ldquoBranding of Nokiardquo

BackgroundThese days it has not only become a necessity but a need for all the competitive companies to build around a brand image Branding in fact is something that companies have to strive if they need to capture a certain share of the market place Branding is basically the process of creating a strong identity for an organization and it applies to both product manufacturers and companies that provide a servicerdquo We see all sorts of companies around use these days whether they have to do with the transportation sector the services sector the hospitality sector or some other part of the economy Everything from house tissues to the airlines we choose to fly on are to a great extent based on brand names and brand images Since the market competition has become so stiff and concentrated these days the only successful companies are those who have applied branding strategies in a very remarkable fashion and are able to fully utilize their brand name for gaining competitive advantage

Nokia had been a dominant player in the mobile phone market ever since it entered the market It quickly established itself as a strong brand by focusing on branding The companys philosophy the Nokia Way called for four brand values - creative inspiring human and accessible

For this reason I prepare my report about branding strategy of No

History of NokiaVision

Nokia will empower everyone to share and make the most of their life by offering irresistible personal experiences

The convergence of the mobile internet and PC are a reality Consumers want complete solutions not just devices and technology to be invisible Consumer relationships are the new unit of value in this converged industry as consumers consume services as they are created

Vision of the future

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 Thats 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

1

on social location (people and places) In a world where connecting people to what matters empowers them to make the most of every moment Our ambition is to become the leading provider of mobile solutions

From roots in paper rubber and cables in just over 100 years Nokia becomes a powerful industrial conglomerate

The newly formed Nokia Corporation is ideally positioned for a pioneering role in the early evolution of mobile communications

As mobile phone use booms Nokia makes the sector its core business By the turn of the century the company is the world leader

2

on social location (people and places) In a world where connecting people to what matters empowers them to make the most of every moment Our ambition is to become the leading provider of mobile solutions

From roots in paper rubber and cables in just over 100 years Nokia becomes a powerful industrial conglomerate

The newly formed Nokia Corporation is ideally positioned for a pioneering role in the early evolution of mobile communications

As mobile phone use booms Nokia makes the sector its core business By the turn of the century the company is the world leader

2

Nokia sells its billionth mobile phone as the third generation of mobile technology emerges

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

Engaging you

For us lsquoengaging yoursquo incorporates the lsquocustomer satisfactionrsquo value and deals with engaging all our stakeholders including employees in what Nokia stands for in the world

Achieving together

lsquoAchieving togetherrsquo 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

lsquoPassion for innovationrsquo 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 lsquovery humanrsquo 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

3

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

Brand NokiaWhat is Brand

American Marketing Association defines Brand as Name term symbol sign or design or a combination of them intended to identify a seller or a group of sellers and to differentiate them from those of competitors Thus a brand identifies the seller or maker

A brand is a complex symbol that can convey up to six levels of meaning viz Attributes Benefits Values Culture personality and User Scott Davis suggests visualizing a Brand Pyramid in constructing the image of brand At the low level are brand attributes at the next level are the brands benefits and at the top are beliefs and values as shown below

Brand pyramid

Brand building

It is one of the most important activities to be performed for the lifecycle of any brand Some of the various tools used by Nokia include

bull Public relations and press releases

bull Sponsorships

bull Events marketing

bull High value for money

Brand Value

It is the job of estimating the total financial value of the brand The brand valuation is done on yearly basis for all ht global brands that have value greater than $ 1 billion

4

Nokia is one of the top 10 brands in the world for past several years here is the brand value of Nokia in past 5 years

Year Position Brand Value

In $ millions change

wrt previous year

2001 35035

2002 6 29970 -14

2003 6 29440 -12

2004 8 24041 -2

2005 6 26452 10

Good chunk of the brand value comes from the marketing budgets and different business models require different marketing approaches It is interesting to note that in the top valued brands 6 out of 10 are technology companies

A strong correlation exists between the brand value and the innovation factor which means their innovative efforts were correctly communicated and moreover there is a strong consistency between what the company judge as operational efficiency and delivers as a consequence and what the market accordingly perceives

Nokia Brand PositioningNokia was named the 5th Best Global Brand in 2007 and has been one of the 10 best global brands for almost a decade So what makes Nokia Brand so valuable and what is Nokiarsquos value proposition As Tam Harbert of Electronic Business magazine has put it If Nokia Corp were a person it would be young sexy sophisticated hip and generally with it Nokia newly released high-end phones aimed at both the

5

consumer and business user and is showing strength in both emerging and mature markets Nokia has been successful in differentiating itself in the crowed and highly competitive mobile communication industry and its newly targeted battle of internet industry Nokia emphasizes technology innovation fun spirit design and ease of use to build a ldquotrusted relationshiprdquo with customers The brand has lived up to the vision of its ldquoConnecting peoplerdquo and ldquoHuman technologyrdquo slogan Nokiarsquos strategy can be easily spotted on companyrsquos corporate website Nokiarsquos strategy is to build trusted consumer relationships by offering compelling and valued consumer solutions that combine beautiful devices with context enriched services Example would be Nokia phonersquos faceplates and different colors that suit userrsquos personality mood and lifestyle By owing the ldquohumanrdquo dimension of mobile communications Nokia has taken the best position for itself leaving its competitors behind pondering what to own to position themselves

According to PerttiKorhonen Chief Technology Officer Nokia a consumer-first mindset remains at the core of everything at Nokia This approach is communicated down to Nokiarsquos employees including designers who sketch a new mobile phone concept and hardware engineers who design complex technology enablers such as multiradio and video sharing Nokia offers mobile phones in five categories broad appeal lifestyle products entry CDMA and Vertu Nokia ensures that every phone it offers can answer customersrsquo needs

Dominating the Mobile Phone MarketNokia Corporation (Nokia) launched two new mobile phones models - the N96 and the N78 - under its popular Nseries sub-brand at the Mobile World Congress5 held from February 11 to 14 2008 at Barcelona Spain The launch of the two new phones came after the success of other multimedia mobile phone models brought out under this sub-brand - the N95 the N73 the N90 the N80 etc In June 2007 Nokia had launched another mobile phone the E90 Communicator under its Eseries brand6 The Eseries was another popular sub-brand of Nokia for its business-oriented mobile phones The E90 was launched as a follow-up to other handsets which had been brought out earlier under the Eseries sub-brand - the E50 and the E65

6

Nokia is one of the top 10 brands in the world for past several years here is the brand value of Nokia in past 5 years

Year Position Brand Value

In $ millions change

wrt previous year

2001 35035

2002 6 29970 -14

2003 6 29440 -12

2004 8 24041 -2

2005 6 26452 10

Good chunk of the brand value comes from the marketing budgets and different business models require different marketing approaches It is interesting to note that in the top valued brands 6 out of 10 are technology companies

A strong correlation exists between the brand value and the innovation factor which means their innovative efforts were correctly communicated and moreover there is a strong consistency between what the company judge as operational efficiency and delivers as a consequence and what the market accordingly perceives

Nokia Brand PositioningNokia was named the 5th Best Global Brand in 2007 and has been one of the 10 best global brands for almost a decade So what makes Nokia Brand so valuable and what is Nokiarsquos value proposition As Tam Harbert of Electronic Business magazine has put it If Nokia Corp were a person it would be young sexy sophisticated hip and generally with it Nokia newly released high-end phones aimed at both the

5

consumer and business user and is showing strength in both emerging and mature markets Nokia has been successful in differentiating itself in the crowed and highly competitive mobile communication industry and its newly targeted battle of internet industry Nokia emphasizes technology innovation fun spirit design and ease of use to build a ldquotrusted relationshiprdquo with customers The brand has lived up to the vision of its ldquoConnecting peoplerdquo and ldquoHuman technologyrdquo slogan Nokiarsquos strategy can be easily spotted on companyrsquos corporate website Nokiarsquos strategy is to build trusted consumer relationships by offering compelling and valued consumer solutions that combine beautiful devices with context enriched services Example would be Nokia phonersquos faceplates and different colors that suit userrsquos personality mood and lifestyle By owing the ldquohumanrdquo dimension of mobile communications Nokia has taken the best position for itself leaving its competitors behind pondering what to own to position themselves

According to PerttiKorhonen Chief Technology Officer Nokia a consumer-first mindset remains at the core of everything at Nokia This approach is communicated down to Nokiarsquos employees including designers who sketch a new mobile phone concept and hardware engineers who design complex technology enablers such as multiradio and video sharing Nokia offers mobile phones in five categories broad appeal lifestyle products entry CDMA and Vertu Nokia ensures that every phone it offers can answer customersrsquo needs

Dominating the Mobile Phone MarketNokia Corporation (Nokia) launched two new mobile phones models - the N96 and the N78 - under its popular Nseries sub-brand at the Mobile World Congress5 held from February 11 to 14 2008 at Barcelona Spain The launch of the two new phones came after the success of other multimedia mobile phone models brought out under this sub-brand - the N95 the N73 the N90 the N80 etc In June 2007 Nokia had launched another mobile phone the E90 Communicator under its Eseries brand6 The Eseries was another popular sub-brand of Nokia for its business-oriented mobile phones The E90 was launched as a follow-up to other handsets which had been brought out earlier under the Eseries sub-brand - the E50 and the E65

6

consumer and business user and is showing strength in both emerging and mature markets Nokia has been successful in differentiating itself in the crowed and highly competitive mobile communication industry and its newly targeted battle of internet industry Nokia emphasizes technology innovation fun spirit design and ease of use to build a ldquotrusted relationshiprdquo with customers The brand has lived up to the vision of its ldquoConnecting peoplerdquo and ldquoHuman technologyrdquo slogan Nokiarsquos strategy can be easily spotted on companyrsquos corporate website Nokiarsquos strategy is to build trusted consumer relationships by offering compelling and valued consumer solutions that combine beautiful devices with context enriched services Example would be Nokia phonersquos faceplates and different colors that suit userrsquos personality mood and lifestyle By owing the ldquohumanrdquo dimension of mobile communications Nokia has taken the best position for itself leaving its competitors behind pondering what to own to position themselves

According to PerttiKorhonen Chief Technology Officer Nokia a consumer-first mindset remains at the core of everything at Nokia This approach is communicated down to Nokiarsquos employees including designers who sketch a new mobile phone concept and hardware engineers who design complex technology enablers such as multiradio and video sharing Nokia offers mobile phones in five categories broad appeal lifestyle products entry CDMA and Vertu Nokia ensures that every phone it offers can answer customersrsquo needs

Dominating the Mobile Phone MarketNokia Corporation (Nokia) launched two new mobile phones models - the N96 and the N78 - under its popular Nseries sub-brand at the Mobile World Congress5 held from February 11 to 14 2008 at Barcelona Spain The launch of the two new phones came after the success of other multimedia mobile phone models brought out under this sub-brand - the N95 the N73 the N90 the N80 etc In June 2007 Nokia had launched another mobile phone the E90 Communicator under its Eseries brand6 The Eseries was another popular sub-brand of Nokia for its business-oriented mobile phones The E90 was launched as a follow-up to other handsets which had been brought out earlier under the Eseries sub-brand - the E50 and the E65

6

The Nokia BrandNokia had been a dominant player in the mobile phone market ever since it entered the market It quickly established itself as a strong brand by focusing on branding The companys philosophy the Nokia Way called for four brand values - creative inspiring human and accessible The importance of branding was drilled into everyone in the organization through training programs

Brand StrategyThe image and value of the brand is critical in consumer markets and a strong one is invaluable to an organization especially in todays global economy where the battle for customers is intensified each day It isnt just about the color of the logo the type face used or even the images used A brand is the source of a promise to a consumer of what a company is all about when it comes to its products and operations Thus it is a foundational piece in any marketing communication and one a company does not want to be without if it wants to stay competitive and successful This is the reason why it is imperative for organizations to spend time investing in researching defining and building the brand Developing a brand strategy can be one of the most difficult steps in the marketing plan process Its often the element that causes most businesses the biggest challenge but its a vital step in creating a company identity This paper will take a look at the branding strategy for Peejay Engineering Co Ltd as a way of all about understanding the elements that give the brand its strength and position in the market in Ghana and provides a review of its brand development strategy

Unlike other industries such as the service and product manufacturing the value of the brand tends to be undervalued This company like many others coming up has found that there is an essential need for brand development for three reasons

bull There are myriad of small and medium size business that provide architectural engineering and construction services in various forms and variations With is comes the difficulty of clients differentiating among these organization Thus the better your brand the less confused clients are about your services This enables you to get short listed

bull The competition for talented and highly skilled professionals (of various aspects in the field) has been steadily increasing as

Nokia Brand MarketingHas the brand done a great job wit relationship marketing marketing experiential marketing to one-to-one marketing

What did the brand do Why was it effective

Could others learn from that

7

Nokia has done a really great job with relationship to marketing In order to explain this we will explain the general strategy that this Brand uses for its products then the activities they have taken along with some specific examples Later on we will see the results of this marketing its effectiveness and either success or failure Finally well comment about the possibility of other companies learning from NokiaThe Product that the Brand offers has already been mentioned However in the marketing part its important to state that what characterizes Nokia is phones that tend to include all the latest technology and a lot of the consumers favourite aspects (here we have to write the special features that Nokia has) They offer also accessories like carry cases hands free kits and in-car chargers which generate Nokia a lot of profit as they are very high priced

Phones produced by Nokia are usually sold at high prices (introduction of new phones with the latest technology to the market can be expected at around euro280) This price usually decreases after an introductory period around 2 months later They try they try to keep their prices a bit lower than those of the closest competitors but not as low as the smallest competition Generally Nokia phones are sold at all established mobile phone dealerships such as Carphone Warehouse and The Link although they are also sold at other retailers such as Dixons and other electrical suppliers

Nokias tendency is to promote new technologies and mobile devices they create with one big advertising campaign focused on a singular technology instead of each individual handset so they can appeal to a lot of different markets with one campaign As the leader Brand in communications technology Nokia is able to do

The Use Of Brand Name As A Strategy For Gaining Competitive AdvantageThese days it has not only become a necessity but a need for all the competitive companies to build around a brand image Branding in fact is something that companies have to strive if they need to capture a certain share of the market place Branding is basically the process of creating a strong identity for an organization and it applies to both product manufacturers and companies that provide a service (Khan 1) We see all sorts of companies around use these days whether they have to do with the transportation sector the services sector the hospitality sector or some other part of the economy Everything from house tissues to the airlines we choose to fly on are to a great extent based on brand names and brand images Since the market competition has become so stiff and concentrated these days the only successful companies are those who have applied branding strategies in a very remarkable fashion and are able to fully utilize their brand name for gaining competitive advantage It is essentially through the practice of branding that a company is able to provide a meaningful framework by which it can establish an active relationship with its new and old customers By having a successful branding strategy customers are able to remember a particular company and what it stands for what type of products it sells the quality of those products and also what to expect when using its products Branding indeed is the key to develop and maintain competitive advantage in todays marketplace

8

Marketing Strategy For NokiaFor this project I have been instructed to come up with a marketing strategy for an existing companyproduct I have chosen to do Nokia communications particularly the mobile phone sector of Nokias 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) 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

9

Nokia has done a really great job with relationship to marketing In order to explain this we will explain the general strategy that this Brand uses for its products then the activities they have taken along with some specific examples Later on we will see the results of this marketing its effectiveness and either success or failure Finally well comment about the possibility of other companies learning from NokiaThe Product that the Brand offers has already been mentioned However in the marketing part its important to state that what characterizes Nokia is phones that tend to include all the latest technology and a lot of the consumers favourite aspects (here we have to write the special features that Nokia has) They offer also accessories like carry cases hands free kits and in-car chargers which generate Nokia a lot of profit as they are very high priced

Phones produced by Nokia are usually sold at high prices (introduction of new phones with the latest technology to the market can be expected at around euro280) This price usually decreases after an introductory period around 2 months later They try they try to keep their prices a bit lower than those of the closest competitors but not as low as the smallest competition Generally Nokia phones are sold at all established mobile phone dealerships such as Carphone Warehouse and The Link although they are also sold at other retailers such as Dixons and other electrical suppliers

