Mostafa Mahmoud Hussein 13105091

Mohamed Ibrahim 13107772

Nokia Research Project

Submitted to: Dr. Rana Wagdy
Contents
Organization name ........................................................................................................................................ 3
Research topic ............................................................................................................................................... 3
History .......................................................................................................................................................... 3
Problem Statement ........................................................................................................................................ 5
Objective ....................................................................................................................................................... 6
Questions ...................................................................................................................................................... 6
Book bibliography ......................................................................................................................................... 7
Hypotheses .................................................................................................................................................. 11
Thesis aim and hypotheses.......................................................................................................................... 11
Theory ......................................................................................................................................................... 12
Concepts...................................................................................................................................................... 13
Abstract ....................................................................................................................................................... 14
The Customer Development Process .......................................................................................................... 14
Business to Customer .................................................................................................................................. 15
Business to business.................................................................................................................................... 15
Segmenting by Purchase Behavior ............................................................................................................. 16
REFERENCES & BIBLIOGRAPHY ......................................................................................................... 20
 Task 1

Organization name
Nokia

Research topic
Organizational outcomes such as increased sales, market share, profits, growth and effectiveness.

History
The history of Nokia

1. Founding

Nokia was originally founded as a paper manufacturer by Fredrik Ides tam in 1865. After having
established a ground wood pulp mill in South-western Finland, Ides tam in 1868 constructed a
second mill in the nearby town of Nokia: having better resources for the generation of
hydropower production. In 1971 Ideas tam along with close friend Leo Michelin transformed the
firm into a share company, thereby founding the Nokia Company.

2. Electronics

In the late 19th century Nokia added electricity generation to its business activities. After setting
up the Finnish Cable Works in 1912, Nokia began to branch out into electronics in the 60s.
Having developed its first electronic device in 1962 (a pulse analyzer for use in nuclear power
plants) Nokia began development on radio telephones in 1963 for the army and emergency
services and by 1987 Nokia became the third largest TV manufacturer in Europe.

3. Mobile phone

In 1979 the company established the radio telephone company Mobira Oy as a joint venture with
the Finnish TV maker Salora. Having established a firm business footing Nokia released the
Nordic Mobile Telephone (NMT) service, the world’s first international cellular network. As the
mobile phone industry expanded throughout the 1970s and early 1980s Nokia introduced their
first car phone in 1982, the Mobira Senator.

4. Gorbachev

In 1987 Nokia introduced the Mobira Cityman, the first handheld mobile phone for NMT
networks. Although the phone was both heavy at 800g and expensive at €4560 it was well
received – and is now considered a classic – in large part thanks to Mikhail Gorbachev after he
was photographed using one. After having established themselves as major players in the mobile
phone industry GSM was adopted as the European standard for digital mobile technology.

5. The ringtone

Nokia launched the 2100 series in 1994, the first to feature the Nokia Tune ringtone. After
having established itself as one of the most frequently played and widely recognized pieces of
music in the world the Nokia 2100 went on to sell 20 million phones worldwide (Nokia’s target
had been 400,000). In addition to the ringtone Nokia in 1997 introduced the game of Snake: a
game that is now replicated on over half a million phones.

6. World leader

By 1998 Nokia established itself as the world leader in mobile phones sales. Between 1996 and
2001 Nokia’s turnover increased by almost 500 percent from €6.5bn to €31bn. The exploding
world-wide demand for mobile phones through the 90s caused a major logistics crisis for many
mobile phone operators; however Nokia was, and still is today, renowned as being the best
operator for handling such logistics.

7. The internet

Nokia in 1999 released the Nokia 7110, capable of rudimentary web-based functions, including
email. Further developments in mobile technology meant that in 2001 Nokia launched its first
phone with a built-in camera (Nokia 7650) and in 2002 their first video capture phone (Nokia
3650). Though it was in 2002 with Nokia’s first 3G phone (Nokia 6650) that mobile technology
was to experience a radical technological shift. Here on phones were able to browse the web,
download music, watch TV and provide listless other services.

8. Development
Nokia was to sell its billionth phone in 2005 as mobile phone subscriptions surpassed 2bn in this
same period. In 2007 Nokia was internationally recognized as the fifth most valued brand in the
world.

In both 2009 and 2010 the Dow Jones Indexes ranked Nokia as the world’s most sustainable
technology company as they set about developing their business methods and strategies in
accordance with new environmental standards.

