ASSAINGNMENT

Subject: SEMINAR MARKETING Submitted To: Mrs. Mariym Iqra Submitted By:

Hassnain Ali

MB-11-40

(MBA 5th Semester Evening)

Department of Business Administration BZU Bahadur Sub Campus Layyah

Marketing Plan Nokia Nokia Marketing Strategy Nokia at Present

In 1992, the company launched its first GSM handset and then introduced their famous Nokia Tune in 1994. During that year, the worlds first satellite was made using a Nokia GSM handset. In 1997 the world famous mobile game Snake was presented in the Nokia 6110. Soon after, in 1998, the company became the world leader in mobile phones. Following a good deal of research, they launched the first mobile phone Nokia 7110 which included a WAP.

Nokia Now
Presently, Nokia is creating more and more mobiles phones with differing functions. The company also makes sure into diversifying and segmenting its products. Their leading position pushed the company to go forward in their research. They came up with the first 3G Phone in 2002, and the multi-player Nokia N-Gage. In 2005, the N-series were born with their sophisticated mobile phones. In 2006, Olli-Pekka Kallasvuo became the new CEO of Nokia and Jorma Ollila shifted to being the Chairman of Nokias board. At that time Nokia and Siemens announced plans for Nokia siemens network the leading operations of Nokia. In 2007, Nokia launched its new internet services brand. In order to achieve its goals, Nokia developed strategies. These strategies differ from country to another, from a culture to another. Companies are always creating a vision and a mission statement to make everything tacit. Evidently, Nokia has set up its specific missions

EXECUTIVE SUMMARY
Nokia is a leading mobile device manufacturer globally and has a high market share. Maximum population in India prefers using Nokia handsets as it is user friendly. It can use its customers goodwill and loyalty to diversify in the mobile network market in India. The communications sector in India has transformed into a multi-player and multi-product market that has diverse market size and segments. In order to diversify in to new market, Nokia needs to develop a marketing plan which will give them the idea what factors to be considered before entering the mobile network sector. The marketing plan includes all the factors that need to be undertaken. They are market analysis, competitor analysis, and environmental analysis, and customer analysis, internal and external factors.

The mobile network market is growing rapidly and has good opportunities for new entrants to enter market and gain market share. Though there is much opportunity in this market, there are some threats such as threat from existing competitor, high customer churn rates, etc.

BACKGROUND OF NOKIA:
Nokia was incorporated by Fredrik Idestams on the banks of Nokianvirta river in 1865. From its incorporation to till date Nokia had gone through four phases (see figure 1). Nokia started as a paper mill company and by 1967 merged with cable company and rubber enterprise to place Nokia in to electronics. Between 1968-1991, it was positioned to take initiative in the advancement towards mobile communications. During the period 1992-1999, Nokia

concentrated primarily on its telecommunications unit and became market leader before the start of millennium. In the last decade, Nokia continues to be the market leader with 3G, mobile gaming, multimedia devices and with future challenges to be achieved.

MARKETING PLAN

A marketing plan is a written document that outlines the marketers knowledge about the market place and point out how the company plans to achieve its marketing objectives. Kotler (1991) states that marketing plan is one of the most important output of marketing process.

PROPOSED PRODUCT
I have selected Nokia sim-cards as their new product extension. As they are not in the service provider market, it will help them to diversify and gain market share through the goodwill they have created over decades.

COMPETITOR ANALYSIS
In order to enter in to the sim card market, Nokia will have to face competition from already existing service providers such as Bharti Airtel which is the market leader with over 93.92 million subscribers and market share of 21.73%. Followed by this is reliance and Vodafone with market share of 17.49% and 17.46% respectively. Whereas, new entrant Aircel has bagged 18.48 million subscribers and market share of 6.40% within a short span of time. This indicates there is increasing demand in this market. Hence, Airtel, Vodafone, Reliance, and Aircel are major competitors which can dissuade the growth of Nokia.

MARKET ANALYSIS
It is a tool that helps organization to better understand the environment in which they function (Kress, Webb, and Synder, 1994). It is critically assessing the market in which the organization is launching a product. And is a vital step in development of marketing plan. One of the methods used in market analysis is Porters five forces framework. It implements five forces that show competitive force and attractiveness of the market.

Bargaining power of Buyers (Customers): The customers in the service provider market have high bargaining power because of following reasons: Availability of many service providers. The service is undifferentiated as most of the service providers provide same service.

Bargaining power of Suppliers (Service Providers): The service providers have limited bargaining power due to following reasons: Existence of many service providers. Fewer margins to differentiate service from other service providers.

Threat of New Entrants:

As there is significant growth in this market for the past few years, which results in increasing threat from new entrants. Growing interdependence between service provider and cell phone manufacturer. Low entry barrier.