Nokias tendency is to promote new technologies and mobile devices they create with one big advertising campaign focused on a singular technology instead of each individual handset so they can appeal to a lot of different markets with one campaign As the leader Brand in communications technology Nokia is able to do

The Use Of Brand Name As A Strategy For Gaining Competitive AdvantageThese days it has not only become a necessity but a need for all the competitive companies to build around a brand image Branding in fact is something that companies have to strive if they need to capture a certain share of the market place Branding is basically the process of creating a strong identity for an organization and it applies to both product manufacturers and companies that provide a service (Khan 1) We see all sorts of companies around use these days whether they have to do with the transportation sector the services sector the hospitality sector or some other part of the economy Everything from house tissues to the airlines we choose to fly on are to a great extent based on brand names and brand images Since the market competition has become so stiff and concentrated these days the only successful companies are those who have applied branding strategies in a very remarkable fashion and are able to fully utilize their brand name for gaining competitive advantage It is essentially through the practice of branding that a company is able to provide a meaningful framework by which it can establish an active relationship with its new and old customers By having a successful branding strategy customers are able to remember a particular company and what it stands for what type of products it sells the quality of those products and also what to expect when using its products Branding indeed is the key to develop and maintain competitive advantage in todays marketplace

8

Marketing Strategy For NokiaFor this project I have been instructed to come up with a marketing strategy for an existing companyproduct I have chosen to do Nokia communications particularly the mobile phone sector of Nokias 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) 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

9

Marketing Strategy For NokiaFor this project I have been instructed to come up with a marketing strategy for an existing companyproduct I have chosen to do Nokia communications particularly the mobile phone sector of Nokias 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) 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

9

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

10

With all of these competitors in the market Nokia must keep ahead of the game by running successful marketing strategies to do this Nokia must focus on the principles of marketing At the moment Nokia are the worlds best selling phone company (see table below which shows market share) Nokia strengthened its lead as the No 1 vendor in the market during 2000 with shipments growing 66 percent over 1999 Some of the companys success was attributed to a strong second half in 2000 when 59 percent of sales occurred

1 Nokia 372 (347 1Q02)

2 Motorola 173 (155)

3Samsung 98 (96)

4Siemens 85 (88)

5 Sony-Ericsson 52 (64)

Marketing principles

There are many priorities within a business but in a marketing orientated company like Nokia many of the following principles will be high on the agenda

1 Customer satisfaction

Market research must be used to find out whether customers expectations are being met by current products or services

2 Customer perception

11

This is based on the images consumers have of the organization and its products this can be based on value for money product quality fashion and product reliability 3 Customer needs and expectations

This is anticipating future trends and forecasting for future sales This is vital to any organization if they wish to keep their entire current market share and develop more

4 Generating income or profit

This principle clearly states that the need of the organization is to be profitable enough to generate income for growth and to satisfy stakeholders in the business Although satisfying the customer is a big part of a companies plan they also need to take into account their own needs such as

5 Making satisfactory progress

Organizations need to make sure that their product is developing along with the market if a product is developing well then income should increase if not then the marketing strategy should be revised

6 Be aware of the environment

An organization should always know what is happening within their designated market if it is changing saturation technological advances slowing down or rapidly growing being up to date on this is essential for companies to survive

Political factors-

Legal constraints (such as the G3 technology constraints that Nokia have to take into consideration) must be taken into account because many businesses aim to make a profit so they may be tempted to mislead their customers about prices quality of products and the availability of their products They may also try to cut expenditure by using lesser quality materials in their products (such as weaker materials for Nokia cases and batteries) also some companies may also dispose their waste in ways that damage the environment (pollution) and not ensuring high standards of hygiene and safety in the workplace and outlet stores all of these are illegal and can leave companies in big legal trouble

The governmental bodies in the UK have introduced new laws into the business environment

12

With all of these competitors in the market Nokia must keep ahead of the game by running successful marketing strategies to do this Nokia must focus on the principles of marketing At the moment Nokia are the worlds best selling phone company (see table below which shows market share) Nokia strengthened its lead as the No 1 vendor in the market during 2000 with shipments growing 66 percent over 1999 Some of the companys success was attributed to a strong second half in 2000 when 59 percent of sales occurred

1 Nokia 372 (347 1Q02)

2 Motorola 173 (155)

3Samsung 98 (96)

4Siemens 85 (88)

5 Sony-Ericsson 52 (64)

Marketing principles

There are many priorities within a business but in a marketing orientated company like Nokia many of the following principles will be high on the agenda

1 Customer satisfaction

Market research must be used to find out whether customers expectations are being met by current products or services

2 Customer perception

11

This is based on the images consumers have of the organization and its products this can be based on value for money product quality fashion and product reliability 3 Customer needs and expectations

This is anticipating future trends and forecasting for future sales This is vital to any organization if they wish to keep their entire current market share and develop more

4 Generating income or profit

This principle clearly states that the need of the organization is to be profitable enough to generate income for growth and to satisfy stakeholders in the business Although satisfying the customer is a big part of a companies plan they also need to take into account their own needs such as

5 Making satisfactory progress

Organizations need to make sure that their product is developing along with the market if a product is developing well then income should increase if not then the marketing strategy should be revised

6 Be aware of the environment

An organization should always know what is happening within their designated market if it is changing saturation technological advances slowing down or rapidly growing being up to date on this is essential for companies to survive

Political factors-

Legal constraints (such as the G3 technology constraints that Nokia have to take into consideration) must be taken into account because many businesses aim to make a profit so they may be tempted to mislead their customers about prices quality of products and the availability of their products They may also try to cut expenditure by using lesser quality materials in their products (such as weaker materials for Nokia cases and batteries) also some companies may also dispose their waste in ways that damage the environment (pollution) and not ensuring high standards of hygiene and safety in the workplace and outlet stores all of these are illegal and can leave companies in big legal trouble

The governmental bodies in the UK have introduced new laws into the business environment

12

This is based on the images consumers have of the organization and its products this can be based on value for money product quality fashion and product reliability 3 Customer needs and expectations

This is anticipating future trends and forecasting for future sales This is vital to any organization if they wish to keep their entire current market share and develop more

4 Generating income or profit

This principle clearly states that the need of the organization is to be profitable enough to generate income for growth and to satisfy stakeholders in the business Although satisfying the customer is a big part of a companies plan they also need to take into account their own needs such as

5 Making satisfactory progress

Organizations need to make sure that their product is developing along with the market if a product is developing well then income should increase if not then the marketing strategy should be revised

6 Be aware of the environment

An organization should always know what is happening within their designated market if it is changing saturation technological advances slowing down or rapidly growing being up to date on this is essential for companies to survive

Political factors-

Legal constraints (such as the G3 technology constraints that Nokia have to take into consideration) must be taken into account because many businesses aim to make a profit so they may be tempted to mislead their customers about prices quality of products and the availability of their products They may also try to cut expenditure by using lesser quality materials in their products (such as weaker materials for Nokia cases and batteries) also some companies may also dispose their waste in ways that damage the environment (pollution) and not ensuring high standards of hygiene and safety in the workplace and outlet stores all of these are illegal and can leave companies in big legal trouble

The governmental bodies in the UK have introduced new laws into the business environment

12

which ensure that none of these procedures take place if a company is to be successful they must follow all of these laws

Environmental social and ethical factors-

some businesses view profits are more valuable then a strong ethical code and this can govern behavior and business conduct Some un-ethical practices are against the law and companies can not become involved in them (I have mentioned these above) but there are also some practices that arent illegal by law but are considered highly un-ethical by the consuming public companies who engage in these practices can lose a lot of market share if they are found out An example of this is cosmetic testing on animals it is legal but some of the consuming publicis not happy about it and boycott certain products because of it companies must be very careful about how they conduct themselves

Nokia have managed to be quite environmentally friendly and have not done anything that the consuming public have taken huge offence to they have been very careful about this and this is one of the reasons they are such a popular brand of mobile phones

Technological-

In the communications market technology is perhaps the most important factor that companies like Nokia have to take into consideration They have to keep up to date with all the newest technological advances (like camera and motion capture phones) if they are going to capture the biggest market share and stay ahead of their competitors (Sony and Seimens)

Market development-

To complete market development successfully Nokia must look into the following

middot Researching and selling to a different market (in case of saturation or poor market share) middot Change times that television adverts are aired at and alter the places in which print adverts are being displayed (this can help your products appeal to a whole new market segmentation) middot Lower current prices to help the products appeal to a wider range of consumers Product development-

This area of the Ansoffs matrix involves keeping up to date with the latest technologies available in your chosen market and using them to appeal to different people (for example WAP phones are aimed at more professional people while Camera phones are aimed at the youth market) Diversification-

13

This refers to developing technology that offers consumers something new or different this is the most common way of companies trying to gain greater market share and increase their profits

Market research

A businesses success is based on whether they can give the customer what they want and when they want it Market research involves the collection collation and analysis of data relating to the consumption and marketing of relevant goods and services

The purpose of market research is really to find out whether there is a gap in the market for your product or service or whether you can make customers want your product through persuasive adverting We already know that there is a market for mobile phones but the current market gap has become saturated (or if not saturated almost saturated) so Nokia need to find a new market segment to aim their products at In order to classify the wants and needs of the consuming population companies need to gather information on the following

middot Consumer behavior-

How do customers react to advertising Whether they are partial to prize give-aways or free gifts What are their reactions to new and developed products

middot Buying patterns and sales trends-

Organizations need to look at how buying trends and patterns are affected by class gender religion and region They also need to understand how buying patterns change over time and what markets are expanding and are worth trying to enter and obviously which markets are contracting and companies shouldnt aim to enter into

middot

Consumer preferences-

14

What customers are looking for in a product for example style color technology amount of outlets customer service and promotional styles

middot Activities of competitors in the market-

Nokia need to examine how their rivals are adapting their prices and products to meet the consumersneeds how well the rivals are selling and what marketing strategies they are usingMarket research should supply the company with all the information they require about consumers preferences whether they buy certain products what design features are preferable and what kind of retail outfits are most frequently used for purchasing certain products

Sources of marketing information

The information that companies collect through market research can be in one of two forms either quantitative or qualitative data

1 Quantitative data refers to data presented in numerical form usually figures for example Nokias operating profit in the 4th quarter of 1997 was 830 million

2 Qualitative data is the information concerning the motives and attitudes of consumers for example more people buy Nokia phones then Sony phones because Nokia phones are more reliable

The two main sources of market research information are primary research (where the company has gathered the information about the markets themselves) and secondary research (when researchers use information that has been discovered by other companies)

Methods of collecting primary data

middot Face to face survey

middot Open ended interview

middot Telephone survey

15

middot Postal surveys

middot Consumer panels

middot Observations

middot Experiments

Methods of collecting secondary data

Internal sources

middot Existing reports

middot Distribution data

middot Shopkeepers opinions

middot Stock records

middot Sales records

middot Accounting records

External data

middot Government statistics

middot Specialist business organization for example Mintel or Neilsons retail audit

16

middot Consumer databases

To help decide what market segment to aim at companies can also look at the buying habits of customers In order to make decisions about the type of products to make what advertising to use promotional tactics pricing and packaging Nokia will need to know about the following 1 The types of goods customers buy

2 How much they buy

3 How often they buy

There are also certain variables that can affect peoples buying habits they include 1 Age

2 Gender

3 Area they live in

4 Religion

5Lifestyle 6Taste 7Fashion and preferences

Market segmentation

In order to plan their product Nokia must look at what area of the market they want to aim the products at as the current youth market is more or less saturated Nokia will have to research into a new market I suggest the 55+ market as they will have lots of disposable income and my research shows that most people aged 55+ do not currently own a mobile device and could be persuaded to buy one by certain promotions and a good advertising campaign also the drop in call prices should attract a lot of people who may have previously been hesitant due the high

17

costs Below is a table showing the population in terms of social grouping of the UK in 1999 Socio-economic group

Of population

A-Upper class

28 B- Middle class

186 C1- Lower middle class

275 C2- Skilled working class

221 D- Working class

176 E-Low income earners

114 I think that Nokia should aim their products at the socio-economic group B (middle class) event though they arent the biggest group they are the group that is most likely to spend their money on a mobile telephone as my questionnaire results showed

Investigating consumer trends

As the main aim of market research is to develop an idea of market opportunities an important part of this research must be to track sales in order to identify those products which are likely to experience a rise in sales and to look at those in which the sales are likely to fall Changes in customer demand which continue in the same direction for more then 2 years show

18

a long-term trend or saturation is occurring within the market This is definitely a bad market for businesses to be in (the mobile phone market is in the first year of a continuing trend) and the company must consider changing their market or product to a market or product that is currently showing a continuing upwards trend

The stages of marketing

1Market and product research

Finding out what your customers want

Technical research

2 Product launch

Test market

Pricing

Branding

Packaging

3 Product promotion

Advertising

Merchandising

Publicity and PR

19

Sales promotion

4 Sales and distribution

Managing the sales force

Type and amount of sales outlets

Local national or international sales

Transportation of goods

5 Monitoring and analyzing the sales

Meeting customer satisfaction

Does the product need modifying or replacing

Is a profit being made

Is customer service satisfactory

Have the sales targets been met

Is the promotion and distribution policy effective

If a company gets to section 5 of the marketing cycle and a substantial amount of the goals havent been met then they will have to consider re-launching the product or taking it out of the market completely and placing it in a different market or changing it to meet the needs of the current market

20

What customers are looking for in a product for example style color technology amount of outlets customer service and promotional styles

middot Activities of competitors in the market-

Nokia need to examine how their rivals are adapting their prices and products to meet the consumersneeds how well the rivals are selling and what marketing strategies they are usingMarket research should supply the company with all the information they require about consumers preferences whether they buy certain products what design features are preferable and what kind of retail outfits are most frequently used for purchasing certain products

Sources of marketing information

The information that companies collect through market research can be in one of two forms either quantitative or qualitative data

1 Quantitative data refers to data presented in numerical form usually figures for example Nokias operating profit in the 4th quarter of 1997 was 830 million

2 Qualitative data is the information concerning the motives and attitudes of consumers for example more people buy Nokia phones then Sony phones because Nokia phones are more reliable

The two main sources of market research information are primary research (where the company has gathered the information about the markets themselves) and secondary research (when researchers use information that has been discovered by other companies)

Methods of collecting primary data

middot Face to face survey

middot Open ended interview

middot Telephone survey

15

middot Postal surveys

middot Consumer panels

middot Observations

middot Experiments

Methods of collecting secondary data

Internal sources

middot Existing reports

middot Distribution data

middot Shopkeepers opinions

middot Stock records

middot Sales records

middot Accounting records

External data

middot Government statistics

middot Specialist business organization for example Mintel or Neilsons retail audit

16

middot Consumer databases

To help decide what market segment to aim at companies can also look at the buying habits of customers In order to make decisions about the type of products to make what advertising to use promotional tactics pricing and packaging Nokia will need to know about the following 1 The types of goods customers buy

2 How much they buy

3 How often they buy

There are also certain variables that can affect peoples buying habits they include 1 Age

2 Gender

3 Area they live in

4 Religion

5Lifestyle 6Taste 7Fashion and preferences

Market segmentation

In order to plan their product Nokia must look at what area of the market they want to aim the products at as the current youth market is more or less saturated Nokia will have to research into a new market I suggest the 55+ market as they will have lots of disposable income and my research shows that most people aged 55+ do not currently own a mobile device and could be persuaded to buy one by certain promotions and a good advertising campaign also the drop in call prices should attract a lot of people who may have previously been hesitant due the high

17

costs Below is a table showing the population in terms of social grouping of the UK in 1999 Socio-economic group

Of population

A-Upper class

28 B- Middle class

186 C1- Lower middle class

275 C2- Skilled working class

221 D- Working class

176 E-Low income earners

114 I think that Nokia should aim their products at the socio-economic group B (middle class) event though they arent the biggest group they are the group that is most likely to spend their money on a mobile telephone as my questionnaire results showed

Investigating consumer trends

As the main aim of market research is to develop an idea of market opportunities an important part of this research must be to track sales in order to identify those products which are likely to experience a rise in sales and to look at those in which the sales are likely to fall Changes in customer demand which continue in the same direction for more then 2 years show

