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Executive Summary:

Mobile phone market in India is going through


major changes. Key players are losing market share
while new and young companies, mostly from Asian
countries, are coming to the market. At the same time
the market is slowly expanding when people are
buying more phones than ever. The whole process of
buying mobile phones has changed in the last few
years. People no longer carry the same phone year in
year out, change is the fast technological development
of the phones. But also consumer’s but they change
their phone every year, some even twice a year. One
reason for these attitudes towards mobile phones has
changed. Mobile phones are no longer seen as
expensive, hi-tech products, but they have become
accessories like jewellery or a piece of clothing. Here
we can mention about nokia the world’s number one
mobile phone company and this discussion is going
through about this company.
This report gives an overview on what is happening
on the mobile phone market today and analyses
Nokia’s market position in the growing market. This
report includes a brief introduction to Nokia followed
by an environmental analysis, SWOT analysis of the
company.

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History

The roots of Nokia go back to the year 1865 with


the establishment of a forest industry enterprise in
South-Western Finland by mining engineer Fredrik
Idestam. Elsewhere, the year 1898 witnessed the
foundation of Finnish Rubber Works Ltd, and in 1912
Finnish Cable Works began operations. Gradually, the
ownership of these two companies and Nokia began to
shift into hands of just a few owners. Finally in 1967
the three companies were merged to form Nokia
Corporation.
At the beginning of the 1980s, Nokia
strengthened its position in the telecommunications
and consumer electronics markets through the
acquisitions of Mobira, Salora, Televa and Luxor of
Sweden. In 1987, Nokia acquired the consumer
electronics operations and part of the component
business of the German Standard Elektrik Lorenz, as
well as the French consumer electronics company
Oceanic. In 1987, Nokia also purchased the Swiss
cable machinery company Maillefer.
In the late 1980s, Nokia became the largest
Scandinavian information technology company
through the acquisition of Ericsson's data systems
division. In 1989, Nokia conducted a significant
expansion of its cable industry into Continental
Europe by acquiring the Dutch cable company NKF.
Since the beginning of the 1990's, Nokia has
concentrated on its core business,
telecommunications, by divesting its information
technology and basic industry operations.

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2001 and into the Future
Nokia is harnessing its experience in mobility and
networks to generate a startling vision of the future.
Meeting rooms, offices and homes will be 'smart'
enough to recognize their human visitors and give
them whatever they want by listening to their
requests. Nokia welcomes change and improvement
and can embrace new ideas at great speed. Such
characteristics will never change but, as to the rest,
the story has only just begun!

Mission and Vision:

1 Vision
“Our customers continue to our First Priority”
Nokia’s future success depends on delivering great
experiences to our customers by creating products
and solutions that work seamlessly and are appealing.

2 Mission
“In a world where everyone can be connected, we
take very human approach to technology”
Connecting is about helping people to feel close to
what matters. Wherever, whenever, Nokia believes in
communicating, sharing, and in the awesome
potential in connecting the 2 billion who do with the 4
billion who don’t. If we focus on people, and use
technology to help people feel close to what matters,
then growth will follow. In a world where everyone
can be connected, Nokia takes a very human approach
to technology.

3
Strategy

“Wherever, whenever, we believer in


communicating, sharing and in the awesome potential
of connecting the 2 billion who do, with the 4 billon
who don’t”
At Nokia, customers remain our top priority.
Customer focus and consumer understanding must
always drive our day-to-day business behavior.
Nokia’s priority is to be the most preferred partner to
operators, retailers and enterprises.
Nokia will continue to be a growth company, and
we will expand to new markets and businesses. World
leading productivity is critical for our future success.
Our brand goal is for Nokia to become the brand most
loved by our customers.

