Can Nokia Rise Once Again?

Walk into any mobile phone store in town and you’ll see rows of new touch screen mobile phones. Apple, HTC, Samsung. Then, there’s our long forgotten friend Nokia. It is becoming increasingly difficult to remember the time when Nokia dominated the cell phone market. Remember the old nokia 3310, the most hardy, well received phone introduced in 2000? Not so much I guess.

nokia-phone

The good news is that Nokia is still the world’s largest handset maker. The bad news is that it is not doing quite so well these days. The Finnish company recently lowered its projections for the second quarter this year causing its shares to plummet a good 15.52%. Analysts have slashed forecasts for fear of not being able to pull off a quick turnaround to halt the decline in market share. The company is clearly buckling under the immense pressure from competitors such as Apple and HTC that have created stellar phones. The question is, can Nokia rise again?

Answering the call
The Nokia success story (in the past) can be attributed to the fact that the Finnish company answered fundamental consumer needs at that period of time. Consumers wanted a phone that was reliable, a phone that wasn’t so clunky and thick and a phone that was for once, ergonomic. The Finnish firm delivered on all these aspects and created a line of phones that were widely accepted by the world.

The Wheel of Fortune Spins
Success was sweet for Nokia but it didn’t last for long. In 2007 Apple Inc. launched the very first Iphone and that marked Nokia’s official descent into darkness. The Iphone opened the floodgates for a whole bunch of technologically superior phones from other manufacturers. These phones outsmarted what Nokia had to offer.
But perhaps the main reasons for the company’s decline are exactly the same as those that brought it fame and fortune a decade ago; Nokia had failed to innovate and to answer consumer needs. The company was not aware of the changing needs.

People change
In 2000, there were already signs of change. Apple inc. released the first iPod in 2001 and that made the world realize their own hidden desires – The desire to have multi functional portable devices that complimented the lifestyles of individuals. Devices started to become technologically more advanced with focus on entertainment and lifestyle (Videos, music etc.). Phones also became more stylish and ergonomic for the user. The same attributes that were desired for in the past were taken as a given as technology improved.

A Drowning Man Will Cling To A Straw
Nokia realizes that the best way to compete in the new market is to seek strong allies. In partnering Microsoft, Nokia will soon (we hope) be dishing out phones that have an incredibly fast interface as its smartphone platform. The WP7 apps market may be still in its hatchling stage, but this could grow in time, since it boasts an easier app development platform compared to those of iPhone and Android. Is it enough to outfox the current big competitors? Only time will tell.

Is Nokia Finnish-ed?
Nokia has lost significant share in the global cell phone market. Is this the end of Nokia? Not yet. It does seem that Nokia is experiencing relative success in the developing world. The company has been rolling out services to emerging markets in Brazil, China, India, and parts of Africa where there’s a high demand for affordable, practical mobile services.

The needs of these developing countries closely resemble those same needs in the early stages of mobile phone development. Nokia’s low-cost handsets allow Nokia to have a significant leg-up on competition in emerging markets across the world, including two of the biggest — China and India.

So can the former champion reclaim its spot at the top? Well yes, if it focuses on answering the needs of consumers in the developing world. As for the developed world, it would need to seriously reconsider the needs and wants of consumers in the developing world.

Any thoughts?

BrandhubBrandHub is a Singapore based strategic brand consultancy dedicated to creating and building Leader Brands in Asia. Established in 2003, BrandHub has been voted the leading independent brand consultancy in Singapore by readers of Marketing Magazine in 2007 and 2008. BrandHub's clients include SingTel, Certis, RedRock, National Heritage Board and National Library Board.