18

a long-term trend or saturation is occurring within the market This is definitely a bad market for businesses to be in (the mobile phone market is in the first year of a continuing trend) and the company must consider changing their market or product to a market or product that is currently showing a continuing upwards trend

The stages of marketing

1Market and product research

Finding out what your customers want

Technical research

2 Product launch

Test market

Pricing

Branding

Packaging

3 Product promotion

Advertising

Merchandising

Publicity and PR

19

Sales promotion

4 Sales and distribution

Managing the sales force

Type and amount of sales outlets

Local national or international sales

Transportation of goods

5 Monitoring and analyzing the sales

Meeting customer satisfaction

Does the product need modifying or replacing

Is a profit being made

Is customer service satisfactory

Have the sales targets been met

Is the promotion and distribution policy effective

If a company gets to section 5 of the marketing cycle and a substantial amount of the goals havent been met then they will have to consider re-launching the product or taking it out of the market completely and placing it in a different market or changing it to meet the needs of the current market

20

middot Postal surveys

middot Consumer panels

middot Observations

middot Experiments

Methods of collecting secondary data

Internal sources

middot Existing reports

middot Distribution data

middot Shopkeepers opinions

middot Stock records

middot Sales records

middot Accounting records

External data

middot Government statistics

middot Specialist business organization for example Mintel or Neilsons retail audit

16

middot Consumer databases

To help decide what market segment to aim at companies can also look at the buying habits of customers In order to make decisions about the type of products to make what advertising to use promotional tactics pricing and packaging Nokia will need to know about the following 1 The types of goods customers buy

2 How much they buy

3 How often they buy

There are also certain variables that can affect peoples buying habits they include 1 Age

2 Gender

3 Area they live in

4 Religion

5Lifestyle 6Taste 7Fashion and preferences

Market segmentation

In order to plan their product Nokia must look at what area of the market they want to aim the products at as the current youth market is more or less saturated Nokia will have to research into a new market I suggest the 55+ market as they will have lots of disposable income and my research shows that most people aged 55+ do not currently own a mobile device and could be persuaded to buy one by certain promotions and a good advertising campaign also the drop in call prices should attract a lot of people who may have previously been hesitant due the high

17

costs Below is a table showing the population in terms of social grouping of the UK in 1999 Socio-economic group

Of population

A-Upper class

28 B- Middle class

186 C1- Lower middle class

275 C2- Skilled working class

221 D- Working class

176 E-Low income earners

114 I think that Nokia should aim their products at the socio-economic group B (middle class) event though they arent the biggest group they are the group that is most likely to spend their money on a mobile telephone as my questionnaire results showed

Investigating consumer trends

As the main aim of market research is to develop an idea of market opportunities an important part of this research must be to track sales in order to identify those products which are likely to experience a rise in sales and to look at those in which the sales are likely to fall Changes in customer demand which continue in the same direction for more then 2 years show

18

a long-term trend or saturation is occurring within the market This is definitely a bad market for businesses to be in (the mobile phone market is in the first year of a continuing trend) and the company must consider changing their market or product to a market or product that is currently showing a continuing upwards trend

The stages of marketing

1Market and product research

Finding out what your customers want

Technical research

2 Product launch

Test market

Pricing

Branding

Packaging

3 Product promotion

Advertising

Merchandising

Publicity and PR

19

Sales promotion

4 Sales and distribution

Managing the sales force

Type and amount of sales outlets

Local national or international sales

Transportation of goods

5 Monitoring and analyzing the sales

Meeting customer satisfaction

Does the product need modifying or replacing

Is a profit being made

Is customer service satisfactory

Have the sales targets been met

Is the promotion and distribution policy effective

If a company gets to section 5 of the marketing cycle and a substantial amount of the goals havent been met then they will have to consider re-launching the product or taking it out of the market completely and placing it in a different market or changing it to meet the needs of the current market

20

middot Consumer databases

To help decide what market segment to aim at companies can also look at the buying habits of customers In order to make decisions about the type of products to make what advertising to use promotional tactics pricing and packaging Nokia will need to know about the following 1 The types of goods customers buy

2 How much they buy

3 How often they buy

There are also certain variables that can affect peoples buying habits they include 1 Age

2 Gender

3 Area they live in

4 Religion

5Lifestyle 6Taste 7Fashion and preferences

Market segmentation

In order to plan their product Nokia must look at what area of the market they want to aim the products at as the current youth market is more or less saturated Nokia will have to research into a new market I suggest the 55+ market as they will have lots of disposable income and my research shows that most people aged 55+ do not currently own a mobile device and could be persuaded to buy one by certain promotions and a good advertising campaign also the drop in call prices should attract a lot of people who may have previously been hesitant due the high

17

costs Below is a table showing the population in terms of social grouping of the UK in 1999 Socio-economic group

Of population

A-Upper class

28 B- Middle class

186 C1- Lower middle class

275 C2- Skilled working class

221 D- Working class

176 E-Low income earners

114 I think that Nokia should aim their products at the socio-economic group B (middle class) event though they arent the biggest group they are the group that is most likely to spend their money on a mobile telephone as my questionnaire results showed

Investigating consumer trends

As the main aim of market research is to develop an idea of market opportunities an important part of this research must be to track sales in order to identify those products which are likely to experience a rise in sales and to look at those in which the sales are likely to fall Changes in customer demand which continue in the same direction for more then 2 years show

18

a long-term trend or saturation is occurring within the market This is definitely a bad market for businesses to be in (the mobile phone market is in the first year of a continuing trend) and the company must consider changing their market or product to a market or product that is currently showing a continuing upwards trend

The stages of marketing

1Market and product research

Finding out what your customers want

Technical research

2 Product launch

Test market

Pricing

Branding

Packaging

3 Product promotion

Advertising

Merchandising

Publicity and PR

19

Sales promotion

4 Sales and distribution

Managing the sales force

Type and amount of sales outlets

Local national or international sales

Transportation of goods

5 Monitoring and analyzing the sales

Meeting customer satisfaction

Does the product need modifying or replacing

Is a profit being made

Is customer service satisfactory

Have the sales targets been met

Is the promotion and distribution policy effective

If a company gets to section 5 of the marketing cycle and a substantial amount of the goals havent been met then they will have to consider re-launching the product or taking it out of the market completely and placing it in a different market or changing it to meet the needs of the current market

20

costs Below is a table showing the population in terms of social grouping of the UK in 1999 Socio-economic group

Of population

A-Upper class

28 B- Middle class

186 C1- Lower middle class

275 C2- Skilled working class

221 D- Working class

176 E-Low income earners

114 I think that Nokia should aim their products at the socio-economic group B (middle class) event though they arent the biggest group they are the group that is most likely to spend their money on a mobile telephone as my questionnaire results showed

Investigating consumer trends

As the main aim of market research is to develop an idea of market opportunities an important part of this research must be to track sales in order to identify those products which are likely to experience a rise in sales and to look at those in which the sales are likely to fall Changes in customer demand which continue in the same direction for more then 2 years show

18

a long-term trend or saturation is occurring within the market This is definitely a bad market for businesses to be in (the mobile phone market is in the first year of a continuing trend) and the company must consider changing their market or product to a market or product that is currently showing a continuing upwards trend

The stages of marketing

1Market and product research

Finding out what your customers want

Technical research

2 Product launch

Test market

Pricing

Branding

Packaging

3 Product promotion

Advertising

Merchandising

Publicity and PR

19

Sales promotion

4 Sales and distribution

Managing the sales force

Type and amount of sales outlets

Local national or international sales

Transportation of goods

5 Monitoring and analyzing the sales

Meeting customer satisfaction

Does the product need modifying or replacing

Is a profit being made

Is customer service satisfactory

Have the sales targets been met

Is the promotion and distribution policy effective

If a company gets to section 5 of the marketing cycle and a substantial amount of the goals havent been met then they will have to consider re-launching the product or taking it out of the market completely and placing it in a different market or changing it to meet the needs of the current market

20

a long-term trend or saturation is occurring within the market This is definitely a bad market for businesses to be in (the mobile phone market is in the first year of a continuing trend) and the company must consider changing their market or product to a market or product that is currently showing a continuing upwards trend

The stages of marketing

1Market and product research

Finding out what your customers want

Technical research

2 Product launch

Test market

Pricing

Branding

Packaging

3 Product promotion

Advertising

Merchandising

Publicity and PR

19

Sales promotion

4 Sales and distribution

Managing the sales force

Type and amount of sales outlets

Local national or international sales

Transportation of goods

5 Monitoring and analyzing the sales

Meeting customer satisfaction

Does the product need modifying or replacing

Is a profit being made

Is customer service satisfactory

Have the sales targets been met

Is the promotion and distribution policy effective

If a company gets to section 5 of the marketing cycle and a substantial amount of the goals havent been met then they will have to consider re-launching the product or taking it out of the market completely and placing it in a different market or changing it to meet the needs of the current market

20

Sales promotion

4 Sales and distribution

Managing the sales force

Type and amount of sales outlets

Local national or international sales

Transportation of goods

5 Monitoring and analyzing the sales

Meeting customer satisfaction

Does the product need modifying or replacing

Is a profit being made

Is customer service satisfactory

Have the sales targets been met

Is the promotion and distribution policy effective

If a company gets to section 5 of the marketing cycle and a substantial amount of the goals havent been met then they will have to consider re-launching the product or taking it out of the market completely and placing it in a different market or changing it to meet the needs of the current market

20

Types of pricing strategies

Cost based pricing

This involves calculating the cost of production for the product and then adding a mark-up for profit usually 10 so a company can make enough profit to re-invest into the business so they can grow

Marginal cost pricing

This is the addition to total cost resulting from the production of an additional unit of output If a decision is made to expand by one or more units it will be based on an assumption that the price of each unit will be least sufficient to cover marginal costs so that the profit earned on all previous units is not lower then it previously was

Demand based pricing

This is usually pricing products based around the customer demand for a product if the demand is high the prices will rise This is usually used when the product is unique for example a football match or concert To use this strategy companies must carry out detailed market research to find out what prices the consumers are willing to pay so they dont over price their product Market skimming

This pricing strategy is also known as price creaming and is usually put into place in markets where the competition is limited Market skimming pricing involves charging a high price for new products because the customer is new and unique so (hopefully) the consumers will be willing to pay higher prices for them This is the most common strategy in the mobile phone market as consumers will pay the higher prices for phones that have the newest technology Penetration pricing

Firms who are trying to establish themselves in a new market and gain instant market share usually use this strategy It is a high-risk high cost strategy that is only an available option to the bigger companies (like Nokia) who supply to mass markets Penetration pricing is based around

21

the idea that a company will set their prices low to encourage customers to buy their products instead of higher priced more established brands

The organization may also boost sales by lowering prices if demand is price elastic One problem with this strategy in the mobile communications market (or any other highly competitive markets) is that price wars will often develop with rival companies and this can limit to the amount of profit that can be made and also generate losses due to under-pricing in an attempt to hold onto market share

Price discrimination

This is where companies can charge different prices in different markets because of the consumers they are aiming at for example rail companies charge different prices for peak and off-peak travel cards and fares This strategy is only available for use when the consumers are unable to undercut higher prices by reselling their products from low priced markets to high priced markets

Destroyer pricing

This is a more drastic and aggressive form of penetration pricing used when a companys objective is to get rid of competition completely by lowering their prices to levels that other companies cannot afford to drop to The down side to this strategy is that consumers may see the low price as a reflection of the quality of the product and stick to the higher priced products because they offer a product of higher quality

External factors affecting pricing decisions

Setting a price with regards to only production costs ignores the influence of external factors such as

Market conditions-

how much are the customers willing to pay Can advertising increase product image and price Is the product aimed at a mass market or a niche market (a niche market refers to when a company aims a product at a very small select segment of the market)

22

Production costs-

Prices must cover the costs spent in production if a profit is to be made The price must cover variable costs (for the short term) and fixed costs (for the long term) otherwise a company will face closing

Taxes and subsidies-

VAT and customs duties will raise the price of a product Government subsidies will allow businesses to charge lower prices

Business objectives-

Is the business looking to maximize profits Or is the company looking to increase its market share

Marketing mix-

What stage is the product at in the life cycle What forms of promotion are being used Where is the product being sold

Marketing structure-

How much competition is there in the market What prices is the competition charging

Nokias current marketing strategy

The marketing mix

Price-

The phones that Nokia produce are usually sold at high prices (new phones can be expected to enter the market at around pound200+ if they carry the latest technology) The price of the new phones usuallydecreases after an introductory period which is usually around 2 months long Nokias prices are usually competitor based in such a way as they try to keep their prices a bit lower then those of the closest competitors but not as low as the smallest competition as

23

consumers do not mind paying the extra money for the extra quality they will receive with a well known brand such as Nokia

Place-

Nokia phones are generally sold at all established mobile phone dealerships such as Carphone Warehouse and The Link although they are also sold at other retailers such as Dixons and other electrical suppliers The products are only sold in the electrical suppliers and stores other then dedicated phone dealerships after the introductory period so the phones can remain limited edition as this will encourage younger consumers to buy them

Promotions-

Nokia tend to promote the new technologies and mobile devices they create using one big advertising campaign that focuses on a singular technology instead of each individual handset so they can appeal to a lot of different markets with one campaign

Product-

Nokia phones tend to include all the latest technology and a lot of the consumers favorite aspects such as text messaging and games like Snake and Memory When the phones came out they were big and bulky and quite unattractive but now they are all quite sleek and stylish with phones now getting small enough to fit in the palm of your hand as standard Most of the phones produced nowadays have accessories that consumers must buy with them (carry cases hands free kits and in-car chargers) these generate Nokia a lot of profit as they are very high priced Nokias marketing mix has worked very well until recently as the market they are aiming at has become more and more saturated and after looking at all the mobile phone sales figures it looks as if the phone companies can aim at this same youth market for about another 2 years until they need to change but they should change sooner so they can start making a bigger profit and get a head start on the competition who will also have to change the market they are aiming at Nokias current promotional strategy is working very well as they are able to talk to a large number of consumers in different markets rather then the niche markets the old promotional strategies where restricted to

24

Market segmentation

Market segmentation refers to the different areas of the population that companies can aim their products towards The market segment that Nokia has chosen to aim is the youth market focusing on students aimed 13-19 as market research has shown that some of the youth market are receiving large amounts of pocket money and most have no real commitments to spend it on and that means they have lots of disposable income and will be able to spend a lot money on new mobile phones

As a big company Nokia are able to do a lot of promoting and advertising that smaller less successful companies may not be able to afford such as television advertising and sponsoring lots of events that will be viewed or heard by large amounts of people in their chosen market segment (events such as music festivals and music awards are a goldmine for companies as they are viewed by millions of people worldwide) Adverts such as television and print adverts will be put into certain areas so that they can attract their chosen market segment Nokia tend to put a lot of their print adverts in mens magazines such as FHM and Loaded so they can appeal to all of their readers instead of a smaller percentage of the readers they would attract in magazines such as Lifestyle and Good Housekeeping I think Nokias way of promoting is very good as they can appeal to mass markets and large amounts of people in their chosen market segmentation with certain advertisements and with sponsoring large events like the ones I have previously mentioned Pricing strategy

Nokias current pricing strategy is based on 2 main theories

1 Penetration pricing-

although this strategy is usually for companies that are trying to gain instant market share in a new market companies who are already well known in the market still do it with new products that carry new technologies so they can take more market share form their competitors

2 Competitor based pricing-

this is used when there is a lot of competition in the market and a company is looking to take another companies market share by offering the same or similar products for a lower price this happens a lot in the communications market and this strategy is used by every mobile phone producing company that is still in business

25

Nokias pricing strategy has proven very effective this is down to the fact that they first sell their products for high prices and have very limited sales but make big profits on each sale they then lower the price of their product and have lots more sales but they make less profit but they still make a large profit due to the amount of sales the other reason that they are so successful is that they offer high quality products and they sell them for the same price and sometimes even lower prices then the competition and have now built up the highest market share they currently have 372 of the mobile phone market share and are the biggest selling mobile phone company in the world