In line with these priorities, Nokia’s business


portfolio strategy focuses on five areas, with each
having long-term objectives:
- Create winning devices
- Embrace consumer Internet service
- Deliver enterprise solutions
- Build scale in networks
- Expand professional services
There are three strategic assets that Nokia will
invest in and prioritize:
- Brand and design
- Customer engagement and fulfillment
- Technology and architecture

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Organization

Nokia comprises four business groups: Mobile


Phones, Multimedia, Enterprise Solutions and
Networks.
Mobile Phones connects people by providing
expanding mobile voice and data capabilities across a
wide range of mobile devices. We seek to put
consumers first in our product-creation process and
primarily target high-volume category sales.
Multimedia brings connected mobile multimedia
experiences to consumers in the form of advanced
mobile devices and applications. Our products give
people the ability to create, access and consume
multimedia, as well as share their experiences with
others through a range of radio technologies.

Mobile Phone Market in India

NOKIA’s hegemony in the GSM handset segment


has increased during last six months. NOKIA’s market
share (in terms of unit 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 march 05.In terms of
value, Nokia’s 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, according to ORG GFK
estimates.

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Supply Chain

Nokia is committed to reducing the


environmental impact of its business. It expects all
Nokia suppliers and their suppliers to take a similar
approach. At Nokia, it believes in long-term
partnerships with suppliers who share our approach
to ethical business. Together it works hard to
anticipate risk, demonstrate company values, enhance
its governance practices, increase employee
satisfaction and look after the communities where it
does business.

SWOT Analysis

Nokia is at an important crossroads in its history.


Having architected many of the key tenets for growth
during the formative years of the mobile phone
industry, the market with which Nokia is so familiar
may be adopting different rules, ones that it may not
fully understand. The situation Nokia faces may be
similar to the period in the PC industry when Dell
Computer surpassed perennial leaders IBM, Hewlett-
Packard and Compaq Computer. Why might this
happen? Because Nokia's strengths are so well-
understood by its competitors, they are well-targeted
and improved upon. The wireless market's evolution
has slowed, making it easier to challenge the
incumbents. Also, the progress of technology has
made many of Nokia's early advantages easier to
overcome. Nokia's leadership position is a result of
paying persistent attention to market needs and
taking the right chances at the right time.
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Nokia was the first to acknowledge fashion as an
important element in mobile phone purchases, and it
is solidly behind the push for Multimedia Messaging
Service, which could become the first data service
beyond Short Message Service to be deemed
successful. There is a significant gap between Nokia
and startups, which makes it difficult to compete
against Nokia. Nokia's tie to operators has kept its
products solidly in consumers' view. Yet, Nokia faces
some serious challenges.

Strengths

• Nokia has long established identity (1898); lots of


available resources (financial, etc.)
• Nokia has high penetration rate in Europe, especially
in Northern countries (close to 100%)
• Nokia Consumer Electronics has access to innovative
technology through group companies

Weakness

• Lack of centralized marketing strategy and


champion; completely different positioning strategy
depending on the country
• Too many brand names (100) in one market;
problem trying to find balance
• Corporate culture is highly technical and
operational: So what if the customer does not
understand!; lack of customer service priority

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Opportunities

• Potential for brand name sales in Europe and Asia-


pacific
• Growing replacement and supplement television
market
• NCE has opportunity of using its technology to
enhance user-friendliness

Threats

• The market for color TVs and VCRs is a


mature/saturated market; consumers are buying less
often and only to replace older units (same trend for
all countries across Europe)
• Can’t differentiate based on technical advancement
or price; competitors too fast to match
• Impact of recent purchases (for example, Sony) and
mergers is unknown; competitors are getting larger
and integrating supply chains
• Competitors (Samsung, Gold star, Daewoo) quickly
and successfully building brand name and image
Branding Strategy In the color TV market, neither
technology nor price provides a competitive
advantage. The decision a consumer makes to
purchase is primarily motivated by emotion, and is
driven largely by comfort level with a particular brand.
A successful branding strategy for NCE is, therefore,
critical to gaining a competitive advantage.
Specifically, NCE should brand for the following
reasons:
• Competitive advantage is gained through brand
name (not technology or price)

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• According to brand awareness studies, Nokia is
recognized most of the time (in Germany, France,
Italy, UK and Norway), but not necessarily affiliated
with consumer electronics such as TVs and VCRs
• Consumers buy televisions based on emotion
• Consumers perceive value in features that are
marketed as user-friendly. In the past Nokia has
relied heavily on its ability to innovate—it is a strong
technology company.

