The enabling of the broadband at high speeds or provisioning of internet to everyone would ensure that the smart phone usage would increase and this in turn would increase the sales of those phones. This a positive spinoff from a industry point of view.
Economical: This factor relates to the happenings that are affecting the economy like the growth / decline in the general economic conditions, interest rate fluctuations, exchange rate and inflationary factors, availability of credit, wage structure and minimum wage restrictions, the cost of living, purchasing power parity of a country would be some of the factors that would be required to considered from a economical point of view.
The major events that happened over the last twelve months on an economic front are that the year has noticed great drop in inflation and the consumer price index and the same had a progressive negative impact on the market and the manufacturing industry. However, there has been a steep increase that is being noticed in the last couple of months which would enable the industry to bounce back and Nokia could offer products keeping the factor of elasticity of demand in mind to mix and match its product basket to suit customer needs would enable it to achieve the growth and gain market share in United Kingdom ().
Sociological: This particular factor takes into consideration the cultural norms and expectations, health issues, safety, age distribution and other aspirations like career growth and relevant matters.
The major events on a sociological front in the United Kingdom for the previous twelve months are the effects of recession as per the report from the social issues research centre in 2009, it clearly indicates that the mobile phone has become a necessity even in this period of economising on some products. Hence, it can be assumed that the demand for the products (mobile phones) would continue even in a recessionary environment as sociologically it has become a necessity for everyone ().
Technological: This indicates the technological impact that the environment would have on the industry or the product that is being assessed. From the point of view of mobile as they are inherently part of the technological development, this factor would have a major impact on this industry. The recent Mobile World Congress which was held in Barcelona which has thrown open multiple options on improving the delivery and technology that would be incorporated in the mobile phones has opened up avenues for this industry to take advantage and provide improved services to the customers. Nokia would be able to take advantage of these developments and incorporate the necessary changes like symbian technology in their smart phones would provide it with a competitive advantage ().
Environmental: This is a factor which takes into consideration the impact industry has on the environment and ecological aspects. From an industry perspective climatic change and the impact each industry has on the environment is being showcased and Nokia to address this particular concern is working on numerous strategies like working on a phone which can recharge itself without the requirement of mains electricity (). Nokia has also developed an environmental strategy to minimise their environmental footprint by initiating steps to factor in their substance management, being energy efficient in all the processes that are being developed, and providing options for recycling the products of the customers who use their products and providing sustainable products to the customers ().
Legal: The legal aspect is separated from the political factor however there exists a considerable overlap between these two factors. This factor would address the issues related to employment laws, quotas, etc.,
The company is undergoing multiple issues in the legal front as it is battling a patent infringement battle against Apple Inc as a whole the mobile industry is looking forward to the judgement that is expected from this case. The mobile industry since its inception has been a legal battleground with more and more companies filing suits against each other over patent infringements which is creating a stress on the delivery of right products to the customers. However, Nokia as an organisation is fighting multiple legal battles in different locations across the globe. However, it needs to be seen what are the benefits that the organisation is expected to derive from the ongoing legal battles it is fighting in different hemispheres of the world. The major factor would be recoveries it would be able to bring in from this legal suit Nokia is pursuing.
PART – B
As we have seen how Nokia has been affected from a macro environment perspective. Let us now have a look at the marketing mix strategy that has been adopted by the company with which it has gained the position of being the number one mobile manufacturing company in the world.
Marketing Mix
Marketing mix is a concept which has been in use since the 60’s. Now we will relate how this strategy has been adopted by Nokia Corporation in pursuing the growth of the organisation.
Let us have a look at what are the components of the marketing mix and how they influence the organisation. The marketing mix comprises of 4Ps namely Product, Price, Place, and Promotion. This has been proposed by Mr. McCarthy J.E in 1960. A pictorial representation of the same is given below.
Product: A product can be defined as any tangible or intangible product or service that is offered to the customers and which is mass produced in a large scale in an industrial setup or in a processed format. The product could be differentiated on different methods like variation in price, offering innovative products, replacing old products with new products as part of phasing out process.
Considering the above factors Nokia has been offering various products and mixing the product bouquet to satisfy the needs of customers. They have been innovative and have offered different products and upgraded sequentially on regular basis. They are also inventing new technologies in the market place with the research on the augmented technologies () which is expected to be the next generation of products. This continuous product range and depth have enabled them to take considerable advantage and gain the required momentum to take on the competition.
