Marketing Management

Cia ii

A Report on the Success of a Product

Nokia 1100

By,

Naveen Prabhu B

0911152

Company Profile:

Nokia Corporation is a Finnish multinational communications corporation that is headquartered in Keilaniemi, Espoo, a city neighbouring Finland's capital Helsinki. Nokia is engaged in the manufacturing of mobile devices and in converging Internet and communications industries, with over 123,000 employees in 120 countries, sales in more than 150 countries and global annual revenue of EUR 41 billion and operating profit of €1.2 billion as of 2009.[1] It is the world's largest manufacturer of mobile telephones: its global device market share was about 33% in Q1 2010, up from 32% in Q1 2009 and down from 35% in Q4 2009.Nokia's converged device market share was about 41% in Q1, up from 40% in Q4 2009.Nokia produces mobile devices for every major market segment and protocol, including GSM, CDMA, and W-CDMA (UMTS). Nokia offers Internet services such as applications, games, music, maps, media and messaging through its Ovi platform.

Vision:

"Connecting people" is now connecting people to what matters - whatever that means for each person - giving them the power to make the most of every moment, everywhere, any time. Connecting the "we" is more powerful than just the individual. That's how Nokia is needed to help make the world a better place for everyone.

Strategy:

To do this we will become the leading provider of mobile solutions. Our solutions strategy leverages one of our greatest assets - a portfolio of outstanding devices, with unmatched scale and geographic reach. We couple them with smart services, integrated via an intuitive and seamless user experience. We differentiate these solutions offerings based on our in-depth consumer understanding, with a strong focus on social location (people and places).

CUSTOMER FEEDBACK:

A few selected quality customer feedbacks are:

The basic service of cell phone is to make and receive a call and sometimes send and receive sms and this is perfectly reflected on Nokia 1100. According to me, it is the best phone ever manufactured …

BEST VALUE - this little phone is amazing for its size, durability and performance had it for 3 years now with no problems never had to recharge the battery in less than 1 week, typically it lasts 2 days without charging it...

Any person who uses the mobile for the first time they can afford Nokia 1100 because it’s very simple and easy to use. Battery will hold for minimum of 2 days though I speak 10 hours a day. Torch light feature is a Nokia 1100 Cell Phone great advantage; we can efficiently use that torch option to search for match box in case of power cut. It is very user friendly… One who got used to the Nokia1100 will always be attached to that though they may currently use enhanced gadgets with all the latest features…And I am one of them. It has real value for money!!!

Best mobile i have ever used. Long battery life and for rough use. Used it for around 3 years with no complaint at all. Then i exchanged it with a Nokia 3100 model. Fully satisfied with its performance. Will suggest friends who still own a 1100 not to lose it. Will never get another one which is so much user friendly. Expect such phone from Nokia again. They shouldn’t have stopped its manufacturing. this little phone is amazing for its size..... Its available in shades of black and grey. And now a days nokia produce more memory handsets like N-96 which is my favourite handset because it having every facilities which I want in my handset. The handset which i am having now is also the make of Nokia.... but with more functions, I have call conference facility not in 3310 9.we can lock key pad using security code, no need of service codes, not in 3310 10.we can control all by one switch .skins will last long slim very stylish look. Good sound reception. 

This is one handset which has greater toughness, simple to use and handy enough, easy

to slide down in your jeans or formals. This screen is simple black and white showing

clearly whatever is on display. One of the handsets with longest battery standby time

and talk time.. When i had it (its lost and am trying to buy new one) i recharged it after 4

days. A best feature is its light emitting diode... very bright white light,.. A pronounced

white light ..which can remain on for full 4.5 hours!It became a handy tool while trekking

in the night when i was in dak pathar near Dehradun. The signal is good, much better

than bigger gizmos and another thing which i have noticed is that some small phones

and bigger ones too, become hot while talking for long on it but this has never been a

problem with this phone, be it an old one or a new.

Its not for people who want more than a mobile phone but a simple effective tool about

which you should remain least bothered while on a journey or at any other time, just

charge it once and forget it,use its light and dont get bothered about low battery… The

outer shell is hardened plastic bouncy enough to mitigate damage, the touch panel is

smooth ,plush for a pink lady finger.. All in all those who are bored and are thinking

mobile phone upkeep takes some time and stress, take it and remain in touch all the

time, commando style.

Product Advantage:

The Product Features that set it apart are;

The 1100 features a built-in flashlight - activated by pressing and holding the "c"

key once, or by pressing it twice to lock it on when the keypad is unlocked. It can

also be accessed via a menu item.

