114579483 Marketing Strategy to Increase the Market Share of Nokia Smartphone s

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Strategic MarketingProject on

SMARTPHONEs

INDUSTRY REPORT

2012

Submitted for the partial fulfillment of the requirement

for the award

Of

POST GRADUATE DIPLOMA IN MANAGEMENT

SUBMITTED BY

NITY NIHARIKA

ROLL NO. 21022

UNDER THE SUPERVISION OF Internal: MRS SMITA SINGH

Department of Management

INSTITUTE OF MANAGEMENT EDUCATION,

SAHIBABAD

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ACKNOWLEDGEMENT

Survey is an excellent tool for learning an exploration no classroom routine can substitute which is

possible while working in real situations application of the article knowledge to practical situations is the

bonanzas of this survey.

Without a proper combination of inspection and perspiration, its not easy to achieve anything. There is

always a sense of gratitude, which we express to other for the help and the needy service they render

during the development of this project.

First of all we wish to express my profound gratitude & sincere thanks to my esteemed learned Director

who allowed me to conduct the survey.

We would like to thank my lect. Mrs. SMITA SINGH who has always there to help and guide me when

we needed help. His perceptive criticism kept me working to make the project more full proof. We

thankful to her for her encouraging & enriching experience for me. We very thankful to him for all the

addition & enhancement done to us.

No words can adequately express our overriding debt of gratitude to my parents whose support

help me in all the way above all I shall thank all my friends.!

1.1. TABLE OF CONTENTS

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CONTENTS PAGE NO.

CHAPTER 1 INTRODUCTION 3-22

1.1. Overview of Industry as a whole 3

1.2. Profile of the Organization 8

1.3. Problems of the Organization 16

1.4. Competition Information 17

1.5. S.W.O.T Analysis of the Organization 22

CHAPTER 2 - OBJECTIVES & METHODOLOGY 23-28

2.1. Significance 24

2.2. Managerial usefulness of the study 25

2.3. Objectives 26

2.4. Scope of the Study 26

2.5. Research Methodology 27

CHAPTER-3 CONCEPTUAL DISCUSSION 29-60

CHAPTER-4 DATA ANALYSIS 61-73

CHAPTER-5 FINDINGS & RECOMMENDATIONS 74-82

ANNEXURE

BIBLIOGRAPHY

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CHAPTER-1-

INTRODUCTION

OVERVIEW OF INDUSTRY AS A WHOLE

In today's world, most people communicate through the use cellular phones. It's hard to believe

that fifteen years ago cell phones were a rarity. Below is a history chronicling the dawn of the

cell phone to its current state. 1843-Faraday exposed his great advances of nineteenth-century

science and technology and his discoveries have had an incalculable effect on technical

development toward cellular phone development.

1865- Dr. Mahlon Loomis of Virginia, a dentist, may have been the first person to communicate

through wireless via the atmosphere. Between 1866 and 1873 he transmitted telegraphic

messages at a distance of 18 miles between the tops of Coshocton and Beorse Deer Mountains,

Virginia.1973 - Dr Martin Cooper is considered the inventor of the first portable handset. Dr. Cooper,

former general manager for the systems division at Motorola, and the first person to make a call

on a portable cellular phone.

1973 - Dr. Cooper set up a base station in New York with the first working prototype of a

cellular telephone, the Motorola Dynastic. Mr. Cooper and Motorola took the phone technology

to New York to show the public.

1977 - Cell phones go public. Public cell phone testing began. The city of Chicago was here the

first trials began with 2000 customers and eventually other cell phone trials appeared in the

Washington D.C. and Baltimore area. Japan began testing cellular phone service in 1979.

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1988 - This year changed many of the technologies that had become typical in the past. The

Cellular Technology Industry Association (CTIA) was developed to lay down practical goals for

cellular phone providers. According to the Cellular Telecommunications Industry Association,

today there are more than 60 million customers with cellular phones, even though wireless

service was just invented nearly 50 years ago. The cellular business was a $3 million market 25

years ago and has grown increasingly to close to a $30 billion per year industry

About the Industry

The cell phone industry has evolved greatly in the past 10 years. 10 years ago only the rich could afford

cell phones, and they looked like boxes more than some thing that could fit in your pocket. Today, more

people have cell phones than fixed telephone lines, both in the United States and internationally. There

are more than one billion cell phone users worldwide." Cell phones have now become a part of everyday

life. Without cell phones we would be lost in our high tech world. Americans spend 7 hours a month on

cell phones. The effects of new technology have had positive effects in school, too. Cell phone use is

getting more and popular. "Some 85 million U.S. residents30 percent of the populationhave joined

the mobile-phone revolution. There are already 1 billion cell phone users worldwide. Between 2010 and

2020 it will be hard to find a person with out a cell phone.

They are now bought for the fact that they are used in emergency situations. Nearly 156,000

wireless emergency service calls were made every dayabout 108 calls per minute. Parents are

now buying them for their children so they know where they are all the time. Every company has

their different Marketing Strategies. Now I am going to discuss the Marketing strategies of

Nokia.

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Indias Tele-density in January 2008 neared 12% with the subscriber base nearing the 130mn mark.

During January 2008, record 5mn subscribers were added as against 4.92mn subscribers in December

2007. This strong growth could be attributed to lifetime validity cards launched by almost all operators.

During the first 10 months of FY06, 31.41mn subscribers have been added. In the fixed segment, a total

of 0.28mn subscribers were added during January 2008, taking the subscriber base of fixed line services

to 49.21mn. In the mobile segment, total additions during the month summed up to 4.69mn with highest

ever GSM additions of 3.52mn and CDMA additions of 1.17mn. During the first 10 months of FY08,

28.39mn subscribers have been added

Telecom Industry in India

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Nokia 60%Motorola 10%

Siemens 02%

Sony Ericsson 03%

Samsung 10%

Philips 10%

Others 05%

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60%

10%

2% 3%

10% 10%5%

0%

10%

20%

30%

40%

50%

60%

Nokia

Motorola

Siemens

Sony Ericsson

Samsung

Philips

Others

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1.2. PROFILE OF THE ORGANIZATION

Company Profile

Nokia's history starts in 1865, Due to the European industrialization and the growing

consumption of paper and cardboard Nokia soon became successful. Nokias Cable Work's

Electronics department started to conduct research into semiconductor technology in the 1960s.

This was the beginning of Nokias journey into telecommunications.

Nokia today is a world leader in mobile communications, driving the growth and sustainability of the broader mobility industry.

Nokia connects people to each other and the information that matters to them with easy-to-use and innovative products like

mobile phones, devices and solutions for imaging, games, media and businesses. Nokia provides equipment, solutions and

services for network operators and corporations. The company includes four business groups; Mobile Phones; Multimedia;

Networks and Enterprise Solutions. In this project I will be focusing only on the mobile Phone business of Nokia in India.

Nokia Corporation engages in the manufacture of mobile devices and mobile networks. It also

provides equipment, solutions, and services for network operators, service providers, and

corporations. The company operates in four segments: Mobile Phones, Multimedia, Enterprise

Solutions, and Networks. The Mobile Phones segment offers mobile phones and devices based

on GSM/EDGE, 3G/WCDMA, and CDMA cellular technologies. The Multimedia segment

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enables to create, access, and share multimedia in the form of advanced mobile multimedia

computers and applications with connectivity over multiple technology standards. The Enterprise

Solutions segment offers various products and solutions, including enterprise-grade mobile

devices, underlying security infrastructure, software, and services for businesses and institutions.

The Networks segment provides network infrastructure, communications, and networks service

platforms, as well as professional services to operators and service providers. It focuses on the

GSM family of radio technologies; networks with Internet Protocol and multi access capabilities;

and professional services. The company also develops mobile WiMAX solutions. Nokia sells its

products to operators, distributors, independent retailers, and corporate customers. It has its

operations in Europe, the Middle East, Africa, China, the Asia-Pacific, North America, and Latin

America. The company was founded in 1865 and is based in Espoo, Finland.

