The Impact of Declining Nokia Market

Introduction

Nokia has come a long way to evolve from a paper mill founded in 1865 to a world renowned mobile phone manufacturer and one of the most powerful brands in the world. In 1992 Nokia appointed Jorma Ollila as the new CEO and concentrated its focus on telecommunications.

Throughout the 1990’s Nokia was known as a relentless innovator and a pioneer that made the world’s first satellite call among many other groundbreaking milestones. In 1998 Nokia became the world’s largest mobile phone manufacturer with a turnover of 31 billion dollars. Nokia is still the most influential company to the Finnish national economy, but Nokia’s effect is far from what it was in the early years of the 21st century when Nokia accounted for almost half of the economic growth in Finland and produced as much as five percent of Finland’s annual Gross Domestic Product.

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In 2006, Olli-Pekka Kallasvuo replaced Jorma Ollila as the CEO, but was not able to reverse the decline of Nokia’s market share especially in the high end segment, where competitors like Apple, Blackberry,HTC, Samsung, and phones using Google’s Android operating system captured market share from Nokia at an alarmingly increasing rate. At the end of year 2010 Android was already the most widespread smart phone operating system in the world and Nokia’s market share in the smart phone segment had declined from 38 to 31 percent in one year (Sokala).

Literature Review

The purpose of this literature review is to discuss relevant writings on how to improve marketing strategies from the branding perspective. First, important terms such as brand equity and the concept of consumer-based brand equity are discussed. Secondly, the brand management process is discussed from a strategic viewpoint with the help of terms like brand revitalization and integrated marketing activity. The next part of the literature review concentrates on analyzing the marketing environment.

Finally, the last section summarizes important conclusions on how the literature review relates to the company being observed, Nokia During 2012, the telecom infrastructure market saw slight growth in capital expenditures in Euro terms by global mobile operators, mainly attributable to operators in Japan, Asia Pacific and North America but it was off-set by declines in Europe, China and India, it added. Objective Of The Study The thesis has three distinct research objectives. First of all I will try to find out what is the aspired brand identity and brand image Nokia is trying to convey with its smart phone marketing.

To achieve this I will conduct interviews with people who are responsible for Nokia’s brand management and marketing. The second research objective of my thesis is to find out what is the consumers’ brand perception of Nokia at the moment. To answer this question I will conduct a comprehensive smart phone brand perception survey to collect data from Finland and the United States. The last research objective of the thesis is improving Nokia’s current marketing strategies for its smart phones from a branding perspective in the countries subject to research.

By comparing the results of the customer surveys with the company interviews, I can detect where the aspired brand identity of Nokia does not meet the brand perceptions of the consumers. By utilizing the existing knowledge and literature on the topic, I should be able to come up with ways to improve Nokia’s smart phone marketing in the two distinct geographical regions. Research Methodology The Study This Bachelor’s Thesis is a case study with a conceptual research design since it consists of a defined research problem, clear research objectives, and exact research questions that lead to conclusions on a real-life phenomenon.

The thesis includes empirical as well as descriptive elements. There are several contexts to the research, because the aim is to improve Nokia’s existing marketing strategies in different regions based on potentially differing brand perceptions prevalent in these areas. Data Collection Methods Interview Qualitative research and analysis methods were used to assess the depth interview (Appendix 1) conducted on the fourth of February, 2011, with Mr. Pekka Somerto, the Vice President of Nokia’s Brand and Marketing Portfolio Management. The interview was conducted at Nokia’s headquarters in Keilaniemi and it lasted for approximately an hour.

Interview

The interview consisted of thirteen questions and the purpose was to find out about the brand identity Nokia tries to create with their marketing. The questions asked were chosen based on the literature discussed in the literature review, and with the overall goal of improving Nokia’s marketing strategies for smart phones from the branding perspective. The results of the interview not only helped in reaching the research objective, but they also provided useful ideas and additional questions for the consumer survey. Survey To find out consumers’ brand perceptions of Nokia, quantitative research and analysis methods were utilized.

An online consumer survey (Appendix 2) was created with the Qualtrics-software and distributed to approximately 400 people in Finland and the United States through e-mail and social media networks. Data Analysis The data analysis of the survey results started with a general analysis of the averages and apparent trends. It was followed by the identification of significant regional differences between the responses with the help of cross tabulations.

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