn on the recall of its Galaxy Note 7. That could mean $5b loss in projected revenue, and cutback on jobs.

iPhone 7

With the imminent launch of iPhones in a matter of days, the Galaxy Note 7 brand image is expected to get a further bashing and inadvertently help shore up trust and preference for the Apple iPhone brand, its main competition.

In an enormous operation in which it has first stopped production, Samsung has also stopped the sale of the famous phablet, will be replacing sold ones, and then proceed to do a heavy crisis management/relationship and reputation management campaign over the mass media, online and mobile; with an anticipated cost of this recall being around $1b,

Now if you’re a user of the Galaxy Note 7 living in Nigeria, or who has bought your device in Nigeria, what will the exchange process be like? Nigeria is undoubtedly not the best regulated market for product return, recall or exchange.

Here, consumer protection laws are relatively weak; contracts and guarantees rarely exist, and where they do, divinity might need to be incurred to attest the authenticity, or action indemnity. Fakes might be issued, and originals could be denied.

Popular Phone retail outlet

So, what are the implications for trade, for the brand, and for the customers? Nigeria is Samsung’s largest market in Africa, a largely informal, unregulated market. Some of the purchases were made online via retailers like Konga and Jumia, and a whole lot more would have been procured via informal, and perhaps undocumented secondary channels.

Secondary users make up a good fraction of the owners of these phones, especially in Nigeria. Nigeria wannabes always readily subscribe to the used, recycled, and sometimes already compromised phones.  A lot of the phones are not currently being owned by the first buyers.

Most of the users are second to third generation users of the phones, originally first used somewhere in the UK or the US. The ‘flashing’ and formatting engineers are available at major street corners, and operate en masse at the famous Computer Village to help you get them working again in good time.

Proof of purchase and ownership documents belong to the original owners. Secondary owners have never cared, and never imagine there would come a day as this. The brand new of the Galaxy Note 7 is each going for about N450,000, while the competing Apple iPhone 7 256GB piece sells for N620,000.

Popular online stores

Samsung is expected to start replacing the phones to their customers in a few weeks, but it still has not explained the process or procedure this will take. And retailers in Nigeria are yet to have categorical word for customers requesting information on how to exchange their phones.

While all Samsung phone retailers in the US have stopped selling the phablet, it was still very much on sale in Nigeria as at yesterday, and might remain so even until after something sinister happens. And the Standards Organisation of Nigeria and the National Communications Commission have still not made any pronouncements on the issue on which the respective regulatory bodies around the world are focused.

Adebayo Shittu, Minister of Communication

According to Biodun Odejayi, a seasoned marketing practitioner, the challenge with Samsung globally is the strategy that makes Samsung see itself in a winner takes all battle with its main rival, Apple on devices.

Its market segmentation is also warped, and it attempts reach and satisfy high end and low-end patrons simultaneously. Perhaps that won’t be such a bad idea if it didn’t come with a huge cost to the crop of people working in technical innovation. Quality Control suffers because of the zeal to reach the market, to claim another first, another innovation.

For the Samsung Galaxy Note 7 specifically, there had been some development on the battery of the phone which makes it possible to have several miniature batteries separated by panels. These give the devices longer standby power, making them lighter, yet more powerful. Unfortunately, the terminals were in frequent contact which generates the heat and ends in smokes and fires.

Samsung needs to review its strategy of being everything to everyone. I find it amazing that a company like Samsung can line up about 40 devices to be introduced in the same year. In such endeavour, Quality Control must suffer.

The business also needs to look at its Retail and Marketing business. Only a few days ago, Samsung globally pulled the plug on Note 7 and said it should be permanently switched -off. But amazingly, a store on the UK high street, and indeed, several shops in Nigeria, Samsung shops still have the Samsung Galaxy Note 7 on display!

Written by ‘Dele Dele-Olukoju, Marketing Communication strategist, and publisher of the online Marketing Communication Digest. He writes from Lagos, Nigeria.