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Samsung, Apple, And Amazon: Who Is Innovating Better?

In today's business environment, there is no room for mistakes

13Oct

Despite the power of analytics and strategic efforts, it's still hard to predict whether a new product will succeed in the market after launch. Stakes are high - for startups, it's usually one shot with no room for error, and for incumbents, it's the maintenance of their successful record and staying ahead of the competition. Today, a product can become a sensation based on hype, with others losing the battle, despite having a great value for customers, and vice versa. But is it possible to find a correlation between hype, value, and success?

With disruption shaking up all industries and creating new markets, the chances of becoming a disruptor decrease each day. With easier and wider access to emerging technologies, the speed of product development is high, meaning there is no room for slow players or poor quality products. With the latter, for example, Samsung has got itself into serious trouble.

Probably the biggest tech failure of the year belongs to Samsung's launch of the Galaxy Note 7. The new smartphone was of paramount importance, with hopes to fix falling revenue and decreasing market share happening prior to launch. After the first explosive malfunction forced the company to recall some phones and change them for new ones, it's already clear the game was up. But once changed, devices were faulty as well, the company was forced to permanently stop the production of the Note 7. As for the moment, Samsung ended up reviewing its strategy and had to lower the estimated operating profit for Q3 to $4.6 billion, having vague perspectives in Q4. Consumer Tech Analyst from Creative Strategies, Caroline Milanesi, pointed out that to limit the long-term risk to the brand, Samsung should 'call it a day'. Thus, testing for glitches and any malfunctions at the production stage (not as an emergency measure after the product was launched) is critical.

If tech issues can be fixed by engineers and R&D initiatives, who is going to explain failed sales of a product which is perfectly fine?

Amazon is considered to be one of the biggest innovators in the world. The company succeeded in e-commerce, it created Kindle, delivered Amazon Echo - the company never stands still. However, seemingly cracking the secret of product success, it failed miserably with its Fire smartphone. The company has come up with the customized version of Android and put a price tag of $650, aiming for wide recognition. The mistake was that Amazon failed to recognize that it was capable of disruption but in the end proceeded with the wrong product strategy.

Amazon's success with Kindle tablets should have become a case study for the company's future initiatives. The tablet was introduced as a much cheaper alternative to the expensive iPad, with the embedded Amazon's sales infrastructure. Generally, the model took the very best of disruption concept, where the new niche is created through cheaper products, reduced features, and the unique consumer experience. Instead, Fire phone aimed for the iPhone-like market price wise, and on top of everything, it wasn't widely available (sold only by AT&T).

Whether people like it or not, Apple remains the leader in marketing, sales, and tech performance. In the smartphone market, the failure of the Note 7 and the inability of others to come up with the similar success concept puts Apple far ahead of Amazon and Samsung. Aside from the strong branding strategy that retains customers, Apple's main strength lies in iOS. Since the operating system was introduced in 2007, Apple has maintained a lock on app leadership. This consequently leads to better customer loyalty as people enjoy the exclusivity of features and a more secure App Store. Not radically changing the design and system preferences prove that Apple simply doesn't need to innovate to the same degree as other manufacturers.

Other devices can be more advanced, offering wireless charging, connection with VR headsets, stronger battery, and better e-commerce opportunities, but these doesn’t appear to be a necessity for customers but forces them to use new features, when the majority don't want to. What really owns the customer relationship is the consistency in the availability of the product and its best features that people actually use and like. So at the end of the day - new doesn't always mean better.

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