Apple, Samsung Top Profit and Sales
Apple and Samsung continue to dominate the mobile phone world as both companies share the #1 and #2 spots for profitability and revenue resulting from global sales in the 4Q of 2011. According to Asymco calculations, Apple and Samsung combined have a 91% profit share while their combined revenue share amounts to 64%. Apple returned to the #1 spot for revenue share with 39% and maintained its leadership for profit share with 75%.
Apple’s momentum is so significant that it has captured the triple crown of market share wins with significant gains in unit, revenue and profit market share from 1Q to 4Q 2011 (See chart below).
What is astounding is that these profit and revenue totals are for the entire mobile phone industry. Apple has been able to capture a gargantuan share of profit by focusing only on its smartphone expertise and blue ocean strategy. It lets the other manufacturers swim with the sharks in the red ocean of feature phone pricing and limited profitability. Companies with a vast portfolio of mobile phones erode their margins with the expense of entry level phones in exchange for unit market share and the hope of brand loyalty as users upgrade their mobile phones.
Yet as GFK Research reported in November, Apple iPhone users have the highest brand loyalty with 84% of the iPhone users stating that they would buy another iPhone. Only 60% of Google Android smartphones would stay with the same platform when choosing their next mobile phone. Brand loyalty was less than 50% for other platforms such as RIM. With the iPhone 5 due to be launched later this year, will any smartphone maker be able to dethrone Apple in revenue or market share?