Research in Motion

Market Summary

ABOUT RIM

• Research In Motion Limited (RIM) was founded in 1984 and is headquartered in Waterloo, Canada.

Company Products:

• BlackBerry smartphone portfolio

• BlackBerry Bold series, BlackBerry Torch series, BlackBerry Curve series, and the BlackBerry PlayBook tablet

• BlackBerry enterprise solutions

• Software development tools

• BlackBerry Messenger

• BlackBerry App World

MARKET TRENDS-USER TREND

• Internet page views (August 2012)

• Mobile phones - 9%

• Tablets account - 4.3%

• More than 114 million people in the US own & use smartphones & apps

• By 2014 -> 157.7 million

• Most important user characteristic - BEHAVIOR

• With increased usage comes the need for more power-efficient and flexible displays.

• The immediate trend in battery research is the wireless recharging ability.

MARKET TRENDS-USER TREND

• Materials used for smartphones - subjected to key factors: weight, durability and protection

• Graphene will make mobile devices be more resistant to damage, lighter and ergonomic.

• To unify experience across platforms, operating system providers converge their OS across multiple devices.

• Companies encourage employees to use their own devices -> more efficient by working in a well-known, familiar environment

• The increasing demand of smartphones is determining a series of user behavior alterations (e-commerce, hotel booking, etc.)

MARKET TRENDS-PRODUCT TREND

• Smartphone success - determined by:

• Hardware

• Software capability

• Intuitive user interface

• Variety of downloadable applications

• Strong user support from the developer community

• Vertical integration of devices

SWOT ANALYSIS-STRENGTHS & WEAKNESSES

Strengths

• operating system

• Privacy

• QWERTY Keuboard

• Blackberry App Store

• Battery life

• Brand Loyalty

• GPS

• Brand Image/Name

• BBM

Weaknesses

• Features

• Applications

• Technology

• Health Concerns

• Software

• Products

SWOT ANALYSIS-OPPORTUNITIES/THREATS

Threats

• Competition

• Consumer tastes

• Barriers to entry

• Unique Features

• Last chance

• Consumer expectations

Opportunities

• Blackberry 10 line

• Pricing

• Applications

• Cell phone industry

• Younger generation

• Marketing

• Competition

COMPETITORS - HARDWARE

• Apple

• Samsung

• HTC

• LG

• Motorola

• Nokia

COMPETITORS - SOFTWARE

Android 91.5%

iOS 57.3%

Microsoft Windows 140.0%

BlackBerry -34.7%

COMPETITORS - SOFTWARE

Key Software Factors

• ApplicationsTotal Available Apps in Market (as of 9/12)

• App Store - 700,000

• Google Play - ~700,000

• Windows Phone Store – 120,000

• Security• FIPS 140-2

CONSUMER INSIGHTS

Data source: Smartphone survey reporthttp://www.realtor.org/sites/default/files/reports/2010/smartphone-survey-report-2010.pdf

CURRENT FINANCIALS-PROFITABILITY

• Gross margin for its fiscal year 2012 has decreased

• Net Incomes decreased 10.8%

• Operating expenses increased 6.6%

• Heavily invested on Research & Development and Selling, Marketing and Administration. (the development of the Blackberry 10 line)

RIM Income Statement for Fiscal Year 2011 & 2012

CURRENT FINANCIALS-LIQUIDITY

• Strong liquidity with a large amount of cash on hand. (over $2.1 billion cash on hand as fiscal year 2012)

• RIM will have sufficient cash to push the launch of Blackberry 10 with an aggressive marketing campaign

• No debt and a portfolio full of patents

• However, if sales and profitability continue to decrease for the next year or two, the cash could be easily burned through quickly.

RIM Cash & Investments 2011 & 2012

Marketing Strategy

MARKETING OBJECTIVES

• “RIM is a company driven by ideas. We believe that innovation and collaboration will foster sustainable growth for our business.”

