A PRESENTATION ON NOKIA

Marketing Plan

Marketing Management Prof P. ChandrashekarTable of ContentTopic Page No.1. Executive Summary 12. Company Profile 32.1 History 32.1.1 1865-1960 42.1.2 1960-1980 52.1.3 1980-2001 72.1.4 2001 and into the future 82.2 Mission and Vision 82.2.1 Vision 82.2.2 Mission 8552.2.3 Strategy 82.2.4 Organization 112.3 Mobile Phone Market In India 143. Situation Analysis 173.1 Social Analysis 173.2 Environmental Analysis 193.2.1 Nokia environmental strategy 20 3.2.2 Main Issues In Focus 21 3.2.3 Supply Chain 233.3 SWOT Analysis 23 3.3.1 Strength 25 3.3.2 Weakness 263.3.3 Opportunities 26 3.3.4 Threats 274. Segmentation 32 4.1 Mobile Phone 32 4.1.1 Segmentation Strategy 35 5. Nokia Strategies 37 5.1 Marketing Strategy 39 5.1.1 Marketing Objective 425.1.2 Ease-of-Use 43 5.1.2.1 Simplified Service Setup 43 5.1.2.2 Simplified user interface 455.1.2.3 Clear Payment Method 475.1.2.4 Easy access to Customer Support 485.1.2.5 Simplified service termination 495.1.3 Product Life Cycle 505.2 Positioning Strategy 52

5.2.1 Nokia Product Design 53 5.3 Promotion Strategy 555.3.1 Push 555.3.2 Pull 565.4 Pricing Strategy 575.4.1 Premium Pricing 575.4.2 Penetration Pricing 585.4.3 Economy Pricing 585.4.4 Price Skimming 585.5 Distribution Strategy 596. Marketing Schedule 677. Conclusion

1. Executive Summary:

Mobile phone market in India is going through major changes. Key players are losing market share while new and young companies, mostly from Asian countries, are coming to the market. At the same time the market is slowly expanding when people are buying more phones than ever. The whole process of buying mobile phones has changed in the last few years. People no longer carry the same phone year in year out, change is the fast technological development of the phones. But also consumer’s but they change their phone every year, some even twice a year. One reason for these attitudes towards mobile phones has changed. Mobile phones are no longer seen as expensive, hi-tech products, but they have become accessories like jewellery or a piece of clothing. “Nokia is still the largest mobile phone company in the world, but its long-term dominance is now challenged more than ever. Observers have begun asking whether the cutting edge that has turned Nokia into the No 1 vendor still exists, as Nokia’s market share and revenues have been on the decline. Falling average sales prices (ASPs) and market share have had an impact and forced Nokia to further re-think its strategy towards developed and emerging markets.” This report gives an overview on what is happening on the mobile phone market today and analyses Nokia’s market position in the growing market. This report includes a brief introduction to Nokia followed by an environmental analysis, SWOT analysis of the company. Half way through the report you can find information about consumer behavior and segmentation. At the end, this report introduces the main strategies and objectives of Nokia for the competitive market. Finally we try to make a conclusion of the topics discussed and attempt to give some possible answers to the question at hand.

2. Company Profile2.1 History

The roots of Nokia go back to the year 1865 with the establishment of a forest industry enterprise in South-Western Finland by mining engineer Fredrik Idestam. Elsewhere, the year 1898 witnessed the foundation of Finnish Rubber Works Ltd, and in 1912 Finnish Cable Works began operations. Gradually, the ownership of these two companies and Nokia began to shift into hands of just a few owners. Finally in 1967 the three companies were merged to form Nokia Corporation.At the beginning of the 1980s, Nokia strengthened its position in the telecommunications and consumer electronics markets through the acquisitions of Mobira, Salora, Televa and Luxor of Sweden. In 1987, Nokia acquired the consumer electronics operations and part of the component business of the German Standard Elektrik Lorenz, as well as the French consumer electronics company Oceanic. In 1987, Nokia also purchased the Swiss cable machinery company Maillefer.In the late 1980s, Nokia became the largest Scandinavian information technology company through the acquisition of Ericsson's data systems division. In 1989, Nokia conducted a significant expansion of its cable industry into Continental Europe by acquiring the Dutch cable company NKF.Since the beginning of the 1990's, Nokia has concentrated on its core business, telecommunications, by divesting its information technology and basic industry operations.

2.1.1 1865-1960

From its inception, Nokia was in the communications business as a manufacturer of paper - the original communications medium. Then came technology with the founding of the Finnish Rubber Works at the turn of the 20th century.Rubbers, and associated chemicals, were leading edge technologies at the time. Another major technological change was the expansion of electricity into homes and factories which led to the establishment of the Finnish Cable Works in 1912 and, quite naturally, to the manufacture of cables for the telegraph industry and to support that new-fangled device - the telephone!After operating for 50 years, an Electronics Department was set up at the Cable Works in 1960 and this paved the way for a new era in telecommunications. Nokia Corporation was formed in 1967 by the merger of Nokia Company - the original paper-making business - with the Finnish Rubber Works and Finnish Cable Works.

