Mobile Handset Market in India

India currently has 68 mobile handset players and it is expected to increase to 200 by 2015

Average Selling Price (ASP) of mobiles sold in India is around Rs 2500

Total number of mobile subscribers in India to grow to 1billion by 2015

(Value in US milion $)

Mobile Handset Market Share (in 2010-11)

Total Volume: 156 million units

39%

17%7%

6%

5%

26%

Nokia

Samsung

Micromax

Blackberry

LG

Others

NOKIA- Market LeaderNOKIA- Market Leader

Founded as a paper mill in Finland by Fredrik Idestam

NOKIA CORPORATION

Nordic Mobile Telephone (NMT) launched

Telecommunication branch ‘Nokia-Mobira Oy’ formed

Mobira Cityman, 1st handheld NMT phone launched

Jorma Ollila becomes President and CEO of Nokia

1st GSM handset, Nokia 1011, launched

HistoryHistory

Nokia Verticalization

PEST Analysis

PEST Economic

Political

Technological

Social

1991 – Economic Liberalization Reforms

1994 – National Telecom

1999 – New telecom Policy

2000-2010 – Government encouraging the FDI and competition.

1991 – Economic Liberalization Reforms

1994 – National Telecom

1999 – New telecom Policy

2000-2010 – Government encouraging the FDI and competition.

1995 – evolution of mobile communication with the origin of Mobile Telephony in India

1992-1999 – Indian economic transformed from socialistic market to capitalistic market

2000-2010 – Rise in income levels of society Growth prospects – Indian telecom industry is the fastest

growing telecom industry in the world Indian Mobile Market set to grow to $18 billion by 2012

1995 – evolution of mobile communication with the origin of Mobile Telephony in India

1992-1999 – Indian economic transformed from socialistic market to capitalistic market

2000-2010 – Rise in income levels of society Growth prospects – Indian telecom industry is the fastest

growing telecom industry in the world Indian Mobile Market set to grow to $18 billion by 2012

Economic

PEST Analysis

Social

Rise of Information societyMore awareness about mobile phone handset choice

and advancements due to increased information availability

Change in lifestylePeer group influence (Reference group influence)Roles and Status

Rise of Information societyMore awareness about mobile phone handset choice

and advancements due to increased information availability

Change in lifestylePeer group influence (Reference group influence)Roles and Status

PEST

Political

Technological

Social

Economic

Rise of Information societyGlobal advancements in technology such as MMS,

Bluetooth, WAP, GPRS, cameras, social network, 3G etcAsian markets are more technologically advanced than

their European counterparts. For example in 2002, just 4% of phones in Europe had cameras, whereas in Asia, it was 90%

Rise of Information societyGlobal advancements in technology such as MMS,

Bluetooth, WAP, GPRS, cameras, social network, 3G etcAsian markets are more technologically advanced than

their European counterparts. For example in 2002, just 4% of phones in Europe had cameras, whereas in Asia, it was 90%

Consumer BehaviourCultural Factors

Social Factors

Close family relationshipsSaving-oriented mentality

Need for communicationNeed for low end mobile phones

Personal Factors

Status symbolFamily & friends

Age & occupation•Students•Working Professionals•Housewives

Post Sales Behaviour Availability of service centers

Online applications and applications stores Nokia Ovi Suite Nokia PC Suite Nokia Beta Labs Symbian OS

Software upgrades

Resale value

Consumer Survey Analysis

FEATURES

PRICE

Consumer Survey AnalysisConsumer Survey Analysis

What you like in NOKIA

What you dislike in

NOKIA

Psychographic Segmentation

High InvolvementHigh Involvement

Low InvolvementLow Involvement

RationalRational Aspirational

Aspirational

Marketing MixPRODUCTPRODUCT

Classification of products based on:Useneedprice

LIVE

CONNECT

BUSINESS

LIFESTYLEMessaging

FM

RingtonesColor Screen Alarm Nokia 1100

• SEGMENT - Low end basic phone•TARGET GROUP - Lower class (first time users)•POSITIONING - Highly reliable & durable phone for working class India•World’s best selling model- sold 250 million phones

MP3CameraBluetoothGPRS

Nokia 5800• SEGMENT - Mid-range multimedia phones•TARGET GROUP - Young Generation from middle & upper-middle class•POSITIONING - device for the music crazy customers.•In 2008, Navigation Edition was released which positioned it as much more than a music phone with maps, navigation features, car charger and car kit

Push mail servicesMobile business solutions Quick Office Call conferencing

Nokia E72• SEGMENT - Mid-high end Business-cum-Smart phones•TARGET GROUP - Business professionals aged 25 - 50 with upper middle class incomes•POSITIONING – Business phone to serve needs of working professional + good multimedia support

3G

GPS

High MP

camera and

HD video

Nokia N8• SEGMENT - High End Smart Multimedia phones•TARGET GROUP - Young Generation from the upper middle class•POSITIONING - device packed with must have features like vibrant GUI, music, connectivity, photography, games etc

PRICEPRICE

Marketing Mix

Penetration Pricing

Price Skimming

Low end phones

High end phones

Price wars leading to lower profits

Higher demand for advanced features

Marketing Mix

Nokia has the largest mobile distribution network of 1,30,000 outlets

Nokia ‘Concept Store’ setup in 9 major cities across India to enhance customer experience