The 1100 and 1101 are only able to play monophonic ringtones, which can be

selected from the list of 36 pre-installed ring tones or from the 7 self-composed

ones.

It features Nokia's traditional-style navigational keypad, which uses a single button

to connect and end calls, bi-directional keys and vibrating alert.

The Cingular branded version features a built-in AOL Instant Messenger client.

The 1100 is compatible with the Nokia Xpress-On covers (including matching battery

compartments). In addition to the default light blue, orange or black, there are also

a dark blue, yellow, red, green and pink offered by Nokia, as well as many 3rd party

covers.[11]

It has been specifically designed for developing countries: its keypad and front face

have been designed to be as dustproof as possible and its sides are non-slip for

humid weather.

Other features include a 50-message capacity (inbox and drafts, with 25 messages

in the sent items folder), alarm, stopwatch, calculator, 6 profiles, contacts storage

(capacity 50, with the ability to assign different tones and icons to different

contacts) and games (Snake II and Space Impact+).

The Nokia 1100 (and a closely-related variant, the Nokia 1101) is a durable and very

simple GSM mobile phone produced by Nokia with a 96 x 65 monochrome screen. It is

targeted towards developing countries and users who do not require advanced features

beyond making calls and SMS text messages, alarm clock, reminders, etc.

The 1100 is similar to the now discontinued 5110/3210/3310 models that were among

the most popular cell phones in the world during that time, before handsets developed

several new features such as cameras, polyphonic ringtones and colour screens.

Over 200 million Nokia 1100 cell phones have been sold since its launch in late 2003,

making it the world's bestselling phone handset, as well as the bestselling consumer

electronics device in the world, beating Sony's PlayStation 2 (138

million), Apple's iPod (250 million) and Motorola's RAZR (120 million).

Market Advantage:By most accounts, India is among the world's fastest-growing markets for mobile phones. The country has some 170 million subscribers and adds 6 million to 7 million more each month. (China, in contrast, adds 5 million subscribers, and the U.S. 2 million subscribers a month.) Recognizing this potential, several global telecom giants jumped into the fray when the Indian government first opened up the country's telecom market to private enterprise in 1994. Among them, one company -- Finland-based Nokia -- forged ahead of rivals and today commands a 58% market share for mobile phones (also called "handsets"). In specific segments, such as GSM telephony, Nokia's market share in India is as high as 70%. (GSM, which stands for Global System for Mobile, is the world's most popular standard for mobile communications.)

How did Nokia take the lead in the Indian mobile phone market, ahead of companies such as Ericsson, Motorola, LG and Samsung? According to company executives and industry experts, Nokia's strategy combined focusing on the mobile phone market, establishing crucial distribution partnerships, making early investments in manufacturing and brand-building, and developing innovative product features -- such as mobile phones that could double as flashlights. Ravi Bapna, professor of information systems at the Indian School of Business in Hyderabad, says, "As far as Nokia's India strategy is concerned, the numbers speak for themselves. The company is a key cog in India's wireless value chain, and it has used India as its emerging market lab."

The Power of Focus

D. Shivakumar, Nokia India's vice president and country manager, believes that focus played a key role in the company's growth in India. "If you look at the [mobile phone] landscape in 1995, anybody could have succeeded if they had done the same things as Nokia did," he says. "But all the other companies had something else to focus on, some other business. Nokia was completely focused on mobile phones; others had consumer electronics, home appliances, etc." Nokia's focus was not just on handsets, of course. The mobile infrastructure business -- then part of Nokia India -- was equally important. But, as of April 1, 2007, Nokia's joint venture with Siemens for mobile infrastructure has become an independent entity. Thus, Nokia India has become even more sharply focused.

Being ahead of the curve was another component of Nokia's strategy. "We invested before everybody else -- in the brand, in people, in distribution," says Shivakumar. Adds Pankaj Mahendroo, president of the Indian Cellular Association: "Nokia invested in each vertical of the handset ecosystem -- manufacturing, distribution and design R&D."

Nokia has invested more than $1 billion in India so far, and company headquarters at Helsinki has repeatedly said that more funds will be made available if required. The Indian company had revenues of more than $3.5 billion in 2006, which means there is also money to be reinvested. (The company does not disclose its profit numbers.)

The Distribution Edge

Investment in people is difficult to judge; every company claims to have the best talent in the business. But when it comes to distribution, Nokia's lead is clear. Today, India has some 95,000 outlets that sell mobile phones. "In 50,000 of them -- and that's a conservative estimate -- only one brand is available, Nokia," says Shivakumar.

