Kirloskar Institute Of Advanced Management Studies Project Report on Why Nokia Handsets

are not preferred over other Handsets?

Submitted to: PROF CHETAN V HIREMATH

Submitted by: Ishan Shingne(27) Tushar gupta(93) Vikas kalani(99)

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Executive Summary:
Objectives: Our objectives behind doing this project was to know,
1. Why customers dont prefer Nokia over other Brands? 2. The areas in which Nokia performs better? 3. How the Brand Nokia effect the consumers Psychology? 4. Strategies to be adapted by Nokia to be the to keep their market base? 5. To analyze the brand NOKIA acceptability by the customers.

Results: we came to know that people dont prefer Nokia because of mainly its range of products, Availability, durability and user friendliness. It is facing close competition from other players like Samsung, Apple, sony (formerly sony Ericson), micromax, Karboon, LG etc. We also came to know the strategies adapted by Nokia to try to maintain its market position somewhere in the market. The main reason behind its downfall is due to its operating system which is not at all accepted by the consumers.

Conclusion: During the course of research on this project (Preference of Nokia mobiles over other cell-phones) we have come to know a lot of interesting facts and Information regarding Nokia. Nokia was undoubtedly the market leader in the cell-phone market. But due to increase in competition in the market and the new and improved services as well as new innovations done by the competitors it has lost its 14 year legacy in the cell phone market.

Introduction:
Nokia was founded in 1865 by Fredrik Idestam in Finland as a paper manufacturing company. In 1920, Finnish Rubber Works became a part of the company, and later on in 1922, Finnish Cable Works joined them. All the three companies were merged in 1967 to form the Nokia Group. In the late 1970s, Nokia started taking an active interest in the power and electronics businesses and by 1987, consumer electronics became Nokia's major business. Nokia created the NMT mobile phone standard in 1981 and launched the first NMT phone, Mobira Cityman, in 1987. The company delivered the first GSM network to Radkilinia, a Finnish company in 1991, and in 1992, Nokia 1011 - a precursor for all Nokia's current GSM phones - was introduced. In the 1990s, Nokia provided GSM services to 90 operators across the world. Another significant move of the company during this period was the divestment of its non-core operations like IT. The company focused on two core businesses mobile phones and telecommunications networks. Nokia in India Nokia entered the Indian market in 1994. The first ever GSM call in India was made on a Nokia 2110 mobile phone on its own network in 1995. When Nokia entered India, the telecom policies were not conducive to the growth of the mobile phone industry. The tariffs levied on importing mobile phones were as high as 27%, usage charges were at Rs.16 per minute and, at these high rates, consumers did not take to mobile phones. . It started capturing the market with its quality products and services. Nokias success is mainly attributed to distribution deals they inked - of the estimated 79,000 retail outlets in India selling mobile phones, Nokia had a presence in 72,000 of them. Though Nokia had to face tough competition from other powerful global players like Samsung, Apple, sony (formerly sony Ericson), micromax, Karboon, LG etc. Upto 2008 Nokia not only enjoyed market leadership in india but also in the world but due to changing scenario brought in by Apple in the Smartphone market there has been steep decline in the market share of NOKIA.
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Handset Market Share:

OTHERS 9% Micromax 10%

Nokia 23%

Samsung 58%

Review of literature on
1. Its operating system

Articles which are reviewed are taken from the following:- (VIKAS KALANI 99)
1)http://tech2.in.com/features/mobile-phones/timeline-the-fall-of-nokia/444992 2)http://www.ciol.com/ciol/news/103721/three-reasons-nokia-failed 3)http://articles.economictimes.indiatimes.com/2012-11-27/news/35385831_1_asha-series-asha-rangenokia-devices