2.1.2 1960-1980

Design has always been important at Nokia and today's mobile phones are regarded as a benchmark for others to follow. Take, for example, multi-colored, clip-on fascias which turned mobiles into a fashion item overnight. But Nokia has always thought like that and back in the fashion-conscious 1960's when one branch of the corporation was a major rubber manufacturer, it hit on the idea of making brightly-colored rubber boots at a time when boots followed the Henry Ford principle - you could have any colour, so long as it

was black!The '60s, however, were more important as the start of Nokia's entry into the Telecommunications market. A radio telephone was developed in 1963 followed, in 1965, by data modems - long before such items were even heard of by the general public.In the 1980's, everyone looked to micro computers as the next 'big thing' and Nokia was no exception as a major producer of computers, monitors and TV sets. In those days, the prospect of High Definition TV, satellite connections and teletext services fuelled the imagination of the fashion conscious homeowner.In the background, however, changes were afoot. The world's first international cellular mobile telephone network, NMT, was introduced in Scandinavia in 1981 and Nokia made the first car phones for it. True enough, there were 'transportable' mobile phones at the start of the '80's but they were heavy and huge. Nokia produced the original hand portable in '87 and phones have continued to shrink in inverse proportion to the growth of the market ever since.

2.1.3 1980-2001

It took a technological breakthrough and changes in the political climate to create the wire-free world people are increasingly demanding today. The technology was the digital standard, GSM, which could carry data in addition to high quality voice. In 1987, the political goal was set to adopt GSM throughout Europe on July 1st 1991. Finland met the deadline, thanks to Nokia and the operators. Politics and technology have continued to shape the industry. The '80s and '90s saw widespread deregulation, which stimulated competition and customer expectations. Nokia changed too and in 1992 Jorma Ollila, then President of Nokia Mobile Phones, was appointed to head the entire Nokia Group. The corporation divested the non-core operations and focused on telecommunications in the Digital Age. Few people in the early '90s would have thought that 'going digital' would change things so much.

2.1.4 2001 and into the Future

Nokia is harnessing its experience in mobility and networks to generate a startling vision of the future. Meeting rooms, offices and homes will be 'smart' enough to recognize their human visitors and give them whatever they want by listening to their requests. Nokia welcomes change and improvement and can embrace new ideas at great speed. Such characteristics will never change but, as to the rest, the story has only just begun!

2.2 Mission and Vision:2.2.1 Vision

“Our customers continue to our First Priority”Nokia’s future success depends on delivering great experiences to our customers by creating products and solutions that work seamlessly and are appealing.

2.2.2 Mission

“In a world where everyone can be connected, we take very human approach to technology”Connecting is about helping people to feel close to what matters. Wherever, whenever, Nokia believes in communicating, sharing, and in the awesome potential in connecting the 2 billion who do with the 4 billion who don’t. If we focus on people, and use technology to help people feel close to what matters, then growth will follow. In a world where everyone can be connected, Nokia takes a very human approach to technology.

2.2.3 Strategy

“Wherever, whenever, we believer in communicating, sharing and in the awesome potential of connecting the 2 billion who do, with the 4 billon who don’t”At Nokia, customers remain our top priority. Customer focus and consumer understanding must always drive our day-to-day business behavior. Nokia’s priority is to be the most preferred partner to operators, retailers and enterprises.Nokia will continue to be a growth company, and we will expand to new markets and businesses. World leading productivity is critical for our future success. Our brand goal is for Nokia to become the brand most loved by our customers.

In line with these priorities, Nokia’s business portfolio strategy focuses on five areas, with each having long-term objectives:- Create winning devices- Embrace consumer Internet service- Deliver enterprise solutions- Build scale in networks- Expand professional servicesThere are three strategic assets that Nokia will invest in and prioritize:- Brand and design- Customer engagement and fulfillment- Technology and architecture

2.2.4 Organization

Nokia comprises four business groups: Mobile Phones, Multimedia, Enterprise Solutions and Networks.Mobile Phones connects people by providing expanding mobile voice and data capabilities across a wide range of mobile devices. We seek to put consumers first in our product-creation process and primarily target high-volume category sales.Multimedia brings connected mobile multimedia experiences to consumers in the form of advanced mobile devices and applications. Our products give people the ability to create, access and consume multimedia, as well as share their experiences with others through a range of radio technologies.

Fig 2.1. Revenue by four business groups

Enterprise Solutions offers businesses and institutions a broad range of products and solutions, including enterprise-grade mobile devices, underlying security infrastructure, software and services. We also collaborate with other companies to provide fixed IP network security, mobilize corporate email, and extend corporate telephone systems to Nokia’s mobile devices.Networks provides network infrastructure, communications and networks service platforms, as well as professional services to operators and service providers. Networks focuses on the GSM family of radio technologies and aims at leadership in three areas: GSM, EDGE and 3G/WCDMA networks; core networks with increasing IP and multiaccess capabilities; and services. Our business groups are supported by various horizontal entities:Customer and Market Operations is responsible for marketing, sales, sourcing, manufacturing and logistics for mobile devices from Mobile Phones, Multimedia and Enterprise Solutions.Technology Platforms is responsible for the competitiveness of Nokia’s technology assets. The group supports Nokia’s overall technology management and development by delivering leading technologies and well-defined platforms both to Nokia’s business groups and to external customers.Nokia-wide horizontal units drive and manage specific Nokia assets. They include brand and design, developer support, research and venturing, and business infrastructure.Corporate Functions support Nokia's businesses with company-wide strategies and services.

2.3 Mobile Phone Market In India

NOKIA’s hegemony in the GSM handset segment has increased during last six months. NOKIA’s market share (in terms of unit sold) has grown to 74% in March 06 from 61.5% in October 05. In the colour segment too, Nokia has increased its market share to 55% in march 06 from 33.7% in march 05.In terms of value, Nokia’s overall market share has jumped to 70.5 % in march 06 from 57.7% in October 05. In the colour phone category, its market share (in terms of value) has increased to 59.3% in march 06 from 40.9% in October 05, according to ORG GFK estimates.