Branding

Nokia phones are seen as being of the highest quality and this is reflected in their massive sales figures The fact that they are seen to be such high quality products is partly down to successful branding they have a highly recognizable packaging style and the style of their handsets is similar in every line of production with the company name printed just above the screen and just below the earpiece The fact that Nokia operate such an aggressive marketing strategy has elevated them above the competition as consumers are fooled into believing that branded products are better then un-branded products or products produced by lesser-known brands such as One Tel and other lesser-known phone producers in the market

Product life cycle-Nokia

Introduction When Nokia phones were first introduced they required a lot of promoting and advertising as they werent established enough to sell based on their quality and what they offer to the consumer so this is where Nokia spent the largest amount of money promoting their products and establishing their brand as a leader in the communications market Also when mobile phones were first available there were only a few companies as well as Nokia in the market (Sony etc) so they could charge higher prices then they can at the present time in the product life cycle because no companies would dare to enter a price war with such a new product

Growth This stage of the life cycle also has high promotion costs involved in it this is due to the fact that mobile phones are becoming established as a consumer necessity and lots of other companies decide to enter the growing market although companies do not need to assure customers that

26

they need a mobile phone Nokia have to assure the customers that they want a Nokia phone and this is where the high promotional costs come from

Maturity In this stage the promotional costs do decrease as the more popular brands such as Nokia and Samsung have gathered the majority of the market share and only have to show customers that they have a new model out and it will sell well as they have been established as a quality brand and customers no-longer need to be persuaded to buy Nokia brand technology

Decline This is the stage that the mobile communications market including Nokia have recently entered (Nokia had reported the first drop in sales in the first quarter of 2002) and companies are now promoting heavily their new MMS products to the market in an attempt to get out of decline and back into growth with a new generation of technologically advanced phones that offer motion picture capture camera technology and the opportunity to watch television on your handset

What I have found out by analyzing SWOT is that Nokias main weaknesses are

1They are currently promoting their products to a market that is verging on saturation-

Nokia need to re-launch some of the older models to a different market and only promote new products to the existing market segment

2 Their wag costs are already high and are always rising-

To solve this they can try and invent or discover machines that can increase productivity so that the number of staff currently employed (The average number of employees in 2002 was 52714 and this was a decrease from 57716 in 2001) 3 High import charges are being implemented by the government-To counter this Nokia need to set up factories in more companies this will have high start up costs but will eventually start to save Nokia money on import and export charges I have also discovered that Nokia have established themselves as one of the most popular mobile communications companies in the market with a total of over 52000 sales in 1997 which was a 34 increase from 1996s sales

There are many external factors that can affect a marketing strategy from developing this is where you must use PEST analysis I have outlined PEST analysis on pages 2 and 3 but have

27

further analyzedthe effect of these external factors on the development of Nokias marketing schemes below

Political factors-

Legal factors such as the G3 technology licensing which has cost companies a total of 110 billion eurorsquos so far are always around to stop Nokia from properly developing strategies and further conquering the communications market Also taxes such as import and export have an affect on Nokias development and these are more-or-less impossible to avoid unless a company can afford to run factories in every country and continent in the world

Environmental Social and ethical factors-

Many companies may view profit as more important then ethical practice and this can lead them to making illegal decisions and this has been a big contribution to many companies going out of business or loosingtheir entire market share to eco-friendly companies

Technological factors-

In the communications market this is probably the most important external factor in affecting a companies development of their marketing strategy as they must always keep up to date with every change within the market if they are to be successful and hold on to their market share ad hopefully gain more

Nokias current marketing strategy has helped them become the biggest selling brand in the communications market to date but now sales are starting to decrease with the saturation of the current market segment so Nokia will need to do one of the following Re-launch their products with an aggressive promotional scheme Target a different segment of the market that has not been entered so Nokia can instantly gain 100 of the market share (although this is risky as the market might not take to their products and the demand might be low so sales will also be low and prices will have to be high and this will further stop people from purchasing Nokias products) Differentiate their products to offer something no other company can offer to the market or simply try and offer a different product altogether such as landline phones or televisions

Market research

28

the idea that a company will set their prices low to encourage customers to buy their products instead of higher priced more established brands

The organization may also boost sales by lowering prices if demand is price elastic One problem with this strategy in the mobile communications market (or any other highly competitive markets) is that price wars will often develop with rival companies and this can limit to the amount of profit that can be made and also generate losses due to under-pricing in an attempt to hold onto market share

Price discrimination

This is where companies can charge different prices in different markets because of the consumers they are aiming at for example rail companies charge different prices for peak and off-peak travel cards and fares This strategy is only available for use when the consumers are unable to undercut higher prices by reselling their products from low priced markets to high priced markets

Destroyer pricing

This is a more drastic and aggressive form of penetration pricing used when a companys objective is to get rid of competition completely by lowering their prices to levels that other companies cannot afford to drop to The down side to this strategy is that consumers may see the low price as a reflection of the quality of the product and stick to the higher priced products because they offer a product of higher quality

External factors affecting pricing decisions

Setting a price with regards to only production costs ignores the influence of external factors such as

Market conditions-

how much are the customers willing to pay Can advertising increase product image and price Is the product aimed at a mass market or a niche market (a niche market refers to when a company aims a product at a very small select segment of the market)

22

Production costs-

Prices must cover the costs spent in production if a profit is to be made The price must cover variable costs (for the short term) and fixed costs (for the long term) otherwise a company will face closing

Taxes and subsidies-

VAT and customs duties will raise the price of a product Government subsidies will allow businesses to charge lower prices

Business objectives-

Is the business looking to maximize profits Or is the company looking to increase its market share

Marketing mix-

What stage is the product at in the life cycle What forms of promotion are being used Where is the product being sold

Marketing structure-

How much competition is there in the market What prices is the competition charging

Nokias current marketing strategy

The marketing mix

Price-

The phones that Nokia produce are usually sold at high prices (new phones can be expected to enter the market at around pound200+ if they carry the latest technology) The price of the new phones usuallydecreases after an introductory period which is usually around 2 months long Nokias prices are usually competitor based in such a way as they try to keep their prices a bit lower then those of the closest competitors but not as low as the smallest competition as

23

consumers do not mind paying the extra money for the extra quality they will receive with a well known brand such as Nokia

Place-

Nokia phones are generally sold at all established mobile phone dealerships such as Carphone Warehouse and The Link although they are also sold at other retailers such as Dixons and other electrical suppliers The products are only sold in the electrical suppliers and stores other then dedicated phone dealerships after the introductory period so the phones can remain limited edition as this will encourage younger consumers to buy them

Promotions-

Nokia tend to promote the new technologies and mobile devices they create using one big advertising campaign that focuses on a singular technology instead of each individual handset so they can appeal to a lot of different markets with one campaign

Product-

Nokia phones tend to include all the latest technology and a lot of the consumers favorite aspects such as text messaging and games like Snake and Memory When the phones came out they were big and bulky and quite unattractive but now they are all quite sleek and stylish with phones now getting small enough to fit in the palm of your hand as standard Most of the phones produced nowadays have accessories that consumers must buy with them (carry cases hands free kits and in-car chargers) these generate Nokia a lot of profit as they are very high priced Nokias marketing mix has worked very well until recently as the market they are aiming at has become more and more saturated and after looking at all the mobile phone sales figures it looks as if the phone companies can aim at this same youth market for about another 2 years until they need to change but they should change sooner so they can start making a bigger profit and get a head start on the competition who will also have to change the market they are aiming at Nokias current promotional strategy is working very well as they are able to talk to a large number of consumers in different markets rather then the niche markets the old promotional strategies where restricted to

24

Market segmentation

Market segmentation refers to the different areas of the population that companies can aim their products towards The market segment that Nokia has chosen to aim is the youth market focusing on students aimed 13-19 as market research has shown that some of the youth market are receiving large amounts of pocket money and most have no real commitments to spend it on and that means they have lots of disposable income and will be able to spend a lot money on new mobile phones

As a big company Nokia are able to do a lot of promoting and advertising that smaller less successful companies may not be able to afford such as television advertising and sponsoring lots of events that will be viewed or heard by large amounts of people in their chosen market segment (events such as music festivals and music awards are a goldmine for companies as they are viewed by millions of people worldwide) Adverts such as television and print adverts will be put into certain areas so that they can attract their chosen market segment Nokia tend to put a lot of their print adverts in mens magazines such as FHM and Loaded so they can appeal to all of their readers instead of a smaller percentage of the readers they would attract in magazines such as Lifestyle and Good Housekeeping I think Nokias way of promoting is very good as they can appeal to mass markets and large amounts of people in their chosen market segmentation with certain advertisements and with sponsoring large events like the ones I have previously mentioned Pricing strategy

Nokias current pricing strategy is based on 2 main theories

1 Penetration pricing-

although this strategy is usually for companies that are trying to gain instant market share in a new market companies who are already well known in the market still do it with new products that carry new technologies so they can take more market share form their competitors

2 Competitor based pricing-

this is used when there is a lot of competition in the market and a company is looking to take another companies market share by offering the same or similar products for a lower price this happens a lot in the communications market and this strategy is used by every mobile phone producing company that is still in business

25

Nokias pricing strategy has proven very effective this is down to the fact that they first sell their products for high prices and have very limited sales but make big profits on each sale they then lower the price of their product and have lots more sales but they make less profit but they still make a large profit due to the amount of sales the other reason that they are so successful is that they offer high quality products and they sell them for the same price and sometimes even lower prices then the competition and have now built up the highest market share they currently have 372 of the mobile phone market share and are the biggest selling mobile phone company in the world

Branding

Nokia phones are seen as being of the highest quality and this is reflected in their massive sales figures The fact that they are seen to be such high quality products is partly down to successful branding they have a highly recognizable packaging style and the style of their handsets is similar in every line of production with the company name printed just above the screen and just below the earpiece The fact that Nokia operate such an aggressive marketing strategy has elevated them above the competition as consumers are fooled into believing that branded products are better then un-branded products or products produced by lesser-known brands such as One Tel and other lesser-known phone producers in the market

Product life cycle-Nokia

Introduction When Nokia phones were first introduced they required a lot of promoting and advertising as they werent established enough to sell based on their quality and what they offer to the consumer so this is where Nokia spent the largest amount of money promoting their products and establishing their brand as a leader in the communications market Also when mobile phones were first available there were only a few companies as well as Nokia in the market (Sony etc) so they could charge higher prices then they can at the present time in the product life cycle because no companies would dare to enter a price war with such a new product

Growth This stage of the life cycle also has high promotion costs involved in it this is due to the fact that mobile phones are becoming established as a consumer necessity and lots of other companies decide to enter the growing market although companies do not need to assure customers that

26

they need a mobile phone Nokia have to assure the customers that they want a Nokia phone and this is where the high promotional costs come from

Maturity In this stage the promotional costs do decrease as the more popular brands such as Nokia and Samsung have gathered the majority of the market share and only have to show customers that they have a new model out and it will sell well as they have been established as a quality brand and customers no-longer need to be persuaded to buy Nokia brand technology

Decline This is the stage that the mobile communications market including Nokia have recently entered (Nokia had reported the first drop in sales in the first quarter of 2002) and companies are now promoting heavily their new MMS products to the market in an attempt to get out of decline and back into growth with a new generation of technologically advanced phones that offer motion picture capture camera technology and the opportunity to watch television on your handset

What I have found out by analyzing SWOT is that Nokias main weaknesses are

1They are currently promoting their products to a market that is verging on saturation-

Nokia need to re-launch some of the older models to a different market and only promote new products to the existing market segment

2 Their wag costs are already high and are always rising-

To solve this they can try and invent or discover machines that can increase productivity so that the number of staff currently employed (The average number of employees in 2002 was 52714 and this was a decrease from 57716 in 2001) 3 High import charges are being implemented by the government-To counter this Nokia need to set up factories in more companies this will have high start up costs but will eventually start to save Nokia money on import and export charges I have also discovered that Nokia have established themselves as one of the most popular mobile communications companies in the market with a total of over 52000 sales in 1997 which was a 34 increase from 1996s sales

There are many external factors that can affect a marketing strategy from developing this is where you must use PEST analysis I have outlined PEST analysis on pages 2 and 3 but have

27

further analyzedthe effect of these external factors on the development of Nokias marketing schemes below

Political factors-

Legal factors such as the G3 technology licensing which has cost companies a total of 110 billion eurorsquos so far are always around to stop Nokia from properly developing strategies and further conquering the communications market Also taxes such as import and export have an affect on Nokias development and these are more-or-less impossible to avoid unless a company can afford to run factories in every country and continent in the world

Environmental Social and ethical factors-

Many companies may view profit as more important then ethical practice and this can lead them to making illegal decisions and this has been a big contribution to many companies going out of business or loosingtheir entire market share to eco-friendly companies

Technological factors-

In the communications market this is probably the most important external factor in affecting a companies development of their marketing strategy as they must always keep up to date with every change within the market if they are to be successful and hold on to their market share ad hopefully gain more

Nokias current marketing strategy has helped them become the biggest selling brand in the communications market to date but now sales are starting to decrease with the saturation of the current market segment so Nokia will need to do one of the following Re-launch their products with an aggressive promotional scheme Target a different segment of the market that has not been entered so Nokia can instantly gain 100 of the market share (although this is risky as the market might not take to their products and the demand might be low so sales will also be low and prices will have to be high and this will further stop people from purchasing Nokias products) Differentiate their products to offer something no other company can offer to the market or simply try and offer a different product altogether such as landline phones or televisions

Market research

28

Production costs-

Prices must cover the costs spent in production if a profit is to be made The price must cover variable costs (for the short term) and fixed costs (for the long term) otherwise a company will face closing

Taxes and subsidies-

VAT and customs duties will raise the price of a product Government subsidies will allow businesses to charge lower prices

Business objectives-

Is the business looking to maximize profits Or is the company looking to increase its market share

Marketing mix-

What stage is the product at in the life cycle What forms of promotion are being used Where is the product being sold

Marketing structure-

How much competition is there in the market What prices is the competition charging

Nokias current marketing strategy

The marketing mix

Price-

The phones that Nokia produce are usually sold at high prices (new phones can be expected to enter the market at around pound200+ if they carry the latest technology) The price of the new phones usuallydecreases after an introductory period which is usually around 2 months long Nokias prices are usually competitor based in such a way as they try to keep their prices a bit lower then those of the closest competitors but not as low as the smallest competition as

23

consumers do not mind paying the extra money for the extra quality they will receive with a well known brand such as Nokia

Place-

Nokia phones are generally sold at all established mobile phone dealerships such as Carphone Warehouse and The Link although they are also sold at other retailers such as Dixons and other electrical suppliers The products are only sold in the electrical suppliers and stores other then dedicated phone dealerships after the introductory period so the phones can remain limited edition as this will encourage younger consumers to buy them

Promotions-

Nokia tend to promote the new technologies and mobile devices they create using one big advertising campaign that focuses on a singular technology instead of each individual handset so they can appeal to a lot of different markets with one campaign

Product-

Nokia phones tend to include all the latest technology and a lot of the consumers favorite aspects such as text messaging and games like Snake and Memory When the phones came out they were big and bulky and quite unattractive but now they are all quite sleek and stylish with phones now getting small enough to fit in the palm of your hand as standard Most of the phones produced nowadays have accessories that consumers must buy with them (carry cases hands free kits and in-car chargers) these generate Nokia a lot of profit as they are very high priced Nokias marketing mix has worked very well until recently as the market they are aiming at has become more and more saturated and after looking at all the mobile phone sales figures it looks as if the phone companies can aim at this same youth market for about another 2 years until they need to change but they should change sooner so they can start making a bigger profit and get a head start on the competition who will also have to change the market they are aiming at Nokias current promotional strategy is working very well as they are able to talk to a large number of consumers in different markets rather then the niche markets the old promotional strategies where restricted to

