Table of Contents

Executive summary.....................................................................................2
1. Current situation....................................................................................3
1.1

Market description...............................................................................4

1.2

Product review.....................................................................................5

1.3

Competitive review..............................................................................5

1.4

Distribution situation...........................................................................7

2. SWOT analysis........................................................................................7
2.1

Strengths.............................................................................................7

2.2

Weakness.............................................................................................8

2.3

Opportunities.......................................................................................8

2.4

Threats.................................................................................................8

3. Objectives................................................................................................9
4. Marketing Strategy................................................................................9
4.1

Positioning.........................................................................................10

4.2

Product strategy................................................................................10

4.3

Pricing strategy..................................................................................11

4.4

Distribution strategy..........................................................................11

4.5

Marketing communications strategy..................................................12

4.6

Marketing research............................................................................12

5. Action program.....................................................................................12
6. Strategy Assessment and Recommendation...................................13

Executive summary
Nokia had been dominating the Smartphone market until the launch of
iPhone

in

2007,

which

changed

the

current

trends

of

Smartphone

playground. With a purpose of regaining its position as a leading distributor,

Nokia signed a partnership contract with Microsoft, launching a new series of
smartphones called Nokia Lumia, in order to regain its competitive position.
Lumia smartphones are offered at more affordable prices and continue to
differentiate themselves from other Windows phones with the combination of
new software and tehnologies. In this report, we analyze the marketing plan
of Nokia Lumia in Europe market by presenting the current situations
including market description, product review, competitive review, distribution
situation and macro environment. Then, for the further understanding of
Nokias potentiality and capacity, we continue with SWOT analysis consisted
of the companys strengths, weaknesses, opportunities and threats. The
following part is Lumias objectives. Specially, marketing strategy will be
clarified after that with positioning, product strategy, pricing strategy,
distribution strategy, marketing communication strategy, marketing research
and marketing organization. The last part is action program and our
evaluation on this plan including strategy assortment and recommendation.

1. Current situation
Nokia held the title of best-selling mobile vendor for well over a decade, but
now their reign at the top of the charts is over as they have had to move
aside for Samsungs surge to the top. Many industry experts had predicted
this shift in power ever since the mobile phone went smart a few years
back.
Nokias dominance of the global feature phone market was only ever going
to get them so far and when the world embraced smartphone technology,
Nokia were ponderously slow at adapting to the market.Still, better late than
never, as they say, and with the new Lumia handset (inspired by the Finns
partnership with Microsoft) Nokia have finally arrived at the smartphone
party. The Finnish mobile giants have released the glossyLumia range with
models; Lumia 710 and Lumia 900 being two of the morepopular handsets in
the series.

Figure 1. Comparative analysis: Sales in volume

According to a research study from Strategy Analytics, Nokia Lumia smartphone family with Microsoft OS has out-shipped Apples iPhone and
Samsungs Android family in the first 3 quarters after their commercial
launches. It is an encouraging start for Nokia and Microsoft. Also, based on
historical shipment benchmarks, the report said that Nokias Lumia portfolio
is performing reasonably well. Some of the pessimism surrounding Nokia and
Microsofts partnership so far may be misplaced. However, Nokia and
Microsoft are clearly not out of the woods yet. With a new Apple iPhone 5
expected on the horizon, and Samsungs Galaxy S3 selling in huge
quantities, Nokia will need to pull something impressive out of the bag for
the next-generation Windows Phone 8 launch later this year to sustain its
tentative early momentum.
1.1

Market description

Nokia Lumia is the product of both Nokia and Microsoft as it teams up to

have a bigger share of the smartphone market that is being dominated by
4

Apple and Google Android. There are four Nokia Lumia models out in the
market right now. These are Nokia Lumia 610, Nokia Lumia 710, Nokia Lumia
800, and Nokia Lumia 900. The target market is as follows:
Nokia Lumia 610 targets specifically the students.
The other Nokia Lumia models target windows lover users and working
professionals.
Nokia Lumia 800 and Nokia Lumia 900 target the high end users and technosavvy customers.
In sum, the product mainly focuses on young generation which is technosavvy, gaming lover and wants different experience from a phone.