Fig.2.2 NOKIA’s performance over a year

Once NOKIA’s closest rival, Samsung has been losing its market share since October’05 when it had an overall market share (in terms of units) of 1.2, to 7.8% I March’06. The drop is much steeper in value terms where its market share has fallen to 9.8% in March’06 from 21.2% in October’05.Sony Ericsson’s market share (in terms of units) has improved marginally from 7.1% October’05 to 7.6% in March’06, although in value terms it has increased from 8.7% in October’05 t 10.2% in March’06. The colour segment, where Samsung used to rue once, has seen its market share falling both in terms of units and value. The market share (units) has dropped to 16.3% in March’06 from 34.9% in October’05 ad in terms of value, has dropped to 14% in March’06 from 32.5% in October’05. Sony Ericsson’s

market share in the colour segment is marginally more than the Samsung’s at 16.7% (unit) and 15.9% (value) in March’06 and is an improvement over its October’4 figures of 15.6% (units) and 14% (value). The total handset units sold in the top 10 towns in the month of March is 5,06,493 units, from 4,68,621 units inOctober’05. The total value of the handset s sold is Rs.245.6 crore as of March’06 from Rs.236.1 crore in October’06. The number of colour phones jumped to 2,11,779 units in March’06 from 1,66,210 units in October’05. The value of the colour phone market increased to Rs.15,208 lakhs in March’06 from Rs13,023 lakhs in October’05.

3. Situation Analysis:3.1 Social Analysis

For electronics companies, take back and recycling add value. They support brand value and customer loyalty and inspire customer insights. They also demonstrate environmental responsibility. Manufacturers like Nokia are generally in a disadvantaged position for take back, due to the costs involved and the lack of many consumer touch points.Stakeholders in the take back and recycling process include governments, retailers, customers, consumers and products. Other stakeholders include recyclers, refurbishes and NGOs.The responsibility for bringing used devices back for recycling lies ultimately with the consumers. The challenge for Nokia in take back programs is how to make mobile phone users do their share and return the used products for recycling. By bringing the used mobile to a take back point the customers make sure that used phones will not end up in landfills in their own or other countries. Instead, the recyclable raw materials can be used again in new products.In a typical consumer scenario, such as when a mobile phone user is renewing a service contract with a mobile phone provider, in the US and Europe an estimated 60% to 70% retain their old devices because of their perceived value.Successful take back is also driven to a great extent by economics and market factors, which in turn place large quantities of used devices in refurbishment scenarios. This causes concern for the quality and safety of products repaired or altered outside of the intense controls fundamental to a Nokia production process. The optimum outcome from Nokia's environmental efforts in the product lifecycle is to minimize adverse effects to the environment, to our customers and consumers and to our business. As the Nokia lifecycle philosophy applies to take back, the power to manage take back and direct the disposal of a mobile device at the end of its life is largely controlled by: customers, consumers, retailers, and by governments. There are various take back channels and Nokia has limited control over the actual flows. Despite the challenges posed by the logistics of recovery, Nokia has for years had programs in place and continues to move ahead with new programs to recover mobile devices at the end of their useful lives.These include take back:* Via our authorized service centers and flagship stores * Through our web site, only limited in certain countries

* As part of eBay Rethink, only in the US Nokia is also piloting different forms of cooperation with operators and distributors, such as installing collection bins at point of sales and mail service return, as well as in various industry level schemes and in public awareness building campaigns.

3.2 Environmental Analysis

NOKIA aims to be a leading company in environmental performance. By working to reduce the adverse environmental impacts of our products and activities, our customers can use our products with confidence and good conscience. Combining environmental issues into daily work makes business sense for Nokia. By working to reduce the adverse environmental impacts of our products and activities, we minimize risk, ensure legal compliance, gain stakeholder acceptance, and help advance the long-term success of our company.Our customers can also use our products with confidence and good conscience. Through our environmental strategy, we work to ensure that our products are safe for personal use and that they do not overly tax the environment. Nokia is a trusted brand and we take that trust seriously.

3.2.1 Nokia environmental strategyNokia is a leading company in environmental performance. Nokia’s environmental strategy is based on lifecycle thinking, beginning with the extraction of raw materials and ending with recycling and disposal of as well as the reintroduction of recovered materials into the economic system. Our goal is to develop advanced mobile technology, products and services, which have no undue environmental impact, consume energy efficiently, and that can be appropriately reused, recycled or disposed of. Nokia's environmental strategy is integrated with our business strategy. Our four business groups have set environmental targets for their own activities to implement our corporate level environmental strategy.3.2.2 Main Issues In Focus

Three important global issues remain at the forefront of much of Nokia’s environmental work. They are substance management, arrangements for the take back and recycling of end-of-life products, and energy efficiency.* Substance management During the planning and design of our products, one of our main focus areas is their material content. We are continuously analyzing the materials used in our products with the aim of reducing the amount of potentially hazardous or harmful content.* Take back and recycling In take back and recycling, we have for years had in place our own arrangements for mobile devices and accessories, as well as for mobile network and IP network security equipment. All Nokia products are also covered by the European Union's new Waste Electrical and Electronic Equipment (WEEE) directive. Nokia is assuming product responsibility as defined by the directive as it is implemented throughout Europe. In addition, take back of Nokia mobile devices will also continue at authorized Nokia Service Centers and Flagship stores in all markets where we do business.