However, it is not good at introducing or packaging


this technology for consumers. It must introduce a
new mindset to NCE; a strategic shift that encourages
customer service and international marketing.
Internal Management Challenge faces at least two
challenges within NCE that he must address
immediately:
1. Lack of a marketing champion in corporate
headquarters
2. A continued reliance on technology as the main
marketing approach. For example, the remote control
TV mouse is centered on technology and may frighten
away potential customers who may perceive it as too
technical.

Options for solving these include:

1.Push down his ideas and force all to comply using


his positional power;
2.Soft approach—gradually getting buy-in to his plans
from technical representative, sales and marketing.

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Option 1 is not viable since even though it may result
in short-term agreement, it will result in resignations,
poor morale and distrust in senior management over
the long run. Since the change process can be slow,
Nokia should adopt option 2 that means getting buy-in
at the senior management level.

Quality targets:

• For Nokia to be number one in customer and


consumer loyalty.
• For Nokia to be number one in product leadership.
• For Nokia to be number one in operational
excellence.

Segmentation Strategy

Nokia Market Demographic


The profile for Nokia customer consists of the
following geographic and demographic:
Geographic
• Our immediate geographic target is rural India.
• The total targeted population is estimated at 100
million.

Demographic
• Male and female.
• Ages 25-50, this is the segment that makes up 80%
of the Nokia mobile phone market according to the
NOKIA India Ltd.
• Professionals and College students.

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Marketing Strategy
Today, the true “killer” data application is still text
messaging, a typical example of person-to-person
communication. Other end-user services, however,
have not taken off as expected in recent years.
The primary reason for this slow take-up is that most
of these services do not fulfill the expectations of
users. Although ring tones are one example of
successful person-to-content services, progress must
be made for market take-up of other mobile data
services such as:
• Messaging (e.g., MMS and e-mail)
• Entertainment (e.g., graphics, logos, games)
• Information (e.g., directory services, news)

Marketing Objective
ü Capture rural Indian market
ü Target school student
ü Attract Customers to New technology
ü Enhance Distribution
ü Maximize our revenues
ü Maintain Customer’s Loyalty

Nokia using Microfinance to sell Phones in


Rural India

Nokia is looking to extend a pilot scheme that has been


operating in 2,500 villages in the southern states of Andhra
Pradesh and Karnataka to make its mobile phones more
affordable to rural Indians.

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The company, which accounts for about half of all
mobile handsets sold in India, has been using microfinance
schemes to allow poor villagers to buy its products. A
microfinance organization has bought handsets from Nokia
and sold them to women in rural villages by charging them
Rs 100 or about US$2 a week for as long as 25 weeks.

Distribution Channels

Distributors:
A) HCL Infosystem: During the last ten years, the HCL-
Nokia relationship has witnessed strong growth in the
Indian GSM handset market resulting in a significant
market share gain for Nokia.
B) Bright point: It offers the most comprehensive
selection of brands and products in the wireless
industry. Handset, Integrated devices, PDAs, etc. They
also provide full selection of OEM and aftermarket
accessories, Modems and software. It distributes
product manufactured by the world’s leading handset
manufacturer.

Conclusion

Nokia being in a competitive market holds the


market as a monopoly with its Unique identity,
Marketing Strategy and distribution policy. Through
the Ease-of-use concept, it will add a lot to Customer
Value, which further helps Nokia in capturing the
market share in India.

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