Vision: Life Goes Mobile

Ten years ago, Nokia had a vision that seemed revolutionary for the times: Voice Goes

Mobile! As history shows, this vision became reality in an incredibly short amount of time.

With more than 1.6 billion mobile phone subscriptions globally and more mobile phones

than fixed-line phones in use shows that mobility has transformed the way people live their

lives

Business Mission: Connecting People

By connecting people, they help fulfill a fundamental human need for social connections and contact.

Nokia builds bridges between people both when they are far apart and face-to-face and also

bridges the gap between people and the information they need.

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As a market leader, the best contribution we can make to the global community is to conduct our business

in a responsible way. This belief drives our commitment to creating ethically sound policies and

principles that guide us in our work. Our Corporate Responsibility (CR) agenda is framed around the

Nokia Values and is carried out in all aspects of our work to ensure customer satisfaction and respect, and

also to assist us in embracing renewal and striving for achievement. By striving to include all members of

Nokia's community in this process, we are demonstrating our overall commitment to the belief that

responsibility is everybody's business. In this section you will find information about our strategy and

approach, navigating the links above will give you more concrete information on our Corporate

Responsibility activities.

Our vision is a world where everyone is connected. With mobile subscriptions about to reach four billion,

we are closer to our vision than anyone could have imagined just a few years ago. Our business benefits

people, communities and the environment in new and exciting ways. As our business expands, so do our

responsibilities. This sense of corporate responsibility (CR) is a fundamental part of who we are.

Considering the wider impact of our actions is embedded in the Nokia Values, which guide our behavior,

and in the Nokia Code of Conduct, which gives guidance to our everyday work. Global challenges such

as climate change and poverty concern us all. As a business that affects the lives of billions around the

world, Nokia is in a key position to offer solutions to these challenges. We bring the benefits of mobiletechnology to more people in ways that reflect our values and our responsibilities.

Our impacts

Nokia is the world's number one manufacturer of mobile devices by market share and a leader in the

converging Internet and communications industries.

We make a wide range of devices for all major consumer segments and offer Internet services that enable

people to experience music, maps, media, messaging and games. We also provide comprehensive digital

map information through NAVTEQ and equipment, solutions and services for communications networks

through Nokia Siemens Networks. In 2008, Nokia's net sales were EUR 50.7 billion and operating profit

was EUR 5.0 billion. At the end of 2008, we employed more than 128,445 people; had production

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facilities for mobile devices and network infrastructure around the world; sales in more than 150

countries; and a global network of sales, customer service and other operational units.

Corporate responsibility

Corporate responsibility is a fundamental element in Nokias business, brand and culture. Nokia aims to

set the standards for the industry through initiatives that not only make a positive impact, but also make

good business sense. The Nokia Code of Conduct commits us to uphold high ethical principles in

everything we do. We respect the principles set in Universal Declaration of Human Rights and by the

International Labor Organization and the United Nations Global Compact. Communications is a relatively

"clean industry. It is not a high energy user, does not generate substantial pollution, and does not

endanger people or communities. But a responsible business needs to address its impacts and aim to makea positive contribution wherever possible. Environmental issues are our main priority. Climate change is a

serious threat which requires everyone to contribute to building a low carbon economy. We believe that

strong, early action is necessary and that we have an opportunity to make a contribution to tackling

climate change beyond the impact of our operations and our products. Our environmental strategy sees

Nokia among the worlds leading companies for all aspects of environmental performance. We have three

priorities: energy efficiency, managing substances in our products, and take-back and recycling. We are

also focusing on developing mobile services to promote more sustainable lifestyles. Reflecting this

prioritisiation, our environmental data can be found in its own section here. We have also set high ethicalstandards for oursupply chain and our own factories. We seek to provide consumers with accessible high

quality products that meet their needs and to trade with our customers responsibly. Above all, we aim to

make a positive contribution to society at the local and global level. Please refer to our key Issues for

information on how we identify our most important impacts.

Our values

The Nokia Way and Values: A flat, networked organization and speed and flexibility in decision-

making characterize the Nokia Way of working. Equal opportunities and openness towards people and

new ideas are also key elements we want to nourish. Nokia is straightforward when dealing with

customers and suppliers, and we always looks for innovative ways of creating and introducing products

and solutions to the market. We provide individuals with a platform for personal growth in a challenging

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http://www.nokia.com/environment/our-responsibility/environmental-strategyhttp://www.nokia.com/environment/our-responsibility/environmental-report-2008http://www.nokia.com/A4942649http://www.nokia.com/A4942630http://www.nokia.com/A4942617http://www.nokia.com/A4946162http://www.nokia.com/A4942585http://www.nokia.com/environment/our-responsibility/environmental-strategyhttp://www.nokia.com/environment/our-responsibility/environmental-report-2008http://www.nokia.com/A4942649http://www.nokia.com/A4942630http://www.nokia.com/A4942617http://www.nokia.com/A4946162http://www.nokia.com/A4942585


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environment with a clear vision, goals and shared management principles - the Nokia Way. The Nokia

Way brings together talented individuals who share these principles, and therefore share success. The

values of our company make us different. They provide a sense of direction for consistent behaviour as

employees and citizens of the world, and in our quest to become more of an internet company. Through

extensive employee engagement, we have renewed our values to reflect our business and changing

environment. They act as a foundation for our evolving culture and are the basis of our operational mode.

Living up to our values every day is our shared philosophy.

Engaging you: For us, engaging you incorporates the customer satisfaction value and deals with

engaging all our stakeholders, including employees, in what Nokia stands for in the world.

Achieving together: Achieving together is more than collaboration and partnership. As well as trust, it

involves sharing, having the right mind-set and working in formal and informal networks.

Passion for innovation: Passion for innovation is based on a desire we have to live our dreams, to find

courage and make the leap into the future through innovation in technology, ways of working and through

understanding the world around us.

Very human: Being very human encompasses what we offer customers, how we do business and the

impact of our actions and behavior on people and the environment. It is about being very human in the

world - making things simple, respecting and caring. In short, our desire is to be a very human company.

For more information on the Nokia Way and Nokia Values, go to Nokia as an employerwithin careers.

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As approximately one in three phones in use is a Nokia phone, its safe to say our products influence the

lives of hundreds of millions of people.

Maximizing the benefits of mobile communication and minimizing potentially negative effects requires

commitment from governments, civil society, and the business sector. However, we recognize that as a

market leader with global operations, our potential impact, and therefore our responsibility, is great. From

a social growth and economic development perspective, we acknowledge our impact and responsibilitiesthroughout our value chain: in our sourcing, product design, manufacturing, employee well-being,

business partnerships, recycling, community involvement, and communications. Through our product

lifecycle we respond to various environmental needs. Through employee relations, supply-chain

management, and consumer offerings we aim to have a positive social influence. Our overall response to

our stakeholders is to produce high-quality, safe products while upholding the law, protecting the

environment, and following sound best practices. It is an expectation we strive to meet.

Nokia India

Nokia has played a pioneering role in the growth of cellular technology in India, starting with the first-

ever cellular call a decade ago, made on a Nokia mobile phone over a Nokia-deployed network. Nokia

started its India operations in 1995, and presently operates out of offices in New Delhi, Mumbai, Kolkata,

Jaipur, Lucknow, Chennai, Bangalore, Hyderabad, Pune and Ahmedabad. The Indian operations comprise

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of the handsets business; R&D facilities in Bangalore, Hyderabad and Mumbai; a manufacturing plant in

Chennai and a Design Studio in Bangalore.

Over the years, the company has grown manifold with its manpower strength increasing from 450 people

in the year 2004 to over 15000 employees in March 2008 (including Nokia Siemens Networks). Today,

India holds the distinction of being the second largest market for the company globally.