Nokia has wide range of products to meet the customer requirements and adopt them to suit the different regions it serves. At the same time it standardises its products at a low level and it helps the organisation to migrate different products to regions as per the requirement and necessity.
Nokia has also adopted an approach of offering products as per the product life cycle of different previous products which are of the same line or to meet the requirements of a segmented target of customers. This approach of targeting the customers with upgraded products has enabled them to sustain in the market place.
Place: This can be referred to as the channel or medium used for the distribution of products or services or the physical location from where the products are offered to the customer.
The distribution channel adopted by M/s. Nokia and entered into Joint Venture for offering their products with major logistics operators and the products are then channelled to various parts of the United Kingdom for display and sale at retailers like carphone warehouse, mobiles4u, and the mobile operators like O2 for offering their products through their networks. This kind of piggybacking has enabled them to capture the large market through the mobile operators.
Previously, Nokia had their own flagship stores which offered the dual benefit of offering experience to the customers on the products availability and the range. However, with the recession and the development of the markets Nokia has closed this channel of distribution and concentrated on channelling their offerings through distributors and online stores (Gareth. B, 2009). This was first started in United States of America and the London store was closed as Nokia has refocused its strategy to offer the products through the retailers and cut down on the costs incurred in maintaining a separate store to showcase its products.
Price: Price of the product is one of the 4Ps and has considerable impact on the overall marketing mix strategy. This can be defined as the value that the product has in the market or is the assumed value in the minds of the customers.
Nokia has offered different products to target the market and prices have been varied to meet the requirements of the customers. Nokia has a wide product range to suit the requirements of all the customers and they also offer products in coordination with the service providers on contractual basis. This enables them to offer the products as per the requirements of the market. Apart from that Nokia has concentrated on the business customers as they plan to move them to mobile networks from the existing landline based communications that are followed in this time. As a marketing strategist it would be beneficial if the operators are engaged to migrate the existing business customers from landline based communication to mobile based communication thereby gaining the advantage of achieving the penetration and growth that is necessary to sustain in this kind of market. The United Kingdom market is saturated from a customer point of view hence concentrating on the business customers would be a viable option.
Finally old and existing customers can be offered to renew their mobiles with new mobiles on discounted prices to ensure that the company can derive the dual advantage of recycling the products and also if possible recycle the parts in the product. This will enable them to offer new products at discounted rates or the same can be offered in different regions of the world where the mobile penetration is still in its nascent stage.
Promotion: This can be defined as the types of communication that is used to educate the customer about the availability and the features of the products that are being offered. There are different types of strategies that are used in the marketing mix.
The one which is used by Nokia is the ‘pull’ strategy. This strategy is based on the concept that where the communication is originated by the manufacturer is directed towards the customer to create demand. A pull strategy is based around the manufacturer promoting their product amongst the target market to create demand. Consumers pull the product through the distribution channel forcing the wholesaler and retailer to stock it, hence the name pull strategy.
This kind of strategy enables Nokia to ensure that the customer is aware of the products on offer and the same can be checked by the customer with the retailer for availability and the company can mass manufacture them to ensure that they are available to the customer as per the requirement.
The other concept that is used by Nokia is the Promotion through Product Life Cycle. In this concept the company adopts aggressive marketing campaigns at the entry stage and the offering is sustained during the growth stage also by continuous promotion to ensure brand loyalty is maintained and in the maturity stage of the product the strategist adopts the persuasive model of promotion and finally at the decline stage, new products or enhancement of the old product is released to ensure continuity of demand and sustainability in the market place.
Conclusion
As can be seen from the above Nokia has undergone and studied the factors that affect the organisation from an external environment these include the PESTEL which are of importance and the last and most important factor would be the understanding about the competitor and provide the products to counter the offerings of the competitor who would be challenging the product offerings in the market place. Hence a continual scan of the above factors and a pulse on the market trends at all times is required to ensure that the company can sustain its growth in the long term.
The above strategies elaborate the methodologies adopted by Nokia to have a processed way of assessing the factors that can influence it in the given environment. The marketing strategist is expected to undertake this activity on a periodical basis or at important events like launching of new products this would enable them to have a clear perspective and understanding of the market trends and accordingly the marketing mix can be revised or reconfigured to meet the current demands in the market.
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