Failure of

Nokia
By: Karan Kamboj
Why Nokia failed?
One of the giants in mobile manufacturers
sold itself to Microsoft. Is it a sign of failure
or its inability to maintain a firm. No doubt its
a failure to properly manage.

So, why do you think Nokia failed. Be

attentive to know the reasons behind failure of
Nokia's marketing strategy and what can be
learnt from it.
How Nokia failed in connecting 'to' people
Apple redefined smart phones with touch screen and
Blackberry with email. Android proved that software matters
more than hardware.

Nokia was slow to respond to these trends.

InIndia, local brands stole the lead on dual SIMs, low-end

Qwerty and long-battery-life phones.

Ina nutshell, that's how Nokia, which enjoyed a 60% market

share in India, ended 7-9% as per IDC Asia Pacific Mobile
Tracker in Q4 2012.
 Android weakened roots of Nokia?
In 2008, brands like Samsung, HTC, and Sony found
roots to extend their market.
Samsung's Android phones are user friendly and
budget friendly too.
When every manufacturer is busy in making
touchscreen mobiles, Nokia felt that touch wouldn't
have a scope in the near future but customers
overwrote their expectations.
Nokia's entrance into Windows platform is quite late
Finally Nokia gave up for a 7.1 billion to Microsoft.
Mistakes that lead to Nokia Failure
1. Failure of Symbian OS:

Nokia launched its Symbian 60 series in year 2002 which initially

had a good market response.

The introduction of Apple iOS in 2007 and Android in 2008, the OS

race was completely taken over by the two giants.

The reasons for collapse of Symbian OS is lack of applications and

UI (User Interface).

After facing competition from iOS and Android, Nokia

continuously tried to improve their Symbian OS but was not
creating something unique.
2. Wrong Deal with Windows
The company made the biggest mistake to take a leap
of faith in Windows in 2011. At that point of time, the
company already was in declining condition and
trusting Windows which was new in the field to regain
its status was the biggest mistake the company made.

All these phones which the company launched were

comparable to other competitor devices but OS was the
problem which lead to ultimate collapse of company.
 3. NOKIA Became Laggard in
Smartphone Market
Stiff competition from Samsung and Apple.

Lack on focus on innovation was the second

big reason of collapse.

Nokia seemed to be lagging in the race.

Where Samsung from nowhere entered the
race and focused on innovation as its core
competence to gain the market share,
Nokia was very late to realize this fact.
Below is the diagram showing how sales
dipped from Q4 in 2010 to Q4 in 2012.
4. Losing Market Share on Both Ends
Nokia not only failed to realize competition from
Apple, Samsung, Sony, Blackberry in high end smart
phones, they also failed to notice the stiff competition
in the lower segments of phones.

The company which used to have epic models like

Nokia 1100 suddenly started losing at lower ends too.

Very lately company realized this thing and launched

their Asha series but by that time they had already lost
the game.
5. Failure to Implement the Right
Umbrella Branding Strategy
Apple was the first phone to use the strategy of umbrella branding
using iPhone as an umbrella brand and then building subsequent
models each year.

Samsung was quick in identifying this concept and they started

building their high end phones with Galaxy S series.

Nokia on the other hand used to have used an umbrella brand in the
N series and recently the Lumia series, but they failed to create
buzz among customers which Apple created.

The company which is missing the constant innovation has the high
probability of getting punished from the customer.
SWOT
Strength Weakness
Experience Low voice quality

Largest network of selling & Less stylish in low priced

distribution products

Strong customer relation Heavy sets

Wide range of products for Unlike iPhone Apple, Nokia

all class N-series is complex, tough and
not user friendly
SWOT Cont...
Opportunities
New growth markets
Concentrate on Smartphone's
Well designed and styled set
Mini notebooks
Threats
China mobiles It has made exact
copy of Nokia
Competitors like Samsung & Apple
Sales may decline due to global
economic downturn
Standard & Poor downgraded Nokia
with low grade
Journey towards failure
Year 2006:
Nokia is on a high. It enjoys 60% share of India's
mobile market and is the undisputed lead.

Year 2007:
June 29
Apple launches iPhone 3s.
Redefines smart phone and challenges category
leaders like BlackBerry and Nokia.
Year 2008
March
Micromax sets up handset business in India.

September
Samsung launches Omnia. Becomes dominant in touch
screen phones globally.
Year 2009

June
Android enters Indian market with HTC Magic at Rs
29,990.
Year 2010
June
Samsung launched Galaxy S in India at Rs 31,500,
its first smart phone.
Later, Galaxy-3 (Rs 12,300) & Galaxy-5 (Rs
10,200).
Samsung's smart phone sales surge.
August 30
Nokia launches C1 & C2dual SIM phones.
Nokia market share in India for 2010 (Jan-Sept),
according to IDC, crashes to 32.9%
Year 2011
February
Nokia announces Microsoft patnership, but it takes 8-9
months to unveil products.

Meanwhile, Samsung consolidates position while Micromax,

Karbonn, Lava, Spice launch cheaper smartphones.
March
iPhone 4. The iPhone changed the industry in more ways than
one: apps, superlative design and accessories.
But Nokia is still struggling to find traction with Windows.

June
Nokia launches dual-SIM phones, becomes no.1 player in this
space, but it is 18 months late. This delay cost Nokia.
November
Samsung's Galaxy Note, iPhone 4S launched.

December
Nokia's Lumia 800 (Rs 29,000)
Lumia 710 (Rs 19,000) launched.
Samsung's cheapest Galaxy at `7,830; strengthens position in
the low-end smartphone space.
Year 2012
January
Nokia fights back. Launches first Asha, 200 for Rs 4,400. It is
its first QWERTY dual-SIM device. Strong product, but dual-
sim market is past its peak.
June
Full-Touch Asha 305 launched. Nokia claims it's largest-selling
smartphone; but rivals and some tracking agencies don't
consider Asha a smartphone.
September
Nokia Market share is 22.2 % and 19.2% in smartphones.

November
iPhone 5 launched.

December
Samsung's India Galaxy sales count crosses 1 crore.
Year 2013
Nokia's market share dwindles down to 7-9% as per IDC Asia
Pacific Mobile Tracker in Q4 2012.

March
Lumia 520 (Rs 10,000) launched but Samsung, Micromax move
ahead.
Conclusion
Thank
you