1.2

Product review

These are feature specification of Nokia Lumia series.

Phone
model
Lumia
610

Screen type
480x800 pixel
16m-color

Release
year
2011

Technology

Platform

Generation

GSM EDGE
UMT
S
WLAN

Windows
Phone
7.5

BB5.0

Form
factor
Candybar

Camera
5.0
megapi
xel

Lumia
710

480x800 pixel
16m-color
WVGA

2011

Lumia
800

480x800 pixel
16m-color
WVGA
AMOL
ED
(16.7M)
Color Capacitive
480x800 pixel
16m-color
WVGA
AMOL
ED
Color
Capacitive
touchscreen

2011

Lumia
900

2012

GSM EDGE
UMT
S
WLAN

GSM EDGE
UMT
S
WLAN

GSM EDGE
UMT
S
WLAN (4G
LTE
for
certain
markets
only)

(Mang
o)
Windows
Phone
7.5
(Mang
o)
Windows
Phone
7.5
(Mang
o)
Windows
Phone
7.5
(Mang
o)

BB5.0

Candybar

5.0
megapi
xel

BB5.0

Candybar

8.0
megapi
xel

BB5.0

Candybar

8.0

1.3 Competitive review

Apples Iphone and Samsung are the most important rivals, because they are
market leaders in Europe. Nokia, according to its mission and vision
statement, wants to regain its leadership position. Therefore, Nokia has to
deal with this two companies. Even Mr. Elop was frustrated by their success
according to an interview for BBC (Nokia at crisis 2011).
Apple Inc
Apple Inc entered the European smart phone market for first time in
November 2007 with its Iphone. The smart phone has been great success
and by now there is 6 generations of the product. Currently the Iphone has
25.3 % market share in Europe (Yarol, 2013). Apple has a much diversified
customer base such that some of the iPhone users are children, students,
average adults, and businessmen and women.
The product has differentiated design compared to its rivals; it is very simple
and classic. The simple design allows it to target the mass market and to be
6

megapi
xel

chosen by different people who can customize it with covers according to

their style. The product is offered in two colors and it has some of the latest
technologies available on the market. The software is also very user friendly
and simplified. The ecosystem offers great variety of apps followed closely
by Android operating system. Apps are very important, because the users
can customize the smartphone according to their needs (Desmarais, C.
2013). IPhone is one of the most expensive products in the smartphone
market in Europe. Apple does not make so much use of advertising on TV
and billboards; it is mainly using word of mouth advertising. The company
has its own shops in almost all Europe where it sells its products. Apple is
much differentiated in terms of almost all 4 dimensions of the marketing mix
compared to its rivals.
Samsung
Samsung is the market leader with 32.3% of the market share in the
European smartphone market (Stellar growth sees 2012). In the second
quarter of 2011, Samsung overtook Nokia with 29% market share in the
Western European market. In this region, Nokia has been the market leader
since1990 (UPDATE 1-Samsung 2011).
The smartphones that Samsung offers run Googles operating systemAndroid. In 2012, Samsung introduced its first Windows phone. The company
offers a great variety of products targeting almost every customer segment
in the market. For example for music lovers Samsung offers Galaxy music,
which has features such as surround sound and easy access to music. For
people who appreciate innovative technology the company offer the Galaxy
S3, also it offers a mini version for the people who find the S3 too big. The
galaxy note series offer its users to write down as they write on real pen and
paper (Samsung, mobile devices). The price of the products also varies a lot
to meet almost every need. Samsung does not differentiate itself in the place
and promotion of the marketing mix.

1.4

Distribution situation

Distribution system of Nokia always continues to enhance and ceaselessly

develop with purpose of a long term progress. Distribution strategies are
dissimilar among continental markets. In Europe, Nokia Lumia products are
delivered to customers most through operator and distributor channels.