9. Losses

In October 2009 Nokia posted its first quarterly loss in more than a decade, largely thought to be
a repercussion of HTC releasing the first phone to use Google’s Android operating system: the
HTC Dream (as of today 60 percent of mobile phones are powered by Android). After a year of
struggling to keep pace with iPhone and Android devices Nokia hired former Microsoft
executive Stephen Elop as chief executive in September 2009.

10. Cuts and plans

In October of 2010 Elop outlined plans to make 1800 job cuts and to streamline Nokia’s
Smartphone operations. After admitting its inferiority to Microsoft’s operating system Nokia
moved away from Symbian and established a partnership with Microsoft.

Having spent 2010 onwards making thousands of job cuts and enduring the failed successes of
its Lumia 800 Nokia were superseded by Samsung as the largest producer of mobile phones.

Nokia has more recently announced the new Lumia 920 as the flagship for Microsoft’s new
operating system and have signed a deal to sell and lease back what were its headquarters for the
past 16 years

Problem Statement
Compared to the same quarter last year, Nokia overall revenue is down 29%, to $9.7bn (£6bn).
And the company is now losing money, $1.8bn, 18.5% of revenue.
Objective
 To know the reason behind the decline in the proportion of sales

 Lead to help the company revive its old position as the market leader in Mobile Segment.

Questions
 Is the problem short term or long term?

 What are the factors that affect sales growth in the company?

 What will be the methods used to overcome losing money?

 Task 2
Book bibliography
Kotler, P. & Armstrong, G. (2012). Principles of Marketing. Edinburgh Gate: Pearson.

Chapter overview

(Chapter 7)

In this chapter, we learned about the major elements of a customer-driven marketing strategy:
segmentation, targeting, differentiation, and positioning. Marketers know that they cannot appeal
to all buyers in their markets, or at least not to all buyers in the same way. Therefore, most
companies today practice target marketing-identifying market segments, selecting one or more of
them, and developing products and marketing mixes tailored to each.

Into groups based on consumers’ knowledge, attitudes, uses, or responses concerning a product.

Business marketers use many of the same variables to segment their markets. But business
markets also can be segmented by business demographics (industry, company size), operating
characteristics. The effectiveness of the segmentation analysis depends on finding segments that
are measurable, accessible, substantial, differentiable, and actionable.
 Task 3
Nokia fell into a big problem which is marketing myopia that can really drain its power. The
company want to gain back its position and market and try to gain a bigger market share. For a
very long duration Nokia ruled the domestic and international market. But it forgot one very
basic fundamental that people get bored if they are served a same type of item in the long run up.
What people missed in the Nokia mobile phones were offered by the new players and that also in
the same price range? And it resulted in the downfall of Nokia regime. With nothing more to
lose, Nokia is all set to rule the mobile market once again. They have re-introduced themselves
with some new series of mobile phone and

The mobile phone division at Nokia took a big hit in its last fiscal quarter. The company revealed
that sales of its phones went down 30 percent in the first quarter of 2014, compared to the same
period a year ago.

It is the most important Nokia failed in the race with Samsung

Nokia could not market itself as innovator in the market the price of Nokia phones has been
higher than Samsung phones. In addition, Samsung has the capacity to launch new models in
every 40 days while Nokia has very limited capacity of introducing new models

And there is another problem for Nokia downfall the competitive marketing: its systematic
collection and analysis of publicly available information about consumer and competitors and
developments in the marketplace. the goal of competitive marketing is to improve strategic
decision making by understanding consumer environment and tracking competitors and the
good marketing can help marketers gain insight into how consumer talk about and connect with
their brands

And if we are talking about product life cycle in Nokia company

Growth stage: Nokia phones satisfied the market and her sales climbing quickly Nokia was to
sell its billionth phone in 2005 as mobile phone subscriptions surpassed 2bn in this same period.
In 2007 Nokia was internationally recognized as the fifth most valued brand in the world.
In both 2009 and 2010 the Dow Jones Indexes ranked Nokia as the world’s most sustainable
technology company as they set about developing their business methods and strategies in
accordance with new environmental standards

Maturity stage: Nokia sales growth slows or level off the slowdown in sales growth results in
many producers with many products to sell in turn this overcapacity leads to greater competition
such as Samsung, apple and Sony

Decline stage: Nokia sale decline because there is a lot of reasons such as technological advances
and shifts in consumer tastes, increased competition as sales and profit decline In October 2009
Nokia posted its first quarterly loss in more than a decade, largely thought to be a repercussion of
HTC releasing the first phone to use Google’s Android operating system: the HTC Dream (as of
today 60 percent of mobile phones are powered by Android). After a year of struggling to keep
pace with iPhone and Android devices Nokia hired former Microsoft executive Stephen Elop as
chief executive in September 2009.
 Task 4