Threat of Substitutes:
There is much threat from substitutes due to availability of many service providers and also due to less scope to differentiate from the competitors.

ENVIRONMENTAL ANALYSIS
It deals with scanning the business environment through collecting, analyzing and implementing the available information for developing a market plan. The tool used to scan the business environment is through PEST analysis.

Pest Analysis
Political Factors: It includes government rules and regulations under which an organization must operate. It differs from one organization to another as per the market in which it functions. In India, there is partial regulation of government policies for service providers in the telecommunications industry. As market is deregulated, it gives an opportunity for Nokia to enter the service provider market with better service plans to its customers.

Economic Factors: It affects the buying power of customers and also has an impact on the companys cost of capital. In current market situation of global recession, people are opting for service plans with cheaper rates (Call, text messaging) and also internet connectivity of the service provider, Nokia can introduce its sim-card with better coverage, cheaper rates,

internet connectivity and additional services for people using Nokia handsets. This will give an edge to Nokia to penetrate in the service provider market.

Social Factors: It deals with customers profile such as demographic, culture, occupation, etc. As the number of people using mobile phones in India is growing every year, Nokia can penetrate the service provider market by selecting its target market and offering service plans according to the usage. Nokia can segment the market as per region, population, and so on.

Technological Factors: Research and Development (R&D) plays a key role in success of any organization. The more technological advance the firm is, the better they have advantage to capture the market. As Nokia is well-known for its wireless technology and is among the leading player. They can use their advance technology in the service provider market and provide strong network range. Also high internet connectivity will give an edge over the existing network service providers.

CUSTOMER ANALYSIS
At present, almost everyone uses cell phone. Therefore, the target segment for this market cannot be specific. Nokia needs to target population according to their usage by providing customize service plans so that the customer can select the plan which meets their requirements. They can also segment customers regionally as the usage is much more in urban market.

SWOT ANALYSIS
Strengths: Huge market share: Nokia has huge market share in the cell phone sector and therefore can use its image to be successful in the service provider market. World-class technology: Nokia can make use of its world class research and development team to design better network coverage for its sim-cards.

Geographical Reach: As Nokia is one of the renowned brands globally, its presence in the market is very high and can use this to provide its sim-cards service to majority of population.

Weakness:

New in the market: As Nokia is new in the service provider market, it will be difficult to attract customers towards its sim-cards and service plans.

High customer churn rate: Due to many competitors in the market and less margin to differentiate the service from competitors, customers switch from one service provider to other if they are not satisfied with its service. Opportunities:

Untapped Market: Nokia is new to the service provider market and has an opportunity to explore the market. High market growth rate: As the number of people using mobile phones is increasing rapidly. There is high growth rate in the market.

Increase Market Share: Nokia can increase its market share by untapping the service provider market and increasing its customer base.

Threats:
Competitors threat: Nokia face competitors threat from market leaders such as Airtel, Vodafone and also from new entrant Aircel which has been successful to gain market share within a short period.

Global recession: It led to less amount of disposable income with the customers. Hence, customers think twice before investing his money.

Market Saturation: It poses as another threat if the service provider market saturates due to financial crisis caused by recession.

MARKET SEGMENTATION, TARGETING AND POSITIONING

Market Segmentation
It is process of dividing the market in to segments based on different characteristics. The various ways to segment the market are: Demographic, Psychographic, etc. Consumer based segmentation can be executed on product specific basis. It is a process of segmenting customers on various dimensions. Nokia has to target its customers based on their usage. For instance, cheaper call rates and SmS for college students, faster internet connectivity for professionals, etc.

In order to evaluate the market segment, Nokia needs to look at two major factors: Overall attractiveness of the market and companys objectives and resources

Market Targeting
One of the key elements of marketing strategy is to select its target market. A target market can be defined as a market or group of customers that the firm has decided to target its products or services through its marketing strategies. As Nokia is new in the SIM card market, it has to target its customers at the lower end as to increase its customer base and ultimately market share. Moreover, there is high usage rate in urban areas and among youngsters therefore Nokia needs to select the target market accordingly. They can also use undifferentiated marketing to target its selected market.

Market Positioning
It refers to position a firms product or service in customers mind so that customers can differentiate a firms product from other. In order to position product, a firm need to select its target segment and thereby position its product. Nokia has position its SIM-cards in the same manner as it had done to position its cell phones. It can position its SIM cards as better network coverage, cheaper call rates, good customer service and so on. This will help its customers to get emotionally connect to its service and thereby prefer Nokia SIM cards over its competitors.

