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Introduction
When mobile phones were introduced in India in the mid-90s, US based Motorola, Sweden's Ericsson and Finland's Nokia dominated the handset market in India. Over the years, the old order has changed. Asian players like Samsung and LG, European brands Philips and Siemens now compete with Motorola and SonyEricsson. However, Nokia has been able to race ahead of all other players to become the leading mobile handset maker across the world. In India its dominance is even more pronounced with a 70 per cent market share, compared to around 30 per cent globally. Its closest rival in the Indian market, Samsung, comes a poor second with less than 10 per cent market share. Its business strategy, management style and marketing savvy have earned it the respect of its peers. In 2004, Nokia was chosen as 'the most respected consumer durables company' in India by the weekly magazine Business World. The reasons for Nokia's stupendous success in India include amazing branding, a focused marketing exercise and distribution strength, among others. Sanjeev Sharma, CEO, Nokia India, says, An extensive product range, anticipating consumer trends early we were the first to introduce a phone for the fashion segment, the 8210 a retail strategy that ensures consumers across the country get a consistent experience and an excellent staff, all put together, clicked for Nokia. Nokia's commitment to the Indian consumer was underscored when it became the first, and only, handset major to develop a model suited for Indian conditions. The company launched two models, 1100 and 1108, after intensive research on the Indian customer's specific needs. The phones gave an integrated torch, a sheath covered keypad for dust protection and a slip-free grip. The phones were also introduced in other markets in Asia and Africa. Nokia's first Made for India model, the 1100, is the largest selling model in the Indian GSM handset market. The five largest selling handset models in the market are all Nokia's. Besides, the company today has a substantial share of both ends of the market. It has 77 per cent of the $66-$88 phone market and about 68 per cent of the over $330 phone market. In a marketing first, in March this year Nokia opened a dedicated Concept Store which features the full range of Nokia products including handsets, mobile enhancements, ring tones, graphics, games, software and exclusive Nokia merchandise. The products allow clients to experience the newest applications such as gaming, imaging and e-mail support
Objectives
-Overview of the world mobile handset industry. -In-depth analysis of the Asian mobile handset industry. -The present market position. -The future projections. -Geographical and regional segmentation of the industry and the consumers. -Sales and profitability of the industry. -Challenges faced by the industry that propels higher competition among the vendors and retail sectors.
Product Details
Economical Products:
1100 better known as Made for India
Product features:
Icon-based phonebook with simplified menu navigation 20-chord polyphonic ringing tones with MP3-grade sound New inverted black and white display Graphical demo mode for phone features both with and without SIM card Analog clock display Call management (timers, counters) Internal antenna Changeable Xpress-on color covers Picture messaging to send a picture greeting Three built-in games Easy deletion of multiple messages
Undo item in SMS editor Price: Rs. 1,744.00 Warranty: Nokia India 1 Year Warranty
Video
Shoot DVD-like quality video up to 30 frames per second Video stabilization Dedicated video capture controls Digital stereo microphone 3.2 megapixel camera and Carl Zeiss optics Sharper images with up to 3x optical zoom Autofocus and LED flash 2.4-inch display Cut your videos and burn them to DVDs with Adobe Premiere Elements Post directly to Flickr Share images during video conferencing Nokia Web Browser with Mini Map Support for RSS feeds Connect to your compatible PC via USB, infrared, or Bluetooth wireless connectivity Play your videos on compatible home electronic devices with Wi-Fi connectivity M-156 (Dual-mode) WCDMA 2100EGSM 900/1800/1900 MHz Main display: 240 x 320 with up to 16.7 million true colors Sub-display: 128 x 36 Rs. 42209
Imaging
Connectivity
Production Process
Globally, mobile phone manufacturing involves seven different segments with varying technology and skill-sets. These are semiconductors or ICs, passive components, PCB fabrication, modular components, plastic parts, box-build assembly and testing. As things stand, there are companies in India that are already in a position to provide most of these components. In most mobile handsets, there are anything between 40-60 components. In China, almost all these are made locally. In India, the local companies can provide about 30 per cent of the components initially. These can be supplied by the component suppliers to the electronic industry, most of whom are based in Bangalore. According to a study by international consultancy KPMG for the Indian Cellular Association, the technology used to make printed circuit boards (PCBs) by Flextronics, D-Link, Jabil Circuit and Celetron in India exceeds the requirements needed to manufacture handset PCBs.