Sales volume via different distribution channels in Europe

9%

40%

51%

Operator
Distributor
Retailor

2. SWOT analysis
According to Ferrell and Hartline (2012 p.17) SWOT analysis is a marketing
tool used to approach companys internal and external environment in order
to evaluate its strengths, weaknesses as well as opportunities and threats. To
create competitive advantages, Nokia should take its strengths into
consideration and build appropriate strategy to enhance and utilize these
strengths. Besides, Nokia should be aware of its weaknesses and threats to
improve performance as well as protect company from risks. Opportunities
are chances that help Nokia expand company scale and gain market share.
2.1

Strengths

Since the first launch of mobile phone in 1982, Nokia has been one of the
most popular and trusted brand. The company dominates mobile phone

market with wide range of products from low-cost phone to high-end device
for higher-income class. Their products are well-known for high quality with
user-friendly design, long-lasting cell and sturdiness. Until 2012, Nokia has
been the biggest distributor of mobile phone during 14 years with over 30%
of market share. Even though Nokia had a hard time catching up with
Smartphone trend, a large number of loyal costumer and companys
reputation assist company to maintain the position.
Like other Nokia phones, Lumia has solid and sturdy design that provides
higher shock resistance. Besides, with Windows-based operating system,
Lumia helps user easily sync with computer; support work with various and
accessible office applications such as MS word, MS excel, etc. In addition, in
comparison with other Smartphones of different brands, Lumia has moderate
price that is affordable for people with lower income. Moreover, Lumia is
available with many fashionable colors to attract young people who now
consider mobile phone as discerning accessories.
2.2

Weakness

As a mobile phone manufacturer, Nokia lacks focus in software, internet and

service. Therefore, Nokia is having difficulties in coping with the changing of
Smartphone market trend. Another drawback is that Windows operating
system provides low quantity of applications and games; the interface design
is not truly attractive and flexible. In term of customer service, Nokia has a
small number of service centers which is not efficient to satisfy customers
needs.
2.3

Opportunities

Partnership with Microsoft facilitates Nokia to have a huge competitive

opportunity. Firstly, Nokia is one of the first companies to introduce Windows
phone; therefore, Nokia can become a pioneer in developing new and
innovative products. After the first Lumia Smartphones were released in

Europe, HTC and Samsung also established their Windows 8 mobile phone.
However, Nokia is more advantageous since they have released 8 models of
Windows phone while Samsung only has one. In other words, Nokia has more
experiences in collaboration with Microsoft to develop joint products.
Besides, Lumia series can be expanded from assorted price range and
features to meet the needs of customers of different groups.
2.4

Threats

There exist remarkable threats that Nokia has to face with. The first threat is
that Nokia has many formidable rivals in smartphone market such as
Samsung, Motorola, HTC, Sony, etc. In a segment of high-end phones, the
company is competing with Apple and RIM, 2 companies that are considered
to be big players of costly and luxury phone market. Furthermore, Nokia has
participated in the market later than their competitors because they lost
much time in developing and repairing their strategy. The second threat is
that Nokias switching from Symbian software to Windows operating system
makes loyal customers confused because they may have difficulties
transferring their information from the previous system. Nowadays, a mobile
phone is not only a communicative device but also personal information
storage. Therefore, Nokia needs to convince customers that Lumia can
satisfy all their demands in a convenient and comfortable way.

3. Objectives
Entering Smartphone market as a debutant, Nokia has exerted all its
strength to compete with Apple, Samsung and many other mobile phone
companies. Lumia was expected to be an entrance ticket for Nokia to join the
new tech smartphone playground. Nokia hoped to build the brand name of
Nokia Lumia which could be comparable to Samsung Galaxy or Apples
iPhone. This firm also aimed at people being eager to explore or innovative
ones by providing a completely fresh experience. With the integration of new

10

technology and features, Lumia wish to offere new experiences and utilities
which assist users in various aspects.
Nokia has set objective for sales of Lumia in Europe for 2 periods of time:
- In the forth quarter of 2011, the sales figure reaches 500,000 devices.
- Until the forth quarter of 2013, sales grow at double, which means 1 million
devices are delivered to customers.

