This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Why Chinese Aren't Boycotting Samsung

TAIPEI, Taiwan ( TheStreet) -- When I lived in China in 2005 and the country's youth declared a guerrilla boycott against Japanese products over unburied World War II issues, common Chinese people had to be careful about where they parked their Toyotas.

The boycott also forced Chinese locals to cloak their Nikon cameras as they photographed a series of anti-Japanese mass street protests. Eventually, Chinese authorities, though the most gushing opponents of Japan, asked the public to stop. We Chinese, you see, make and already own Japanese stuff, big brother told the littler ones.

One would have expected a similar response to Korean electronics giant Samsung after labor rights groups stung it in November with claims of exploiting some of its workers in China.

But even though many Chinese consumers feel jealous of South Korea for its clean, quick rise to prosperity, they were barely stirred (let alone outraged) by the reports of teenage workers, required overtime and blank contracts.

Normally they would be quick to vent, but this time they're unfazed because Samsung is making phones they want and can afford and that are better than homegrown alternatives.

Samsung has surpassed Nokia (NOK - Get Report) as the most "commonly used smartphone brand" in China since the third quarter of 2012, a division of global market research firm TrendForce said in a March 19 consumer research report. Samsung claims a 20.3% market share, leaving Nokia -- a long-standing favorite since presmartphone days -- with 14.3%.

So investors might buy a few Samsung shares if they haven't already, based on the Android OS overachiever's worldwide showing, hold shares of Nokia until it starts to make a comeback and take another bite into Apple (AAPL - Get Report) shares (find out why later).

Whether or not workers were exploited, Samsung was calling out to China last year. It stepped up production in the country to make more handsets locally, which should mean lower prices for lack of shipping costs.

Samsung twinned increased production with an expansion of its sales network to more Chinese consumers. Chinese consumers are numerous, we all know, and if the government gets its way in retooling the economy, they will spend more of their hard-saved money and cut China's historic but increasingly squeamish reliance on industrial development.

Key components of that extension are mass marketing, the pro-China price range of Samsung smartphones and dependable after-sales service.
1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $117.81 -0.19%
NOK $7.19 -0.83%
FB $105.45 0.04%
GOOG $750.26 0.28%
TSLA $231.61 0.86%


Chart of I:DJI
DOW 17,798.49 -14.90 -0.08%
S&P 500 2,090.11 +1.24 0.06%
NASDAQ 5,127.5250 +11.3820 0.22%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs