NOKIAs BL-5C battery controversy (August 2007) IBN News 22 August 2007

New Delhi, Aug 19, 2007 (UNI) Mobile phone-maker Nokia is undeterred over the controversies surrounding its ''BL-5C'' batteries and hopes that consumers will appreciate the measures taken by the company to resolve the problem as soon as possible, a top company official said. ''Our foremost priority is consumer's interest and for that we are taking all possible measures to sort out their problems,'' India Director Marketing Devinder Kishore told UNI. Nokia has warned consumers that 46 million batteries used in its mobile phones could overheat and has offered to replace them for free, Mr Kishore added. ''Nokia has a quality system in which customer is in focus,'' Mr Kishore said adding that the matter will be resolved in a customer-friendly way. ''We are transparent and do not want to disturb day-to-day life of customers. Hence, we issued a product advisory for the Nokia-branded BL-5C battery manufactured by Matsushita Battery Industrial Co Ltd of Japan between December 2005 and November 2006 on Tuesday.'' After the product advisory issued on Tuesday, the company has received 31.6 lakh messages through SMSs, calls and websites, Mr Kishore informed and added that the company is committed to consumer's safety. Nokia's US shares closed down 64 cents or 2 per cent at 29.84 dollars on the New York Stock Exchange. Its European shares had closed down 1.55 per cent. When asked if the controversy would impact Nokia's sales, Mr Kishore said that till now trends in sales have been positive and the company hopes that this advisory will have a positive impact on the company's overall business. Nokia, the world's top cell phone maker had said about 100 incidents of such overheating had been reported globally, but none had involved serious injuries

or property damage. Nokia took prompt notice of the matter and made several public advisory announcements about its faulty BL-5C battery, which was manufactured by Matsushita Battery Industrial Co. Ltd of Japan between December 2005 and November 2006. Nokia further offered to replace for free any BL 5C battery subject to the product advisory.

Brand image And Public Relation of NOKIA

What action should brands take when faced with such controversies? Consults says, First of all, accepting ones fault is half the battle won. After which, the source of the problem should be identified and corrected at the earliest. All this should be communicated well to the consumer to make him or her realise that the brand has indeed taken (remedial) steps and to restore credibility and faith. I believe that the action taken by any brand in such a situation should be highly demonstrative, not just based on managing returns. I think that due to Nokias high credibility and strong international brand presence, the brand has not lost much. But this doesnt mean that there will be no impact on the brand. Even for a short time, this could affect the sales and credibility of the brand. According to me the strategy adopted by Nokia, though prompt, was still not good for its brand image in a country such as India. The reason: The Indian consumer is not educated enough to see its remedial action as a responsible step. There might be a number of consumers who are educated, but at the pan-India level, their numbers are fewer. With consumers who are not so well educated, the faulty batteries will go against Nokias brand image to the extent that in the future, it may face a credibility issue if another problem of a similar nature crops up. The problem arises from the fact that India does not have a concrete consumer interaction platform where consumers can be educated or made aware of such issues nor does it haves a strong consumer redressal system in place.

Industry Experts about NOKIAs controversy

Jagdeep Kapoor chairman and managing director of Samsika Marketing Consultants, offers a different point of view. Kapoor thinks that Nokia has taken immediate notice and well thought out action by issuing product advisories across media platforms to spread awareness regarding the faulty batteries.

Nokia has immense credibility as a brand and things like this can happen to any brand. The point here is that this wont harm the image of the brand to a large extent or in the long run, as public memory is short. In the short term, it will have an impact, but as the brand has taken corrective measures, rather than having a negative impact on the brand image, it will only enhance the Nokia identity, adds Kapoor. When faced with a controversial situation like this, responsibility and accountability on the part of the brand is essential, states Kapoor. An honest approach, transparency and quick response are the factors that tide a brand through controversy, say industry experts. These should be followed under all circumstances to build a strong image for the brand in the minds of the consumer and the marketer. Industry experts also warn brands against going on the defensive and denying outright that they are at fault, as did Coke and Pepsi. Advertising experts believe that the media plays a major role in this situation. The Nokia situation was handled well by the media. Clear communication is the need of the hour and this can be done through honest, responsible advertising, which builds bridges, rather than portraying half-truths and messages that are muddled about their intentions.

PUBLIC RELATION
Brand- NOKIA Issue- Nokias BL-5C Battery controversy

Submitted by- Ajeet Chaudhary 03, Fashion Communication, Semester- VI