Samsung Company: How To Destroy The Reputation In A Minute

One of the largest phone companies in the world would be Samsung, based in South Korea, Samsung has a large range of electronics which not only includes mobile phones but household devices and other digital media devices. In the 2000s Samsung created the smartphone series, which became its most successful product. It continuously topped the lists for best-selling smartphones. In 2006 their televisions became more popular however again in 2010 they increased their merchandise to tablets and with that came the Galaxy tablet.

The newest phone on the market in the year 2016 was the Samsung Galaxy Note 7, known for its larger screen, improved design with additional features, and stylus smart pen for writing, note-taking, and is even waterproof. On August 3rd people could pre-order the phone and they would be given exclusive bundles in addition to the phone. By August 19th the Galaxy note 7 was predicted to break sales as they have done previously for the phone’s cousin the Samsung s7 in comparison to apple. By August 24th there was an alarming number of reports that came from customers that have bought the phone. Only 6 days after it was first released Samsung put out an official statement about the cases that were brought up regarding the defective battery and ended sales for the galaxy note. However, on a different report, it was said that customers would be able to get a galaxy 7 in replacement for their galaxy note. The increase of defective batteries increased worldwide and Samsung struggled to recall all phones. Within a week Samsung told customers to shut down their phones for the fear of them exploding and were told to get in touch with Samsung to gain a new phone. As a result of these battery failures, Samsung faced a huge threat to its corporate image. Samsung was anticipated to sell around 14 million devices but instead, they were replacing the phone's batteries and therefore lost around 17 billion in market share. While Samsung was losing the battle with their phones, other companies such as Apple and Google pixel were getting more and more customers. It has been over two years and Samsung has brought out several other phones and has recovered from their blunder.

It takes years for a brand or company to build a good reputation or trust with its consumers. But it only takes seconds to minutes for that reputation to be destroyed. Such instances would be a crisis, which would be unforeseen and disturbs the peace and trust that the company has built over the years. Crisis communications have is essential for companies to maintain their public image. Working fast and appropriately addressing the crisis is one of the things that make a good company. The successful use of crisis communication can repair the damage that has been done. In order to gain back the trust of the consumers, the company needs to act fast, take responsibility, and respond in a manner that will help the consumers.

Recalling all the phones was not the first step that Samsung took, users that had bought the phone tried to reach out to Samsung via social media however failed to get any attention regarding the matter. Putting these complaints on a platform where everyone could see it gave others who were not involved to also help and try to get Samsung’s attention. Soon Samsung gained a stream of updates regarding the battery and took their first step into assisting the public. Though because they sat back and did nothing when the issue first arose and continued to sell the phones. Their hesitancy made their consumers not trust them and was unsure as to whether they should rely on a Samsung brand. The media watched how Samsung addressed the issue and kept speculating as to what went wrong. This issue was on print and social media as well as news releases to warn the public of the situation on hand. While on the other side the public relations teams for Samsung were online trying to help any customers that needed assistance. The media kept pressuring Samsung to find out where they went wrong and Samsung had an obligation to fulfill and need to discover what happened. Samsung used traditional and social media as their main platforms to address this crisis. While sales are now better some customers still vary to the brand because of their lack of communication from the Galaxy Note 7. The president of Samsung was vague when addressing the issue, while they still beat apple in the U.S. market in 2017, the company still suffers a damaged reputation because of how long it took them to take the phone off the market. Every company or organization should have a crisis communication plan because you never know when a crisis can happen therefore having a designated team or person to address the issue will help when a crisis strikes. Steps need to be taken immediately in order to make sure the crisis doesn’t expand and create more of a mess. Effective communication is key to make a business work. Though in Samsung's case they needed mass communication from their consumers in order for them to finally come out and address their issue, they ignored the minor audience until more people got involved. If Samsung has prepared a business communicator for this crisis they may have less backlash. If the communicator is vague and isn't addressing the issue the consumers will lose trust immediately that is what happened with the president of the company when he tried to address the issue. An open letter was published by the president on their website which apologise for the phone and proceeded to talk about their company values and said they were working to find the issue.

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“Samsung is fully committed to identifying and addressing the source of the Note7’s battery issue. We have already initiated investigations with independent third-party experts to carefully revisit every aspect of the device, including the battery, hardware and software, and manufacturing processes. Once available, we will transparently share our findings.”