* Energy efficiency In our product creation as well as our own operational activities, an important area for continuous performance improvement is in energy efficiency. We have consistently been able to reduce the energy intensity of our products.

3.2.3 Supply Chain

We are committed to reducing the environmental impact of our business. We expect all Nokia suppliers and their suppliers to take a similar approach. At Nokia, we believe in long-term partnerships with suppliers who share our approach to ethical business. Together we work hard to anticipate risk, demonstrate company values, enhance our governance practices, increase employee satisfaction and look after the communities where we do business.

3.3 SWOT Analysis

Nokia is at an important crossroads in its history. Having architected many of the key tenets for growth during the formative years of the mobile phone industry, the market with which Nokia is so familiar may be adopting different rules, ones that it may not fully understand. The situation Nokia faces may be similar to the period in the PC industry when Dell Computer surpassed perennial leaders IBM, Hewlett-Packard and Compaq Computer. Why might this happen? Because Nokia's strengths are so well-understood by its competitors, they are well-targeted and improved upon. The wireless market's evolution has slowed, making it easier to challenge the incumbents. Also, the progress of technology has made many of Nokia's early advantages easier to overcome. Nokia's leadership position is a result of paying persistent attention to market needs and taking the right chances at the right time. Nokia was the first to acknowledge fashion as an important element in mobile phone purchases, and it is solidly behind the push for Multimedia Messaging Service, which could become the first data service beyond Short Message Service to be deemed successful. There is a significant gap between Nokia and startups, which makes it difficult to compete against Nokia. Nokia's tie to operators has kept its products solidly in consumers' view. Yet, Nokia faces some serious challenges.

Fig.3.1. SWOT AnalysisThe mobile landscape has fundamentally shifted, and some of Nokia's strengths and core beliefs may no longer be valid. In the following research, we discuss Nokia's strengths and challenges and provide advice for enterprises partnering with, purchasing from and working with Nokia. 3.3.1 Strength · Nokia has long established identity (1898); lots of available resources (financial, etc.) · Nokia has high penetration rate in Europe, especially in Northern countries (close to 100%) · Nokia Consumer Electronics has access to innovative technology through group companies

3.3.2 Weakness

· Lack of centralized marketing strategy and champion; completely different positioning strategy depending on the country · Too many brand names (100) in one market; problem trying to find balance · Corporate culture is highly technical and operational: So what if the customer does not understand!; lack of customer service priority

3.3.3 Opportunities · Potential for brand name sales in Europe and Asia-pacific · Growing replacement and supplement television market · NCE has opportunity of using its technology to enhance user-friendliness 3.3.4 Threats · The market for color TVs and VCRs is a mature/saturated market; consumers are buying less often and only to replace older units (same trend for all countries across Europe) · Can’t differentiate based on technical advancement or price; competitors too fast to match · Impact of recent purchases (for example, Sony) and mergers is unknown; competitors are getting larger and integrating supply chains · Competitors (Samsung, Gold star, Daewoo) quickly and successfully building brand name and image Branding Strategy In the color TV market, neither technology nor price provides a competitive advantage. The decision a consumer makes to purchase is primarily motivated by emotion, and is driven largely by comfort level with a particular brand. A successful branding strategy for NCE is, therefore, critical to gaining a competitive advantage. Specifically, NCE should brand for the following reasons: · Competitive advantage is gained through brand name (not technology or price) · According to brand awareness studies, Nokia is recognized most of the time (in Germany, France, Italy, UK and Norway), but not necessarily affiliated with consumer electronics such as TVs and VCRs · Consumers buy televisions based on emotion · Consumers perceive value in features that are marketed as user-friendly. In the past Nokia has relied heavily on its ability to innovate—it is a strong technology company.

However, it is not good at introducing or packaging this technology for consumers. It must introduce a new mindset to NCE; a strategic shift that encourages customer service and international marketing. Internal Management Challenge faces at least two challenges within NCE that he must address immediately:1. Lack of a marketing champion in corporate headquarters 2. A continued reliance on technology as the main marketing approach. For example, the remote control TV mouse is centered on technology and may frighten away potential customers who may perceive it as too technical.

Options for solving these include: (1) Push down his ideas and force all to comply using his positional power; (2) Soft approach—gradually getting buy-in to his plans from technical representative,

sales and marketing. Option 1 is not viable since even though it may result in short-term agreement, it will result in resignations, poor morale and distrust in senior management over the long run. Since the change process can be slow, Nokia should adopt option 2 that means getting buy-in at the senior management level.