4. Marketing Strategy
Nokias marketing strategy is based on a positioning of product
differentiation, which is a combination of differentiation competitive
advantage and broad target scope. Nokias consumer target is from middle
to upper income individuals who need a portable device to communicate
with families or friends, surfing the Internet, coordinate work schedules or
capture photos,etc. However, Nokia,which has been one of the most popular
brands for mobile phones, somehow faded out with the creation of the
massive Smartphone market in Europe, as Alison Donnelly (2008) pointed
out the situation has already changed in late 2008. She stressed the fact that
not so long ago it was very popular to own a Nokia product, but at this time
the company was loosing customers to rivals. Furthermore, According to
Shaw (2012) the marketing strategy of a product should change in the
different stages of the product lifecycle, therefore, changing the marketing
strategy is crucial due to the decline of the company and the need of
regaining market share. Also given the partnership with Microsoft and the
launch of Nokia Lumia series, the company has changed its strategic market
approach.
4.1

Positioning

Nokia used to position to own the low-end smartphone market against its
rivals, especially Apples Iphone which Nokia thought would not be able to
make appealing devices at low prices. However, when Apple agreed with
11

AT&T to lower the price of Iphone to $200, Iphone immediately became a

popular product in the cellphone market, as a result, Nokias market share
has reduced dramatically.
Therefore, in order to regain leadership in the smartphone space
Nokia has formed a strategic partnership with Microsoft that hopefully help
the company regain lost ground in the smartphone market. Together, Nokia
intend to build a global ecosystem that surpasses anything currently in
existence. The Nokia-Microsoft ecosystem will deliver differentiated and
innovative products such as the Lumia series with unrivalled scale in terms of
product breadth, geographical reach and brand identity.
4.2

Product strategy

Produce more smart phones with slim, lightweight and fashionable designs
toattract customers.
Focus on extending the OVI store (including music, games, apps, map etc.)
withthe assistance of partner Microsoft and its advantages (e.g. office
application)
Design more series of smart phones so that customers will have many
choices based on their ages, characteristics and hobbies.
Build up more Nokia warranty/service center in Europe to meet, satisfy and
solve all the needs of customers.
On September 2013, Nokia released the Lumia 1020, which is the flagship
device in Europe, features the very latest Amber version of Windows Phone 8
as well as its excellent camera. However, Apps that run on Windows phone
are much less than those that Android and IOS offer for their customers. This
is a huge problem for Nokia, as apps are really important for the Smartphone
user. Nokias devices are offered in different colours such as green, red, blue
and yellow so the customers can customize the phone by their
preferences.The devices are differentiated in the product part of the
12

marketing mix. However it does not become clear whether the products are
targeting any particular customer group.
4.3

Pricing strategy

Attach value-added services to differentiate the companys offers as well as

support higher prices (rather than cutting prices to match competitors).
Offering reasonable quality and good service at a fair price, discount for
customers in some special event.
Reduce prices for customers buying a new product when they give back an
oldone, encourage them to buy products as well as protect the environment.
Looking at the prices of Nokias flagship device 1020, the product is selling in
the UK for a price tag of 588, in some other EU countries such as Germany
and Italy, the price is introduced at about 687 in retail stores, which is
slightly cheaper than Iphone 5s (699).
4.4

Distribution strategy

Focus on expanding current branches in potential markets such as the

fastest 4G mobile broadband speed in the UK which is upto 97Mbps,
according to new research.)
Other ideal markets include Paris, Berlin, Roma,etc. since they are among the
most developed and popular cities in Europe, which attract many people
worldwide.
Focus more on selling products directly to consumers via the websites to
save distribution and labour cost. Franchising in some places that
appropriate and convenient for the customer to come and buy the products
(e.g. near the shopping centers, famous sight-seeing, high living standard
areas).
4.5