The crisis was dragged on for several months as Samsung tried to get back the defective Samsung phones but after they took some crisis action the company communicated with their audience in order to recall the phones, while they received more assorted reviews for their techniques they were still successful and the company was able to get back to how they were. Samsung did communicate with the public and tried to constantly give updates as to where they were regarding the phone. They were unable to reach the 4% of consumers that still had a phone. They had a link on their main page to recall all phones and they also put all their newsroom releases for anyone to view. As a company, they were transparent with their actions to correct the mess and take responsibility. In order for them to be clear, a constant voice must be displayed worldwide through their media channels and company statements, controlling what is being said is important and is an influential feature for a crisis. But Samsung failed to create a voice that would be used everywhere. While they did create a voice to warn U.S. residents, the rest of the world was at a loss and the communication teams within Samsung were struggling to create the same voice that they did within the U.S. While it was all being felt with the president was in contact with media, globally the market felt their issues weren’t being addressed.

It took Samsung a while to get back on track after all the recalls. They still needed to gain trust back and explain to their consumers what exactly went wrong with their product and that is what they continued to do. After they tracked down most phones the president for mobile communications for Samsung electronics, Koh Dong-Jin said this

“Technology innovation is important to Samsung, but our customer’s safety is more important. We want to reinstate trust in the brand.' Samsung put more effort into gaining the consumer's trust and made its brand more inclusive globally. They had to not only gain the trust but also had to do it by launching their newest phone the Samsung 8. Instead of following their brand formula, they went into another direction with more warmed and launched their “Do what you Can’t” tagline which has been a great brand decision. From then they went to forming a team to identify the root of the problem for the S7 so that they can learn from their mistake and apply it to future products. Finally, towards the end of January 2017, Samsung came back, almost 6 months later they gave their consumers an answer as to what went wrong. Koh Ding- jin told the public the battery was definitely to blame because it included an unusually thin lining within the battery. While they faced a significant loss they still took the challenge head-on to try and figure out what exactly happened, they created a new test lab with had 700 researchers and contained 200,000 devices with the defective batteries and attempted to reproduce the cause of the fire. Samsung could have easily dropped the issue after finding out it was just the battery causing the explosions however despite the loss they continued to perceiver and show the public exactly what went wrong through pictures and videos. This goes back to communication and giving the information out to the public so that they are informed as to what went wrong, Samsung knew their audience would not have been happy with a simple statement so they went out of their way to give them the full explanation. In turn, they were rewarded, the sales for the Samsung 8 were better and they exceeded what they were expected to.

Samsung is back on track to how they were before the battery crisis, while some consumers may not trust them they have definitely gained more and more people within two years. Reputation is important for a company to survive and while Samsung lost some of that reputation they gained it along to way to redemption. In order to be effective within the business effective communication and effective management is vital because when you plan ahead for such moments such as this crisis you can overcome it quickly and gain back the minimal amount of trust for example an app called Buffer realized they had a security breach which caused accounts to post out spam messages on Facebook and as soon as they realized this they apologized and handled to the situation immediately, for this they got a great response from the audience. Samsung waited and started addressing the issue; the simple act of waiting is what caused Samsung to fall. Samsung should have had a crisis plan which indicated which steps they needed to take in order to effectively solve this matter. The lack of information didn’t help their case and they also failed to gain an effective spokesperson to speak up for the matter at hand. The U.S. has someone to speak for them but the rest of the world was blind. Mass communication would have helped them communicate with their consumers, while they had social media at their fingertips they failed to use it effectively. Apologizing and owning up to a mistake is important for a business in order to compensate for the negative implications which were caused by the response to the crisis, timing is key and with Samsung’s case, they failed in that aspect because they only put out an apology ad on November of 2016, 4 months after and this was considered Samsung’s official apology. But because it took so long the public was already outrage at them for not taking responsibility for the failure of their products. If Samsung had controlled the narrative within the public and stakeholders it may have cushioned the fall but their strategy for crisis communication failed. However, as the years go by the Samsung continues to rebuild its trust with the consumers but taking full responsibility and acknowledging the failure of the product.