If there is disagreement at the highest level of the company on international marketing strategy, then the same can be expected throughout the ranks of the company. For example, the vice-president of engineering may agree on the surface, but tell his employees to continue to do what they have always done (don’t play the new marketing tapes at the fairs, etc.). Getting Buy-in from the Dealer Network The dealer network is critical to their branding strategy. If a dealer is not satisfied or confident with a manufacturer’s market position, they may lead a potential buyer to a competitive brand. NCE must maintain its strong brand-marketing program. And it needs to dealers to support them or they will fail. Ultimately a successful marketing campaign will draw customers into the dealer’s door. If Nokia is foremost in their mind, we want the dealer to sell them Nokia, not attempt to switch to a competitive brand. Customer Brand Awareness and Association the Nokia brand name has limited awareness across the Indian markets. Studies indicate that on average when a person is asked if they have heard of the company the answer is usually answered yes well below 50% of the time. Worse, however, is when asked to name a consumer electronics company, Nokia is very rarely the answer; typical answers are Philips, Grundig or Sony among others. This indicates a problem associating the Nokia brand name with consumer electronics (TVs and VCRs). Therefore, the challenge is not only getting the brand name in front of consumers, but ensuring they think of Nokia when buying a TV. Networking and Distribution Strategy in order to make the Marketing Campaign successful, the selection of a proper distribution channels would be a crucial element to make the Seagull flies. In this section, different options of distribution channels were discussed and recommendations for each brand were made. 4. Segmentation4.1 Mobile Phone Mobile Phones connect people by providing expanding mobile voice and data capabilities across a wide range of mobile devices. We seek to put consumers first in our product-creation process and primarily target high-volume category sales of mobile phones and devices based on the following global cellular technologies: GSM/EDGE, 3G/WCDMA and CDMA.In voice centric and mainstream mobile phones, we believe that design, brand, ease of use and price are our customers' most important considerations. Increasingly, our product portfolio includes new features and functionality designed to appeal to the mass market, such as mega pixel cameras, music players and advanced-quality color screens.Quality is at the heart of Nokia’s brand promise, very human technology. We want our customers to know that Nokia is the best quality company in the industry. Our goal is to have the industry’s best products and services, most loyal customers and most efficient operational mode. We believe that quality is about meeting and exceeding customer expectations. At Nokia,

we view quality holistically and as an integral part of business management. The quality of products and customer experiences depends on the quality of processes, which in turn is tied to the quality of management.

Our key quality targets are: · For Nokia to be number one in customer and consumer loyalty.· For Nokia to be number one in product leadership.· For Nokia to be number one in operational excellence.The quality and reliability or our products and services are among the most important factors driving customer satisfaction and loyalty. Designing good quality products begins with understanding customer requirements and creating the best user experience. The whole chain, from suppliers through to R&D, operations, sales and distribution to customers, impacts the end-result – everybody in the chain has a role to play in achieving quality. Our products and customer experiences are the results of our everyday processes. Process management means finding the simplest way of operating, in order to create customer value in a lean manner. Our process thinking covers everything we do, and processes are continuously improved based on the measures and the feedback we receive from our customers. Quality in management is vital for leveraging innovations globally and improving productivity in general. Our approach to this is platform thinking, process management and combining fact-based management with values-based leadership. We have developed a key framework for improvement at Nokia, which we call the 'Self-Regulating Management System'. It's about management practices that allow us to run our business in a consistent, effective and fact-based manner. Commitment to quality improvement is a continuous management process. It is both a business strategy and a personal responsibility, and it is a part of our culture and values. But at the end of the day, quality improvement is much more than something we can quantify in words or pictures. It is an attitude – a mindset. By taking quality personally we are able to deliver world-class quality to our customers. It is our source of inspiration, energy and excitement.

4.1.1 Segmentation Strategy

Fig.4.1 Nokia Market Demographic The profile for Nokia customer consists of the following geographic and demographic:Geographic· Our immediate geographic target is rural India. · The total targeted population is estimated at 100 million.

Demographic· Male and female. · Ages 25-50, this is the segment that makes up 80% of the Nokia mobile phone market according to the NOKIA India Ltd. · Professionals and College students.5. Nokia Strategies

Market growth predictions provide one motivation for network operators and service providers to improve the data service experience. For example, some research predicts a 270% increase in average monthly ARPS (average revenue per subscriber) for data services from 2005 to 2020, as indicated in Figure 5.1.Nokia predicts a CAGR (compound annual growth rate) of 9% for the mobile services market during the years 2004–2009 (see Figure 5.2). This growth will be due largely to growth in data services (CAGR 23%), with CAGR at 6% for voice and other calls. Data is particularly a growth driver in emerging markets and Asia. Some researchers provide more conservative figures, but all the research indicates that definite growth opportunities exist for mobile data services. The question is, who will capture the market growth and how is it enabled?

Fig.5.1. Researchers project tremendous growth for data services revenues

Fig.5.2. Mobile revenues will continue to experience attractive growth rates through 2009, especially in data services.

5.1 Marketing Strategy

Today, the true “killer” data application is still text messaging, a typical example of person-to-person communication. Other end-user services, however, have not taken off as expected in recent years.The primary reason for this slow take-up is that most of these services do not fulfill the expectations of users. Although ring tones are one example of successful person-to-content services, progress must be made for market take-up of other mobile data services such as:• Messaging (e.g., MMS and e-mail)• Entertainment (e.g., graphics, logos, games)• Information (e.g., directory services, news)

Fig.5.3. A variety of user needs will drive market growth for mobile data services

There are two main barriers to increased usage of data services. First is the lack of

relevant service propositions, where the price does not correlate with the perceived value of the service. Second is the complexity of service adoption and usage, where users perceive that data services require too much effort compared to other solutions. User needs and market growth are clearly present, as illustrated in Fig.5.3.However, mass-market adoption will happen only when the service providers have identified the relevant service propositions and ease-of-use factors. Delivering ease-of-use is within the reach of any service provider, regardless of whether it operates its own network. However, the challenge is to understand the underlying reasoning for end-user behavior and usage patterns and to organize the service offering accordingly. Visibility into the end-user service experience can be obtained from resources such as sophisticated end-user quality monitoring systems, continuous end-user behavior studies and end-to-end performance field measurements.Moreover, it is of great importance to analyze internal customer processes and readjust them according to customer needs. Eventually, the need to be attuned to the customer experience might lead to a new, customer-centric organizational structure with clear responsibilities for end-to-end Quality of Experience (QoE). Who will have the overriding responsibility for end-user experience will vary depending on the operator’s business model and organizational structure? In order to prepare the organization for differentiation, the research firm Forrester proposes that the marketing department should be made responsible for the total customer experience. Today, service providers offer data services that appeal to a very small proportion of mobile users: the young and technology savvy. This group is also one that is most prone to churn. Yet today’s high ARPU (average return per subscriber) users are arguably the customers to retain, as they will likely remain at high ARPU levels for some years to come.