R & D centers

Nokia has three Research & Development centers in India, based in Hyderabad, Bangalore and Mumbai.

These R&D hubs are staffed by engineers who are working on next-generation packet-switched mobile

technologies and communications solutions to enhance corporate productivity. The Center in Bangalore,

the biggest R&D site in the country comprises S60 Software Organization, Common Technologies, Next

Generation now called Maemo Software, Productization and Software & Services.

NOKIAS MARKET SHARE:

Today, Nokia is the leader in mobile phone technology, although they have other subsidiaries,

namely Nokia Networks and Nokia Ventures Organization, which, together with Nokia

Mobile Phones, form Nokia Group. Nokia also launched Vertu Ltd. in 2009, the worlds first

luxury mobile phone company, selling gold and platinum phones at exorbitant prices.

Last year, Nokia has once again retained its top position in the market. It enjoys a market share

of 32.6%, followed by Samsung (because of their CDMA phones) with 29.6% and LG with

22.8% (due to their tie-ups with Reliance). Motorola has 5.5% market share, with Panasonic at

3.8%, Sony Ericsson with 2.6% and Siemens with 1.4%; they are the fourth, fifth, sixth and

seventh largest players in the domestic handset market. In the GSM handset segment, Nokia has

58% market share, with Samsung at 14.7%, Motorola at 14.1%, and Sony Ericsson at 7.1%.

Thus, Nokia has a larger presence in the GSM market than the CDMA market .

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Pie chart showing the market share in the GSM mobile phone market

Nokia

58.4%

Samsung

14.7%

Sony Ericsson

7.1%Motorola

14.1%

1.3. PROBLEMS OF THE ORGANIZATION

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The prominent brands in the Indian cellular phone industry are Nokia, Sony Ericsson, Motorola, and

Samsung. Nokia has the single largest market share in India of 60%. I have focused my research on Nokia

and also on one of its major competitor; Sony Ericsson since these are very prominent players in the

Indian market. Nokia has saturated the urban market including the B and C class cities and is now

targeting potentially untapped markets. Sony Ericsson on the other hand has chosen to focus its energies

on the B and C class cities since which it had not ventured into so far.

The following are the major problems faced by Nokia in the Indian cellular market:-

Identify cause of problems faced Nokia to enable the management to train the employees in handling

the problems as well as solving the problem in a satisfactory manner.

Segregate identified problems of Nokia into problems requiring staff development action such as

training and into problems requiring other management actions, so that these problems are accurately

addressed.

Prioritize training actions in accordance to where the training need is more urgent.

Marketing Strategy For Nokia

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Marketing Strategy for Nokia

For this project I have been instructed to come up with a marketing strategy for an existing

company/product I have chosen to do Nokia communications, particularly the mobile phone sector of

Nokia's business. To do this properly I will need to:

* Appropriately identify, collect and use primary and secondary data that is relevant to the marketing

strategy of Nokia.

* Produce a clear analysis of the external influences affecting the development of a marketing strategy.

* Complete a realistic rationale for the development of a coherent marketing mix for Nokia

communications.

* Show a full understanding of a marketing strategy for Nokia with a clear understanding of marketing

principles.

* Produce a full, well-balanced marketing strategy that reflects appropriate use of marketing models and

tools.

Introducing the product

Nokia is a communications based company, which focuses on mobile telephone technology. When

mobile phones first became available on the market the models were very basic with the best technology

being SMS messaging (sending written "text messages" from one phone to another).

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Then the next advance in technology was being able to put different faces on your phone (different style

covers for the front and back of your mobile device) and after that the technological advances have come

thick and fast, with advances such as:

* MMS

* WAP (internet)

* Polyphonic ringtones

* Predictive SMS (where the phone will finish off a word for you if it can guess what you are typing)

* Camera phones and

* Video recorders

Competition in the market

-------------------------

With all this technology available in the communications market it is obvious that Nokia will have lots of

competition, they include:

* Sony Ericsson

* Samsung

* Motorola

* Siemens

* Panasonic

* NEG

* Sagem and

* Toplux

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With all of these competitors in the market Nokia must keep ahead of the game...

1.5 S.W.O.T ANALYSIS OF NOKIA

Strengths

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Is a dominant player in the smart phone market via its majority ownership of Symbian and its

proprietary Series 60 user interface which are projected to represent majority of the 100M smart

phones sold in the next 4 years.

33% market share still the largest cell phone vendor by far, with double the market share of nearest

competitor

Size should enable Nokia to amortize R&D costs and to get cost advantages

Brand position: probably one of the top 20 brands in the world

Weaknesses

The N-gage is considered a flop.

Being the market leader and its increase role in Symbian is giving Nokia a bad image, much like

Microsoft in the PC industry.

Slow to adopt new ways of thinking: good examples are clamshell phones which are preferred by

many customers. Nokia was reluctant to produce a clamshell until this year, when it launched its first

model.

Opportunities

Increase their presence in the CDMA market, which they are just entering, as well as 3G and Edge

New growth markets where cell phone adoption still has room to go, including India and other

countries.

Leverage its infrastructure business to get preference and a stronger position with carriers

Threats

Late in the game in 3G creates a risk to be displaced by leaders like Motorola, LG, NEC and others.

Asian OEMs who are entering the market very aggressively (TCL, nGo Bird)

ODMs (HTC and others) enabling carriers to leverage their customer power bypassing the handset

vendor. Operators want to lessen their dependency on handset vendors and the dominance of Nokia.

Orange, O2, and many other operators globally are selling their own brand of phones.

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CHAPTER-2

OBJECTIVES AND METHODOLOGY

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SIGNFICANCE OF THE STUDY

The present study is quite significant because it discusses values cultures vision, mission and

strategies of Nokia and its competitors .Nokia and its competitors to make comparative analysis

between these companies it identifies the current positions of the company .

The report finds that high quality and advanced technologies are important factor for Nokias

success moreover they are concentrating on ne area that is telecommunication while Samsung is

indulging in many areas

Moreover the other finding is that Nokias financial position is surpassing its competitors in the

telecommunications report concludes that Nokia has established its leadership in telecom

companies Samsung is gaining its area in style point of view or advanced features in their

products.

MANAERIAL USEFULLNESS OF THE STUDYManagerial usefulness of the study is to analyse the comparative study between Nokia and

competitors.Compare between there market strategies and to know about there vision mission

and there future plans the respondents were discussing the questions prior to reply thus there

could be biasness different promotional schemes were not known by the respondents.

The customer analysis of this coursework highlighted that the upper segment of the population

are the major consumers of mobile phones extensive research was conducted into yhe strategies

being implemented for the rural market ..

Nokia has the single largest market share in India of 60%and the we have noticed that Nokia is

the only competitor of Samsung but Nokias major competitor is Sony Ericson since these are

very prominent players in the market

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OJECTIVES OF THE STUDY

To know about the cellular industries.

To help consumers to know about the companies their products and the future over

comings

To know about the brand Nokia and the Samsung their products, market strategies, values

mission adopted in the cellular companies.

To know consumer behavior towards Nokia and Samsung.

SCOPE OF THE STUDY

As learning is the human activity and is as natural ,as breathing despite of the fact the learning is

all pervasive in our lives, psychologists do not agree on how learning takes place .how

individuals learn s a matter of interest to marketers they want to teach consumers in their roles as

their roles as consumers. They want consumers to learn about their products product attributes,

potential consumers benefit, how to use, maintain or even dispose of the product and the new

ways of behaving that will satisfy not only the consumer needs, but the marketers objectives.

The scope our study restricts itself to the analysis of CONSUMER BEHAVIOR, perception of

Nokia and its competitors.

LIMITATIONS OF THE STUDY

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The findings of the study will be based on opinion of the respondents, which may be

based.

The study is confined to sahibabad residential areas

Lack of time and finance may prevent from carrying out in depth study.