Nokia started distributing its phones through a partnership with HCL (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. "Both companies realized that there was a tremendous growth opportunity and it was best that we utilized the resources of both organizations in an optimum manner," says Nokia India director of sales Sunil Dutt. "We decided that we would address some markets jointly, and that we would individually address some of the other markets."

While Dutt does not spell out how the two partners will divide the markets, some 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 this constituency.

The price points sometimes dictate the type of outlet. "As the [telecom] operator footprint expands into different markets, all kinds of retail outlets get into selling mobile phones and airtime connections," says Dutt. "People who have been selling consumer electronics, STD booth owners and even cloth merchants get into this business." A stationery store stocks mobiles in a corner; a mom-and-pop grocery store moves beyond rice and lentils. "Then there are people with existing businesses who decide to set up a separate shop only for mobile phones," he continues. "And why do they feel the need to set up a different outlet? In this business, customer engagement … requires a completely different approach. Even the retail outlets realize this and [have started] separating the two businesses."

Dutt notes that in the mature urban markets, "such as the metros and Tier I towns where mobility has been around for a few years, customer expectations are more evolved, and are continuously evolving. Our task here is to provide our people with relevant competency and skills sets." Nokia has begun to set up concept stores -- seven so far -- in Indian cities. "At our concept stores, we have tried to bring to life all the experiences that we offer at Nokia experiential zones across the world," he adds.

Investment in Manufacturing

The other big investment area that has set Nokia apart from other telecom firms is manufacturing facilities and R&D. Nokia has several R&D centers and labs in India. More importantly, it established a $150 million handset manufacturing facility in Chennai in 2005. The total production at this unit has crossed 25 million handsets. "Some 30% of our production is being exported to neighboring countries," says Sachin Saxena, Nokia India director of operations in charge of the factory.

Other companies, such as Motorola, LG and Samsung, have also lined up similar investments or are in the process of setting up manufacturing units, but Nokia has had a clear head start. Also, the Chennai factory is devoted to handsets, whereas other companies are planning to make a whole range of consumer electronics products. "Domestic manufacturing has worked to Nokia's advantage," says Ravinder Zutshi, deputy managing director, Samsung India Electronics. "Samsung India is looking at making its Chennai facility a global hub for its consumer electronics products."

Industry analysts note that Nokia's strategy is potentially risky. When the going is good -- as it is now -- the company can do well. But Samsung's approach is more flexible, these analysts note. If demand for mobile phones were to slump, Samsung could switch its manufacturing lines to other products. In contrast, Nokia India's focus on mobile phones mirrors the priorities of its parent company. Nokia traditionally was in a whole range of businesses -- from toilet paper to power. But in 1993, CEO Jorma Ollila decided to sell off everything else and concentrate on mobile telephony.

Building the Brand

Another crucial aspect of Nokia's investment strategy focused on building its brand. Here, the company ran into a problem. The Nokia range available in India extends from Rs 1,499 ($37) at the lower end to Rs 45,000 ($1,125) at the high end. Marketing theory says a brand cannot be all things to all people. This is the reason that Hindustan Unilever, with quality built around its brand, refused to match Nirma, which came out with a cheap detergent. This is also why Eveready, the battery manufacturer, refused to lower prices when faced with a Chinese challenger in the dry cell market.

But Nokia has a problem promoting other brands under its corporate umbrella. "Unlike the FMCG (fast-moving consumer goods) market -- where the product lifecycle is at least 10 and sometimes 50-100 years -- models have a lifespan of 15-24 months here," says Devinder Kishore, Nokia India's director of marketing. With such a lifecycle, promoting various models would mean watching money go down the drain in a couple of years.

Instead, Nokia is promoting platforms -- music, for instance. With this approach, one model can replace another while the branding remains the same, or is extended slightly with the E series and N series. "Nokia has done well to focus on the 'mother' brand rather than on 'another' brand," says Jagdeep Kapoor, chairman and managing director of Samsika Marketing Consultants. Kapoor, who has written several books on brand management, says that Nokia has understood the Indian market by straddling all segments: the high, the middle and the low end. "The company has created a ladder for consumers to climb from the low end to the middle end to the high end, while being fully assured that they will be with the mother brand Nokia."