24

Market segmentation

Market segmentation refers to the different areas of the population that companies can aim their products towards The market segment that Nokia has chosen to aim is the youth market focusing on students aimed 13-19 as market research has shown that some of the youth market are receiving large amounts of pocket money and most have no real commitments to spend it on and that means they have lots of disposable income and will be able to spend a lot money on new mobile phones

As a big company Nokia are able to do a lot of promoting and advertising that smaller less successful companies may not be able to afford such as television advertising and sponsoring lots of events that will be viewed or heard by large amounts of people in their chosen market segment (events such as music festivals and music awards are a goldmine for companies as they are viewed by millions of people worldwide) Adverts such as television and print adverts will be put into certain areas so that they can attract their chosen market segment Nokia tend to put a lot of their print adverts in mens magazines such as FHM and Loaded so they can appeal to all of their readers instead of a smaller percentage of the readers they would attract in magazines such as Lifestyle and Good Housekeeping I think Nokias way of promoting is very good as they can appeal to mass markets and large amounts of people in their chosen market segmentation with certain advertisements and with sponsoring large events like the ones I have previously mentioned Pricing strategy

Nokias current pricing strategy is based on 2 main theories

1 Penetration pricing-

although this strategy is usually for companies that are trying to gain instant market share in a new market companies who are already well known in the market still do it with new products that carry new technologies so they can take more market share form their competitors

2 Competitor based pricing-

this is used when there is a lot of competition in the market and a company is looking to take another companies market share by offering the same or similar products for a lower price this happens a lot in the communications market and this strategy is used by every mobile phone producing company that is still in business

25

Nokias pricing strategy has proven very effective this is down to the fact that they first sell their products for high prices and have very limited sales but make big profits on each sale they then lower the price of their product and have lots more sales but they make less profit but they still make a large profit due to the amount of sales the other reason that they are so successful is that they offer high quality products and they sell them for the same price and sometimes even lower prices then the competition and have now built up the highest market share they currently have 372 of the mobile phone market share and are the biggest selling mobile phone company in the world

Branding

Nokia phones are seen as being of the highest quality and this is reflected in their massive sales figures The fact that they are seen to be such high quality products is partly down to successful branding they have a highly recognizable packaging style and the style of their handsets is similar in every line of production with the company name printed just above the screen and just below the earpiece The fact that Nokia operate such an aggressive marketing strategy has elevated them above the competition as consumers are fooled into believing that branded products are better then un-branded products or products produced by lesser-known brands such as One Tel and other lesser-known phone producers in the market

Product life cycle-Nokia

Introduction When Nokia phones were first introduced they required a lot of promoting and advertising as they werent established enough to sell based on their quality and what they offer to the consumer so this is where Nokia spent the largest amount of money promoting their products and establishing their brand as a leader in the communications market Also when mobile phones were first available there were only a few companies as well as Nokia in the market (Sony etc) so they could charge higher prices then they can at the present time in the product life cycle because no companies would dare to enter a price war with such a new product

Growth This stage of the life cycle also has high promotion costs involved in it this is due to the fact that mobile phones are becoming established as a consumer necessity and lots of other companies decide to enter the growing market although companies do not need to assure customers that

26

they need a mobile phone Nokia have to assure the customers that they want a Nokia phone and this is where the high promotional costs come from

Maturity In this stage the promotional costs do decrease as the more popular brands such as Nokia and Samsung have gathered the majority of the market share and only have to show customers that they have a new model out and it will sell well as they have been established as a quality brand and customers no-longer need to be persuaded to buy Nokia brand technology

Decline This is the stage that the mobile communications market including Nokia have recently entered (Nokia had reported the first drop in sales in the first quarter of 2002) and companies are now promoting heavily their new MMS products to the market in an attempt to get out of decline and back into growth with a new generation of technologically advanced phones that offer motion picture capture camera technology and the opportunity to watch television on your handset

What I have found out by analyzing SWOT is that Nokias main weaknesses are

1They are currently promoting their products to a market that is verging on saturation-

Nokia need to re-launch some of the older models to a different market and only promote new products to the existing market segment

2 Their wag costs are already high and are always rising-

To solve this they can try and invent or discover machines that can increase productivity so that the number of staff currently employed (The average number of employees in 2002 was 52714 and this was a decrease from 57716 in 2001) 3 High import charges are being implemented by the government-To counter this Nokia need to set up factories in more companies this will have high start up costs but will eventually start to save Nokia money on import and export charges I have also discovered that Nokia have established themselves as one of the most popular mobile communications companies in the market with a total of over 52000 sales in 1997 which was a 34 increase from 1996s sales

There are many external factors that can affect a marketing strategy from developing this is where you must use PEST analysis I have outlined PEST analysis on pages 2 and 3 but have

27

further analyzedthe effect of these external factors on the development of Nokias marketing schemes below

Political factors-

Legal factors such as the G3 technology licensing which has cost companies a total of 110 billion eurorsquos so far are always around to stop Nokia from properly developing strategies and further conquering the communications market Also taxes such as import and export have an affect on Nokias development and these are more-or-less impossible to avoid unless a company can afford to run factories in every country and continent in the world

Environmental Social and ethical factors-

Many companies may view profit as more important then ethical practice and this can lead them to making illegal decisions and this has been a big contribution to many companies going out of business or loosingtheir entire market share to eco-friendly companies

Technological factors-

In the communications market this is probably the most important external factor in affecting a companies development of their marketing strategy as they must always keep up to date with every change within the market if they are to be successful and hold on to their market share ad hopefully gain more

Nokias current marketing strategy has helped them become the biggest selling brand in the communications market to date but now sales are starting to decrease with the saturation of the current market segment so Nokia will need to do one of the following Re-launch their products with an aggressive promotional scheme Target a different segment of the market that has not been entered so Nokia can instantly gain 100 of the market share (although this is risky as the market might not take to their products and the demand might be low so sales will also be low and prices will have to be high and this will further stop people from purchasing Nokias products) Differentiate their products to offer something no other company can offer to the market or simply try and offer a different product altogether such as landline phones or televisions

Market research

28

consumers do not mind paying the extra money for the extra quality they will receive with a well known brand such as Nokia

Place-

Nokia phones are generally sold at all established mobile phone dealerships such as Carphone Warehouse and The Link although they are also sold at other retailers such as Dixons and other electrical suppliers The products are only sold in the electrical suppliers and stores other then dedicated phone dealerships after the introductory period so the phones can remain limited edition as this will encourage younger consumers to buy them

Promotions-

Nokia tend to promote the new technologies and mobile devices they create using one big advertising campaign that focuses on a singular technology instead of each individual handset so they can appeal to a lot of different markets with one campaign

Product-

Nokia phones tend to include all the latest technology and a lot of the consumers favorite aspects such as text messaging and games like Snake and Memory When the phones came out they were big and bulky and quite unattractive but now they are all quite sleek and stylish with phones now getting small enough to fit in the palm of your hand as standard Most of the phones produced nowadays have accessories that consumers must buy with them (carry cases hands free kits and in-car chargers) these generate Nokia a lot of profit as they are very high priced Nokias marketing mix has worked very well until recently as the market they are aiming at has become more and more saturated and after looking at all the mobile phone sales figures it looks as if the phone companies can aim at this same youth market for about another 2 years until they need to change but they should change sooner so they can start making a bigger profit and get a head start on the competition who will also have to change the market they are aiming at Nokias current promotional strategy is working very well as they are able to talk to a large number of consumers in different markets rather then the niche markets the old promotional strategies where restricted to

24

Market segmentation

Market segmentation refers to the different areas of the population that companies can aim their products towards The market segment that Nokia has chosen to aim is the youth market focusing on students aimed 13-19 as market research has shown that some of the youth market are receiving large amounts of pocket money and most have no real commitments to spend it on and that means they have lots of disposable income and will be able to spend a lot money on new mobile phones

As a big company Nokia are able to do a lot of promoting and advertising that smaller less successful companies may not be able to afford such as television advertising and sponsoring lots of events that will be viewed or heard by large amounts of people in their chosen market segment (events such as music festivals and music awards are a goldmine for companies as they are viewed by millions of people worldwide) Adverts such as television and print adverts will be put into certain areas so that they can attract their chosen market segment Nokia tend to put a lot of their print adverts in mens magazines such as FHM and Loaded so they can appeal to all of their readers instead of a smaller percentage of the readers they would attract in magazines such as Lifestyle and Good Housekeeping I think Nokias way of promoting is very good as they can appeal to mass markets and large amounts of people in their chosen market segmentation with certain advertisements and with sponsoring large events like the ones I have previously mentioned Pricing strategy

Nokias current pricing strategy is based on 2 main theories

1 Penetration pricing-

although this strategy is usually for companies that are trying to gain instant market share in a new market companies who are already well known in the market still do it with new products that carry new technologies so they can take more market share form their competitors

2 Competitor based pricing-

this is used when there is a lot of competition in the market and a company is looking to take another companies market share by offering the same or similar products for a lower price this happens a lot in the communications market and this strategy is used by every mobile phone producing company that is still in business

25

Nokias pricing strategy has proven very effective this is down to the fact that they first sell their products for high prices and have very limited sales but make big profits on each sale they then lower the price of their product and have lots more sales but they make less profit but they still make a large profit due to the amount of sales the other reason that they are so successful is that they offer high quality products and they sell them for the same price and sometimes even lower prices then the competition and have now built up the highest market share they currently have 372 of the mobile phone market share and are the biggest selling mobile phone company in the world

Branding

Nokia phones are seen as being of the highest quality and this is reflected in their massive sales figures The fact that they are seen to be such high quality products is partly down to successful branding they have a highly recognizable packaging style and the style of their handsets is similar in every line of production with the company name printed just above the screen and just below the earpiece The fact that Nokia operate such an aggressive marketing strategy has elevated them above the competition as consumers are fooled into believing that branded products are better then un-branded products or products produced by lesser-known brands such as One Tel and other lesser-known phone producers in the market

Product life cycle-Nokia

Introduction When Nokia phones were first introduced they required a lot of promoting and advertising as they werent established enough to sell based on their quality and what they offer to the consumer so this is where Nokia spent the largest amount of money promoting their products and establishing their brand as a leader in the communications market Also when mobile phones were first available there were only a few companies as well as Nokia in the market (Sony etc) so they could charge higher prices then they can at the present time in the product life cycle because no companies would dare to enter a price war with such a new product

Growth This stage of the life cycle also has high promotion costs involved in it this is due to the fact that mobile phones are becoming established as a consumer necessity and lots of other companies decide to enter the growing market although companies do not need to assure customers that

26

they need a mobile phone Nokia have to assure the customers that they want a Nokia phone and this is where the high promotional costs come from

Maturity In this stage the promotional costs do decrease as the more popular brands such as Nokia and Samsung have gathered the majority of the market share and only have to show customers that they have a new model out and it will sell well as they have been established as a quality brand and customers no-longer need to be persuaded to buy Nokia brand technology

Decline This is the stage that the mobile communications market including Nokia have recently entered (Nokia had reported the first drop in sales in the first quarter of 2002) and companies are now promoting heavily their new MMS products to the market in an attempt to get out of decline and back into growth with a new generation of technologically advanced phones that offer motion picture capture camera technology and the opportunity to watch television on your handset

What I have found out by analyzing SWOT is that Nokias main weaknesses are

1They are currently promoting their products to a market that is verging on saturation-

Nokia need to re-launch some of the older models to a different market and only promote new products to the existing market segment

2 Their wag costs are already high and are always rising-

To solve this they can try and invent or discover machines that can increase productivity so that the number of staff currently employed (The average number of employees in 2002 was 52714 and this was a decrease from 57716 in 2001) 3 High import charges are being implemented by the government-To counter this Nokia need to set up factories in more companies this will have high start up costs but will eventually start to save Nokia money on import and export charges I have also discovered that Nokia have established themselves as one of the most popular mobile communications companies in the market with a total of over 52000 sales in 1997 which was a 34 increase from 1996s sales

There are many external factors that can affect a marketing strategy from developing this is where you must use PEST analysis I have outlined PEST analysis on pages 2 and 3 but have

27

further analyzedthe effect of these external factors on the development of Nokias marketing schemes below

Political factors-

Legal factors such as the G3 technology licensing which has cost companies a total of 110 billion eurorsquos so far are always around to stop Nokia from properly developing strategies and further conquering the communications market Also taxes such as import and export have an affect on Nokias development and these are more-or-less impossible to avoid unless a company can afford to run factories in every country and continent in the world

Environmental Social and ethical factors-

Many companies may view profit as more important then ethical practice and this can lead them to making illegal decisions and this has been a big contribution to many companies going out of business or loosingtheir entire market share to eco-friendly companies

Technological factors-

In the communications market this is probably the most important external factor in affecting a companies development of their marketing strategy as they must always keep up to date with every change within the market if they are to be successful and hold on to their market share ad hopefully gain more

Nokias current marketing strategy has helped them become the biggest selling brand in the communications market to date but now sales are starting to decrease with the saturation of the current market segment so Nokia will need to do one of the following Re-launch their products with an aggressive promotional scheme Target a different segment of the market that has not been entered so Nokia can instantly gain 100 of the market share (although this is risky as the market might not take to their products and the demand might be low so sales will also be low and prices will have to be high and this will further stop people from purchasing Nokias products) Differentiate their products to offer something no other company can offer to the market or simply try and offer a different product altogether such as landline phones or televisions

Market research

28

Market segmentation

Market segmentation refers to the different areas of the population that companies can aim their products towards The market segment that Nokia has chosen to aim is the youth market focusing on students aimed 13-19 as market research has shown that some of the youth market are receiving large amounts of pocket money and most have no real commitments to spend it on and that means they have lots of disposable income and will be able to spend a lot money on new mobile phones

As a big company Nokia are able to do a lot of promoting and advertising that smaller less successful companies may not be able to afford such as television advertising and sponsoring lots of events that will be viewed or heard by large amounts of people in their chosen market segment (events such as music festivals and music awards are a goldmine for companies as they are viewed by millions of people worldwide) Adverts such as television and print adverts will be put into certain areas so that they can attract their chosen market segment Nokia tend to put a lot of their print adverts in mens magazines such as FHM and Loaded so they can appeal to all of their readers instead of a smaller percentage of the readers they would attract in magazines such as Lifestyle and Good Housekeeping I think Nokias way of promoting is very good as they can appeal to mass markets and large amounts of people in their chosen market segmentation with certain advertisements and with sponsoring large events like the ones I have previously mentioned Pricing strategy

Nokias current pricing strategy is based on 2 main theories

1 Penetration pricing-

although this strategy is usually for companies that are trying to gain instant market share in a new market companies who are already well known in the market still do it with new products that carry new technologies so they can take more market share form their competitors

2 Competitor based pricing-

this is used when there is a lot of competition in the market and a company is looking to take another companies market share by offering the same or similar products for a lower price this happens a lot in the communications market and this strategy is used by every mobile phone producing company that is still in business

25

Nokias pricing strategy has proven very effective this is down to the fact that they first sell their products for high prices and have very limited sales but make big profits on each sale they then lower the price of their product and have lots more sales but they make less profit but they still make a large profit due to the amount of sales the other reason that they are so successful is that they offer high quality products and they sell them for the same price and sometimes even lower prices then the competition and have now built up the highest market share they currently have 372 of the mobile phone market share and are the biggest selling mobile phone company in the world

Branding

Nokia phones are seen as being of the highest quality and this is reflected in their massive sales figures The fact that they are seen to be such high quality products is partly down to successful branding they have a highly recognizable packaging style and the style of their handsets is similar in every line of production with the company name printed just above the screen and just below the earpiece The fact that Nokia operate such an aggressive marketing strategy has elevated them above the competition as consumers are fooled into believing that branded products are better then un-branded products or products produced by lesser-known brands such as One Tel and other lesser-known phone producers in the market

Product life cycle-Nokia

Introduction When Nokia phones were first introduced they required a lot of promoting and advertising as they werent established enough to sell based on their quality and what they offer to the consumer so this is where Nokia spent the largest amount of money promoting their products and establishing their brand as a leader in the communications market Also when mobile phones were first available there were only a few companies as well as Nokia in the market (Sony etc) so they could charge higher prices then they can at the present time in the product life cycle because no companies would dare to enter a price war with such a new product