5.1.1 Marketing Objective

ü Capture rural Indian market ü Target school studentü Attract Customers to New technologyü Enhance Distribution ü Maximize our revenuesü Maintain Customer’s Loyalty

5.1.2 Ease-of-Use

The main reason why data services have not yet achieved mass-market adoption is due to the complexity perceived and experienced by end-users. The poor reputation of data services increases the threshold of willingness for non-users to experiment with data. Bad user experiences also inhibit existing users from adopting new services.

5.1.2.1 Simplified Service Setup

Mass-market service usage can occur only if the technical barriers for end-users have

been overcome. Improving the initial phase of service delivery is a sure way to increase the use of a mobile service, which will lead to an improved end-user experience; higher revenues for service providers, operators and developers; decreased customer care costs; and decreased churn rates. Finding and subscribing to a service are the first hurdles for a potential user. End-users expect the same effortless and easy access to services via a mobile phone as they are accustomed to with other channels (e.g., Internet, TV). However, easy access to a service is dependant on the user’s frame of reference. Some users consider access via a branded Internet portal easy, while some users prefer a browser menu on the device. Knowing your customers is the key to identifying the most appropriate access channels and improving the efficiency of marketing.Service set-up and configuration is the crucial stage in the service adoption process. Users often consider setting-up and configuring services the most tedious part of service take-up. Studies suggest that users will abandon the service after two or three failed setup attempts. As the number of functions on mobile sets continues to grow, users find it increasingly difficult to configure and maintain services and applications on their devices (see Fig.5.4). Focusing on delivering ease-of-use in set-up and configuration is paramount in order to promote service adoption and improve revenues from services.

Fig.5.4. For a complex data service such as messaging, most users seek setup assistance from a person, whether by phone or in-store

5.1.2.2 Simplified user interface

For an easy-to-use experience, service content must be undemanding and plain. Ease-of-use comes from effortless navigation, with a simple structure that does not require reading a user manual to be understood. Understandable terminology used throughout the service session enhances the experience even further. The user interface should have flexible content behind it, in the sense that the content adapts seamlessly to different terminals. Ease-of-use is also created by minimizing the user’s exposure to the underlying technology when using the service. A simple and practical user interface, coupled with relevant content, is a prerequisite for a successful service concept. Any device offered as part of a service must be carefully matched with the requirements of intended users. An easy-to-use experience stems from a service concept that successfully combines relevant content with a matching device. Handset functionality already includes email, various types of messaging, and access to Internet and entertainment functions. However, end-users experience the increasing functionality of handsets as too complicated and are hesitant to use them. As such, complex handsets do not by themselves promote increased service usage.From the perspective of service management, ease-of-use means integrated systems that feed service information into reporting systems that enable the service provider to monitor and assess service usage online, in real-time. Application developers must consider the scalability of applications in order to deliver adaptability for different interfaces in devices and in the network.

5.1.2.3 Clear Payment Method

The ease-of-use experience is also reflected in payment options and processes, which should be as effortless as possible. These processes include payments and associated transactions, such as contracts required to access the service, as well as procedures to make and confirm transactions. End-users favor suppliers that can minimize the risks involved and maximize the user’s level of comfort and confidence. The end-user should feel able to control spending and feel secure about the services used. For convenience, users prefer to pay for services with existing pre-paid or post-paid accounts.

5.1.2.4 Easy access to Customer Support

Offering customer care is an essential part of an ease-of-use service experience. The working customer care concept creates stickiness between the end-user and the service provider. Customer support can be offered via a call center, by providing automated self-service or through in-store support. The challenge is to choose the customer support combination that best matches the specific service proposition. For call centers, ease-of-use manifests in quick response, least number of call transfers, transparent tariffs and knowledgeable personnel. The better the alignment in business processes, supporting infrastructure and related call center processes, the better the capabilities for delivering superior call center service.Another contact point for users is often provided via a branded Internet portal. An Internet portal is an attractive option because it supports end-users 24/7 and is cost-effective for the service provider. Users can access the portal to manage and modify their own account. Connection stability and logical navigation with a minimal number of clicks determines the ease-of-use experience in an Internet portal. The third contact point for users is in-store support. This support is difficult to organize and manage for quality as it is often outside of a service provider’s own business realm. End-users often perceive in-store support as inadequate and not fulfilling their needs. Many end-users complain about the service they have been given while visiting an outlet.