RESEARCH METHDOLOGYResearch comprise defining and redefining problems, formulating hypothesis or suggested solutions;

collecting, organizing and evaluating data; making deductions and reaching conclusions; and at last

carefully testing the conclusions to determine whether they fit the formulating Hypothesis. In short, the

search for Knowledge through Objective and Systematic method of finding solutions to a problem is

Research.

Research Design

Type of Research: - Descriptive research

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Descriptive research includes Surveys and fact-finding enquiries of different kinds. The main

characteristic of this method is that the researcher has no control over the variables; he can only report

what has happened or what is happening.

Data Source:

There are two types of data.

Primary Data:

The data was mainly obtained from the people feedback on the questionnaire which was distributed

by the group members at various places

Secondary Data:

The secondary data was obtained from various journals, internet, magazines etc.

Research Instruments

Selected instrument for Data Collection for Survey is Questionnaire.

Sample Design

Who is to be surveyed? The marketing researcher must define the target population that will be sampled.

The sample Unit taken by me; General public of different age group, different gender and different

professions.

Extent:-

Where the survey should be carried out?

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I have covered entire residential area of Delhi city for the survey

Time Frame:-

When the survey should be conducted?

I conducted my survey for 1week

Sampling Frame:-

The source from which the sample is drawn

Sampling Technique: -

How should the respondent be chosen?

In the Project sampling is done on basis of Probability sampling. Among the probability sampling design

the sampling design chosen is stratified random sampling.

Because in this survey I had stratified the sample in different age group, different gender and different

profession

Sample Size/ Population Size: - How many people should be surveyed?

My sample size is 50

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EXECUTIVE SUMMARY

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EXECUTIVE SUMMARY

Nokia Corporation is a Finnish multinational communications and information technology

corporation headquartered in Keilaniemi, Espoo, Finland. Its principal products are mobile

telephones and portable IT devices.Nokia is the first company to launch mobile phones in India

and became one of the most trustable brands in India. Though nokia is market leader in the

overall mobile handset industry but due to entry of Samsung, HTC and other local players in

android based smartphone and the lack of Nokias innovation in the smartphone segment they

started on a downward trend and started losing their market share in the Smartphone segment

because of this its competitor Samsung market share is increasing every month where Nokias

overall market share and smartphone Market share is also declining every month .

Through this project we were able to understand the current market scenario of Nokia

Smartphones and suggest them with strategies to help them revive the brand and help them

regain their market share by identify the gaps and limitations in their current strategies.

To understand the current market scenario of Nokia, we did analysis like Industry Analysis, STP

Analysis, PEST analysis, GAP analysis. We also studied the marketing mix of Nokia

Smartphone in detail and identified those features that create value. We identified the critical

success factors and also the core competencies.

We also conducted two surveys

Direct mail survey To understand the customer trends, preferences when they are buying a

Smartphone and product features that influence their decision making

Personal survey To understand the brand-price trade off

Based on our findings from the analysis and research, we recommended a strategy where Nokia

Should involve in more promotional activity to reach the mass and to eliminate the wrong

perception about nokia smart phones performance and Should involve in the IMC activity based

upon Educating the consumers about advantage of Smartphones and its purpose ,how

smartphone can increase their productivity and how it makes the user smarter than others.

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NOKIA:

Nokia Corporation is a Finnish multinational communications and information technology

corporation headquartered in Keilaniemi, Espoo, Finland. Its principal products are mobile

telephones and portable IT devices. It also offers Internet services including applications, games,

music, maps, media and messaging through its Ovi platform, and free-of-charge digital map

information and navigation services through its wholly owned subsidiary Navteq. Nokia has a

joint venture with Siemens, Nokia Siemens Networks, which provides telecommunications

network equipment and services.

Nokia has around 122,000 employees across 120 countries, sales in more than 150 countries and

annual revenues of around 38 billion. As of 2012 it is the world's second-largest mobile phone

maker by unit sales (after Samsung), with a global market share of 22.5% in the first quarter

Nokia is a public limited-liability company listed on the Helsinki, Frankfurt, and New York

stock exchanges. It is the world's 143rd-largest company measured by 2011 revenues according

to the Fortune Global 500.

Nokia was the world's largest vendor of mobile phones from 1998 to 2012.However, over the

past five years it has suffered declining market share as a result of the growing use of

Smartphones from other vendors, principally the Apple iPhone and devices running on Google's

Android operating system. As a result, its share price has fallen from a high of US$40 in 2007 to

under US$3 in 2012.[9][10] Since February 2011, Nokia has had a strategic partnership with

Microsoft, as part of which all Nokia Smartphones will incorporate Microsoft's Windows Phone

operating system (replacing Symbian). Nokia unveiled its first Windows Phone handsets, the

Lumia 710 and 800, in October 2011.

First Mobile Phone:

The technologies that preceded modern cellular mobile telephony systems were the various "0G"

pre-cellular mobile radio telephony standards. Nokia had been producing commercial and some

military mobile radio communications technology since the 1960s, although this part of the

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company was sold some time before the later company rationalization. Since 1964, Nokia had

developed VHF radio simultaneously with Salora Oy. In 1966, Nokia and Salora started

developing the ARP standard (which stands for Autoradiopuhelin or car radio phone in English),

a car-based mobile radio telephony system and the first commercially operated public mobile

phone network in Finland. It went online in 1971 and offered 100% coverage in 1978.

In 1979, the merger of Nokia and Salora resulted in the establishment of Mobira Oy. Mobira

began developing mobile phones for the NMT (Nordic Mobile Telephony) network standard, the

first-generation, first fully automatic cellular phone system that went online in 1981. In 1982,

Mobira introduced its first car phone, the Mobira Senator for NMT-450 networks.

Nokia bought Salora Oy in 1984 and now owning 100% of the company, changed the company's

telecommunications branch name to Nokia-Mobira Oy. The Mobira Talkman, launched in 1984,

was one of the world's first transportable phones. In 1987, Nokia introduced one of the world's

first handheld phones, the Mobira Cityman 900 for NMT-900 networks (which, compared to

NMT-450, offered a better signal, yet a shorter roam). While the Mobira Senator of 1982 had

weighed 9.8 kg (22 lb) and the Talkman just under 5 kg (11 lb), the Mobira Cityman weighed

only 800 g (28 oz) with the battery and had a price tag of 24,000 Finnish marks (approximately

4,560).Despite the high price, the first phones were almost snatched from the sales assistants'

hands. Initially, the mobile phone was a "yuppie" product and a status symbol.

Nokia's mobile phones got a big publicity boost in 1987, when Soviet leader Mikhail Gorbachev

was pictured using a Mobira Cityman to make a call from Helsinki to his communications

minister in Moscow. This led to the phone's nickname of the "Gorba".

In 1988, Jorma Nieminen, resigning from the post of CEO of the mobile phone unit, along with

two other employees from the unit, started a notable mobile phone company of their own,

Benefon Oy (since renamed to GeoSentric). One year later, Nokia-Mobira Oy became Nokia

Mobile Phones.

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SYMBIAN OS:

Symbian is a mobile operating system (OS) and computing platform designed for Smartphones

and currently maintained by Accenture. The Symbian platform is the successor to Symbian OS

and Nokia Series 60; unlike Symbian OS, which needed an additional user interface system,

Symbian includes a user interface component based on S60 5th Edition. The latest version,

Symbian^3, was officially released in Q4 2010, first used in the Nokia N8. In May 2011 an

update, Symbian Anna, was officially announced, followed by Nokia Belle (previously Symbian

Belle) in August 2011.

Symbian OS was originally developed by Symbian Ltd. It is a descendant of Psion's EPOC and

runs exclusively on ARM processors, although an unreleased x86 port existed. Some estimates

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indicate that the number of mobile devices shipped with the Symbian OS up to the end of Q2

2010 is 385 million. By 5 April 2011, Nokia released Symbian under a new license and

converted to a proprietary model as opposed to an open source project.