STRATEGIES FOR GROWTH

Generic Strategy The term generic strategy was introduced by Michael E. Porter to find ways how companies compete in segmented market and gains advantage over its competitors. The firm can achieve competitive advantage over other players by differentiating its product and service offerings. There are three key generic strategies that an organization can undergo to achieve competitive advantage over other firms. They are cost leadership, differentiation and focus

Cost Leadership: A company who tries to gain competitive advantage by pricing its

product lower than competitors can achieve strategic growth through cost leadership. In case of Nokia, the price of the SIM cards should be kept low to target broad market and achieve cost leadership. They can thus achieve competitive advantage among customers over its competitors.

Differentiation: It refers to an organization offering its product or service that differentiates

from its competitors to gain competitive advantage. In order to differentiate its product a company has to incur higher cost in its R & D. Nokia can differentiate its SIM cards by offering customize service plans to its customers which they can select as per their usage.

Focus: The firm which focuses on a particular market tries to use niche marketing to gain

competitive advantage. It is done through targeting its product offering to narrow market. Nokia can use this strategy to gain competitive advantage over its competitors by targeting its SIM cards particularly in rural market which is still untap to a certain market. It may also involve a high cost but they can use their cell phone market geographical reach to target that market.

MARKETING MIX
It is the most famous marketing term and is used by all organization to target its customers. The elements of marketing mix are the basis of a marketing plan. It includes 4 Ps for products and 7 Ps for services. They are Product, Price, Place, Promotion and extended Ps i.e. Physical evidence, People and Process for services.

Product

A product is a tangible thing that is sold by an organization to its customers in order to gain market share. To gain market share a firm needs to differentiate its products from competitors, be innovative, and eliminate the products which are not doing well in the market. In case of Nokia, it is a market leader in cell phone market. To gain market share and increase its customer base, Nokia is diversifying into SIM cards market. To differentiate its product from the competitors it has to use various strategies such as mass marketing. The product offered by Nokia i.e. SIM cards can be described with the service that they can offer.

Price Price refers to the amount a customer is willing to spend. It is determined by a number of factors such as market share, growth rate, competitor pricing, etc. Nokia has to keep its SIM card prices low in order to penetrate into the mobile network market. They need to offer service plans as per the usage of the customers. While pricing, Nokia needs to keep in mind different segments that they are targeting. For instance, different plan for youngsters, corporate, businesses, SBUs. They also need to constantly update its pricing in order to compete with its competitors.

Place It refers to geographical area where the product is placed. It also includes outlets, distribution channel. Nokia needs to make available its SIM cards both in rural and urban areas. It can also use its geographical reach to untap the rural markets which is still not properly covered by the existing competitors. Nokia can also use its customer care centres to sell its SIM cards. Apart from this, they can provide its SIM cards to retailers and dealers.

Promotion It represents all the marketing activities that are carried to promote a product in the market. There are various mediums to promote products such as advertisements, hoardings, etc. Nokia can use various mediums to promote its SIM cards. It can use celebrities, advertisements, hoardings, sponsoring events, etc. They can also spread awareness about its SIM cards by using canopies outside colleges.

Distribution Process

The distribution process of Nokia SIM cards is through two ways: Franchise Dealer Customer: Nokia can sell it SIM cards to the franchise which will

sell the SIM cards in the outlet and also through providing to dealers which will then make available to the customers. Distributor Dealer Customer: Nokia can also use this distribution channel by providing the SIM cards to regional distributors which will sell directly to customers and also provide it to dealers who will ultimately sell to customers

CONCLUSION AND RECOMMENDATIONS

In order to diversify its business in to mobile network market, Nokia needs to make use of its leading mobile phones manufacturer image. As Nokia has build loyalty among its mobile phone users, it can use this for attracting customers towards its SIM cards and thereby gain market share. Also with its world class R & D department, it can offer many services to its customers which will help them to differentiate in their service offering from its competitors. For instance, video calling, free roaming, outgoing call restriction, etc. By focusing more on rural market which is untap to a certain extent, Nokia can satisfy its customers in rural areas which most of the existing players are not successful. Also by offering customize service plans to its customers such as offering SmS package, unlimited internet package, Free Hello tune, and so on with minimum price. Nokia can also make tie-ups with existing players such as Airtel, Vodafone, Aircel in order to gain larger market share. It can also offer better deals to customers who are buying Nokia handsets on its SIM cards which will increase its sales as well as customer base. This will help them to develop loyalty among its customers. In order to diversify in to SIM cards segment, Nokia needs to use mass marketing by implementing various promotion strategies such as Advertisements, Hoardings, Sponsoring events, canopies outside colleges and so on. Nokia also needs to plan its distribution strategy in order to reach to maximum people. They can also use their Connecting People tagline in its SIM card, thereby giving additional meaning to it.