Table of Content

Topic Page No

1. Executive Summary
2. Company Profile
2.1 History
2.1.1 1865-1960
2.1.2 1960-1980
2.1.3 1980-2001 7
2.1.4 2001 and into the future 8
2.2 Mission and Vision 8
2.2.1 Vision 8
2.2.2 Mission 8
2.2.3 Strategy 8
2.2.4 Organization 11
2.3 Mobile Phone Market In India 14
3. Situation Analysis 17
3.1 Social Analysis 17
3.2 Environmental Analysis 19
3.2.1 Nokia environmental strategy 20
3.2.2 Main Issues In Focus 21
3.2.3 Supply Chain 23
3.3 SWOT Analysis 23
3.3.1 Strength 25
3.3.2 Weakness 26
3.3.3 Opportunities 26
3.3.4 Threats 27
4. Segmentation 32
4.1 Mobile Phone 32
4.1.1 Segmentation Strategy 35
5. Nokia Strategies 37

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5.1 Marketing Strategy 39
5.1.1 Marketing Objective 42
5.1.2 Ease-of-Use 43
5.1.2.1 Simplified Service Setup 43
5.1.2.2 Simplified user interface 45
5.1.2.3 Clear Payment Method 47
5.1.2.4 Easy access to Customer Support 48
5.1.2.5 Simplified service termination 49
5.1.3 Product Life Cycle 50
5.2 Positioning Strategy 52
5.2.1 Nokia Product Design 53
5.3 Promotion Strategy 55
5.3.1 Push 55
5.3.2 Pull 56
5.4 Pricing Strategy 57
5.4.1 Premium Pricing 57
5.4.2 Penetration Pricing 58
5.4.3 Economy Pricing 58
5.4.4 Price Skimming 58
5.5 Distribution Strategy 59
6. Marketing Schedule 67
7. Conclusion

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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

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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.

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Company Profile
2.1 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
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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
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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.
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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
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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

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characteristics will never change but, as to the rest,
the story has only just begun!

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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

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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 services
There 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.

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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;

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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 one year. NOKIA’s market
share (in terms of unit sold) has grown to 74% in
March 09 from 61.5% in October 08. In the colour
segment too, Nokia has increased its market share
to 55% in march 06 from 33.7% in march 05.In terms

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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

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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

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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

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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

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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 strategy

Nokia 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

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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

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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

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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.

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Fig.3.1. SWOT Analysis
The 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-

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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)

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· 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:

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(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

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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. Segmentation
4.1 Mobile Phone
Mobile Phones connect people by providing
expanding mobile voice and data capabilities across
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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.

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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

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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%

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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

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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

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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

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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 student
ü Attract Customers to New technology
ü Enhance Distribution
ü Maximize our revenues
ü Maintain Customer’s Loyalty

5.1.2 Ease-of-Use

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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

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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

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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

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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

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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

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willingness to test the service. A simple SMS or MMS
message should be adequate to terminate the
service.
5.1.3 Product Life Cycle
A 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

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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,

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"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

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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

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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.

5.4 Pricing Strategy

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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

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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 Strategy
Mobile 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

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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

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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 infosystem
ii. Bright point.

Outlets-:
i. Nokia priority dealers
ii. Multi brand outlets
iii. Reliance web world
iv. Reliance web world express
v. Tata true value shop.

Fig.5.6 Nokia Distribution Channels

Distributors:
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

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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:

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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.

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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 Plan
1. Jun ’06 to Oct ’06 -: New Programmes - Concept
Development and Pilot
– Sanjay, Sumit
2. 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

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– Sandeep, Ashwini
4. Jun ’06 to Mar ’07 – Market Research, Surveys,
Consumer Feedback
– Abdul Gani, Mehlam
7. Conclusion
Nokia 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.”

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