ARAVALI INSTITUTE OF MANAGEMENT

(An institution of Marwar Education Foundation)

PROJECT REPORT
ON
NOKIA AND ITS COMPITITORS

Submitted to: Submitted by:

Mr .Vishwas Gupta Anubha Shroff
PGP-II
Section-B, Roll no-23
Topic: NOKIA and its other competitors

Objective: To find out the factors affecting decline in sales of NOKIA products
compared to other companies in order to bring back NOKIA on its original
track

Sub-objective:
• To know the current product portfolio
• To do SWOT analysis
• To know market share of NOKIA
• To know customers perception regarding NOKIA mobiles (mainly
focused)

Research design:
• Qualitative research
o Primary data - focus group technique and depth interview
o Secondary data – Websites
• Population - 40
• Sample size – 8
• Confidence level – 90%
• Confidence Interval – 10%
 Introduction
Nokia Corporation (NYSE: NOK) is one of the world's largest
telecommunications equipment manufacturers. It has since established a
leading brand presence in many local markets, and business has expanded
considerably in all areas to support customer needs and the growth of the
telecommunications industry. Nokia also produces mobile phone
infrastructure and other telecommunications equipment for applications
such as traditional voice telephony, ISDN, broadband access, professional
mobile radio, voice over IP, wireless LAN and a line of satellite receivers.
Nokia provides mobile communication equipment for every major market
and protocol, including GSM, CDMA, and WCDMA.

Some facts about NOKIA:

o Nokia's India Sales Down 24% in 2009 - Nokia's India sales went down
substantially from 3.7 billion Euros (approx 5 billion USD at current
Euro-Dollar exchange rates) in 2008 to 2.8 billion Euros (3.8 billion
USD) in 2009 according to a report filed by the company with the US
Securities and Exchange Commission. Among its leading markets, only
China saw a marginal increase in sales with Russia and Indonesia
showing substantial declines during the year.
http://www.secondrepublic.in/StoryDescription.aspx?mainid=1&storyid=792

o Nokia India Q2 Market Share Drops to 36 percent (from 54 percent in Q2

2009)

o Nokia India has 54.1 percent market share , over 100 million phones sold
in 2009 in India
http://www.fonearena.com/blog/14770/nokia-india-has-54-1-percent-market-share-
over-100-million-phones-sold-in-2009-in-india.html

o Nokia has dominated the mobile phone market share in India. But
research proves Indians prefer locally made cell phone or Original
Equipment Manufacturer (OEM). Research firm Strategy Analytics found
that Indian citizens prefer to use mobile phones made in India. Even the
local brand mobile phone India, like Lava, Micromax, and Spice, will
benefit from mobile phone users like this character. Other international
brands that have no market like Nokia, such as Samsung, LG and Sony
Ericsson, it is believed will find it difficult to gain market share low-end
handsets.
o Local brand mobile phones in India are only able to survive in the market
in the next few years. However overall, if all their local market share
numbers will be combined so much. Even 63 percent of respondents who
live in rural villages with an average income $ 130, claimed to prefer to
buy mobile phones production manufacturer, India or the production of
Original Equipment Manufacturer (OEM) Nokia. There are at least two
more reasons why they have phones for local production. First is because
the price is certainly cheap and easy to repair, or parts availability.

o The pride of nationalism is one factor. But when they spend 4 percent of
income per year for the mobile, they would buy a cheap phone but
quality, according to Strategy Analytics, the number of mobile phone
users will be more and more in the next five years. Most of them are new
users with low incomes and live in rural area. Cheap and attractive
feature will be the secret of successful mobile phone manufacturers to
survive in India.
Product basket:

SWOT Analysis of the Company: Nokia

Strengths:
Nokia has largest network of distribution and selling as compared to other mobile phone
company in the world. It is backed with the high quality and professional team in the HRD
Dept. The financial aspect is very strong in case of Nokia as it has many more profitable
businesses. The product being user friendly and have all the accessories one want that is why
is in great demand making it No-1 selling mobile phones in the world. The re-sell value of
Nokia phones are high compared to other company’s product.

Weakness:
Some of the weakness includes the price of the product offered by the company. Some of the
products are not user friendly. Not concern about the lower class of the society people. Not
targeting promotion toward them. The price of the product is the main issue. The service
centers in India are very few and scare. So after sales service is not good.
Opportunity:
Nokia has ample of opportunity to expand its business. With the wide range in products,
features and different price range for different people, it has an advantage over the
competitors around. With the opportunity like ‘Telecom penetration in India’ being at the
peak time, Nokia has an opportunity to increase its sales as well as the market share. As the
standard of living in India has increased the purchasing power of the people as increased as
well, so Nokia has to target right customer at right time to gain the most out of the situation.

Threat:
Nokia has many threats to tackle to maintain its position as market leader. The threats like
emerging of other mobile companies in the market. The companies like Motorola, Sony
Eriksson, etc, these companies have come to the stand of tough competition with Nokia in
the field of Mobile Phones. Threats can be like providing cheap phones, new features, new
style and type, good after sales service etc. So, Nokia has to keep in mind the growing
competition around. Nokia has to make strategies to tackle problems in the present and the
near future. The growing demand of WLL network can cause drop in sales for Nokia, as
Nokia provides many less CDMA phones to the customer.

Reasons for declining sales of NOKIA mobiles (as per discussion)

o Commission given to distributors is less as compared to other companies, that’s why

vendors insists us to purchase other brand phones rather than NOKIA

o NOKIA cells are less attractive as compared to other company phones like LG,
micromax (especially for girls), etc. NOKIA phones gives more formal look,
generally for professionals but that also now blackberry has taken that place.

o Although NOKIA is not compromising with quality, features and price, but other
local Indian companies are coming with same features but at cheaper price.

o Other company came with dual sim before than NOKIA, but NOKIA came that to
also with some limitations

o Its phone processing speed is very slow as compared to others

o Major case happened in China about battery blast gave opportunity to other
companies to enter into the market

o NOKIA has stopped doing corporate tie ups with companies like Airtel, Vodafone,
etc, but others are still doing it

o NOKIA has reduced its advertisements on television and has stopped celebrity
endorsement too

o Making its all products to compete with each other because NOKIA have large no. of
products which is giving customers more choice
 Recommendations
o Put restriction on every time launch of new product, stop giving
customers more choice in your own company product range

o Should look upon its weakness, i.e. to bring down the prices and start
targeting lower segment people

o Prices of products are high due to excessive number of features or

software which is not usable for general customers. Should eliminate
these features and software

o They should think upon more and more creative advertisement to

promote its product

o Prototype of product must be first tested on focused group then it should

be introduce

o Should also think upon celebrity endorsement