Growth This stage of the life cycle also has high promotion costs involved in it this is due to the fact that mobile phones are becoming established as a consumer necessity and lots of other companies decide to enter the growing market although companies do not need to assure customers that

26

they need a mobile phone Nokia have to assure the customers that they want a Nokia phone and this is where the high promotional costs come from

Maturity In this stage the promotional costs do decrease as the more popular brands such as Nokia and Samsung have gathered the majority of the market share and only have to show customers that they have a new model out and it will sell well as they have been established as a quality brand and customers no-longer need to be persuaded to buy Nokia brand technology

Decline This is the stage that the mobile communications market including Nokia have recently entered (Nokia had reported the first drop in sales in the first quarter of 2002) and companies are now promoting heavily their new MMS products to the market in an attempt to get out of decline and back into growth with a new generation of technologically advanced phones that offer motion picture capture camera technology and the opportunity to watch television on your handset

What I have found out by analyzing SWOT is that Nokias main weaknesses are

1They are currently promoting their products to a market that is verging on saturation-

Nokia need to re-launch some of the older models to a different market and only promote new products to the existing market segment

2 Their wag costs are already high and are always rising-

To solve this they can try and invent or discover machines that can increase productivity so that the number of staff currently employed (The average number of employees in 2002 was 52714 and this was a decrease from 57716 in 2001) 3 High import charges are being implemented by the government-To counter this Nokia need to set up factories in more companies this will have high start up costs but will eventually start to save Nokia money on import and export charges I have also discovered that Nokia have established themselves as one of the most popular mobile communications companies in the market with a total of over 52000 sales in 1997 which was a 34 increase from 1996s sales

There are many external factors that can affect a marketing strategy from developing this is where you must use PEST analysis I have outlined PEST analysis on pages 2 and 3 but have

27

further analyzedthe effect of these external factors on the development of Nokias marketing schemes below

Political factors-

Legal factors such as the G3 technology licensing which has cost companies a total of 110 billion eurorsquos so far are always around to stop Nokia from properly developing strategies and further conquering the communications market Also taxes such as import and export have an affect on Nokias development and these are more-or-less impossible to avoid unless a company can afford to run factories in every country and continent in the world

Environmental Social and ethical factors-

Many companies may view profit as more important then ethical practice and this can lead them to making illegal decisions and this has been a big contribution to many companies going out of business or loosingtheir entire market share to eco-friendly companies

Technological factors-

In the communications market this is probably the most important external factor in affecting a companies development of their marketing strategy as they must always keep up to date with every change within the market if they are to be successful and hold on to their market share ad hopefully gain more

Nokias current marketing strategy has helped them become the biggest selling brand in the communications market to date but now sales are starting to decrease with the saturation of the current market segment so Nokia will need to do one of the following Re-launch their products with an aggressive promotional scheme Target a different segment of the market that has not been entered so Nokia can instantly gain 100 of the market share (although this is risky as the market might not take to their products and the demand might be low so sales will also be low and prices will have to be high and this will further stop people from purchasing Nokias products) Differentiate their products to offer something no other company can offer to the market or simply try and offer a different product altogether such as landline phones or televisions

Market research

28

Nokias pricing strategy has proven very effective this is down to the fact that they first sell their products for high prices and have very limited sales but make big profits on each sale they then lower the price of their product and have lots more sales but they make less profit but they still make a large profit due to the amount of sales the other reason that they are so successful is that they offer high quality products and they sell them for the same price and sometimes even lower prices then the competition and have now built up the highest market share they currently have 372 of the mobile phone market share and are the biggest selling mobile phone company in the world

Branding

Nokia phones are seen as being of the highest quality and this is reflected in their massive sales figures The fact that they are seen to be such high quality products is partly down to successful branding they have a highly recognizable packaging style and the style of their handsets is similar in every line of production with the company name printed just above the screen and just below the earpiece The fact that Nokia operate such an aggressive marketing strategy has elevated them above the competition as consumers are fooled into believing that branded products are better then un-branded products or products produced by lesser-known brands such as One Tel and other lesser-known phone producers in the market

Product life cycle-Nokia

Introduction When Nokia phones were first introduced they required a lot of promoting and advertising as they werent established enough to sell based on their quality and what they offer to the consumer so this is where Nokia spent the largest amount of money promoting their products and establishing their brand as a leader in the communications market Also when mobile phones were first available there were only a few companies as well as Nokia in the market (Sony etc) so they could charge higher prices then they can at the present time in the product life cycle because no companies would dare to enter a price war with such a new product

Growth This stage of the life cycle also has high promotion costs involved in it this is due to the fact that mobile phones are becoming established as a consumer necessity and lots of other companies decide to enter the growing market although companies do not need to assure customers that

26

they need a mobile phone Nokia have to assure the customers that they want a Nokia phone and this is where the high promotional costs come from

Maturity In this stage the promotional costs do decrease as the more popular brands such as Nokia and Samsung have gathered the majority of the market share and only have to show customers that they have a new model out and it will sell well as they have been established as a quality brand and customers no-longer need to be persuaded to buy Nokia brand technology

Decline This is the stage that the mobile communications market including Nokia have recently entered (Nokia had reported the first drop in sales in the first quarter of 2002) and companies are now promoting heavily their new MMS products to the market in an attempt to get out of decline and back into growth with a new generation of technologically advanced phones that offer motion picture capture camera technology and the opportunity to watch television on your handset

What I have found out by analyzing SWOT is that Nokias main weaknesses are

1They are currently promoting their products to a market that is verging on saturation-

Nokia need to re-launch some of the older models to a different market and only promote new products to the existing market segment

2 Their wag costs are already high and are always rising-

To solve this they can try and invent or discover machines that can increase productivity so that the number of staff currently employed (The average number of employees in 2002 was 52714 and this was a decrease from 57716 in 2001) 3 High import charges are being implemented by the government-To counter this Nokia need to set up factories in more companies this will have high start up costs but will eventually start to save Nokia money on import and export charges I have also discovered that Nokia have established themselves as one of the most popular mobile communications companies in the market with a total of over 52000 sales in 1997 which was a 34 increase from 1996s sales

There are many external factors that can affect a marketing strategy from developing this is where you must use PEST analysis I have outlined PEST analysis on pages 2 and 3 but have

27

further analyzedthe effect of these external factors on the development of Nokias marketing schemes below

Political factors-

Legal factors such as the G3 technology licensing which has cost companies a total of 110 billion eurorsquos so far are always around to stop Nokia from properly developing strategies and further conquering the communications market Also taxes such as import and export have an affect on Nokias development and these are more-or-less impossible to avoid unless a company can afford to run factories in every country and continent in the world

Environmental Social and ethical factors-

Many companies may view profit as more important then ethical practice and this can lead them to making illegal decisions and this has been a big contribution to many companies going out of business or loosingtheir entire market share to eco-friendly companies

Technological factors-

In the communications market this is probably the most important external factor in affecting a companies development of their marketing strategy as they must always keep up to date with every change within the market if they are to be successful and hold on to their market share ad hopefully gain more

Nokias current marketing strategy has helped them become the biggest selling brand in the communications market to date but now sales are starting to decrease with the saturation of the current market segment so Nokia will need to do one of the following Re-launch their products with an aggressive promotional scheme Target a different segment of the market that has not been entered so Nokia can instantly gain 100 of the market share (although this is risky as the market might not take to their products and the demand might be low so sales will also be low and prices will have to be high and this will further stop people from purchasing Nokias products) Differentiate their products to offer something no other company can offer to the market or simply try and offer a different product altogether such as landline phones or televisions

Market research

28

they need a mobile phone Nokia have to assure the customers that they want a Nokia phone and this is where the high promotional costs come from

Maturity In this stage the promotional costs do decrease as the more popular brands such as Nokia and Samsung have gathered the majority of the market share and only have to show customers that they have a new model out and it will sell well as they have been established as a quality brand and customers no-longer need to be persuaded to buy Nokia brand technology

Decline This is the stage that the mobile communications market including Nokia have recently entered (Nokia had reported the first drop in sales in the first quarter of 2002) and companies are now promoting heavily their new MMS products to the market in an attempt to get out of decline and back into growth with a new generation of technologically advanced phones that offer motion picture capture camera technology and the opportunity to watch television on your handset

What I have found out by analyzing SWOT is that Nokias main weaknesses are

1They are currently promoting their products to a market that is verging on saturation-

Nokia need to re-launch some of the older models to a different market and only promote new products to the existing market segment

2 Their wag costs are already high and are always rising-

To solve this they can try and invent or discover machines that can increase productivity so that the number of staff currently employed (The average number of employees in 2002 was 52714 and this was a decrease from 57716 in 2001) 3 High import charges are being implemented by the government-To counter this Nokia need to set up factories in more companies this will have high start up costs but will eventually start to save Nokia money on import and export charges I have also discovered that Nokia have established themselves as one of the most popular mobile communications companies in the market with a total of over 52000 sales in 1997 which was a 34 increase from 1996s sales

There are many external factors that can affect a marketing strategy from developing this is where you must use PEST analysis I have outlined PEST analysis on pages 2 and 3 but have

27

further analyzedthe effect of these external factors on the development of Nokias marketing schemes below

Political factors-

Legal factors such as the G3 technology licensing which has cost companies a total of 110 billion eurorsquos so far are always around to stop Nokia from properly developing strategies and further conquering the communications market Also taxes such as import and export have an affect on Nokias development and these are more-or-less impossible to avoid unless a company can afford to run factories in every country and continent in the world

Environmental Social and ethical factors-

Many companies may view profit as more important then ethical practice and this can lead them to making illegal decisions and this has been a big contribution to many companies going out of business or loosingtheir entire market share to eco-friendly companies

Technological factors-

In the communications market this is probably the most important external factor in affecting a companies development of their marketing strategy as they must always keep up to date with every change within the market if they are to be successful and hold on to their market share ad hopefully gain more

Nokias current marketing strategy has helped them become the biggest selling brand in the communications market to date but now sales are starting to decrease with the saturation of the current market segment so Nokia will need to do one of the following Re-launch their products with an aggressive promotional scheme Target a different segment of the market that has not been entered so Nokia can instantly gain 100 of the market share (although this is risky as the market might not take to their products and the demand might be low so sales will also be low and prices will have to be high and this will further stop people from purchasing Nokias products) Differentiate their products to offer something no other company can offer to the market or simply try and offer a different product altogether such as landline phones or televisions

Market research

28

further analyzedthe effect of these external factors on the development of Nokias marketing schemes below

Political factors-

Legal factors such as the G3 technology licensing which has cost companies a total of 110 billion eurorsquos so far are always around to stop Nokia from properly developing strategies and further conquering the communications market Also taxes such as import and export have an affect on Nokias development and these are more-or-less impossible to avoid unless a company can afford to run factories in every country and continent in the world

Environmental Social and ethical factors-

Many companies may view profit as more important then ethical practice and this can lead them to making illegal decisions and this has been a big contribution to many companies going out of business or loosingtheir entire market share to eco-friendly companies

Technological factors-

In the communications market this is probably the most important external factor in affecting a companies development of their marketing strategy as they must always keep up to date with every change within the market if they are to be successful and hold on to their market share ad hopefully gain more

Nokias current marketing strategy has helped them become the biggest selling brand in the communications market to date but now sales are starting to decrease with the saturation of the current market segment so Nokia will need to do one of the following Re-launch their products with an aggressive promotional scheme Target a different segment of the market that has not been entered so Nokia can instantly gain 100 of the market share (although this is risky as the market might not take to their products and the demand might be low so sales will also be low and prices will have to be high and this will further stop people from purchasing Nokias products) Differentiate their products to offer something no other company can offer to the market or simply try and offer a different product altogether such as landline phones or televisions

Market research

28

Nokias business strategy

Our business objective is to strengthen our position as a leading communications systems and products provider Our strategic intent as the trusted brand is to create personalized communication technology that enables people to shape their own mobile world

Nokia are currently creating innovative technology to allow people to access Internet applications devices and services instantly irrespective of time or place Achieving interoperability of network environments terminals and mobile services is a key part of our intent

Nokia need to capitalize on our leadership role by continuing to target and enter segments of the communications market that we believe will experience rapid growth or grow faster then the industry as a whole

By expanding into these segments during the initial stages of their development Nokia have established themselves as one of the worlds leading players in wireless communications and significantly influenced the way in which voice and other services have been transferred to a wireless mobile environment

As demand for wireless access to an increasing range of services accelerates Nokia are planning to lead the development and commercialization of the higher capacity networks and systems required to make wireless content more accessible and rewarding to the end user In the process we plan to offer our customers unprecedented choice speed and value

Nokia has a history of contributing to the development of new technologies products and systems for mobile communications Recent examples include the commitment to the open mobile alliance the co-development of the new operating system for the future terminals with sambaing short-range wireless connectivity with Bluetooth the development of wireless LANs for enabling local mobility in fixed LANs and MMS for enabling mobile multimedia messaging

In addition Nokia have continued to be active in IP convergence They have established alliances with other service providers in order to make mobile access services easier for the end user

29

Research and development

In 2002 Nokia continued to invest in its worldwide research and development network and co-operation At year-end Nokia had 19 579 RampD employees approximately 38 of Nokias total personnel Nokia has RampD centers in 14 countries Investments in RampD increased by 2 (16 in 2001) and totaled EUR 3 052 million (EUR 2 985 million in 2001) representing 102 of net sales (96 of net sales in 2001)

People

The average number of personnel for 2002 was 52 714 (57 716 for 2001) At the end of 2002 Nokia employed 51 748 people worldwide (53 849 at year-end 2001) In 2002 Nokias personnel decreased by a total of 2 101 employees (decrease of 6 440 in 2001)

Employee Value Proposition-

In a move to further attract and retain a skilled workforce this year Nokia developed an employee value proposition framework The adaptation of this has already started at country levels to reflect and respond to local employee needs and expectations The four fundamentals of the proposition are

(1) the Nokia Way and Values

(2) performance-based rewarding

(3) professional and personal growth and

(4) work-life balance

Dividend

Nokias Board of Directors will propose a dividend of EUR 028 per share in respect of 2002

Revised marketing strategy

As Nokias current sales figures are decreasing and they show no sign of increasing again

30

In the near future I have come up with a revised marketing strategy that will re-launch Nokia and its products and increase sales to what they have been in the past and probably higher then they have been since they were first released

Marketing mix

Product-

The phones will continue to be of a high quality but will not be as technologically advanced as the recent phones that have been released The phones will be easier to use and carry the less advanced technology with WAP being the most advanced feature available in the new range of phones that will be released as my market research showed that most of the people aged 40+ were technophobes or wanted mobile technology to be easier to use if they were going to purchase a mobile phone

Price-

If the technology released with the phones is not as advanced the price does not need to be as high as the prices of the phones in the market at the moment as less money is being spent on product development and the phones wont cost as much to produce there is no need to keep the prices so high I have decided to lower the price due to production costs and it is also down to the fact that nearly all of the people who I intend to have set as the new target market (the 40+ market) said that phones cost to much and so did call rates but if phones were a lot cheaper (around pound125 per phone on pay as you go and free if a contract method of payment is selected)

Place-

Nokia phones will continue to be sold at the main communications outlets (Carphone warehouse and The link) but will also be sold at the three main supermarkets Sainsburys Safeways and Tesco as my market research has shown that this where my new target market do the majority of their food shopping at these outlets it would be an excellent place to sell phones as there is also no competition distributing their products in these locations and Nokia could have 100 of the shoppers business and it would also be a way of promoting Nokia for free as people will look at almost anything while waiting in supermarket queues

Promotion-

31

As Nokia would be aiming their new line of mobile phones at a completely new market there would be high promotion costs involved as there is at the introduction stage of any product life cycle The best places to put print advertisements would be in supermarkets near the tills so people in the queue can read them and hopefully become interested in buying a Nokia brand mobile phone Also print adverts should be placed in magazines and newspapers where the target market will see them my market research showed that the most read magazines by people aged 40+ was Lifestyle and Vogue for the women and the most read by men was the observer magazine as not many men admitted to buying a magazine regularly The most popular newspapers were The Observer and The Guardian on weekends and the Evening standard during the week so it is obvious that these are the magazines and newspapers that adverts should be placed in as they would be seen more by the new target market Because we do not want to cancel out any people outside our target market (avoiding a niche market) Nokia should continue to place poster adverts in places that will be viewed by a massive selection of people (such as Londons West End and other popular shopping centers)