5.1.2.5 Simplified service termination

Termination of the service should be as simple as possible in order to lower the threshold for a user’s willingness to test the service. A simple SMS or MMS message should be adequate to terminate the service.5.1.3 Product Life CycleA large untapped potential exists among the present base of non-users: the 10% of existing customers who use services infrequently or do not use services at all, even though they have the right mobile handset. In general, these mainstream users are more loyal to their existing service provider, making them a group to reward for their loyalty. Ease-of-use is one of the key factors when increasing customer loyalty, which, in turn, will lower churn and eventually lead to a decrease in marketing expenditures. Differentiation by ease-of-use experience will also have an effect on increasing ARPU, because it speeds up the adoption of new services.The more mainstream the target users, the more they value ease-of-use and customer

intimacy and seek practical uses for new services. The fact that ease-of-use is particularly relevant to mainstream users makes it such an important consideration. Making a service successful in the mainstream market has the challenge for most existing services. Creating ease-of-use in services will help a service provider to “cross the chasm” from the early market of innovators and trendsetters to the mainstream market of average users (see Fig.5.5).

Fig.5.5. Services Life Cycle

Creating and implementing a business strategy that focuses on ease-of-use will enable the service provider to increase service revenues. Naturally, strategies across geographical regions and operators differ and it is not possible to copy exactly from the experiences of others. Service uptake and usage differ vastly depending on the stage of the overall society and service culture, main technologies chosen, competitive market situation, maturity level of networks, and other network lifecycle variables.

5.2 Positioning Strategy

When Nokia positions its brand in the crowded mobile phone marketplace, its message must clearly bring together the technology and human side of its offer in a powerful way. The specific message that is conveyed to consumers in every advertisement and market communication (though not necessarily in these words) is "Only Nokia Human Technolgy enables you to get more out of life"In many cases, this is represented by the tag line, "We call this human technology". This gives consumers a sense of trust and consideration by the company, as though to say that Nokia understand what they want in life, and how it can help. And it knows that technology is really only an enabler so that you-the customer-can enjoy a better life. Nokia thus uses a combination of aspirational, benefit-based, emotional features, and competition-driven positioning strategies. It owns the "human" dimension of mobile communications, leaving its competitors wondering what to own (or how to position themselves), having taken the best position for itself.5.2.1 Nokia Product Design

Nokia is a great brand because it knows that the essence of the brand needs to be reflected in everything the company does, especially those that impact the consumer. Product design is clearly critical to the success of the brand, but how does Nokia manage to inject personality into product design? The answer is that it gives a great deal of thought to how the user of its phones will experience the brand, and how it can make that experience reflect its brand character. The large display screen, for example, is the "face" of the phone. Nokia designers describe it as the "eye into the soul of the product". The shape of phones is curvy and easy to hold. The faceplates and their different colors can be changed to fit the personality, lifestyle, and mood of the user. The soft key touch pads also add to the feeling of friendliness, expressing the brand personality. Product design focuses on the consumer and his needs, and is summed up in the slogan, "human technology."

Nokia now accounts for over half of the value of the Finland stock market, and has taken huge market share from its competitors. According to one brand valuation study carried out in mid-1999, it ranked 11th on the world's most valuable brand list, making it the highest-ranking non-U.S. brand. As has been pointed out, it has unseated Motorola. Nokia achieved its brilliant feat through consistent branding, backed by first-class logistics and manufacturing, all of which revolve around what consumers what.

5.3 Promotion Strategy"Push or Pull"?Marketing theory distinguishes between two main kinds of promotional strategy - "push" and "pull". 5.3.1 Push:

A “push” promotional strategy makes use of a company's sales force and trade promotion activities to create consumer demand for a product. The Nokia promotes the product to wholesalers, the wholesalers promote it to retailers, and the retailers promote it to consumers. For example Nokia promote their products via retailers such as Carphone Warehouse. Personal selling and trade promotions are often the most effective promotional tools for companies such as Nokia - for example offering subsidies on the handsets to encourage retailers to sell higher volumes. A "push" strategy tries to sell directly to the consumer, bypassing other distribution channels (e.g. selling insurance or holidays directly). With this type of strategy, consumer promotions and advertising are the most likely promotional tools.

5.3.2 Pull:A “pull” selling strategy is one that requires high spending on advertising and consumer promotion to build up consumer demand for a product. If the strategy is successful, consumers will ask their retailers for the product, the retailers will ask the wholesalers, and the wholesalers will ask the producers.

Fig.5.5 “Push” and “Pull” strategy

5.4 Pricing Strategy

Fig.5.6 Pricing Strategy Matrix

Nokia observes different pricing strategy for different range of product. The main aim is to gain the market at rural village of India and maintain it’s customer for Mid range phone.

5.4.1 Premium Pricing

Use a high price where there is uniqueness about the product or service. This approach is used where a substantial competitive advantage exists. Such high prices are charge for luxuries such as NOKIA E-series mobile phone.

5.4.2 Penetration Pricing

The price charged for products and services is set artificially low in order to gain market share. Once this is achieved, the price is increased. This approach was used Nokia on Model No. 1100 and 1108, in Indian rural market.

5.4.3 Economy Pricing

This is a no frills low price. The cost of marketing and manufacture are kept at a minimum. Nokia follow it for it’s mid range Mobile phone. Normally it is to attract middle income group.5.4.4 Price Skimming