• Marketing Strategy

Young professionals

+1. Brand Awareness

2. Distribution

3. Market Share

4. Revenues

TARGET MARKET-PRIMARY MARKET

• Corporate and enterprise

• Existing target market

• Dominant Position

• Competitive advantage

• Secure System

TARGET MARKET-PRIMARY MARKET

• Consumer- the younger demographics. (Age between 16-34 years old)

• The biggest growth in smartphone ownership and usage

• Existing market share

• Brand Loyalty

Secondary Market-Parents of these young adults

FINANCIAL PROJECTION • Projected target results as follow:

• 2013 Target Overall Revenue Growth: 10%

• 2013 Market Share Growth: 2%

• 2013 Total BlackBerry Devices Sold: 55 Million

• Projected devices sold

In Millions 3-Mar-13% change from 2012

3-Mar-12% change from 2011

26-Feb-11

BlackBerry handheld devices sold 55 12% 49 -6% 52.3

FINANCIAL PROJECTION

• Projected increase of expenses

• Cost of Sales: 4% increase

• Research and Development: 1% increase

• Selling, Marketing and Administration: 10% increase

• Investment Income: 2% increase

• RIM Projected 2013 Income Statement

PRODUCT –POINTS OF DIFFERENCE

Caters to Both Sides of Life

• Is perfect for “BYOD”(Bring Your Own Device) • BlackBerry Balance

• Increased security

PRODUCT –POINTS OF PARITY

• New App store

• Touch screen phones

PRICE

• Research In Motion used to dominate the smartphone’s market.

• Blackberry sustained the business environment with a professional and secure data platform.

• The Blackberry 10 line is the company’s latest effort to regain its lost market share.

• Pricing and distribution strategies depend heavily on the product’s reviews and perceptions.

•  The IT & tech market is very dynamic - It can easily launch a new product into space or drown it. 

PRICE

• Best pricing strategy: rapid market penetration

• high promotion costs

• high competition

• RIM is launching a whole line of Blackberry 10 products => pricing strategies will differ from one product to the other

• Phone’s features and capabilities - main determinant in pricing range

DISTRIBUTION

• US carriers that offer special pricing plans (AT&T, T-Mobile, Verizon) 

• Other specialty stores where trained staff answers customers’ questions (Best Buy, Wal-Mart) 

• E-purchasing channels (Amazon.com, RIM.com)

• B2B - it’s very important that RIM is not dependent on third parties

POSITIONING

Position Statement

• To busy professionals who need to be wired 24/7, Blackberry is the phone that will provide them with the ability to work efficiently independently of location and time.

Action Plan

COMMUNICATION OBJECTIVES

• Communication Objectives

• Knowledge and Awareness

• Attitude

• Behavior/Action

• Communication Strategy

• Can you please pass me my Blackberry?

• Markets Share Focus

• Position Dominance

• Expansion

ADVERTISING

PHASE I

• Prior to the official Blackberry 10 line launching (November - December, 2012)

• Teaser

• Revealing

• Inform the public of the new technology available - informative advertising

• Generate higher brand awareness after a long period of decline

Phase 1Awareness

Phase 2Sales

Phase 3Retention and Reinforcement

ADVERTISINGPHASE II

• During the actual launching of the product (Q1, 2013)

• Introduce the highly anticipated smartphone to the market

• Intensive persuasive advertising campaign => generate liking, conviction and will increase the desire to purchase among the consumers

• Objective - increase sales

PHASE III 

• April - August, 2013 

• reminder & reinforcement advertising campaigns take over

• continue to stimulate and increase purchase

• reinforce the consumers purchasing decision

ADVERTISING - BUDGET

Promotional Budget Allocation by Type

Advertising; $346,920,000

Sales Promotion; $213,934,000

Public Relations; $14,455,000

Monitoring Controls; $2,891,000

2013 Total Marketing Budget $578,200,000

ADVERTISING – MEDIA MIX• TV - Nielsen

• Radio - Arbitron

• Print Media - MRI/Simmons/ABC

• Magazines

• Posters

• Online Display - Unique Visitors Per Month/Nielsen AdRelevence

• Online Magazines

• Blogs

• Outdoor (OOH) - Eyes On Ratings

• Billboards

• SEM - Google Adwords

IMPLEMENTATION CONTROLS

• Check the effectiveness of the 2012-13 3-phase campaign

• Dashboard

• Brand Awareness

• Advertising & PR impressions

• Click Through Rate

• Conversion Rate

• Leads generated

• Orders Generated

• Unit Sales

• Evaluation / Optimization

THANK YOU!