FREE ESSAY ON NOKIA

NOKIA

Nokia 
SWOT 
STRENGTHS
-  Nokia has long established identity (1898); lots of available resources (financial,
etc.) 
-  Schmohl is experienced in international marketing (Adidas and Uniroyal) 
-  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

WEAKNESSES
-  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 
OPPORTUNITIES
-  Potential for brand name sales in Europe = differentiation 
-  Growing replacement and supplement television market 
-  NCE has opportunity of using its technology to enhance user-friendliness 
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, Goldstar, Daewoo) quickly and successfully building brand name
and image 
Branding Strategy
In the colour 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. Schmohl must introduce a new mindset to NCE; a strategic shift that encourages
customer service and international marketing.
Internal Management Challenge
Schmohl 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,
Schmohl 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 manufacturers 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. To do this, Schmohl should be willing to
increase margins to dealers or incentive programs to encourage them to sell the Nokia
brand vision and concept. 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 European 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. 
Summary of the recommendation of channels for each brand is illustrated on the table
below:
NOKIA SALORA LUXOR
INDEPENDENTS   
MULTIPLES   
GENERALISTS   
1. Independents
-  High turnover (53%) with 58,000 outlets, high market penetration 
-  Strong in some countries like Italy, Germany and UK. But weak in others like in
France. 
-  Mix of product line, could be a cherry picker. 
-  Potentially high Traction cost because of decentralization. 
-  Suitable for selling from low to high end product. 
Based on the above characteristics, it is recommended that both Nokia and Luxor should be
distributed through independents channels in order to maximized the market penetration
since these two brands focus on user friendly, long term quality, reliability and
security to low or middle end users. However, it is recommended that Luxor should only be
marketed in the Scandinavian countries since it has no appearance in the other
countries.
2. Specialist Capital chains or Multiples
-  Strong in France and UK (41% & 22% resp.). 
-  Relatively lower market penetration 
-  Good Product knowledge 
-  Suitable for middle to highend products with innovative technology. 
-  Relatively lower transaction cost since dealing with smaller number 
Based on these characteristics, it is recommended that Salora and Nokia should be
distributed through this network because of they are relatively higher end positioning
with innovative technology and user-friendly features. It is also recommended that
special focus should be paid on the countries such as France and UK (regional sales of
41% and 22% respectively) since Multiple channels take an important role in those
region.
3. Generalists
-  Plays as an important channels in Spain, Germany, Spain, and France 
-  Consumer electronics products are only parts of the goods being sold. 
-  Poor product knowledge. 
-  High traffic pattern and potential shoppers, suitable for well-established and
traditional brands with proven technology that required minimum after-sales service. 
-  Relative low transaction cost due to well established and highly centralized. 
According to these characteristics, it is recommended that both Nokia and Luxor should
also be marketed through Generalists because these are proven products and well known
brands. Salora is not recommended in this channel because it is a higher end product that
required more product knowledge and selling skills which is not suitable in this
environment.