Charge a high price because you have a substantial competitive advantage. However, the advantage is not sustainable. The high price tends to attract new competitors into the market, and the price inevitably falls due to increased supply. 5.5 Distribution StrategyMobile phones have become a major part of our everyday life. On the one hand, India’s Mobile phone market has grown rapidly in the last few years on the back of falling phone tariffs and handset price, making it one of the fastest growing markets globally.Nokia is a world leader in mobile communications, driving the growth and sustainability of the broader mobility industry. Nokia connects people to each other and the information that matters to them with easy-to-use and innovative products like mobile phones, device and solutions for imaging, games, media and businesses. Nokia provides equipment, solutions and services for Network operators and corporations.Nokia held a global market share of 34.2 percent at the end of January, according to consultants’ strategy Analysis, while Motorola had 18.3 percent, Samsung 11.1 percent, and LG and Sony Ericsson 6.6 percent each. “To illustrate Nokia’s performances, more than one third world’s phone users use a Nokia phone”. In India Nokia is the market leader, with a manufacturing facility in Chennai. Understanding of distribution channel used by Nokia – Distribution is the life blood for an organization in order to make sales. The products are required to reach the outlets for sales based on the demand for the product. Only if distribution channel is effective products can reach the consumers, as well maintain or increase their market share. This is very important, as there is intense competition in the market from various other players, in order to stay ahead and meet the competition we need to provide goods on time to the dealers to make sales and earn profits for both company as well as outlets. Availability of goods and time is an essential for any organization this could be done only by having good distributors and redistributors stockiest. Further the company should take care of goods manufactured reach the distributor & the redistributors stockiest on time. The

company requires to have a regular check on these channels if they working efficiently and take steps to further step to improve. The company only stay ahead in profits, market share etc, only if their products reach the outlets on time as well based on demand.The project began with the basic understanding of how distribution of mobile phones takes in the market by Nokia. Nokia works with the distribution of mobile phones takes in the market by Nokia. Nokia works with the distributor, re distributor stockiest (R.D.S) and finally the retailer from whom the product is sold to the consumer. Five forms of outlets sell Nokia’s products:Distributors-:i. HCL infosystemii. Bright point.

Outlets-:i. Nokia priority dealersii. Multi brand outletsiii. Reliance web worldiv. Reliance web world expressv. Tata true value shop.

Fig.5.6 Nokia Distribution ChannelsDistributors:a) HCL Infosystem: During the last ten years, the HCL-Nokia relationship has witnessed strong growth in the Indian GSM handset market resulting in a significant market share gain for Nokia, and the increased need for a distribution Network that will meet the projected market growth of 200 million subscribers by 2007. The relationship with Nokia has been a very satisfying one, and the agreement between Nokia and HCL reaffirms Nokia’s commitment to the growing Indian Market, to ensure that mobile devices are accessible to more consumers in the cities and towns across India.Mobile penetration is getting into the next phase of growth of which a major portion is expected to come from smaller towns and remote locations. There is clear pick up ion demand. The challenges ahead would be to penetrate deeper, preserve market and in order to have much greater depth, align to global policy of balanced channel mix and also to ensure that all possible channels are included, and channel partners are well served so that growth opportunities are captured.The two companies have extended their agreement for another five years. This strong relationship between these two players plays a crucial role in increasing the sales as well to hold the market leader position in the market. Both entering the distribution channels will in fact help the consumer to get the best product in the nearest location in any part of the country.b) Bright point : It offers the most comprehensive selction of brands and products in the wireless industry. Handset, Integrated devices, PDAs, etc. They also provide full selection of OEM and aftermarket accessories, Modems and software. It distributes product manufactured by the world’s leading handset manufacturer.

Outlets:a) Nokia priority dealers are exclusive show rooms for buying Nokia products. These

outlets are directly under the control and supervision of Nokia, which makes them solely accountable to Nokia. NPD’s are preferred outlets to buy Nokia products, as they are their genuine dealers of its products. These outlets have the complete portfolio of Nokia products existing in the market. The buying experience the consumer enjoys is the better than any other outlet in the city.b) Multi brand outlets are the outlets, which deal with all the company products in the market. They provide service and space to all the competitors as they sell all the products in the market. The major purpose is not to dissatisfy the consumers entering the outlet and provide them with all the brands asked by him. The amount of sales made is higher as well the profit earned is higher. The numbers of these outlets are higher in the city.c) Reliance web world are exclusive reliance outlets. They deal with reliance products of providing connections and billing of the connections. These outlets also sell mobile phones of various brands. The major aspect in these outlets is the stock reaches these outlets directly from the company itself. The RDS has no role to play other than providing these providing these outlets POS materials to these outlets.d) Reliance web world express are also exclusive reliance outlets but are the franchise outlets of Reliance. They also deal with reliance products of providing connections and billing of the connections. These outlets also sell mobile phones of various brands. The major difference between web world and express are the stock that reaches these outlets. The RDS and his sales men provide both stocks as well POS materials to these outlets.e) Tata true values Shoppe are also exclusive Tata outlets but are the franchised outlets. They also deal with Tata products providing connections and billing of the connections. These outlets also sell mobile phones of various brands. The RDS and his sales men provide both stocks as well POS materials to these outlets.

6. Marketing Schedule

Action Plan1. Jun ’06 to Oct ’06 -: New Programmes - Concept Development and Pilot – Sanjay, Sumit2. Jun ’06 to Oct ’06 – Promotion material preparation and Ad concepts –Navin, Meghana, Narayan.3. Aug ’06 to Dec ’06 – New Programmes promotion – print ads, channel partner ads, magazine ads – Sandeep, Ashwini4. Jun ’06 to Mar ’07 – Market Research, Surveys, Consumer Feedback – Abdul Gani, Mehlam7. ConclusionNokia being in a competitive market holds the market as a monopoly with its Unique identity, Marketing Strategy and distribution policy. Through the Ease-of-use concept, it will add a lot to Customer Value, which further helps Nokia in capturing the market share in India.“Our goal is to be a good corporate citizen wherever we operate, as a responsible and contributing member of society.”