Boston, Toronto, London, Hong Kong, New Delhi, Beijing, Taipei, Seoul – September 6, 2021
A $1.1-billion opportunity has been created in South Korea with the exit of LG from the smartphone market, according to Counterpoint’s latest Korea Smartphone Tracker. This calculation is based on LG’s smartphone revenue in 2019, when business was stable. LG was once the second-largest player in the market.
Samsung is trying to benefit from LG’s exit as it has a wide range of low- to mid-priced Android models. The company will strengthen its Galaxy A line-up further in the second half, along with the recently released Galaxy Z Fold/Flip series. Recently, Samsung included the LG V50 in its buyback program for the first time. Earlier, the program used to target only Samsung and Apple models.
Apple is also upping its game to increase share, although the absence of feature-enabling credit card payments via iPhones in South Korea may act as a barrier in addition to the general tendency of Android-based mobile users to stick to Android models. Apple has recently started to sell iPhones at LG’s electronics retailer LG Best Shop, thus adding offline sales channels across the country. In addition, it reportedly plans to open South Korea’s third and fourth Apple stores after opening the second one at the end of last year. It is also aiming to expand consumer services in the country.
Xiaomi started to get aggressive in South Korea’s low- to mid-end segments with the Redmi Note 10 launch. However, it does not seem easy for the company to take a significant share here as the consumers have a low preference for Chinese brands.
The South Korean smartphone market itself contracted 8% YoY and 17% QoQ in Q2 2021, lacking momentum from the top two dominant players – Samsung and Apple. Both did not have any new flagships during the period. The Galaxy A52 and A72 were not released due to chip shortages, contrary to the company’s original plan. Further, unlike last year, Apple did not release the iPhone SE series either, while the new product effect of the iPhone 12 diminished with the approaching launch of the iPhone 13.
Senior Analyst Liz Lee said, “A strong recovery of the South Korean smartphone market is expected on the back of new launches in the second half. Samsung will likely take the majority of LG’s domestic market share, but it is worth paying attention to overseas brands’ entry, such as Google and Motorola. Their brand awareness is good among Korean consumers, but the key is whether they fully understand the country’s smartphone market and consumer preferences. It will be important for them to benchmark the past effective strategies of LG, including its target price segments and sales channels, to absorb LG’s smartphone users. With this potential competition, we could expect a more diversified competitive landscape of the South Korean smartphone market than before.”
Some of the many questions that prospective entrants to the South Korean smartphone market need to ask themselves are:
- How big will the South Korean market be in the coming years?
- What was LG’s product positioning?
- Which price segments saw LG competing in the most?
- What key features do consumers consider when buying?
Our detailed report ‘South Korea Smartphone Tracker’ answers these questions.
Feel free to contact us at press(at)counterpointresearch.com for questions regarding our latest research and insights, and for press enquiries.
Background:
Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.
Analyst Contacts:
Liz Lee
Counterpoint Research
press(at)counterpointresearch.com