Market Share
Nokias market share (in terms of units sold) has grown to 74% in March 06 from 61.5% in October 05. In the colour segment too, Nokia has increased its market share to 55% in March 06 from 33.7% in October 05. In terms of value, Nokias overall market share has jumped to 70.5% in March 06 from 57.7% in October 05. In the colour phone category, its market share (in terms of value) has increased to 59.3% in March 06 from 40.9% in October 05. Sony Ericssons market share in the colour segment is marginally more than the Samsungs at 16.7% (units) and 15.9% (value) in March 06 and is an improvement over its October 05 figures of 15.6% (units) and 14% (value). Sony Ericssons market share (in terms of units) has improved marginally from 7.1% in October 05 to 7.6% in March 06, although in value terms it has increased from 8.7% in October 05 to 10.2% in March 06. The colour segment, where Samsung used to rule once, has seen its market share falling both in terms of units and value. The market share (units) has dropped to 16.3% in March 06 from 34.9% in October 05and in terms of value, has dropped to 14.7% in March 06 from 32.5% in October 05. Nokia has retained the top slot in Indian GSM market with 79% share, while US giant Motorola has more than doubled its share to 7% this year, according to a study. Motorola has been able to significantly improve its share to 7% this year from 3% in 2005, according to the latest annual TNS Cell Track 2006 study. It said the US company's gain was possibly the loss of South Korean handset maker Samsung, whose market share dropped to 4% in 2006 from 6% a year ago. In the CDMA market, LG has consolidated its position as the market leader with 49% market share this year against 43% in 2005, the study said.
While Nokia managed to retain its share in CDMA handsets, Samsung and Motorola lost market share from 17% to 8% and 12% to 4% respectively.
RESEARCH METHODOLOGY
1. Source of data: Secondary source Related articles from newspaper and business magazines and also from internet (google.com) Primary source 10 consumers and 5 retailers of different age groups from Mumbai and Navi Mumbai were interviewed. 2. Nature of data: Data collected from consumers are opinion. While that from related websites are facts. 3. Communication approach: Tool: Questionnaire Type: Structured
SONY 27%
Maxsales
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TECHNOLOGY
PDA 13%
CDMA 27%
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subscribers in India. Every month, Indias mobile phone subscriber base expands by seven to eight million; in the first quarter of 2007, India is expected to overtake Russia, which currently ranks third with 152 million subscribers. However, Russia adds a mere 2 million new subscribers every month. The GSM (Global System for Mobile Communications) subscriber base touched the 100 million-mark in India in November, making it the third highest GSM market after China and Russia. There are an additional 36 million CDMA (Code Division Multiple Access) subscribers in India. Industry observers feel that 2007 will see the addition of 10 million new subscribers every month in India, making it the fastest growing cellular phone market in the world. The governments target of 250 million subscribers by the end of 2007 is likely to be reached towards the end of September. The mobile handset sales continue to grow worldwide, going up from 482.5 million in 2003 to 561 million in 2004. This growth rate is expected to gradually slow down over a period of five years. The estimated growth figures for these five years are10% in 2005, 7.7% in 2006, 6.4% in 2007, 4.8% in 2008 and 2.6% in 2009. Notwithstanding the gradual decline in the growth figures, the annual handset sales are predicted to reach 767 million by 2009. Mobile handsets with innovative features have gained a lot of popularity in the developed nations. But the developing markets, which are not yet saturated, namely, India, Russia, Brazil, Mexico, and China, will mainly carry on the global handset sales. Some of the prominent companies, namely, Samsung, LG, and Sony Ericsson will see remarkable growth in this year. Though maintaining a huge gap from its nearest rival, Motorola, Nokia is expected to lose some market share in this year.
