Samsung Galaxy Fold: Brand Equity Impact of Screen Failure Case Study

This report analyzes the Samsung Galaxy Fold screen malfunction, a significant issue impacting Samsung's brand equity. The case study explores the screen flickering and cracking experienced by reviewers, leading to potential customer boycotts and damage to the brand's reputation. The report discusses the primary issues encountered by Samsung, including falling short of customer expectations and the potential for negative publicity affecting profitability. The report suggests strategies to manage the situation, such as admitting mistakes, delaying product launches for further research, and proactively identifying shortcomings. It also emphasizes the importance of curbing negative publicity and acting in a socially responsible manner. The conclusion highlights the lasting impact of the malfunction on reputation, sales, and the need for rigorous testing before product launches.

Marketing & Management

Running Head: Report
Contents
Introduction................................................................................................................................2
Managing brand equity after screen malfunction.......................................................................3
Primary issues encountered by Samsung...................................................................................3
Potential harm and possible boycotting of the product by the users..........................................4
Strategies to manage customer boycott......................................................................................5
Conclusion..................................................................................................................................5
References..................................................................................................................................6
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Running Head: Report
Introduction
The Samsung Galaxy Fold is a flagship device launched by the organisation having dual
display option. This is a premium priced device having a price tag of US$ 1,980. The
organisation handed over samples of the devices for review to some journalists and it was
found that after just a few days of using it, the screen of the fold device unit flickered and
even cracked for a few devices. This report discusses the possible impact of this incident on
the brand equity of Samsung, the main issues encountered by them in its management and the
potential harm on the expected product response for Samsung Galaxy Fold. The report
discusses some strategies that can be adopted by the organisation for managing the possible
boycott of the device by their target customers.
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Running Head: Report
Managing brand equity after screen malfunction
Samsung is an organisation operating in the technology industry that rides high on brand
value and reputation. The screen malfunctioning of the Samsung Galaxy Fold after one or
two days of use by the journalists reviewing the devices has resulted in an irreparable damage
to the brand equity of the company. It is very important that the organisation takes ownership
of the failure and adopts steps for managing the brand equity as recommended here. Very few
organisations are willing to admit when they make a mistake but admitting a mistake is the
first step towards correcting it. The organisation should admit that the device does not
function as planned instead of blaming the reviewers on removing the plastic film. If they
want to innovate and come up with a completely new device, Samsung should take measures
to understand why this failure happened by contacting these rivers and recording the
manufacturing or execution mistake made by them. Samsung should also delay the product
launch instead of going ahead with the plan to launch the device in the current shape and
form (Hauser & Chen, 2019). They should carry out proper research and make the necessary
changes in the device while communicating the same to reinstate the faith of the people on
the brand and the fold device and for maintaining the brand equity of the company.
Primary issues encountered by Samsung
The screen malfunctioning of the Samsung Galaxy Fold has resulted in the organisation
falling short of the Expectations of the customers. The main challenge that Samsung is going
to encounter followed by this incident is the fall of the brand equity. In order to manage this,
the organisation will have to work towards winning the trust of the customers by starting
from scratch. The launch of this flagship device was expected to build further on the
diversified brand portfolio of Samsung. Customer loyalty is hard to generate and maintain.
The negative publicity as a result of this screen malfunction is expected to directly impact the
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profitability of Samsung accounting for increased dissatisfaction among the customers and
even mass migration of the loyal customer base to some other brands (McGregor, 2019). The
customers understandably place very high expectations on Samsung as a mobile technology
leader and therefore, it is the responsibility of the organisation to deliver on reliability and
quality. The fault and malfunction of the screens of the new Samsung Galaxy Fold should be
thoroughly researched by the company and they should carry out extensive testing of the
product before going ahead with the launch process. Buy insurance quality and reliability at
the initial stages, Samsung can ensure that the defects do not arise at a later stage having a
further negative impact on the brand and its reputation (Keller, 2013).
Potential harm and possible boycotting of the product by the users
People are generally apprehensive of embracing a radical change in technology but the device
was expected to perform well in the market because of brand recognition and brand equity of
Samsung. However, the reported malfunctioning of the screen of the new device after 1 or 2
days of usage will raise serious questions on the quality and technology implemented by the
company not just for this particular device but for all the other products manufactured by
Samsung. The current and the potential users of Samsung devices and the target customers of
Samsung Galaxy Fold are going to completely boycott the device followed by the reports of
screen malfunctioning. Some potential buyers may wait for the reviews from the first mover
customer segment before they decide to make the purchase. Samsung Galaxy Fold is a
premium device that is priced on the higher side and therefore the sales and the profitability
of the company expected from this device is going to suffer a lot after the negative reviews
and the malfunctioning of the screen for the devices handed out to the gadget reviewers
(Newman, 2019).
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Running Head: Report
Strategies to manage customer boycott
The suggested strategy for Samsung for handling product boycott for the Samsung Galaxy
Fold is to send it as quickly as possible. The organisation should ensure that this failure does
not get any more media attention as it can cause more damage to their reputation. Samsung
needs to quickly decide to resolve these issues. This will help in reducing the threats of
boycotting the devices and the negative impact on the brand equity. Samsung should
immediately take steps to carry out further research to identify the flaws in the devices and
also provide assurance to the current and the potential customers to ensure that no more
momentum is added to the boycott process (Kumar & Murthy, 2018). Going forward, act in a
socially responsible manner and proactively identify the shortcomings of the devices before
they are launched in the market. Another important step that the organisation needs to take is
to curb the negative publicity on the social media platforms (Heding, et al., 2018).
Conclusion
In conclusion, it can be stated that the malfunctioning of the Samsung Galaxy Fold devices
will prove to be damaging for the organisation. It will impact their reputation, sales and
profitability. However, the organisation needs to take ownership and responsibility and carry
out proper research and testing on the devices before the actual launch in the market to
maintain the reputation and brand equity.
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References
Hauser, C. & Chen, B. (2019) Samsung’s Review Phones Fail, Delivering a P.R. Nightmare,
Available at: https://www.nytimes.com/2019/04/18/technology/samsung-galaxy-screen.html
Heding, T., Knudtzen, C. & Bjerre, M. (2018) Brand Management: Research, theory and
practice, Available at: http://llrc.mcast.edu.mt/digitalversion/Table_of_Contents_134095.pdf
Keller, K. (2013) Strategic Brand Management: Building, Measuring, and Managing Brand
Equity. pp. 20-75, Available at:
https://www.academia.edu/35416678/Strategic_Brand_Management_4th_Edition_Kevin_La
ne_Keller
Kumar, R. & Murthy, Y. (2018) Brand Failure - Concepts And Causes, Available at:
https://www.iimb.ac.in/sites/default/files/2018-07/WP.IIMB_.81.pdf
McGregor, J. (2019) Samsung Is Facing A Huge Broken Screen Problem, Available at:
https://www.forbes.com/sites/jaymcgregor/2019/04/18/samsung-is-facing-a-huge-broken-
screen-problem/#316946cb4293
Newman, J. (2019) Report: Samsung delays the Galaxy Fold as folding screens malfunction
(Update: Confirmed), Available at: https://www.fastcompany.com/90338256/report-
samsung-delays-the-galaxy-fold-as-folding-screens-malfunction
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