Nokia Case

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Point of View: Nokia’s international marketing team (2009)

Case Context
There was a time when cellphone meant Nokia and Nokia defined the cellphone. While still dominating the global cell phone market with close to a 40 percent share, the multinational communications company’s profits has observed considerable decline. On the other hand, the opportunities of emerging nations as sustainably loyal customers should not be undermined. By using a simple, age-old strategy of selling basic products at low prices, it has been able to capture developing countries and become the market leader. Nokia is now trying to capitalize on their market leadership and has developed a comprehensive global strategy that has three facets: growing the number of people using Nokia devices, transforming the devices people use, and building new businesses. But this global strategy is not without loopholes as the US market is still elusive to Nokia. With the popularity of the highly successful smart phones engineered by the competition, this giant market remains to be a constant source of challenges for the company. Short-term Problem: How can Nokia drive the US market to patronize its brand the same way that other countries do, to further establish its name in the US market thereby expanding its market share? Long-term Problem: How can Nokia maintain and protect its position as a market leader?

Key Success Factors
2. Cost Efficiency. Nokia makes cost-cutting tactics that make it possible for the company to sell its products at a relatively low price. 3. Flexibility. Nokia’s products can accommodate working with offers from other brands which make the gadgets more universal 4. Adaptability. Nokia adjusts its products to become suitable to the needs of the people in a region. 5. User-Friendliness. Nokia is known for its simplicity, which enables its users to operate and learn its features with ease. 6. Innovation. Nokia offers a continuous stream of leading-edge products and services. It is open to new ideas to work into new products and market it quickly.

Analysis of Nokia
To evaluate the company’s overall situation, Figure 1 exhibits a SWOT analysis of Nokia. Being the market leader in the cellphone industry, Nokia has the resources that may be used not only to develop their competitive advantage and improve their strategy, but also to turn their weaknesses into strengths in the future. To add to that, they can also use these to tap into the technological and market-related opportunities that create potentials for further growth. On the other hand, the aggressive competition continues to threaten the market leadership of Nokia. Figure 2 reveals the perceptual map of Nokia in relation to its toughest competitors. \Nokia is seen as having a competitive pricing strategy and high product quality but neither with a relatively strong brand image nor an uncompromising inclination towards first-mover innovation. With a 40 percent share of the global cell phone market, Nokia is the current market leader (Figure 3) in mobile phones. Therefore, it has to pay close attention to both the needs and strategies of its customers and competitors, respectively, to deliver more customer value. The strategy of Nokia has been patterned to that of Honda, which focuses on developing countries and aims to gain their loyalty. Executing this strategy needs adapted global marketing strategy, which adjusts the marketing mix elements to the needs of the people for it to be effective and successful; hence, Nokia has a truly global strategy. Figure 4 presents the five global product and communications strategies. Currently, Nokia customizes its cellphones to meet local conditions and wants (product adaptation). Competitors may easily replicate Nokia’s global strategy because of the fact that it is not original tactic from the company. However, Nokia was able to modify its strategy to cater to the different needs of...
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