With over half of the total smartphone market share and one third of premium phone sales, the Romanian subsidiary of Samsung Electronics is constantly reinforcing the company’s position as a leader on the technology market. Romania’s potential of becoming a top tech hub in Eastern Europe could represent a driving force for
Samsung’s strategy, also with the help of Romanian consumers, who are always eager to try its innovative products and services. Julia Kim, President of Samsung Electronics Romania and Bulgaria talked to Business Review about the success story behind Samsung Electronics Romania and provided insight into the company’s approach to sustainability, one of its top priorities both locally and globally.
By Anda Sebesi
What can you tell us about Samsung’s current worldwide operations?
Despite the macroeconomic uncertainties, which are likely to persist, we have managed to obtain record revenues each quarter so far this year. In the third quarter, revenue grew 3.8 % to 76.78 trillion won (USD 54 billion). Specifically, the smartphone business posted solid profitability as demand increased following the release of the foldable phones and new wearables. Even though the economic contraction has hit demand for consumer electronics, we expect our annual revenue to exceed the historical high of 2021.
What is the story behind Samsung’s success in Romania?
Samsung Electronics Romania emerged as a fully autonomous sales subsidiary in June 2010, at a time of general growth for the IT market in South-East Europe. Its success here is the result of a very good mix: a growing market, a solid team that brings Samsung’s vision, mission, and values to life, and tech-savvy consumers looking for a brand that puts their needs first and offers quality and inspiration. And it is precisely the fact that Romanian consumers appreciate innovation and quality that has allowed us to maintain our leading position in the mobile and visual displays categories.
What are the pillars of the company’s strategy?
They include customisation, connectivity, sustainability, and a people-first approach, which means understanding that each person is unique and that they all want to customise their devices to suit their lifestyles. In response to this, we gradually introduced new products like the Bespoke Jet™ vacuum and Bespoke Washer and Dryer, expanding our line-up to every room in the home to offer consumers more ways to customise their spaces. We have also expanded our Lifestyle TVs series, which features the latest technology and increased customisation options, allowing users to express their personal styles and access tailored video and audio experiences.
A better future requires seamless connectivity. As a founding member of the Home Connectivity Alliance (HCA), which brings together various smart home appliance manufacturers, we aim to foster greater interoperability between devices across brands to give consumers more choice and to enhance the security and safety of products and services. Through our SmartThings app, users can control more than 40 functions in 15 product categories from 13 brands, including Samsung Electronics. I mentioned sustainability as being a main pillar; on the one hand, that means building sustainability into the ways customers experience our products, and on the other hand, it involves expanding the use of recycled materials to include all mobile products and home appliances over the next three years.
One of the key statements made by Samsung Electronics is “We create a culture of infinite possibilities.” How does the concept translate to innovation for its customers worldwide?
Behind any product launch, whether it’s a new phone, a new type of TV or a range expansion like the Bespoke home appliances, there are entire research teams working hard so that the innovations we bring to the market can really add value to the lives of our consumers. Throughout the process, we also rely on the feedback we receive from consumers as we carefully study their desires and their expectations, but also new ways in which we can provide them with new experiences and open up infinite possibilities.
I think it’s also important to mention that our culture of infinite possibilities has a new layer, as we are now increasingly focused on a future built on everyday sustainability. This means that we use innovation to respond to the needs of our consumers, in Romania and worldwide, but also to empower people to reduce their carbon footprint and make positive changes towards a better tomorrow. And let me give the readers an example of how we integrate sustainability into our culture: to eliminate battery waste, we’ve launched the SolarCell Remote with a built-in solar panel that can be charged during both day and night. The latest version of the SolarCell Remote gets electricity from radio frequencies in devices like Wi-Fi routers and it will be included alongside more Samsung products, including TVs and home appliances, with the aim of eliminating more than 200 million batteries from landfills.
How has your portfolio developed over the years and how what is your view of the Romanian consumer?
Based on our data, Romanian consumers make their purchase decisions based on three key criteria: price, quality, and sustainability. They spend their incomes on food, savings, and investments, but also—depending on budget constraints—on experiences (relaxation, entertainment, etc.). They are also willing to pay extra for quality because they really appreciate innovation, which for us translates into very good results in the premium area. If we’re talking about young Romanian consumers, we know that they are looking for means of self-expression. They like individualised shopping experiences and pay a lot of attention to brand ethics and corporate responsibility.
Customers are at the core of our strategy, so we are constantly adapting and expanding our portfolio according to their needs and expectations. Our services and products now cover much of what people’s current needs mean, from high-performance phones for multitasking to customisable electrical appliances, including cutting-edge heat pumps to provide people with more comfort.
What are some similarities and differences between the Romanian market and other markets on which you operate in the CEE region?
Romania, just like Bulgaria where we also operate, is a growing tech hub in Eastern Europe, and both countries have been successful in creating an attractive business environment. Both Romania and Bulgaria have a lot of potential for further growth, including in the smart home market area. Two years ago, I had the opportunity to coordinate the development of Samsung’s business in Hungary, a country that is on its way to becoming a leading digital technology hub, with consumers who, just like Romanians, are eager to try our innovative products and services.
How has this year been for Samsung in Romania in terms of achievements, financial results, and investments?
Although global economic activity is experiencing a slowdown, we have managed to continue to grow and develop in several segments. In the smartphone segment, Samsung’s market share continues to be at over 50% in terms of units sold. In the premium segment, one-third of the phones sold on the market are Samsung devices. This demonstrates Romanian consumers’ affinity for premium Samsung products, which have state-of-the-art specifications.
In terms of TVs, the company has a market share of 42 % of the total market in terms of value. We continue to see positive developments in this segment as a result of the increasing consumer interest in Smart TVs and connectivity, as the technology behind these devices now offers users unique viewing experiences.
How important is Romania for Samsung and what is the country’s weight in the company’s portfolio?
As already mentioned, Romanians are very open to new technologies, something that is also reflected by the increases recorded in several business segments, including smartphones and consumer electronics. Moreover, our data and recent studies show that Romanians are increasingly interested in investing in a Smart Home, seeking intelligent solutions for their homes that will not only provide them with more comfort, but also help them save energy. Taking all these aspects into account, we can see that the Romanian market has a lot of development potential, and therefore, it holds major strategic value for us.
What are your longer-term plans in Romania?
We are, of course, focused on strengthening Samsung’s position as a leader on the technology market. We will continue to provide Romanian consumers with products and solutions designed to bring them new experiences and new alternatives for a higher quality of life. We also want to bring AI-based technologies closer to people; as examples, I would mention the upcoming Bespoke washing machines with AI Ecobubble (a function that achieves the same level of cleanliness with lower energy consumption). We are also committed to launching 100% Wi-Fi-enabled appliances by the end of 2023 to ensure access to SmartThings Energy, an easy-to-use, app-controlled smart metre service that helps users reduce energy consumption. And of course, our plans also include guaranteeing the best performance you can get in the smartphone world through the launch of new flagship phones and accessories.