Marketing principles

Any marketing scheme that has been developed must be based around the principles of marketing and my revised Nokia strategy is no different below I have analyzed how I have followed each marketing

principle

Customer satisfaction-

Before developing my strategy I had to found out exactly what the consumers wanted I found out that they wanted phones that were high quality (with long battery life good reception and good SMS features) low priced (priced lower then pound150 but could be higher if call charges dropped) and I have offered this in the new line of phones that are being specially developed to meet the needs of the 40+ market (simpler technology)

Customer perception-

I had found out that Nokia was viewed as the highest quality brand name in mobile communications and it was also the most trusted brand 8 out of 10 people said that they would look for a Nokia phone that they liked before they would look at another brand Nokias prices were considered a bit expensive and this was partly why I have decided to decrease the prices of the new range of phones although people said they didnt mind paying the extra money for the quality they think they will receive with a branded item

32

Customer needs and expectations-

This is where you companies need to anticipate future trends and forecast for future sales In my market mobile phones are not considered a necessity yet so it is hard to anticipate future trends as no company has yet created a foothold in the market and the customers cant say what they would like to see in future products if they do not have any at the moment so a good thing to do would be to create a feedback group with some prototype phones and see what changes they would like Nokia to make to them

Generating income or profit-

This is the reason why I had to review Nokias current strategy the sales were starting to decrease and this was starting to reflect in the income and profits and decreases in these will not satisfy the main stakeholders in Nokia

Making satisfactory progress-

If a product is developing with the market then they are fulfilling this marketing principle Nokia are actually achieving this with their current marketing scheme but they are spending huge amounts of money on product development and the sales are not currently reflecting well on the decisions to spend that amount of money on product development

Awareness of the surrounding environment-

This is the reason ever company must complete market research from my research I know what the customers want where they shop what they watch on television what radio stationsprograms they listen to what the average income is and what features people rate highest in phone technology

There are also many external factors that can affect your marketing style and the decision of which strategy to use we can evaluate these using PEST

Political factors-

Legal constraints are the hardest external factor to try and avoid making any serious impact on any pricing or marketing choices made The only legal constraint that my new strategy dodges is the G3 licensing as the new style of Nokia product doesnt need any of the newest technologies under the G3 frame

33

Environmental and Social factors-

Nokia have never really had any of these affect the way in which they operate because they have never done anything that is really anti-environmental the only problem is the fact that the mobile phones let of radiation and has been said to increase the risk of cancer in mobile phone users but this has not been highly documented and hasnt affected how Nokia have conducted themselves

Technological factors-

This is the most important external factor in the communications as mobile phones are based around technology and new discoveries The new strategy does have to be careful with technological advances as Nokia do not want to make the new phones to complicate as my market research discovered that this is exactly what the target market does not want they want phones that are simpler to use

Pricing strategy

As Nokia will be entering a new market as part of the new market strategy I have decided to change the current pricing plan to a mixture of two theoretical pricing approaches

Market skimming and demand based pricing- Market skimming is where the competition in a market is slim or non-existent and a company can charge what ever price they want because there is no other company to offer a lower one As Nokia will be entering a new market we will be able to choose whatever price we want to start selling mobile phones at and I think they should first be introduced at around pound150 as my market research showed that consumers in the new target market would be hesitant to pay any higher and this is the part that relates to demand based pricing

Market segmentation

The market segment the Nokia was previously aiming at had become saturated my research showed that 100 of students already owned a mobile phone and where not about too buy another one in the near future Due to the fact that this youth market is saturated I analyzed the Ansoffs and Boston matrixes and decided to undertake in market penetration The new market that I am aiming Nokias products is the middle aged people because my research showed that very few middle aged people owned mobile phones and could be persuaded to buy a phone if the product was what they wanted and the price was right and of those people who said that that didnt want a phone most of them said they could be persuaded by strong advertising and

34

branding

Evaluation

My revised strategy has a lot of advantages over Nokias previous strategy and I have listed them below

middot My target market is one that has never been entered before so Nokia will instantly gain 100 market share whereas the current target market is saturated and competition for market share is very strong

middot The products that are being released do not need to be as technically advanced as the ones in the current market because my market research showed that the 40+ market do not want phones that are to complicated and hard to use

middot If product research and development is not needed as much anymore then Nokia can afford to decrease its employment numbers and this would save Nokia a lot of money every year

middot When entering a new market with no competition a company can charge whatever prices they want Nokias prices can be higher then they currently are and this will increase income and profitability

35

• Nokia Brand Positioning
• Dominating the Mobile Phone Market
• The Nokia Brand
• The Use Of Brand Name As A Strategy For Gaining Competitive Advantage
• Marketing Strategy For Nokia

Research and development

In 2002 Nokia continued to invest in its worldwide research and development network and co-operation At year-end Nokia had 19 579 RampD employees approximately 38 of Nokias total personnel Nokia has RampD centers in 14 countries Investments in RampD increased by 2 (16 in 2001) and totaled EUR 3 052 million (EUR 2 985 million in 2001) representing 102 of net sales (96 of net sales in 2001)

People

The average number of personnel for 2002 was 52 714 (57 716 for 2001) At the end of 2002 Nokia employed 51 748 people worldwide (53 849 at year-end 2001) In 2002 Nokias personnel decreased by a total of 2 101 employees (decrease of 6 440 in 2001)

Employee Value Proposition-

In a move to further attract and retain a skilled workforce this year Nokia developed an employee value proposition framework The adaptation of this has already started at country levels to reflect and respond to local employee needs and expectations The four fundamentals of the proposition are

(1) the Nokia Way and Values

(2) performance-based rewarding

(3) professional and personal growth and

(4) work-life balance

Dividend

Nokias Board of Directors will propose a dividend of EUR 028 per share in respect of 2002

Revised marketing strategy

As Nokias current sales figures are decreasing and they show no sign of increasing again

30

In the near future I have come up with a revised marketing strategy that will re-launch Nokia and its products and increase sales to what they have been in the past and probably higher then they have been since they were first released

Marketing mix

Product-

The phones will continue to be of a high quality but will not be as technologically advanced as the recent phones that have been released The phones will be easier to use and carry the less advanced technology with WAP being the most advanced feature available in the new range of phones that will be released as my market research showed that most of the people aged 40+ were technophobes or wanted mobile technology to be easier to use if they were going to purchase a mobile phone

Price-

If the technology released with the phones is not as advanced the price does not need to be as high as the prices of the phones in the market at the moment as less money is being spent on product development and the phones wont cost as much to produce there is no need to keep the prices so high I have decided to lower the price due to production costs and it is also down to the fact that nearly all of the people who I intend to have set as the new target market (the 40+ market) said that phones cost to much and so did call rates but if phones were a lot cheaper (around pound125 per phone on pay as you go and free if a contract method of payment is selected)

Place-

Nokia phones will continue to be sold at the main communications outlets (Carphone warehouse and The link) but will also be sold at the three main supermarkets Sainsburys Safeways and Tesco as my market research has shown that this where my new target market do the majority of their food shopping at these outlets it would be an excellent place to sell phones as there is also no competition distributing their products in these locations and Nokia could have 100 of the shoppers business and it would also be a way of promoting Nokia for free as people will look at almost anything while waiting in supermarket queues

Promotion-

31

As Nokia would be aiming their new line of mobile phones at a completely new market there would be high promotion costs involved as there is at the introduction stage of any product life cycle The best places to put print advertisements would be in supermarkets near the tills so people in the queue can read them and hopefully become interested in buying a Nokia brand mobile phone Also print adverts should be placed in magazines and newspapers where the target market will see them my market research showed that the most read magazines by people aged 40+ was Lifestyle and Vogue for the women and the most read by men was the observer magazine as not many men admitted to buying a magazine regularly The most popular newspapers were The Observer and The Guardian on weekends and the Evening standard during the week so it is obvious that these are the magazines and newspapers that adverts should be placed in as they would be seen more by the new target market Because we do not want to cancel out any people outside our target market (avoiding a niche market) Nokia should continue to place poster adverts in places that will be viewed by a massive selection of people (such as Londons West End and other popular shopping centers)

Marketing principles

Any marketing scheme that has been developed must be based around the principles of marketing and my revised Nokia strategy is no different below I have analyzed how I have followed each marketing

principle

Customer satisfaction-

Before developing my strategy I had to found out exactly what the consumers wanted I found out that they wanted phones that were high quality (with long battery life good reception and good SMS features) low priced (priced lower then pound150 but could be higher if call charges dropped) and I have offered this in the new line of phones that are being specially developed to meet the needs of the 40+ market (simpler technology)

Customer perception-

I had found out that Nokia was viewed as the highest quality brand name in mobile communications and it was also the most trusted brand 8 out of 10 people said that they would look for a Nokia phone that they liked before they would look at another brand Nokias prices were considered a bit expensive and this was partly why I have decided to decrease the prices of the new range of phones although people said they didnt mind paying the extra money for the quality they think they will receive with a branded item

32

Customer needs and expectations-

This is where you companies need to anticipate future trends and forecast for future sales In my market mobile phones are not considered a necessity yet so it is hard to anticipate future trends as no company has yet created a foothold in the market and the customers cant say what they would like to see in future products if they do not have any at the moment so a good thing to do would be to create a feedback group with some prototype phones and see what changes they would like Nokia to make to them

Generating income or profit-

This is the reason why I had to review Nokias current strategy the sales were starting to decrease and this was starting to reflect in the income and profits and decreases in these will not satisfy the main stakeholders in Nokia

Making satisfactory progress-

If a product is developing with the market then they are fulfilling this marketing principle Nokia are actually achieving this with their current marketing scheme but they are spending huge amounts of money on product development and the sales are not currently reflecting well on the decisions to spend that amount of money on product development

Awareness of the surrounding environment-

This is the reason ever company must complete market research from my research I know what the customers want where they shop what they watch on television what radio stationsprograms they listen to what the average income is and what features people rate highest in phone technology

There are also many external factors that can affect your marketing style and the decision of which strategy to use we can evaluate these using PEST

Political factors-

Legal constraints are the hardest external factor to try and avoid making any serious impact on any pricing or marketing choices made The only legal constraint that my new strategy dodges is the G3 licensing as the new style of Nokia product doesnt need any of the newest technologies under the G3 frame

33

Environmental and Social factors-

Nokia have never really had any of these affect the way in which they operate because they have never done anything that is really anti-environmental the only problem is the fact that the mobile phones let of radiation and has been said to increase the risk of cancer in mobile phone users but this has not been highly documented and hasnt affected how Nokia have conducted themselves

Technological factors-

This is the most important external factor in the communications as mobile phones are based around technology and new discoveries The new strategy does have to be careful with technological advances as Nokia do not want to make the new phones to complicate as my market research discovered that this is exactly what the target market does not want they want phones that are simpler to use

Pricing strategy

As Nokia will be entering a new market as part of the new market strategy I have decided to change the current pricing plan to a mixture of two theoretical pricing approaches

Market skimming and demand based pricing- Market skimming is where the competition in a market is slim or non-existent and a company can charge what ever price they want because there is no other company to offer a lower one As Nokia will be entering a new market we will be able to choose whatever price we want to start selling mobile phones at and I think they should first be introduced at around pound150 as my market research showed that consumers in the new target market would be hesitant to pay any higher and this is the part that relates to demand based pricing

Market segmentation

The market segment the Nokia was previously aiming at had become saturated my research showed that 100 of students already owned a mobile phone and where not about too buy another one in the near future Due to the fact that this youth market is saturated I analyzed the Ansoffs and Boston matrixes and decided to undertake in market penetration The new market that I am aiming Nokias products is the middle aged people because my research showed that very few middle aged people owned mobile phones and could be persuaded to buy a phone if the product was what they wanted and the price was right and of those people who said that that didnt want a phone most of them said they could be persuaded by strong advertising and

34

branding

Evaluation

My revised strategy has a lot of advantages over Nokias previous strategy and I have listed them below

middot My target market is one that has never been entered before so Nokia will instantly gain 100 market share whereas the current target market is saturated and competition for market share is very strong

middot The products that are being released do not need to be as technically advanced as the ones in the current market because my market research showed that the 40+ market do not want phones that are to complicated and hard to use

middot If product research and development is not needed as much anymore then Nokia can afford to decrease its employment numbers and this would save Nokia a lot of money every year

middot When entering a new market with no competition a company can charge whatever prices they want Nokias prices can be higher then they currently are and this will increase income and profitability

35

• Nokia Brand Positioning
• Dominating the Mobile Phone Market
• The Nokia Brand
• The Use Of Brand Name As A Strategy For Gaining Competitive Advantage
• Marketing Strategy For Nokia

In the near future I have come up with a revised marketing strategy that will re-launch Nokia and its products and increase sales to what they have been in the past and probably higher then they have been since they were first released

Marketing mix

Product-

The phones will continue to be of a high quality but will not be as technologically advanced as the recent phones that have been released The phones will be easier to use and carry the less advanced technology with WAP being the most advanced feature available in the new range of phones that will be released as my market research showed that most of the people aged 40+ were technophobes or wanted mobile technology to be easier to use if they were going to purchase a mobile phone

Price-

If the technology released with the phones is not as advanced the price does not need to be as high as the prices of the phones in the market at the moment as less money is being spent on product development and the phones wont cost as much to produce there is no need to keep the prices so high I have decided to lower the price due to production costs and it is also down to the fact that nearly all of the people who I intend to have set as the new target market (the 40+ market) said that phones cost to much and so did call rates but if phones were a lot cheaper (around pound125 per phone on pay as you go and free if a contract method of payment is selected)

Place-

Nokia phones will continue to be sold at the main communications outlets (Carphone warehouse and The link) but will also be sold at the three main supermarkets Sainsburys Safeways and Tesco as my market research has shown that this where my new target market do the majority of their food shopping at these outlets it would be an excellent place to sell phones as there is also no competition distributing their products in these locations and Nokia could have 100 of the shoppers business and it would also be a way of promoting Nokia for free as people will look at almost anything while waiting in supermarket queues

Promotion-

31

As Nokia would be aiming their new line of mobile phones at a completely new market there would be high promotion costs involved as there is at the introduction stage of any product life cycle The best places to put print advertisements would be in supermarkets near the tills so people in the queue can read them and hopefully become interested in buying a Nokia brand mobile phone Also print adverts should be placed in magazines and newspapers where the target market will see them my market research showed that the most read magazines by people aged 40+ was Lifestyle and Vogue for the women and the most read by men was the observer magazine as not many men admitted to buying a magazine regularly The most popular newspapers were The Observer and The Guardian on weekends and the Evening standard during the week so it is obvious that these are the magazines and newspapers that adverts should be placed in as they would be seen more by the new target market Because we do not want to cancel out any people outside our target market (avoiding a niche market) Nokia should continue to place poster adverts in places that will be viewed by a massive selection of people (such as Londons West End and other popular shopping centers)

Marketing principles

Any marketing scheme that has been developed must be based around the principles of marketing and my revised Nokia strategy is no different below I have analyzed how I have followed each marketing

principle

Customer satisfaction-

Before developing my strategy I had to found out exactly what the consumers wanted I found out that they wanted phones that were high quality (with long battery life good reception and good SMS features) low priced (priced lower then pound150 but could be higher if call charges dropped) and I have offered this in the new line of phones that are being specially developed to meet the needs of the 40+ market (simpler technology)

Customer perception-

I had found out that Nokia was viewed as the highest quality brand name in mobile communications and it was also the most trusted brand 8 out of 10 people said that they would look for a Nokia phone that they liked before they would look at another brand Nokias prices were considered a bit expensive and this was partly why I have decided to decrease the prices of the new range of phones although people said they didnt mind paying the extra money for the quality they think they will receive with a branded item