Marketing communications strategy

13

Associate with major providers in Europe like Airtel and Vodafone- which
have all launched 3G and 4G services.
Nokia advertises heavily, promoting itsWindows phones. It makes use of
advertising on TV, billboards, Internet and on Microsofts products.
Create advertising videos and images outdoor (in public transport like buses,
tubes, trainsor in the cinemas) to attract customers.
Send messages, email or phone to prospective customers informing them of new
products
Visit customers houses or their places of business to advertise and sell the
products.
4.6

Marketing research

Using research, Nokia is able to identify the specific features and benefits
that their target market segments value. Feedbacks from market tests,
surveys, and focused groups will help develop the Nokia Lumia new product
series. Nokia is also measuring and analyzing customers attitudes toward
competing brands and products. Brand awareness research will help Nokia
determine the effectiveness and efficiency of the companys messages and
media.

5. Action program
In the purpose of Nokia Lumias success assurance, the firm launched an
action program of marketing which in our opinion, could be divided into three
main stages.
October 26th, 2011 Image Building
Nokia ran a 80m global campaign called Amazing Everyday on the
coverage of media channels such as YouTube, especially on TV. Amazing
Everyday was a clip illustrating adventurous twists of daily routines in which
14

desk jockeys creates a train using chairs, or a dancing guy does chore, etc.
with an invitation Experience Amazing Everyday.
On the same day, Nokia World Conference was organized with a view to
introducing the mid-range Lumia 710 and the high-end Lumia 800 on the
global scale.
At this stage, Lumia built its image by claiming its breakthrough of using a
whole new operator system and hitting consumer sentiment to stir their day
by excitement.
From April, 2012 In the fight against two giants Samsung and
Apples iPhone
There were various ads of Nokia promoting its brand Lumia against
Samsung-Apple rivalry from which there were two examples could be
extracted.
Nokia released a commercial Smartphone beta test on April, 2012 for
Lumia 900 mocking Apples iPhone by three exhibitions Outsider, Sick
Golfer, and Death Grip with three people holding a blurred phone which
can be probably seen that they were iPhones.
A year after, the firm continued to show a piece of advertisement named
Dont fight to promote the model of Lumia 920. This one directly pointed at
two leading rivals Samsung and iPhone and laugh with the context of a
wedding where attendees using Samsung Galaxy fought those using Apples
iPhone. At last, there were a waiter showing up and asked his female
colleague Do you think that if they knew about the Nokia Lumia, they'd stop
fighting all the time?" To which the lady replies, "I don't know, I kind of think,
they like fighting. Then here came the message Dont fight. Switch
From September 5th, 2012 A breakthrough with Pureview started
with Lumia 920

15

Pureview reminds people a period of being overwhelmed by a 40 megapixel

camera. By means of broadcasting on TV and YouTube, Lumia brand made its
own trademark in focus of photography function and image viewer.

6. Strategy Assessment and Recommendation

It is no doubt that Nokia did a great attempt in order to gain its market share.
In spite of being a late comer in the race of dominating smartphone market,
Nokia still proved to be a creative mind with mind-blown commercials which
are mentioned above. Reuters journalists Virky and Prodhan (2011) even
claimed this event of debut a first step in the ailing cellphone makers fightback against Apple and Google. These mobile devices was expected to be
a new dawn for Nokia, said CEO of Nokia, Stephen Elop (Virky & Prodhan,
2011). Nokia was also judicious in the fight against Samsung and Apple when
this firm always call for peoples switching from Android and iOS to Window
phone by using Nokia Lumia. From this wise move, Nokia lured many
consumers attention, especially those who got tired of iOS and Androids
confrontation or ones who had nothing to do with their phones themselves.
Besides, the firm also did a good job of positioning its model Lumia 920 with
innovative features such as Pureview. This innovative technology and the
devices design differentiated this model from others. Additionally, the fact
that a newly released Lumia 920 cost 629 demonstrated Nokias
differentiation on its flagship device to the upper stratum of high-end and
costly market segment in order to scramble the pie that Samsung and Apple
were sharing.
Besides, in our perception, Nokia did an elaborate research on what
smartphone users really want from a smartphone. According to Christopher
Versace, a contributor of Forbes magazine, the most wanted desire of any
consumers is improved battery life. Indeed, Lumia phones have a longer
battery life amongst many other smartphone in the playground. It can also