With all the understanding about NOKIA after going through the articles is that people across the globe are after innovation, better operating system, features, etc. This we have also found out in our samples that people and to be specific the youth is very much concerned about being in line with the latest technology and not anything else. When we were going through the articles we also found out that NOKIA is very good in hardware but when we talk about youth they want best features and not best hardware so this is again the area in which NOKIA could cut cost and implement it somewhere else. NOKIA tried through many ways to bounce back but failed as we see in the example of NOKIA Asha series phones through which NOKIA wanted to bounce back but it forgot that Players like Samsung, sony, micromax, etc were providing android phones at such a low cost. Moreover the Asha series phones are related to Symbian software which once was the gamchanger at earlier stages of Nokia but today is on the verge of dyeing. Then comes the Windows tie-up for the series of LUMAI, Nokia had already lost its market and popularity and was on the verge of extinct when it was caught in hand by Microsoft which has tried to lift it but failed as LUMAI series is not popular in youth. Moreover the tie-up was made to work for the best class phones made by NOKIA. Which clearly stated that Nokia has to work with Symbian for its low level phones which is the prime reason for the downfall or we can say decline of Nokia.

2.Articles on Pricing (Ishan Shingne(27))

1)http://articles.economictimes.indiatimes.com/2011-03-27/news/29194836_1_nokia-india-ceostephen-elop-nokia-c7 2) http://www.articals.timesofindia.indiatimes.com/2012-05-10-strategy-31655134_1_nokiastrategy-nokia-s-india-importent-market/ 3)http://gigaom.com/mobile/3-reasons-a-49-lumia-900-price-wont-help-nokia/

The articles in the above links and others which are covered by my friends they all say a common thing that Nokia had enjoyed a long legacy of leadership for more than 14 years and when its competitors came with new features and new technology like when Samsung came up with low range of Corby series which was filled with touch screen, new players, etc Nokia didnt realize the threat and kept on increasing the price whereas its competitors were slashing prices to gain market share.

As the result of high prices the brand loyalty which the Nokia had among its consumers went on declining and was been gained by consumers. Now Nokia has reported losses for another consecutive quarter and is not only cutting jobs in its units but also selling its top class products such as the Lumia series at very low profit margins, the lost brand loyalty of the consumers is one of the major drawback due to which consumers are not able to attach themselves back with Nokia even when the quality demanded is same as quality supplied.

Last year the officials of Nokia had also announced the turnaround strategy of Nokia in which they clearly sad that they wont compromise on quality in order to cut costs so as do gain its market share back. But as per our study its the sunset of Nokia which was once a market leader and pioneer of the term Smartphones but lets wait and watch if Nokia can bounce back or not.

3. Additional feature (Tushar gupta(93))

1)http://www.phonearena.com/phones/compare/Samsung-E1232,Nokia-X101/phones/6837,5572. 2)http://www.cnet.com/8301-17918_1-57465430-85/nokia-808-pureview-camera-vs-samsunggalaxy-s3-vs-iphone-4s-pictures/ 3)http://www.phonearena.com/phones/compare/Samsung-GALAXY-Music,Nokia-Asha311/phones/7534,7132 Through a deep study and research on the articles, the capacity of NOKIA battery is better than SAMSUNGS battery. Samsung and Nokia both are big players in Indian mobile market. Samsung is known for its stylish looks with advanced features whereas Nokia is recognizing buy its amazing appearance and good battery backup the talk time of NOKIA (X1-01) is 13 hrs. While of SAMSUNG (E1232) is 10.16 hrs. The capacity in mAh is also in power comparing with SAMSUNG (1000mAh), due to long battery backup the music playback is also for 36.00 hrs. This is again a positive point for NOKIA. The standby time in 3G of NOKIA is also better than Samsung i.e. 35.5 days while of SAMSUNG is 15.4 days and for 2G it is 43 days. Thus, we can see from this research that battery performance of SAMSUNG is very disappointing. The quality of music is also good in NOKIA but here SAMSUNG has winsthe race, the 5.1 surrounding feature in SAMSUNG dominates the NOKIA market. The headphones with SAMSUNG phones are much better than NOKIA, which attracts the music lovers the most. CAMERA Here again NOKIA win the race. NOKIA again proved that their camera is better than SAMSUNG. KARL ZEISS uses by NOKIA smartphones are really good.The secret to the camera's performance is the extra-large sensor, which is physically much larger than usual 5megapixel and 8-megapixel sensor .NOKIA N8 has some really wonderful settings that you can customize and apply for taking those artistic shots, like its celebrated 5-megapixel mode with the highly detailed zoom. There are also presents for certain situations, like landscape mode (which evens out the foreground and background), lighting scenarios, and various scenes. Thus, we can see through the research that NOKIA cameras are preferred more over SAMSUNG camera.
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Problem Definition: Why Nokia Handsets are not preferred over other Handsets? Hypothesis
Features Ho: features dose not influence the youth H1: features dose influence the youth Pricing Ho: pricing influence youth H1: pricing dose not influence youth Operating System Ho: Operating System influence the youth H1: Operating System does not influence the youth

