It may have one of the industry's largest marketing budgets, but Samsung still lacks something Apple has--a legion of fans who will buy every new product the company launches, unfailingly.
Former Apple CEO John Sculley believes this is what sets the two smartphone rivals apart. The sprightly 74-year-old, who owns a myriad of devices including Galaxy Note, BlackBerry Q10, and of course iPhone, was in Singapore this week to speak at the ITMA CIO Executive Summit and offered some personal insights on the intense competition in the smartphone market.
In a discussion with local reporters, Sculley noted Samsung's massive marketing budget in the U.S. compared to Apple's.
According to Ad Age stats released last month, Samsung last year increased its advertising spend by 58 percent to US$881 million in the U.S. alone, which accounted for one-fifth of its global ad budget. In 2011, the iPhone maker had spent three times more than the Korean smartphone maker.
Despite the efforts to dislodge Apple's stronghold, Cupertino's market share in the U.S. climbed 3.5 percent to 41.9 percent for the first half of this year. Samsung's presence is more strongly felt elsewhere in Asia and Europe.
Sculley said price is a major factor for consumers in Asia where iPhone's price point is considered premium, but added that Apple does well in its own turf. He noted that Samsung doesn't have the loyal fan base that Apple has, where its loyalists would lap up every new product Cupertino launches.
"What's interesting about Apple is that it sells best to people who love it," he said.
He's not wrong. Apple's fans are, infamous, for their fierce loyalty. I liken their fervor to a religion where the producer can do no wrong, and all its creations embraced indiscriminately. Samsung recognizes that too when it launched a series of ads mocking Apple fanboys.
But, Apple has had its fanboy base for years and it is largely concentrated in the U.S. market--its own turf, as Sculley noted.
Despite its lack of loyalists, Samsung has still managed to emerge over the past two years to now lead the global smartphone market, including China, and it also leads the global market in terms of mobile Internet use.
Its immense success indicates clearly you don't need a strong fan base to put you in number one position. Samsung, however, will need to continue coming up with new innovative products to sustain its foothold and market share, because--unlike Apple--it doesn't have a religious fan base that will lap up every new product it releases, good or bad.
But, isn't that how a fair marketplace should behave anyway?