16

be regarded as one of the value that highlights Lumia amongst smartphones

crowded world.
However, Lumia in general was still considered a failure, and indeed, it was.
Firstly, right at the beginning, Nokia seemed not to well position its products,
especially mid-range ones. From the mentioned-above analysis of current
situation, it can be assumed that the firm attempted to use segmentation
strategy. Nonetheless this strategy seemed to go nowhere since its models
did not well fit any market segment. Although they have quite surprisingly
good and innovative features, buyers might find it was hard to choose a
Lumia model over others within the same brand as their prices and its own
features were somehow nearly alike. In our individual opinion, if only Nokia
had positioned its models better like Samsung did, which mean basing on
product and service class as well as price and quality, they might possess a
bigger piece of pie in the smartphone market. Secondly, Nokia did not clarify
its target customers for Lumia series. Through the ad Amazing Every Day,
it can be clearly recognized that the firm wanted to send a message to young
people: Experience Amazing Every day. Nonetheless, this old giant seemed
to fail understanding what the young really need. According to statistics,
besides basic activities of surfing internet, checking social networks, the
third most used activity is playing games (Johnson, 2012). However,
Windows app store for Lumia is not very abundant in which there were not
so many games were developed. Transparently, Nokia should have
developed its application store in order to satisfy young users.

References
Davies, T. (2012), How fast is 4G wireless broadband in the UK? A tester reveals. Retrieved on
May 31st, 2014 from http://www.theguardian.com/technology/blog/2012/mar/28/4g-broadbanduk-how-fast
Donnelly, A. (2008, Oct 01). Nokia. Marketing, 18-18. Retrieved on February 6th, 2013 from:
http://search.proquest.com/docview/214961929?accountid=14468
17

Ferrell, O.C & Hartline, M (2012). Marketing strategy, p.17. Retrieved on May
31st, 2014 from http://books.google.com.vn/books?id=dIWAAAAQBAJ&pg=PA87&dq=swot+analysis&hl=vi&sa=X&ei=D1GJU_FNoH98QXz2IDoDg&ved=0CDsQ6AEwAg#v=onepage&q=swot
%20analysis&f=false
Johnson, D. (2012). Making calls has become fifth most frequent use for a
Smartphone for newly-networked generation of users. Retrieved May 31,
2014, from http://news.o2.co.uk/?press-release=making-calls-has-becomefifth-most-frequent-use-for-a-smartphone-for-newly-networked-generation-ofusers
Lam, W. (2012). Samsung Displaces Nokia as Top Cellphone Brand in 2012
and Takes Decisive Smartphone Lead Over Apple. Retrieved on May 31st,
2014 from https://technology.ihs.com/418323/samsung-displaces-nokia-astop-cellphone-brand-in-2012-and-takes-decisive-smartphone-lead-over-apple
Shaw, E. H. (2012) Marketing strategy: From the origin of the concept to the development of a
conceptual framework, Journal of Historical Research in Marketing, 4(1), 3055.
Thuy Vinh (2012). u im ca Android, Windows Phone, IOS , BlackBerry
OS, Symbian. Retrieved on May 31st, 2014 from
http://lmt.com.vn/home/cong-nghe-so/mobile/434-uu-diem-cua-androidwindows-phone-ios-blackberry-os.html
Versace, C. (2013). What do consumers want in a new smartphone?
Retrieved May 31, 2014, from
http://www.forbes.com/sites/chrisversace/2013/08/21/what-do-consumerswant-in-a-new-smartphone/

18

Virki, T. and Prodhan, G. (2011). Nokia proclaims new dawn with Windows
phones. Retrieved May 31, 2014, from
http://www.reuters.com/article/2011/10/26/us-nokiaidUSTRE79P20T20111026

19