Kapoor views the Nokia brand in terms of his proprietary "REAPS" model, which takes into account five needs -- rational, emotional, aspirational, physical and spiritual -- of the Indian consumer. "Nokia as a brand has been able to address all the five needs to various degrees at various stages," he says. "The rational need of quality versus price has been met across price segments with options. The emotional need of being able to keep in touch with near and dear ones during times of joy and sorrow is being adequately fulfilled. The aspirational need with the new models and features and the look-good approach has helped the brand become a sought-after, must-have brand. The physical need has been taken care of through size and comfort. And, finally, the spiritual need has been met through (local) languages and people --whether they are 18 or 80 -- being able to greet one another via SMS [text messages] during religious festivals."

ISB's Bapna offers a prescription for Nokia. "Going forward with the premise that the mobile infrastructure will serve as India's information infrastructure -- given the lack of substitute physical and digital infrastructure -- I would encourage Nokia to take a more active role in nurturing content and application-creation communities that bring a range of services to all layers of the population," he says. "It's in [Nokia's] own interest to do so."

Products for India

The Nokia story in India has not been about grafting a model that has worked abroad. In fact some of its models -- the handsets, not the strategies -- are unique to India. Consider this example: It would probably be inconceivable to mobile phone users in the U.S. or Europe that their mobile phones should incorporate a flashlight, or torch. But in India -- where large numbers of the rural population do not have electricity, and power cuts are commonplace even in the cities -- having a torch built into a mobile phone is a distinct and tangible benefit. The Nokia 1100, the first made-for-India phone, has been a runaway success. Manufactured at Chennai, it is also being exported. The 1100 incorporates a torch, an alarm clock and a radio. "Innovation is something which consumers reward in this market," says Shivakumar.

Similar plans are in the works at Nokia's three India R&D labs, which employ 700 people. For obvious reasons, most of the activity is under wraps. Nokia is, however, willing to talk about the "shared" phone. This is, again, something that mobile phone users in affluent countries might

find puzzling, but the concept is simple. For reasons of affordability, in rural areas a phone may be shared by several people. The models being launched to cater to this need will have separate address books, individual billings and more. Will it work? People initially doubted the torch phone, too, but it became a popular product.

Shivakumar offers some reasons to explain why he thinks the Indian market is different and needs out-of-the-box thinking. "Fundamental consumer differences exist between India and other countries," he says. "A cell phone is a huge style icon for the Indian masses: 62% of Indians buy a cell phone because of its looks. That is something that is not true anywhere else in the world. It's as huge a style statement as your watch, pen, cufflinks or bag. Hence, the brand matters quite a lot.

"Second, it is a safety product for women in small towns, because with a cell phone you are in touch all the time; you're accessible. Next, it is a huge productivity vehicle. When somebody calls you, you do not need to take your bike out; you don't need to take your car out. You make a phone call and it's over.

"It is also a driver of a lot of economic activity. If you go down the roads of Gurgaon and Delhi, you will find that lots of people have written their [mobile] phone numbers on the walls -- a plumber, an artisan, a carpenter, a tailor. I think the whole service sector has gotten a huge lift, thanks to this. This has killed the visiting card business…. It is also the ultimate entertainment device. You have music on it now, in terms of radio and stored music. The day is not far when you will see movie clips and TV. One of our products has that, so that's TV on the go."

An Expanding Market

The Indian market for mobile phones, in addition to its base of 170 million subscribers, is also one of the most cost-effective in the world. Call rates in India are among the lowest anywhere -- making a mobile phone call costs two cents in India, compared with about four cents in China. The market also has tremendous growth potential. So far, most of the growth has been penetration-led, which means placing devices in consumers' hands. The bulk of the growth going forward will be replacement-led, where consumers come back for more. In India, consumers tend to change their phones faster than in most other places. And whenever they change their phone, 60% are willing to pay a higher price.

Shivakumar offers examples of future services that might be delivered over cell phones. "The cell phone could be the future bank -- a full branch of the bank. You don't need 20 people, a security guard or a vault. This is a passbook plus bank rolled into one. It can be your payment system." Another possible use is navigation, where cell phones could be used to provide maps of an area where the user is based. Such services, whenever they are launched, could help Nokia keep going and growing in India.

Creative Advertising:

References

http://www.coloribus.com/adsarchive/prints/nokia-1100-mobile-phone- desert-6544705/

http://adsoftheworld.com/forum/39124 http://knowledge.wharton.upenn.edu/india/articlepdf/4220.pdf?

CFID=21205410&CFTOKEN=91125045&jsessionid=a830dc9e68a2fd3fd5223b2492ae2a334747

http://www.themarketers.in/?p=37 http://www.mouthshut.com/review/Nokia_1100_Cell_Phone-168655-1.html

http://www.mouthshut.com/product-reviews/Nokia_1100_Cell_Phone- 925043450.html

http://adsoftheworld.com/