WINDOWS OS:

On 11 February 2011, Nokia announced that it would migrate from Symbian to Microsoft's

Windows Phone OS. Nokia CEO Stephen Elop announced Nokia's first Windows phones at

Nokia World 2011: the Lumia 800 and Lumia 710. These phones were launched on 14

November 2011. On 22 June 2011 Nokia made an agreement with Accenture for an outsourcing

program. Accenture will provide Symbian-based software development and support services to

Nokia through 2016; about 2,800 Nokia employees became Accenture employees as of October

2011. The transfer was completed on 30 September 2011.

Windows Mobile is a mobile operating system developed by Microsoft for Smartphones and

Pocket PCs. Windows Mobile is the predecessor of Windows Phone, but they are not part of the

same continuum of operating system development and Windows Mobile cannot be updated to

Windows Phone. In February 2010, Microsoft announced Windows Phone to supersede

Windows Mobile, with the new operating system incompatible with Windows Mobile devices

and software. As a result, Windows Mobile has been discontinued.

The final version of Windows Mobile, released after the announcement of Windows Phone, was

6.5.5. Microsoft has stated that the Windows Phone operating system is incompatible with

devices designed for Windows Mobile as "Windows Mobile 6.x devices do not meet Windows

Phone hardware requirements designed to ensure a consistent user and developer

experience",and software designed for Windows Mobile is incompatible with the new operating

system. And the current operating system used for nokia lumia series is WINDOWS 7.5 and 8.

Smartphone:

A smartphone is a mobile phone built on a mobile operating system, with more advanced

computing capability and connectivity than a feature phone. The first Smartphones combined the

functions of a personal digital assistant (PDA) with a mobile phone. Later models added the

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functionality of portable media players, low-end compact digital cameras, pocket video cameras,

and GPS navigation units to form one multi-use device. Modern Smartphones also include high-

resolution touchscreens and web browsers that display standard web pages as well as mobile-

optimized sites. High-speed data access is provided by Wi-Fi and mobile broadband.

The most common mobile operating systems (OS) used by modern Smartphones include

Google's Android, Apple's iOS, Nokia's Symbian, RIM's BlackBerry OS, Samsung's Bada,

Microsoft's Windows Phone, Hewlett-Packard's webOS, and embedded Linux distributions such

as Maemo and MeeGo.

Fall in market share but still a Global leader:

A decade back, Nokias leadership position in India and globally was almost unassailable. Butriding on the success of Android-based phones, South Korean handset maker Samsung

Electronics Co. Ltd has severely dented the Finnish companys fortunes. Even though Nokia is

the market leader in Indian Mobile phone market, its dominance is under threat from other

MNCs like Samsung and Indian companies like Micromax, Karbonn, Lava etc. Nokia had

49.3% market share in 2010.The Korean mobile phone company Samsung is quickly growing its

market share during the last few years. It reported a revenue growth of 21.7% during last year as

against Nokias flat revenue growth. Nokias revenue during 2011 was Rs 12929 cr against Rs

12900 cr during the previous year.

The major reason for this low growth is due to absence of product ranges like dual Sims, which

are very popular in India. It is estimated that nearly 50% of the handsets sold in India are dual

sim phones, which were not produced by Nokia till recently. Indians didn't go to buy a mobile

phone. They went to buy a Nokia. Now many of them don't. Increasingly, Indians go to buy a

Nokia and come out with a BlackBerry, Samsung or Micromax. Samsung, however, lags behind

Nokia in unit shipments (volumes) in India.

In the overall mobile phone space in India, Nokia retained leadership with a 30% market share in

the October-December 2011 quarter, with Samsung following at 14.4%, according to shipment

numbers by Cyber Media Research. But the research firm also reveals that Nokia has been

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steadily losing market share in India, dropping over the years: 2008 (55%), 2009 (54%), 2010

(49.3%), 2011 (39%).

NOKIA fall in Smartphone segment:

This year, not only did Samsung break Nokias 14-year record of being the worlds largest

handset maker by overtaking it in terms of unit shipments in the January-March quarter,

according to a report in April by research firm Strategy Analytics, it is also threatening to

upstage Nokia in the overall Indian mobile phone market.

It has already toppled Nokia in the Indian smartphone segment. Research firm Convergence

Catalyst pegs Samsungs share in India in the January-March quarter at 45%, way above Nokias

25-30%. It estimates 9-9.5 million Smartphones to have been sold in India in 2011.

It is in this chunky and profitable category that Samsung has carved out a comfortable space for

itself. GfK-Nielsen puts Samsung's share at over 43 per cent of the smartphone market in

March's volume sales compared to the 29 per cent of Nokia. This is in line with the trend of the

last two years. While Samsung grew its share in Smartphones to 26.7 per cent in 2011 from 4.9

per cent the year before, Nokia saw its share shrink from 83.5 per cent 46.1 per cent in 2011.

Vision Statement:

Nokia wants to create a new world; to transform a big planet to a small village. Their vision is to

create, build, and encourage people from all countries to communicate with each other in order

to create a world where everybody is connected.

Mission:

To become market leader in smart phone category by end of 2013.

Objectives:

Increase the market share of Nokia smart phones fromo25.5% to 35.5% by end 2013.

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Objectives of the study:

The main objective of the study is to help Nokia Smartphones by achieve the mission by

providing marketing strategies and a tactical plan for Nokia by identifying the gaps in their

current strategies.

INDUSTRY ANALYSIS

Structure of Mobile Market in INDIA

The mobile phones industry in India has been an attractive destination for the global as well as

domestic mobile phone manufacturers from the very start. It was thought in the beginning that

the mobile phones in India will serve the growing communication needs in the country.

Considering the growth of the industry in India, it can be said that the estimated results have

been achieved beyond expectations. Apart from mobile phone manufacturers, the industry has

also seen the growth of mobile phone carriers, mobile phone application developers, mobile

phone content providers and so on. It is expected that the industry is going to keep on growing to

attain the anticipated goals at a fast rate. There are two big reasons for the rapid growth of

mobile phones industry in India. First, there is a huge market for entry-level mobile phones. And

second, the high-end mobile phone buyers too exist in the Indian mobile phone market. These

reasons encourage the top mobile phone manufacturers to experiment their products from

different categories in the Indian market.

Potential growth rate:

Globally, Smartphone Market grew 61% in 2011 with total shipment volumes reaching 491.4

million units in 2011, a whopping increase of over 304.7 million units in 2010! Smartphones are

replacing features phones at much faster rate than expected, thanks to consistently fallingpricing.

In comparison to Global Smartphone Market, growth in India is expected to be even higher

According to India Smartphone Outlook for 2012 report released by Convergence Catalyst,

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India will witness 100% growth in 2012, with total smartphone shipments expected to reach 20

million units.

Ease of entry of new firms into industry:

Entry Barriers:

A large number of barriers prevent entrance into the smart phone industry. Among the largest

are:

fixed costs necessary research and development

Reputation of incumbent firms people buy phones from companies they trust

Networking people buy phones that their friends and acquaintances use

switching costs switching phones and service costs money and time to users

Differentiation limited ability to differentiate from other phones

On other end Industry estimates put the handset market at Rs 40,000 crore a year, which will

expand to Rs 50,000 crore next year. Every year 120 million handsets of 58 brands are sold.

Total population of India is 1.27 billion in which 97crore people were using mobile phones, out

of which only 2.7 Cr users are using Smartphones. Smartphone industry in India is growing at

the rate of 87% year of year (source: Cyber media research, INDIA). Competitors in India

Smartphone industry is less when compared to other Emerging markets like china.

India, will record compound annual growth rates above 30% through 2014. Understanding local

conditions will be vital for operators, Smartphone vendors and OS developers.

A McKinsey estimate puts the number of Smartphones in India at 450 million in 2015

So there is high level of opportunity for new firms to grow in Smartphone industry in India if

their product is more innovative and lower price than the current players in the Industry.