Nokia Priority Dealers setup in all Tier- 1 and Tier- 2 cities

Multi-brand stores like The Mobile Store, Hot Spot, Big C, etc

PLACEPLACE

Marketing Mix

Below the line marketing

Brand Ambassador Priyanka Chopra / Shahrukh Khan

Digital marketing through social networking sites, mobile

sites, blogs, etc

Extensive TV campaigns and Advertisements in regional

languages

Made For India advertisement for Nokia 1100

The Har Jeb Mein Rang Advertisement Campaign

Main sponsor of Kolkota Knight Riders in IPL

Nokia India Fest 2011-Pan India College festival

PROMOTIONPROMOTION

RURAL MARKET Nokia Life Tools (Jeevan Sadhan): SMS Mechanism, Sachet Pricing, Daily cost of Rs 1 only

‘Showrooms on wheels’ and ‘Rural care on the go’

Tie-up with major micro-finance institutions like SKS Microfinance

PROMOTIONPROMOTION

Marketing MixMarketing Mix

Branding & Positioning Branding & Positioning

Brand value worth 20 billion dollars

Voted as ‘The most trusted brand in India’ according

Brand Equity Survey (Jan,2011)

Brand personality of Nokia- A trusted friend

Nokia's slogan- Connecting people

Media Budget Distribution:20% Print media and 80 %

Television media

Umbrella Branding- N series & E series

Company Name Branding

Rebranding of Ovi stores to Nokia Services

Rebranding effort by changing the classic Nokia Sans font to Nokia Pure font

Branding & Positioning Branding & Positioning Changes in Branding

Strategies

Branding & Positioning Branding & Positioning

Positioning

Points of Parity (POP)Points of Differentiation

(POD)

Good voice clarity Camera GPRS FM & Music Player

Robust build High battery life Good brand perception Ease of use

Porter’s 5 Forces Framework Analysis

RIVALRY AMONG COMPETITORS CONCENTRATION AND BALANCE: The major players

are Samsung, Micromax, Blackberry, LG, HTC etc

INFORMATIONAL COMPLEXITY: Devices are becoming more complex and getting features that are outside the core competencies of traditional manufacturers

CORPORATE STAKES: High stakes for the companies because of huge investments into the business

REDUCING PROFIT MARGINS due to intense competition & price wars

Competitive Analysis

BARGAINING POWER OF BUYERS BUYER INFORMATION: Buyers have comparative

information about the product in terms of price and

features.

PRODUCT DIFFERENCES: Low degree of product

differentiation and any new feature or technology is

quickly imitated.

LOW SWITCHING COSTS due to lower prices

BARGAINING POWER OF SUPPLIERS SWITCHING COSTS: A large number of suppliers for

non critical components. For critical components suppliers work closely with

companies as they involve joint development of specialty inputs and sub-systems.

IMPACT ON DIFFERENTIATION : Companies could switch suppliers for non critical components but are closely tied to them for critical components and sub-systems.

THREAT OF FORWARD INTEGRATION: Suppliers do not pose any credible threat of forward integration even though they are outsourced.

THREAT OF NEW ENTRANTS-ENTRY BARRIERS

PROPRIETARY PRODUCT DIFFERENCES: Technology and product designs are protected by patents. Eg, Apple

BRAND IDENTITY: Powerful brand identity of the existing players developed through advertising and product excellence.

ECONOMIES OF SCALE: High fixed costs means that volume is essential to companies.

CAPITAL REQUIREMENTS: Activities such as R&D and advertising requires large capital commitments.

EXPECTED RETALIATION: Existing competitors have the financial clout to deter new entrants.

ACCESS TO NECESSARY INPUTS: Suppliers work closely with existing companies and therefore critical components may only be available at a premium.

THREAT OF SUBSTITUTES PC based applications such as IP TELEPHONY

Convergence between PDA’S AND MOBILE PHONES.

Internet revolution

Strong Corporate Brand & the largest cell phone vendor

User-friendly features

Strong Distribution Network

Best Navigation (Nokia OVI Maps)

High resale value of hand-sets compared to other handsets

Slow to adopt new ways of thinking (for example, launch of dual sim

mobiles)

High prices compared to other domestic companies

Symbian OS lost out the race with Google’s Android and Apple iOS

Too many products & very little product distinction

No of features offered in the lower end Nokia models are very little and

stagnant

STRENGHTSSTRENGHTS

WEAKNESSWEAKNESS

SWOT Analysis

Nokia can expand its market share by introducing a new low cost

brand in competition to companies like Micromax, GFive etc

Increase their presence in CDMA market

They can target the smart phone in the low to medium segment with

MS Windows- 7 platform

OPPORTUNITIESOPPORTUNITIES

Threats from emerging domestic companies like Micromax, Karbonn,

Maxx, Lava, Spice etc who offer similar features at lower prices

In the higher segment it is losing market share to players like Apple,

HTC, Blackberry, Samsung, etc

THREATSTHREATS

SWOT Analysis

Future Strategies New Brand segment for lower end phones

Change in the distribution model

Future Strategies

Increase the commission of mobile retailers

More emphasis on social media marketing

Future Strategies Nokia mobile money project

Leverage on Nokia-Microsoft Deal: Windows 7?

MeeGo- answer to Android?

Thank you