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Problems
Nokia India: Pathetic apathy for the Indian customer
Nokia is selling some of its degraded products that have software problems. If customer come across such problem in a new set, they waste lot of time in running around service centers as it does not help much, the company informs for replacement set after repeated follow up only. This promise is never fulfilled, if it is fulfilled the customer gets either a secondhand phone or a hand set which is even worse than the defective hand set. After some time the same problems occurs in supplied set also and customer runs around Nokia Service Center again and again.
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Display panel light not glowing; display is there but no light due to starting of sudden vibration. Vibration stops only after removal of battery. But when battery is fixed back vibrations starts immediately.
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Conclusion
In India Nokias dominance is even more pronounced with a 71 per cent market share, compared to around 30 per cent globally. Nokia's stupendous successes in India include amazing branding, a focused marketing exercise and distribution strength, among other brands. An extensive product range, anticipating consumer trends early. Nokia were the first to introduce a phone for the fashion segment. A retail strategy that ensures consumers across the country get a consistent experience and an excellent staff, all put together, clicked for Nokia. Over half a billion mobile phones are sold every year, and despite sluggishness in other parts of the technology industry, the number continues to grow. Sales are being driven, in part, by the surge of new subscribers in the developing world, particularly in India and China. In the developed world, meanwhile, where markets are so saturated that most adults already carry a mobile phone, existing subscribers are switching in droves to today's more advanced models.
Meanwhile, the number of mobile phones in use, at around 1.4 billion, overtook the number of fixed-line phones last year.
Nokia's commitment to the Indian consumer was underscored when it became the first, and only, handset major to develop a model suited for Indian conditions.
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Bibliography
Web site:
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ANNEXURE
Retailers Questionnaire
1. Name of Respondent: __________________________________ 2. Address: _________________________________________________________________ 3. Contact No:___________________ 4 Age Group: Years 10 17 18 25 26 33 34 + 6. Total house hold income from all source:___________________ 7. Which mobile do you select out of this? a) Nokia b) Sony Ericsson c) L.G d) Motorola
8. Which hand set has maximum sales volume? a) Nokia b) Sony Ericsson c) L.G d) Motorola
9. Which type of Hand set has sales volume? a) Colour b) CDMA c)GSM d)Others
10. Why people go for other mobiles than nokia? a) New technology b) Features c) Sound system d) Quality
11. What are the common problems faced by nokia users? a) Battery b) Keypad c) Feature d) Others
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Customers Questionnaire
1. Name of Respondent: __________________________________ 2. Address: _________________________________________________________________ 3. Contact No:___________________ 4 Age Group: Years 10 17 18 25 26 33 34 + 5. Occupation: ____________________________ 6. Total house hold income from all sources: ___________________ 7. Which mobile do you select out of this? b) Nokia b)Sony Ericsson c) L.G d) Motorola
8. Why do you go for mobile other than nokia? b) New technology b) Features c) Sound system d) Quality
9. What are the common problems faced by nokia users? b) Battery b) Keypad c) Feature d) Others
10. Price of nokia mobile is a) Very high b) Fairly High c) Reasonable d) Cheap 11. How satisfied are you from your mobile phone? a) Very satisfied b) Fairly satisfied c) Not very satisfied d)Not at all satisfied 12. Which Nokia's product/market segment is you referring to a) Fashion b) Sports c) Gaming d) business to business 13 why do you prefer nokia mobiles? a) Durability b) easy application c) sound quality d) battery life 14. How frequently do you change your mobile? a) 6 mths b) 12mths c) 18mths d) 24mths or more
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