Intensity of competition among firms:

With new players coming in, the intensity of competition in the industry has increased, especially

over the last three years. The market share of the mobile companies reflects the fragmented

nature of the industry, with as more than 10 players in Smartphone industry.

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Degree of product substitutability:

The degree of product substitutability for Smartphone is high

Substitute product for Smartphone may be normal 2 and 2.5G or feature phones , TABLETS

(TABs) and laptops depends on price and features.

Dependence of complementary or supporting products and services:

For smart phones, any application that works well with the phones is a

Complement. Nokia owns a large number of such applications

Some complements include:

Email

Data manipulation applications (documents)

Maps and GPS

Organization applications

Other internet applications and essentially any software available on phones

Music and other media content

Computers (in order to install and manipulate software on the phone)

Products involved in travel and mobility

Degree of bargaining power:

Smart Phone firms have relatively weak bargaining power.

Some reasons include:

substitutes many substitutes

Elastic demand smart phones are not a necessary product; hence there is Elastic demand

for them.

Information customers tend to research capabilities of smart phones due to price and

high reliance on the product

Differentiation limited ability to differentiate from other competitors

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Degree of Technological Sophistication in industry:

Innovation in the Smartphone market is moving at such an incredibly faster rate that original

equipment manufacturers are releasing new devices on regular intervals. And each new

Smartphone is more technologically advanced than the last.

The recent technology advancement in Smartphone industries are NFC, DLNA, 4G, AI, etc

Rate of Innovation in industry:

The rate of innovation in Smartphone industry is significantly high.

General Level of Management Capability:

The managerial capability should be very high in this industry because the market is very

dynamic and the rate of innovation is also very high and fast so firm should have good R&D and

should be always in proactive mode to face the challenges in future.

Macro & Micro Environment:

Rupee depreciation and appreciation:

The increase or decrease of Value of Rupee against U.S dollar will affect the price of phone. If

Rupee value decreases against U.S dollar (1$=50 INR), then one individual would spend more

than when what he spends during value of Rupee Increases against U.S dollar (1$=45 INR).

Increase in service Tax:

Service Tax is a form of indirect tax imposed on specified services called "taxable services".

Service tax cannot be levied on any service which is not included in the list of taxable services.

Over the past few years, service tax been expanded to cover new services. The objective behind

levying service tax is to reduce the degree of intensity of taxation on manufacturing and trade

without forcing the government to compromise on the revenue needs.

Environmental Factors:

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Mobile phones are not easily recycled, only 65% of recycling of mobile is possible. India

government has signed agreement with UNO in reduction of emission of carbon, usage of other

chemicals and IT wastages which would affect our environment by 2015. Due to this Indian

government may change its Industrial and environmental policies. This may affect the

production and sale of mobile phone in India.

Other micro environments like recession, stagflation, depression and slowdown in country

economy growth

Competitors from overseas (in smart phone category):

Sony

Apple

Samsung

HTC

Huawei

The legislations that will affect our business:

World Health Organization states that mobile phone radiation can possibly cause cancer so,

Indian government would take some changes in mobile industry policies, Which may affect

Nokia growth in India

Demographic affect:-

Smartphones are more techs complex and not user-friendly like other normal mobile phones

because of this complexity only 2% of 50+ age group are using Smartphones in India. If

Smartphones are made with less complexity and more user-friendly then there is chance of

increase in usage of Smartphones among 50+ age group in India.

The major player in this Industry is:

Nokia

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Samsung

Apple

HTC

COMPETITION ANALYSIS

Global Smartphone Shipment-2012:

vendor shipment share Shipment share Year changeSamsung 50.2 32.6 % 18.4 17.0% 172.8%

Apple 26.0 16.9% 20.4 18.8% 27.5%

Nokia 10.2 6.6% 16.7 15.4% -38.9%

Htc 8.8 5.7% 11.6 10.7% -24.1%

ZTE 8.0 5.2% 2.0 1.8% 300.0%

others 50.7 32.9% 39.2 36.2% 29.3%

Total 153.9 100.0% 108.3 100.0% 42.1%

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2Q12 unit 2Q12 Market 2Q11 Unit 2Q11 Market Year-over-

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Source: IDC Worldwide Mobile Phone Tracker, July 26, 2012

Smartphone market grew at 42.1 percent year-over-year in second quarter of 2012. Vendorsshipped 153.9 million smart phones in 2Q12 compared to 108.3 million units in 2Q11, IDC said.

Nokia is still lead in smart phone sector .It has seen a major fall in market share by 50% from

60%, at the start of the 2011 to sub 40% by the end of the year.

Vendor Nokia Samsun

g

BlackBer

ry

HTC Sony LG Motorola Apple Other

s

Total

Market

-11

46.8% 27.4% 13.3% 4.3% 4.2% 0.5% 0.6% 2.4% 0.5% 100%

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INDIA SMARTPHONE MARKET SHARE MARCH-2012:

Operating system (OS)-wise Smartphone market share:

OS Android Symbian Blackberry Ios Bada windows total

Market share 50.6% 23.3% 9.9% 2.4% 10.2% 3.6% 100%

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Samsung on other hand is dominating player in Indian smart phone sector. It is close to 30% of

total smart phone sector. Indian vendors like Micromax, Lava & others have not been able to

replicate the same success in Smartphone segment as they did for feature phones.

This year, not only did Samsung break Nokias 14-year record of being the worlds largest

handset maker by overtaking it in terms of unit shipments in the January-March quarter,

according to a report in April by research firm Strategy Analytics, it is also threatening to

upstage Nokia in the overall Indian mobile phone market.

It has already Samsung toppled Nokia in the Indian Smartphone segment. Research firm

Convergence Catalyst pegs Samsungs share in India in the January-March quarter at 45%, way

above Nokias 25-30%. It estimates 9-9.5 million smart phones to have been sold in India in

2011. Samsung had a 34.2% share of mobile phone retail revenue in March 2012 as against

Nokias 33.8%.

Major competitor: Samsung

Comparisons & Competition analysis:

Category -1 0 1 2 3 4 5

Quality of product

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Reputation in the

eyes of customer

Price of the product

New productlaunch/development

Factors made our competitors successful: Samsung

Wide range of smartphone

Smartphone starting price at 7k INR

ability to offer something for everyone different Smartphones catering to different

demographics

A big display for Smartphones

product portfolio based on Windows, Android and Bada operating systems

Availability of 600,000 Android Apps with more than 2lakh free apps

The proper/excellent design (designed for human)

Samsung Electronics the world's largest information technology company (measured by 2011

revenues)

Tag Line:- What Next? Samsung is always considering its tag line and coming with various kinds

of new brand model.

Have re organized the business of company and channel around the sales channel the dedicated team for

channel management and product.

The change in sales approach will help the firm meet the needs of the large, widespread and growing

multi-brand outlet world as well the specialized needs of the large format retail channel.

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The company tried out this channel-led strategy in the mobile phone business two years back, which led

to rapid expansion of market share. The move allowed the company to have better relationship with the

key sales partners, dealers and retailers, understand their need and build customized sales promotion

strategy around them.

Main competitor: Samsung

Samsung is biggest competitor for Nokia in year 2012. According to the Voice & Data study it has seen

that Samsung posted a growth of 27.5% and annual revenue recorded 5,720 cr in 2012 in India from

4,700 cr in last year. It has around 40% of market share in smart phone sector.

Using same operating system Symbian and windows to power their smartphone and future phone and

advanced operating system then nokia like

The study was conducted by Cyber Media Research, Samsung retained its charisma with 40.4 per cent

market share in smartphone handset category. Nokia on the other hand came second with 25.5 per cent

share.RIM came third with 12.3 per cent share. Smartphone makers like Sony and Motorola are still

playing niche game in a competitive smartphone category.