32

Customer needs and expectations-

This is where you companies need to anticipate future trends and forecast for future sales In my market mobile phones are not considered a necessity yet so it is hard to anticipate future trends as no company has yet created a foothold in the market and the customers cant say what they would like to see in future products if they do not have any at the moment so a good thing to do would be to create a feedback group with some prototype phones and see what changes they would like Nokia to make to them

Generating income or profit-

This is the reason why I had to review Nokias current strategy the sales were starting to decrease and this was starting to reflect in the income and profits and decreases in these will not satisfy the main stakeholders in Nokia

Making satisfactory progress-

If a product is developing with the market then they are fulfilling this marketing principle Nokia are actually achieving this with their current marketing scheme but they are spending huge amounts of money on product development and the sales are not currently reflecting well on the decisions to spend that amount of money on product development

Awareness of the surrounding environment-

This is the reason ever company must complete market research from my research I know what the customers want where they shop what they watch on television what radio stationsprograms they listen to what the average income is and what features people rate highest in phone technology

There are also many external factors that can affect your marketing style and the decision of which strategy to use we can evaluate these using PEST

Political factors-

Legal constraints are the hardest external factor to try and avoid making any serious impact on any pricing or marketing choices made The only legal constraint that my new strategy dodges is the G3 licensing as the new style of Nokia product doesnt need any of the newest technologies under the G3 frame

33

Environmental and Social factors-

Nokia have never really had any of these affect the way in which they operate because they have never done anything that is really anti-environmental the only problem is the fact that the mobile phones let of radiation and has been said to increase the risk of cancer in mobile phone users but this has not been highly documented and hasnt affected how Nokia have conducted themselves

Technological factors-

This is the most important external factor in the communications as mobile phones are based around technology and new discoveries The new strategy does have to be careful with technological advances as Nokia do not want to make the new phones to complicate as my market research discovered that this is exactly what the target market does not want they want phones that are simpler to use

Pricing strategy

As Nokia will be entering a new market as part of the new market strategy I have decided to change the current pricing plan to a mixture of two theoretical pricing approaches

Market skimming and demand based pricing- Market skimming is where the competition in a market is slim or non-existent and a company can charge what ever price they want because there is no other company to offer a lower one As Nokia will be entering a new market we will be able to choose whatever price we want to start selling mobile phones at and I think they should first be introduced at around pound150 as my market research showed that consumers in the new target market would be hesitant to pay any higher and this is the part that relates to demand based pricing

Market segmentation

The market segment the Nokia was previously aiming at had become saturated my research showed that 100 of students already owned a mobile phone and where not about too buy another one in the near future Due to the fact that this youth market is saturated I analyzed the Ansoffs and Boston matrixes and decided to undertake in market penetration The new market that I am aiming Nokias products is the middle aged people because my research showed that very few middle aged people owned mobile phones and could be persuaded to buy a phone if the product was what they wanted and the price was right and of those people who said that that didnt want a phone most of them said they could be persuaded by strong advertising and

34

branding

Evaluation

My revised strategy has a lot of advantages over Nokias previous strategy and I have listed them below

middot My target market is one that has never been entered before so Nokia will instantly gain 100 market share whereas the current target market is saturated and competition for market share is very strong

middot The products that are being released do not need to be as technically advanced as the ones in the current market because my market research showed that the 40+ market do not want phones that are to complicated and hard to use

middot If product research and development is not needed as much anymore then Nokia can afford to decrease its employment numbers and this would save Nokia a lot of money every year

middot When entering a new market with no competition a company can charge whatever prices they want Nokias prices can be higher then they currently are and this will increase income and profitability

35

• Nokia Brand Positioning
• Dominating the Mobile Phone Market
• The Nokia Brand
• The Use Of Brand Name As A Strategy For Gaining Competitive Advantage
• Marketing Strategy For Nokia

As Nokia would be aiming their new line of mobile phones at a completely new market there would be high promotion costs involved as there is at the introduction stage of any product life cycle The best places to put print advertisements would be in supermarkets near the tills so people in the queue can read them and hopefully become interested in buying a Nokia brand mobile phone Also print adverts should be placed in magazines and newspapers where the target market will see them my market research showed that the most read magazines by people aged 40+ was Lifestyle and Vogue for the women and the most read by men was the observer magazine as not many men admitted to buying a magazine regularly The most popular newspapers were The Observer and The Guardian on weekends and the Evening standard during the week so it is obvious that these are the magazines and newspapers that adverts should be placed in as they would be seen more by the new target market Because we do not want to cancel out any people outside our target market (avoiding a niche market) Nokia should continue to place poster adverts in places that will be viewed by a massive selection of people (such as Londons West End and other popular shopping centers)

Marketing principles

Any marketing scheme that has been developed must be based around the principles of marketing and my revised Nokia strategy is no different below I have analyzed how I have followed each marketing

principle

Customer satisfaction-

Before developing my strategy I had to found out exactly what the consumers wanted I found out that they wanted phones that were high quality (with long battery life good reception and good SMS features) low priced (priced lower then pound150 but could be higher if call charges dropped) and I have offered this in the new line of phones that are being specially developed to meet the needs of the 40+ market (simpler technology)

Customer perception-

I had found out that Nokia was viewed as the highest quality brand name in mobile communications and it was also the most trusted brand 8 out of 10 people said that they would look for a Nokia phone that they liked before they would look at another brand Nokias prices were considered a bit expensive and this was partly why I have decided to decrease the prices of the new range of phones although people said they didnt mind paying the extra money for the quality they think they will receive with a branded item

32

Customer needs and expectations-

This is where you companies need to anticipate future trends and forecast for future sales In my market mobile phones are not considered a necessity yet so it is hard to anticipate future trends as no company has yet created a foothold in the market and the customers cant say what they would like to see in future products if they do not have any at the moment so a good thing to do would be to create a feedback group with some prototype phones and see what changes they would like Nokia to make to them

Generating income or profit-

This is the reason why I had to review Nokias current strategy the sales were starting to decrease and this was starting to reflect in the income and profits and decreases in these will not satisfy the main stakeholders in Nokia

Making satisfactory progress-

If a product is developing with the market then they are fulfilling this marketing principle Nokia are actually achieving this with their current marketing scheme but they are spending huge amounts of money on product development and the sales are not currently reflecting well on the decisions to spend that amount of money on product development

Awareness of the surrounding environment-

This is the reason ever company must complete market research from my research I know what the customers want where they shop what they watch on television what radio stationsprograms they listen to what the average income is and what features people rate highest in phone technology

There are also many external factors that can affect your marketing style and the decision of which strategy to use we can evaluate these using PEST

Political factors-

Legal constraints are the hardest external factor to try and avoid making any serious impact on any pricing or marketing choices made The only legal constraint that my new strategy dodges is the G3 licensing as the new style of Nokia product doesnt need any of the newest technologies under the G3 frame

33

Environmental and Social factors-

Nokia have never really had any of these affect the way in which they operate because they have never done anything that is really anti-environmental the only problem is the fact that the mobile phones let of radiation and has been said to increase the risk of cancer in mobile phone users but this has not been highly documented and hasnt affected how Nokia have conducted themselves

Technological factors-

This is the most important external factor in the communications as mobile phones are based around technology and new discoveries The new strategy does have to be careful with technological advances as Nokia do not want to make the new phones to complicate as my market research discovered that this is exactly what the target market does not want they want phones that are simpler to use

Pricing strategy

As Nokia will be entering a new market as part of the new market strategy I have decided to change the current pricing plan to a mixture of two theoretical pricing approaches

Market skimming and demand based pricing- Market skimming is where the competition in a market is slim or non-existent and a company can charge what ever price they want because there is no other company to offer a lower one As Nokia will be entering a new market we will be able to choose whatever price we want to start selling mobile phones at and I think they should first be introduced at around pound150 as my market research showed that consumers in the new target market would be hesitant to pay any higher and this is the part that relates to demand based pricing

Market segmentation

The market segment the Nokia was previously aiming at had become saturated my research showed that 100 of students already owned a mobile phone and where not about too buy another one in the near future Due to the fact that this youth market is saturated I analyzed the Ansoffs and Boston matrixes and decided to undertake in market penetration The new market that I am aiming Nokias products is the middle aged people because my research showed that very few middle aged people owned mobile phones and could be persuaded to buy a phone if the product was what they wanted and the price was right and of those people who said that that didnt want a phone most of them said they could be persuaded by strong advertising and

34

branding

Evaluation

My revised strategy has a lot of advantages over Nokias previous strategy and I have listed them below

middot My target market is one that has never been entered before so Nokia will instantly gain 100 market share whereas the current target market is saturated and competition for market share is very strong

middot The products that are being released do not need to be as technically advanced as the ones in the current market because my market research showed that the 40+ market do not want phones that are to complicated and hard to use

middot If product research and development is not needed as much anymore then Nokia can afford to decrease its employment numbers and this would save Nokia a lot of money every year

middot When entering a new market with no competition a company can charge whatever prices they want Nokias prices can be higher then they currently are and this will increase income and profitability

35

• Nokia Brand Positioning
• Dominating the Mobile Phone Market
• The Nokia Brand
• The Use Of Brand Name As A Strategy For Gaining Competitive Advantage
• Marketing Strategy For Nokia

Customer needs and expectations-

This is where you companies need to anticipate future trends and forecast for future sales In my market mobile phones are not considered a necessity yet so it is hard to anticipate future trends as no company has yet created a foothold in the market and the customers cant say what they would like to see in future products if they do not have any at the moment so a good thing to do would be to create a feedback group with some prototype phones and see what changes they would like Nokia to make to them

Generating income or profit-

This is the reason why I had to review Nokias current strategy the sales were starting to decrease and this was starting to reflect in the income and profits and decreases in these will not satisfy the main stakeholders in Nokia

Making satisfactory progress-

If a product is developing with the market then they are fulfilling this marketing principle Nokia are actually achieving this with their current marketing scheme but they are spending huge amounts of money on product development and the sales are not currently reflecting well on the decisions to spend that amount of money on product development

Awareness of the surrounding environment-

This is the reason ever company must complete market research from my research I know what the customers want where they shop what they watch on television what radio stationsprograms they listen to what the average income is and what features people rate highest in phone technology

There are also many external factors that can affect your marketing style and the decision of which strategy to use we can evaluate these using PEST

Political factors-

Legal constraints are the hardest external factor to try and avoid making any serious impact on any pricing or marketing choices made The only legal constraint that my new strategy dodges is the G3 licensing as the new style of Nokia product doesnt need any of the newest technologies under the G3 frame

33

Environmental and Social factors-

Nokia have never really had any of these affect the way in which they operate because they have never done anything that is really anti-environmental the only problem is the fact that the mobile phones let of radiation and has been said to increase the risk of cancer in mobile phone users but this has not been highly documented and hasnt affected how Nokia have conducted themselves

Technological factors-

This is the most important external factor in the communications as mobile phones are based around technology and new discoveries The new strategy does have to be careful with technological advances as Nokia do not want to make the new phones to complicate as my market research discovered that this is exactly what the target market does not want they want phones that are simpler to use

Pricing strategy

As Nokia will be entering a new market as part of the new market strategy I have decided to change the current pricing plan to a mixture of two theoretical pricing approaches

Market skimming and demand based pricing- Market skimming is where the competition in a market is slim or non-existent and a company can charge what ever price they want because there is no other company to offer a lower one As Nokia will be entering a new market we will be able to choose whatever price we want to start selling mobile phones at and I think they should first be introduced at around pound150 as my market research showed that consumers in the new target market would be hesitant to pay any higher and this is the part that relates to demand based pricing

Market segmentation

The market segment the Nokia was previously aiming at had become saturated my research showed that 100 of students already owned a mobile phone and where not about too buy another one in the near future Due to the fact that this youth market is saturated I analyzed the Ansoffs and Boston matrixes and decided to undertake in market penetration The new market that I am aiming Nokias products is the middle aged people because my research showed that very few middle aged people owned mobile phones and could be persuaded to buy a phone if the product was what they wanted and the price was right and of those people who said that that didnt want a phone most of them said they could be persuaded by strong advertising and

34

branding

Evaluation

My revised strategy has a lot of advantages over Nokias previous strategy and I have listed them below

middot My target market is one that has never been entered before so Nokia will instantly gain 100 market share whereas the current target market is saturated and competition for market share is very strong

middot The products that are being released do not need to be as technically advanced as the ones in the current market because my market research showed that the 40+ market do not want phones that are to complicated and hard to use

middot If product research and development is not needed as much anymore then Nokia can afford to decrease its employment numbers and this would save Nokia a lot of money every year

middot When entering a new market with no competition a company can charge whatever prices they want Nokias prices can be higher then they currently are and this will increase income and profitability

35

• Nokia Brand Positioning
• Dominating the Mobile Phone Market
• The Nokia Brand
• The Use Of Brand Name As A Strategy For Gaining Competitive Advantage
• Marketing Strategy For Nokia

Environmental and Social factors-

Nokia have never really had any of these affect the way in which they operate because they have never done anything that is really anti-environmental the only problem is the fact that the mobile phones let of radiation and has been said to increase the risk of cancer in mobile phone users but this has not been highly documented and hasnt affected how Nokia have conducted themselves

Technological factors-

This is the most important external factor in the communications as mobile phones are based around technology and new discoveries The new strategy does have to be careful with technological advances as Nokia do not want to make the new phones to complicate as my market research discovered that this is exactly what the target market does not want they want phones that are simpler to use

Pricing strategy

As Nokia will be entering a new market as part of the new market strategy I have decided to change the current pricing plan to a mixture of two theoretical pricing approaches

Market skimming and demand based pricing- Market skimming is where the competition in a market is slim or non-existent and a company can charge what ever price they want because there is no other company to offer a lower one As Nokia will be entering a new market we will be able to choose whatever price we want to start selling mobile phones at and I think they should first be introduced at around pound150 as my market research showed that consumers in the new target market would be hesitant to pay any higher and this is the part that relates to demand based pricing

Market segmentation

The market segment the Nokia was previously aiming at had become saturated my research showed that 100 of students already owned a mobile phone and where not about too buy another one in the near future Due to the fact that this youth market is saturated I analyzed the Ansoffs and Boston matrixes and decided to undertake in market penetration The new market that I am aiming Nokias products is the middle aged people because my research showed that very few middle aged people owned mobile phones and could be persuaded to buy a phone if the product was what they wanted and the price was right and of those people who said that that didnt want a phone most of them said they could be persuaded by strong advertising and

34

branding

Evaluation

My revised strategy has a lot of advantages over Nokias previous strategy and I have listed them below

middot My target market is one that has never been entered before so Nokia will instantly gain 100 market share whereas the current target market is saturated and competition for market share is very strong

middot The products that are being released do not need to be as technically advanced as the ones in the current market because my market research showed that the 40+ market do not want phones that are to complicated and hard to use

middot If product research and development is not needed as much anymore then Nokia can afford to decrease its employment numbers and this would save Nokia a lot of money every year

middot When entering a new market with no competition a company can charge whatever prices they want Nokias prices can be higher then they currently are and this will increase income and profitability

35

• Nokia Brand Positioning
• Dominating the Mobile Phone Market
• The Nokia Brand
• The Use Of Brand Name As A Strategy For Gaining Competitive Advantage
• Marketing Strategy For Nokia

branding

Evaluation

My revised strategy has a lot of advantages over Nokias previous strategy and I have listed them below

middot My target market is one that has never been entered before so Nokia will instantly gain 100 market share whereas the current target market is saturated and competition for market share is very strong

middot The products that are being released do not need to be as technically advanced as the ones in the current market because my market research showed that the 40+ market do not want phones that are to complicated and hard to use

middot If product research and development is not needed as much anymore then Nokia can afford to decrease its employment numbers and this would save Nokia a lot of money every year

middot When entering a new market with no competition a company can charge whatever prices they want Nokias prices can be higher then they currently are and this will increase income and profitability

35

• Nokia Brand Positioning
• Dominating the Mobile Phone Market
• The Nokia Brand
• The Use Of Brand Name As A Strategy For Gaining Competitive Advantage
• Marketing Strategy For Nokia