Samsung is offering $100 in credit to Galaxy Note 7 owners who trade in their recalled devices for another of the company’s phones. But a new study indicates Samsung customers are increasingly looking to other vendors.
Samsung has begun offering a $100 credit to users who exchange their Galaxy Note 7 for another Samsung smartphone; customers seeking a full refund or a phone from another manufacturer get only a $25 credit. The South Korean vendor announced the campaign as it issued a recall notice for replacement Galaxy Note 7 phones, which had been deemed safe following an initial recall of the high-end handset due to problems regarding overheating batteries.
Samsung also said it expects losses from the Note 7 debacle to surpass $5 billion, as CNN reported, and Nomura Securities recently predicted the electronics giant could suffer $9.5 billion in lost sales and a $5.1 billion loss in profit through 2017 due to the fiasco.
Demand for Samsung’s would-be flagship was strong out of the gate: BayStreet Research said prior to the first recall the device enjoyed 25 percent higher sales than its predecessor, the Galaxy Note 5, which was released at roughly the same time a year ago.
And the company appeared to regain its footing – to a degree, at least – following the first recall. Samsung said three weeks ago that more than 60 percent of the first Note 7 devices sold in the U.S. and South Korea had been exchanged through its replacement program and roughly 90 percent of Note 7 users had chosen a replacement model “since products became widely available.”
But fresh data from Branding Brand, which operates a mobile e-commerce platform, indicates the second recall has taken a toll on Samsung. Branding Brand said a recent survey of 1,000 Samsung smartphone owners found that 40 percent of respondents said they won’t buy another from the company, up from 34 percent a month ago. Thirty percent of those who said they will switch said they’ll buy an iPhone, and 62 percent planned to move to an Android phone from another vendor. Eight percent of switchers planned to buy Google’s new Pixel.
“As we’ve watched the Galaxy Note 7 recall and discontinuation play out, even more people say they will switch their smartphone brand,” Branding Brand CEO Chris Mason said in a prepared statement. “Only a week after Google’s smartphone launch, many have their sights set on the Pixel.”