The latest round of fires now occurring on Samsung's "safe" replacement Galaxy Note7 phones heavily circulating on the media has at least one industry watcher predicting the brand's demise.
"I don't think there's any salvaging the Note7 name and I don't think they should come out with a Note8 which we've heard was planned," said Russ Napolitano, senior partner at branding and marketing consultancy Tenet Partners. "They have to get rid of the Note name altogether and come out with a better phone with upgrades, but also one that will have the quality that will reassure and excite consumers again."
With reports of Note7 replacement phones catching on fire, Samsung has reportedly suspended production. Meanwhile, mobile phone carriers AT&T, Verizon and T-Mobile announced they will no longer give out the replacement phones as recall exchanges.
While not admitting a production halt, a Samsung spokesperson said in an email Monday morning, "We are temporarily adjusting the Galaxy Note7 production schedule in order to take further steps to ensure quality and safety matters."
The replacement Note7 phones, exchanges for the initially recalled fire-prone models, have now caught on fire on a Southwest airplane at the gate and caused at least one smoke inhalation injury. Social media is rife with Note7 fire videos and negative messages, while airlines are still broadcasting warnings singling out the Note7 users to power off.
Samsung has been regularly issuing statements throughout the Galaxy Note7 recall which began Sept. 2, but has not gone out with mass media advertising to talk about the issues. The video above, uploaded to YouTube on Sept. 16 featuring Samsung Electronics America President-Chief Operating Officer Tim Baxter, offered an apology and claimed the 130,000 phones replaced thus far were safe.
But following the replacement fires, no ads have been developed to reassure consumers.
"They need to take the bull by the horns and get out there with some messaging recognizing that this is an issue and that the safety of their consumers is No. 1 over them selling phones," said Mr. Napolitano. "Unfortunately that message may be too late now because you have your three primary carriers refusing to sell the phone."
He added: "They just don't seem to get the value of communication."
Robert Passikoff, founder and president of Brand Keys, said that the recurring fire incidents do require deft handling by Samsung, but he thinks it's too early to say the Note7 phone is done.
"Consumers' well of forgiveness is not bottomless," he said in an email interview. "On the other hand, with the kinds of loyalty and emotional engagement they've shown the brand in the past I don't think that they've hit a dry well just yet."
His suggestion for Samsung would be to try and migrate users to another Samsung brand like the Edge, or possibly a brand new one offering promotions and big discounts as incentive.
Gartner analyst Tuong Nguyen said he isn't ready to write-off the Note7 yet either. "We're still talking about a high-end, flagship product. This makes it the decision process much more complicated. It wouldn't really make sense to completely pull or cancel this line," he said.