Methodology:
We used different methodology while doing our survey. Firstly we collected PRIMARY DATA. Our sample size was 30. We collected the datas through a Questionnaire we designed. The questionnaire was structured and non- disguised. We collected all the datas from the field directly. The sample size of our survey was a homogenous which comprised of youth. We used Convenience sampling and also random sampling. The sample we selected belonged to our hostels, institute, and local residents as we wanted to make a check only on youth. Regarding the information relating to the company profile we took the help of internet.

QUESTIONNAIRE
Mobile means to you? a) Telephone calls b) c) d) Mailing devise Apps for fun All of the above

Features that you would love to see in your mobile rank it from 1 to 4 a) b) c) d) HD camera Network connectivity Touch screen quality Screen size

OS you love to work on a) b) c) d) Android IOS Windows Java

Price preferences for your smart phone a) b) c) d) 5k to 8k 8k to 12k 12k to 20k 20k and above

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Results:
We asked total 4 questions, First three questions were asked to judge what the basic demand of the consumer is when it comes to choose the handset. Following table shows result for all four questions.
Mobile means to you? a) Telephone calls b) c) d) Mailing devise Apps for fun All of the above 12% 5% 30% 53%

Features that you would love to see in your mobile rank it from 1 to 4 a) b) c) d) HD camera Network connectivity Touch screen quality Screen size 10% 12% 47% 41%

OS you love to work on a) b) c) d) Android IOS Windows Java 70% 10% 10% 10%

Price preferences for your smart phone a) b) c) d) 5k to 8k 8k to 12k 12k to 20k 20k and above 40% 30% 20% 10%

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Features Reject the null hypothesis More than 80 % of population of our sample voted for Apps for fun and All of the above option this shows features of mobile dose influence the customer.

Pricing Accept the null hypothesis Approximately 70% of the sample that we had taken like to go for mobile whose price is less than 12k this simply shows pricing dose influence the youth.

Operating System Accept the null hypothesis 70 % of our sample voted for android operating system, this simply shows youth are more attracted towards operating system.

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Recommendation:
Through our collaborative research, we have found out some areas where Nokia should emphasize more so as to gain trust and share of consumer.

1. Product competitiveness: - The products of Nokia should be superior or at

least at par with the competitors regarding technology, designing and features etc.

2. Customer satisfaction: - Nokia should come up with more value added

products and effective after-sales services.

3. Research and Development: - In order to retain the position of a market

leader Nokia should incorporate the latest technological innovations into their handsets and should put stress on further development.

4. Demand and Supply: - A strong demand and supply network should be

established for smooth availability of products to the customers. 5. End to End capability: - Stress should be given on end to end capability by integrating mobile devices applications and infrastructure.

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Reference and Bibliography:

Uma Sekharan, Research methods for Business 298 Nag and Chanda, Business Statistics, Page no. 03-30 page no.218-

Web Sites
1)www.nokia.com 2)www.mobileburn.com 3)www.iwire.com 4)http://tech2.in.com/features/mobile-phones/timeline-the-fall-of-nokia/444992 5)http://www.ciol.com/ciol/news/103721/three-reasons-nokia-failed 6)http://articles.economictimes.indiatimes.com/2012-11-27/news/35385831_1_ashaseries-asha-range-nokia-devices 7)http://articles.economictimes.indiatimes.com/2011-03-27/news/29194836_1_nokiaindia-ceo-stephen-elop-nokia-c7 8)http://www.articals.timesofindia.indiatimes.com/2012-05-10-strategy31655134_1_nokia-strategy-nokia-s-india-importent-market/ 9)http://gigaom.com/mobile/3-reasons-a-49-lumia-900-price-wont-help-nokia/

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