Case Let
tNokia: The Troubled King of the Indian Handset Market
Dr Andal Ammisetti
Introduction
Nokia has had the history of shaping the mobile handset market in India. Its customized handsets were available in every nook and corner of the country. It was quick in churning out new models. Nokia’s innovation, customization, product quality and extensive distribution made it a market leader. It enjoyed almost 60% of the handset market till 2005. Though there were many players in the mobile handsets industry, brand Nokia was a synonym for the product in India. In the last five years scenario in Indian markets changed to a great extent. New competitors providing innovative solutions at lower costs emerged. Product innovations by companies like Samsung, Sony Ericson, Blackberry, HTC etc and low price models by Micromax, Karbonn, Maxx, etc., were forcing Nokia to head downwards. Nokia remained the number one player in the mobile handset market in India, but it grew at a dismal 0.2%. Vocie and Data’s 16th Annual Survey results proved that Nokia faced tough competition from homegrown players like Micromax, Karbonn and Spice in low-end segments, whereas its high-end phones faced tough competition from brands like Samsung, Blackberry, and HTC. (Refer to Table 1). Nokia has been adopting various marketing and business strategies to regain its market share and compete with exiting and imminent competition. Would the strategies be good enough to get back its past glory? What else should it be doing to increase its market growth?
Table 1: Top 10 Mobile Players in India in FY 2010-11
Company Nokia Samsung Micromax Blackberry LG G’Five Karbonn Spice Maxx Sony Ericsson Revenues (in Rs crores) FY 09-10 12,900 4,700 1,602 1,210 1,600 755 800 1,040 514 590 Revenues (in crores) FY 10-11 12,929 5,720 2,289 1,950 1,834 1,326 1,004 920 745 690 Growth Percentage 0.2 21.7 42.9 61.2 14.6 75.6 25.5 -11.5 44.9 16.9 Market Share (%) 39 17.2 6.9 5.9 5.5 4 3 2.8 2.2 2.1
Handset Market in India
Dr Andal Ammisetti
Introduction
Nokia has had the history of shaping the mobile handset market in India. Its customized handsets were available in every nook and corner of the country. It was quick in churning out new models. Nokia’s innovation, customization, product quality and extensive distribution made it a market leader. It enjoyed almost 60% of the handset market till 2005. Though there were many players in the mobile handsets industry, brand Nokia was a synonym for the product in India. In the last five years scenario in Indian markets changed to a great extent. New competitors providing innovative solutions at lower costs emerged. Product innovations by companies like Samsung, Sony Ericson, Blackberry, HTC etc and low price models by Micromax, Karbonn, Maxx, etc., were forcing Nokia to head downwards. Nokia remained the number one player in the mobile handset market in India, but it grew at a dismal 0.2%. Vocie and Data’s 16th Annual Survey results proved that Nokia faced tough competition from homegrown players like Micromax, Karbonn and Spice in low-end segments, whereas its high-end phones faced tough competition from brands like Samsung, Blackberry, and HTC. (Refer to Table 1). Nokia has been adopting various marketing and business strategies to regain its market share and compete with exiting and imminent competition. Would the strategies be good enough to get back its past glory? What else should it be doing to increase its market growth?
Table 1: Top 10 Mobile Players in India in FY 2010-11
Company Nokia Samsung Micromax Blackberry LG G’Five Karbonn Spice Maxx Sony Ericsson Revenues (in Rs crores) FY 09-10 12,900 4,700 1,602 1,210 1,600 755 800 1,040 514 590 Revenues (in crores) FY 10-11 12,929 5,720 2,289 1,950 1,834 1,326 1,004 920 745 690 Growth Percentage 0.2 21.7 42.9 61.2 14.6 75.6 25.5 -11.5 44.9 16.9 Market Share (%) 39 17.2 6.9 5.9 5.5 4 3 2.8 2.2 2.1
Handset Market in India
References: • Clare Jim,“HTC to push into emerging markets, eyes new tablet, ” http://www.reuters.com/article/ Nov 07, 2011. • Gulveen Aulakh & Joji Thomas Philip, “India can be Samsung 's biggest market for mobiles by 2015: Hyunchul Ryu, VP Samsung South West Asia,” http:// , articles.economictimes.indiatimes.com/ April 15, 2011. • “G 'Five making laptops, tablets for mass market,” http://business-standard.com/ October 28, 2011. • Kamya Jaiswal, “Will BlackBerry India 's stellar Dr Andal Ammisetti (andal27@gmail.com) is a Management Faculty with 18 years of experience in the field of Management Education. At present she is working with IBS, Hyderabad, as an Assistant Professor in the Department of Marketing and Strategy. Her areas of interest include Consumer Behavior, Services Marketing and Business strategy. She has presented papers at various national and international conferences. She did her research in the area of Online Retailing. Friendship is like a book. It takes few seconds to burn, but it takes years to write. - Anonymous Ravibalakrishnanan, “Most trusted brands 2011: Nokia slips from top spot; will it outsmart BlackBerry, Samsung and iPhone” http://articles.economictimes.indiatimes.com/ September 28, 2011. 22 Ravibalakrishnanan, “Most trusted brands 2011: Nokia slips from top spot; will it outsmart BlackBerry, Samsung and iPhone” http://articles.economictimes.indiatimes.com/ September 28, 2011. 21 20 Copyright of Vidwat: The Indian Journal of Management is the property of Dhruva College of Management and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder 's express written permission. However, users may print, download, or email articles for individual use.