PORTER’S FIVE FORCES.
BUYER’S POWER: - Nokia had been edged out by rivals in the smartphone market who launched new and better products which resulted to Customers shifting to android phones which resulted to Nokia reducing their selling price in order to increase the rate of sales but they lost in the rate of profitability and consumer loyalty. The customer power is high; nokia is focusing on the smartphone segment because it has the biggest margin in the industry, the consumers are increasing despite the high rate of recession, product and price differentiation is getting lower which is resulting in the difficulty of buyers making a decision about the particular phone they will want to buy. Most consumers get phones on contract and switching from one phone to another is difficult and expensive and with other brands leading in the smartphone industry, it will be difficult for consumers to switch from Samsung or iPhone to Nokia. Most of the other brands own distribution stores while nokia doesn’t really have enough distribution channels, making it difficult for buyers to reach their product easily in some countries.
COMPETITIVE RIVALRY: - Competitors were quickly catching up with Nokia’s Symbian platform. As the Symbian OS was not optimized for touchscreen devices, users were turning to the Android, Blackberry OS, and Apple’s iOS. Nokia struggled to keep pace with rivals such as Apple, Samsung, Google, and RIM in the high-end smartphone market. Nokia is not only competing with high-end manufacturers but also low end manufacturer. brand recognition is an essential factor for success in the industry, nokia’s brand name has suffered a great deal. The level of differentiation in price and product is low, making it difficult and unnecessary for customers to switch from brands, which can also create problems for new brands entering the industry to gain the attention of consumers in the smartphone industry. The smartphones sales are providing profits for the...
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