Weaknesses of Samsung:

Low manufacturing Base in India

Lack of Mobile handset R&D

Patent problem with Apple

Expansive

Software is fatal problem for feature and low end Samsung mobiles

Tracking competitors activities:

monitoring competitors tactical and strategic developments

analyzing those developments

distributing analyses to appropriate members of your

organization in the form of alerts Monitoring their investment on R&D

Secondary sources :

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Searching newspaper and magazine articles and monitoring competitor and related Web sites on a daily

basis is a straightforward way to track competitors. You can save time and effort by using alerting tools

available from database vendors and search engine providers. These automated searches are available

from most database companies, such as Factiva and LexisNexis, as well as through major search engines

like Google and Yahoo!. They provide current and relevant findings based on a set of search criteria (that

you create) relevant to your competitors and/or their products and services. The more sophisticated tools

allow you to set up alerts to collect and deliver the information to you, often via e-mail, according to your

monitoring schedule. In addition to database and Web-based tracking and alerting, several new tools have

recently been introduced that can help you track changes in competitor Web sites. For example, Watch

That Page and Website-Watcher can alert you to changes in targeted sites.

Changes made by our major competitors in last 12 months:

Launched dual sim technology in smartphone category powered by Android OS.

Launched Samsung 4G enabled GalaxyS IIIwhich is better than i-Phone called killer of i-phone 4SBritish chipmaker CSR sold its mobile business to Samsung in a deal worth $310 million

Samsung have patent problem with apple due to which Samsungfacing potential U.S. & EU sales bans

of its Galaxy Tab 10.1

Samsung turned as a key competitor to Apple in the smartphone market.

Samsung mobile phone business was the highest performer with revenue of 20.52 trillion and won, up 75

percent year-on-year.

Samsung revenue and profit in mobile grew over the previous quarter due to an improvement in its

product mix, and an increase in sales of its high-end Smartphones.

HTC acquired streaming music service MOG

HTC Acquired 51% of Dre's Beats Electronics for $300 Million in august 2011

Business dependence

80% of our profit is dependent only on one product (Mobile Phone)

Nokia has around 122,000 employees across 120 countries, sales in more than 150 countries and

annual revenues of around 38 billion.As of 2012 it is the world's second-largest mobile phone

maker by unit sales. Nokia was the world's largest vendor of mobile phones from 1998 to 2012.

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Products are mobile telephones and portable IT devices. It also offers Internet services including

applications, games, music, maps, media and messaging through its Ovi platform, and free-of-

charge digital map information and navigation services through its wholly owned subsidiary

Navteq.

Product Copy

Yes it is easy to copy the Hardware of any phone of Nokia but it is Impossible to copy Software.

We can easily find duplicate Nokias phone which is made in china. One of the recent survey

revealed that the duplicate market has been growing at a shocking rate of 12% per year in India.

This obviously is a bad sign for companies, consumers as well as the government.

Mobile Brand Original Price Duplicate phone price

Nokia lumia 900 30,000/- 3,500/-

Samsung Galaxy S3 40,900/- 3,000/-

Iphone 4S 42,000/- 3,700/-

Samsung Galaxy note 29,000/- 2,200/-

Following are some tips to Identify Original Nokia Hand Set :-

Price of a fake Nokia is almost half or one-third of its original counterpart.

Abnormally lightweight phones can be fake, so beware, for humans light weights are in

but not for phones

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Fake mobile dont have the blue colored 12-month warranty sticker. If the phone has the

sticker then use the other ways to identify fakes (this is my version)

Unavailability of or poorly printed Nokia Care tamper proof warranty stickers are sign of

a fakeNokia mobile handset

Genuine Nokia phones have a tamper-proof label at the back and they also have tamper-

proof warranty seal

Original Nokia phone have batteries with hologram showing Nokia Connecting people

logo and Original Enhancements written on them. If you slant the hologram left, right,

down, and up you will see 1,2,3 and 4 dots on each side.

The extent of product differentiation that nokia have achieved for Smartphone range of

product/services:

Nokia Drive:

Have maps data for more than 190 countries in more than 50 languages and navigation in

more than 110 countries

collecting information from Nokia Drive users and local authorities to provide traffic

alerts in 26 countries, and also allow dynamic rerouting

Have venue maps in over 4,600 shopping malls, train stations, airport, sports venues, etc.

in 35 countries

Support multi-modal routing: by car, on foot (including footpaths, shortcuts, etc. in over

400 cities) and by public transportation (over 100 cities)

Free-of-charge digital map information and navigation.

Windows 8 Operating system.

Nokia 808 PureView with 41 megapixel camera, first 41 megapixel camera phone in the world.

Nokia Music Store with more free songs for Music Express series of mobiles.

They want to become the biggest entertainment media network in the world. By (ibid). Nokia

offers devices to satisfy every budget and they are trying to make their products and services

indispensable. They sell mobile devices to the hundreds of millions of price-sensitive cell phone

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users in India that cannot afford a data plan. For $1.30 per month rural users in India can receive

information on weather, agriculture, education, and Bollywood. They are also going after the

high-end market high bandwidth market and have developed Ovi, an iTunes type platform with a

variety of downloadable Smartphone applications.

Each Product Lifecycle of Nokia Smartphones:

Nokia has introduced Nokia Asha which is stunning phone designed with sophisticated materials

and metallic finishes. Entertainment and applications are also a core part of the Nokia Asha.

Nokias Smart phone Lumia is in sub introduction phase of Growth phase, which already

attracted the customers by its features and its low price as compare to Samsungs smart phone.

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Feature phones are like 2230, 2690, c2, c00, 1616 etc are in maturity phase. Nokia sells

approximately 14.4 million feature phones in India. As India has price sensitive market it has got

huge market in India because they are available in cheap price.

Sales of other feature phones like Nokia N series and E series have declined.

Product Benefits and customer Needs

Feature BENEFITS CUSTOMER NEEDS

3G enable high speed

connectivity

Video calls, Faster

Internet

3.7 16M-color AMOLED Big Screen Crystal clear visibility

capacitive touch screen of

480 x 800 pixel resolution

Feather touch easy to assess

Windows Phone 7.5 OS

(Mango) and windows 8

faster than symbian User friendly

Wi-Fi 802.11 b/g/n Access Internet any where Internet access if

the area is Wi-Fi enable

GPS receiver Route Map strange city

16GB on-board storage highly compact Store Data

55 hrs music playing Battery Life More Music

7 hrs video play Battery Life More Entertainment

Service and Warranty Of Nokia

The warranty period starts at the time of Products original purchase by the first end-user. The

Product may consist of several different parts and different parts may be covered by a different

warranty period (hereinafter Warranty Period). The different Warranty Periods are:

1) Twelve (12) months for the mobile device and accessories

2) Six (6) months for the following consumable parts and accessories: batteries, chargers, desk

stands, headsets, cables and covers.

3) Ninety (90) days for the media on which any software is provided, e.g. CD-rom, memory

card.

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As far as your national laws permit, the Warranty Period will not be extended or renewed or

otherwise affected due to subsequent resale, repair or replacement of the Product. However,

repaired part(s) will be warranted for the remainder of the original Warranty Period or for sixty

(60) days from the date of repair, whichever is longer.

If you wish to make a claim under the Limited Warranty, you may call the Nokia call center

and/or where necessary, return your Product or the affected part to a Nokia care center or Nokia

designated service location.

Packaging of Nokia Phone

A mobile phone package should give a message about the product image for a customer. It

should also complete the experience that the product is providing for the user. Nokia uses

recyclable materials, mainly wood fibers in its product packages. Coloring and patterning help

cardboard to support products' image and their message. Some 35-100% of materials are also

made of recycled fibers. Their availability vary from region to region. New packaging materials

are sought continuously. High quality packages can be made of several natural fibers. Flax

packaging is already used, agricultural waste as a raw material as well as bioplastics is being

studied. The use of agricultural waste brings challenges related to uniform quality and seasonal

availability of raw materials, while bioplastics are not easily recycled. Bioplastics should be

composted, and cannot therefore be recycled with other plastics.

