Opinions

Can Samsung Buy Love?

Posted by Pandora Lycouri on March 7th, 2014 at 1:28 pm

Samsung made quite a splash at the Oscars. The much ballyhooed "selfie" that Ellen DeGeneres took with her celebrity guests generated unprecedented buzz. According to social media tracking site Kontera, Samsung was generating over 900 mentions a minute immediately after the snap. However, when Ellen snuck backstage during a commercial break, Samsung did not go with her. The “promo” was over and Ellen was happily back to tweeting on her iPhone… and then the question became, can Samsung buy ‘love’, and if so, does it need to?

Apple tops the Millward Brown Optimor BrandZ Most Valuable Brands in the World rankings with an estimated $185bn value. Despite dominant market share, Samsung comes in at 30th with a value of $21bn.

When you look at what is driving this, the answer is clear: deeply rooted fanship.

Apple has a significant edge on ‘bonding’, a highly emotional BrandZ metric denoting the level of consumer commitment and loyalty to use a brand exclusively. Over the years, Apple has extended this strong equity to drive sales of an innovative product portfolio – most notably its latest tablet, the iPad Air. At the Oscars, Apple reinforced this strategy with a highly emotional 1:30 spot. Aptly quoting Walt Whitman, the ad left functionality at the door, instead taking Air users on a passion fulfilling journey around the world.

On the reverse side, Samsung has achieved share by competing on awareness and product features. This is reflected in BrandZ, where Samsung significantly outpaces Apple on ‘presence’, a measure of brand awareness, but also on ‘performance’, the measure of superior experience with brand.

Samsung’s communication has been clear in reinforcing this message – the Galaxy S5 will offer a larger display than the iPhone 5s (5.1” diagonal compared to 4”), a better camera (16 megapixels compared to 8 for the iPhone) and a faster processor (2.5 GHz while Apple hasn’t disclosed the speed of the iPhone 5S CPU). At the Oscars, Samsung’s 1:30 spot showcased its product portfolio (including the latest Galaxy Gear Smartwatch) with users repeatedly reminding the viewer that they ‘need to see this’.

Despite Samsung’s recent splash, it remains to be seen whether its marketing spend, which consistently exceeds Apple’s (last year, Samsung spent over $400 million to advertise its Galaxy line compared to $330 for the Apple iPhone) will translate into brand equity, and more importantly, share of wallet. Does the consistent messaging on the superiority of their product somehow miss the mark when it comes to generating consumer love? Does Samsung need to make up for its shortfalls on consumer love by outspending Apple?

Apple has succeeded in differentiating itself in offering consistently innovative design and iconic style, which in turn has translated to strong emotional connections with its consumers. These high levels of consumer ‘bonding’ directly translate to sales, with Apple shipping a record 51 million iPhones in Q4 2013. Samsung, on the other hand, saw sales of its flagship Galaxy S4 slow sharply after the iPhone 5s launch in September.

It is uncertain what the future holds in the intensely competitive smartphone market. But one thing remains certain: No, love can’t be bought. Ask Ellen.

This blog post was co-authored by Dmitri Seredenko, senior consultant, Millward Brown Optimor.

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