Important of packaging:

To protect a product from damage or contamination:

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The product must be protected against being dropped, crushed, and the vibration it suffers during

transport. The product most also be protected against the climate, including high temperatures,

humidity, light and gases in the air.

To identify and differentiate the product from others:

Packaging is the main way products are advertised and identified. To the manufacturer, the

package clearly identifies the product inside and it is usually the package that the customer

recognizes when shopping.

Protection during Transport and Ease of Transport:

A package should be designed to make it easy to transport, move and lift. A regular shaped

package (such as a cuboids) can be stacked without too much space between each package being

wasted. This means that more packages can be transported in a lorry. Unusually shaped packages

can lead to space being wasted and this can be costly if thousands of the same packages are to be

transported.

To identify the features, specification and color of the product

Product perceived in relation to its Competitor

category Our product competitors product

Price 4 3

Performance 3 4

Packaging 4 4

Reliability 4 3

Durability 3 4

Quality 3 4

After sales service/ 5 3

Maintenance 4 3

Guarantees 4 4

Promotion/Advertising 3 4

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Nokia distribution structure in India

When it comes to distribution, Nokia's lead is clear. Today, India has some 1,10,000 outlets that

sell mobile phones. Out of these, according to companies own conservative estimates, 50,000

stores have only one brand available Nokia.

Nokia started distributing its phones through a partnership with HCLI (formerly Hindustan

Computers Ltd.), which had already built an extensive network for its own products. Recently,

Nokia has decided to supplement that with its own distribution efforts. Nokia believed that there

was a tremendous growth opportunity and it was best exploited when the resources utilization of

both companies was optimized. Nokia and HCLI have decided to develop a go-to-market

strategy to jointly address the coverage needs of the urban and widely dispersed rural areas,

while rest are handled individually. Nokia has always been secretive about its operation and

strategies and have not spelt out clearly how the two partners have divided the markets, but some

do clues exist in the way demand is shaping up. In the cities where the market is maturing,

buyers are looking at more sophisticated mobile phones, such as Nokia's E-series phones (which

serve business users) and the N-series (which have multimedia features). In rural India -- which

constitutes 70% of the population -- affordability is an issue. So there is a different range for thisconstituency. Different types of retail fronts selling Nokia mobiles are :

Nokia concept stores

A one-stop shop for mobile users has been brought into existence to provide an opportunity for

consumers to experience the product before purchasing it. Trained Nokia personnel would

brief customers about various handsets and features. The store would have the entire range of

Nokia devices in all categories including latest range of mobile enhancements and exclusive

Nokia merchandise apart from handsets.

The new Nokia Concept Stores represent a rebranding of the previous Nokia Professional

Centers. Nokia has so far been rolled out 9 Concept Stores in India with only Mumbai and

Bangalore having 2 concept stores. Other Concept stores in India are located in Gurgaon, Indore,

Jaipur, Hyderabad and Chennai.

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These stores would help Nokia strengthen it brand and at the same time save costs that it incurs

in distributing to the dealers. Although it would have to bear the costs of training the employees

but the transportation cost would be greatly reduced. It would also give the company the

advantage of exclusivity. Since it has been opened in only metro and important cities, therefore,

it would not be subject to state sales tax, if the CFA is located in the same city.

Nokia Priority Dealers

Nokia Exclusive Stores namely PRORITY DEALERS are all franchised outlets .The franchisee

must fulfill certain criteria, for example, in the case of an existing store that would be converted

to a priority dealer, there must be a certain number of footfalls, the location of the store should be

prime real estate in that region, and certain other standards.

Nokia provides support to these outlets in the form of help in visual merchandising, furniture etc.

against a certain deposit by the owner which is refundable at the end of the contract if need be.

Multi Brand Dealers

Apart from its Nokia Priority dealers and concept stores, the company distributes its product to

many organized multi-brand mobile stores with nation-wide presence in India and recognized for

their service and price discounts. Few of the major players are

Hotspot

Univercell

The Mobile store

RPG Cellucom

Besides these there are individual mobile retailing stores as well as

wide variety of retail stores like electronics goods dealers,

Stationary shops, etc who have started selling mobile phones over

past few years. HCLI has also established over 150 Nokia Care

Centers managed by HCLI and franchisee operations.

Role of Channel Partners

Nokia

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Nokia manufactures its mobile in Chennai manufacturing plant and then it transfers to nokias

mother depot which is located in Gurgaon. They also provide assistance in selection of channel

partners like redistributors, Dealers, Franchisees, etc. Besides this they provide monetary

assistance in Store development for Nokia Priority dealers, help in promotion of products on

mass scale as well as in store and training of the sales force of partners at every level.

HCLI

HCLI Info has been handling distribution of Nokia phones for 10 years. The agreement was due

for renewal in August, 2006 and was renegotiated beforehand. Again on January28th 2009 a

new agreement for territory division was signed between Nokia and HCLI. Nokia business

accounts for 52% EBIT of HCLI.

HCLI currently has 30,000 channel partners (dealers), some of which it will transfer to Nokia.

The pilot phase was launched in Mumbai and Bangalore to test the new distribution model. The

absence of any other distribution partner ensures that there will be no price-cutting. In both the

territories, Nokia phones were made available for a uniform price.

HCLI starts distributing Nokias product from Gurgaon depot. HCLI takes order from 4

redistributors appointed in Delhi to cover North, South, East and West zones and then it supplies

the product to the dealers with the help of RDSS (Re-Distribution stockiest supplier).

.Re-Distribution stockiest supplier (RDSS)

There are 6 RDSS in Delhi NCR region with territories divided as North, South, East and West

Delhi, Noida and Gurgaon. RDSS are supposed to operate only in their designated territorial

zone. In case of conflict HCLI acts as the arbitrator.

RDSS, assisted by Nokia, also take responsibilities like recruiting sales force, training and

developing. Stocking norms of Nokia- HCLI agreement says that HCLI depot should have 7

days supply, RDSS in city should have 5 days of supply.

Dealers

Nokia Priority dealers, Multi brand and individual dealers in Delhi NCR are all served by RDSS.

Dealers are explained the features of every new launch mobiles, different schemes and offers by

Nokias representatives. Re-supplies are always just a phone call away and the delivery is made

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within a few hours. Besides, Nokia assists most dealers in the region in the store set-up and

design. The price points sometimes dictate the type of outlet.

Stock norms define that for how many days worth of stock does any level in the supply chain

should have. These norms are defined by Nokia only. Given below are the stock norms:

The expected target to be fulfilled by the particular level is determined by the following formula:

Expected target = (30 / No. of working days) * Stock Norm for that level

Margins at each level

The margins for the Nokia distribution segment have not been disclosed separately but are

clubbed with the overall contribution of the office automation and telecom segment. Tentative

margins found on the basis of discussions with dealers were:

Nokia and HCLI have never publicly declared their margins. Nokia business is the largest

contributor to HCLIs revenues and profits. Nokia product distribution was the largest

contributor to HCLIs sales (about 72% in FY2009). As a percentage of PBIT however, the share

of Nokia distribution was at 61%. Since 2006, when Nokia took over 50% distribution channel

from HCLI, revenue growth has almost been flat.

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Margin not

18%

10%2% Margin 8% Margin


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When comparing with its competitors, Nokia offers almost half to one-eighth margins on its

phones. Compared to 2% offered to dealers by Nokia, LG and Motorola offer around 8-10% and

Samsung 18%. But still dealers prefer to go with Nokia as it has much more surer sales and have

excellent support from RDSS and the company.

Distributors Coverage Plan

HCLI being the first level intermediary between Nokia and dealers,

Documents

114579483 Marketing Strategy to Increase the Market Share of Nokia Smartphone s