From previous studies we found that the consumer behavior and consumer perception about the
products affecting on the sales for any company. From another side the people also care about
the brand name, so companies should pay close attention to their brand image and build strong
relationship with their customers. There are a lot of factors that affect the decisions of the buyers
of mobile phones. The most important is its features. If it’s a smartphone with high quality
features then it would be their first choice. The second factor that affects the buyer’s choice is
brand name. The third factor is the durability. It means that if the smart phone is having smart
features and it’s familiar with most users. There are many other factors that affect buyer’s choice
such as core value, color, size, brand name, operating system, and the price. The price is the most
important factor when it comes to deciding which smart phone buyers prefer to purchase that’s
why we see many companies take in their consideration to introduce many products with
different prices because of the highly competitive market and to broad their target customers and
increase their customer base. There is another segment of buyers that price doesn’t play the most
important factor when deciding which smart phone to buy. Smart phones manufactures may take
customer perception in consideration while they are developing the products, so they may
introduce mobiles with different prices and different colors and features that compete in the
market.

In 2006 Fappe Berglun, an engineer working at Nokia, he developed a high quality software for
Nokia. At the same time that apple released their first smart phone with new operating system.
Despite the iPhone growing popularity Nokia continued to focus on creating the highest quality
hardware without paying attention to their outdated software. Nokia had to upgrade their
software and pack it with new features to remain competitive.

The service quality plays an important role affecting competitiveness which must be taken in
consideration by most smart phone manufacturers to make the customers satisfied and increase
their loyalty to the brand. There is another important problem Nokia missed transition and it's
almost ironic to consider that Nokia have missed the transition to smart phone segment. However
Nokia was the leader ship in the market it was able to dominate the market based on operation
system and high performance components such as features. However Nokia started losing this
leader ship 90% with the release of iPhone in 2007 and appeal becomes the leader ship in the
market.

Hypotheses
Sales promotion expenses are on average about two percent of sales but their proportion has big
variation with its maximum 36% depending on industry and business environment. Such as a
high variability of sales promotion result from a wide scope and diversity of sales promotion
activities.

H.1: sales promotion spending has the positive association with prior and contemporary sales and
earnings.

H.2: sales promotion spending has positive with liquidity, Growth, profitability and human
capital investment.

H.3: sales promotion spending has the negative association with inventory turnover and financial
leverage.

Thesis aim and hypotheses

The academic goal of this thesis is to provide a theoretical framework to analyze the main
endogenous and exogenous risks that successful might face in highly dynamic and competitive
industries and how they can prevent or overcome them. In order to achieve this goal the research
will focus on Nokia and the smartphone .several hypotheses formulated concerning this case will
be used to guide this research ":

1. Nokia is confronting serious issues in smartphones market due to a gradual drift in the
company's strategy

2. Winning strategies in smartphone market require a strong focus on building competitive

industry's strategy.

3. in hypercompetitive markets context. Dynamic capabilities paradigm is more appropriate than

resource based theory o explain organization success and superior performance

4. Even in complex and dynamic environment and organization can sustain their

leadership if they develop and implement certain instruments and measures

Theory
1. self-congruity theory (sirgy, 1982; graeff, 1996) self-congruity theory holds that consumers
compare their self-concept with the image that a brand projects, band prefer brands that are
consistent with their self-concept.

2. Disruptive innovation theory: this perspective assumes that growth opportunities emerge
essentially from disruptive innovations (anthony and christensen. 2005:38)
3. Consensuses on an umbrella theory that: we could demonstrate accounted for most of the
actual sales & play patterns we were observing in the market .that theory were based on a fairly
obscure of economics called network effects

Concepts
1. Concept of strategic drift: was defined as the misfit between the changes in the
organization's strategy and its environment changes.

2- Logical instrumentalism: that managers build their apprehension of external stimuli and
their understanding of the environment based on a homogeneous and rather stable view
(1988:88)

3- strategic wear-out : he explain that if the company fails to anticipate .early enough the
external changes by modifying consequently it's course , even the most successful
strategies would inevitably wear –out and lead to failure (2009.506) (Gilligan)

4- Gravity law of marketing: where past strategic choices don't guarantee future success as
"regardless of how big of powerful an organization or brand becomes sooner or later it's
performance will almost inevitably decline” (2009.508..)
 Task 5
Abstract
Sales organizations are continuously developing new ideas and approaches to be more
competitive. One of the approaches taken by most successful organizations is the move from
individuals to boundary-spanning, cross-functional teams. Sales teams are being employed to
counter efforts by buying organizations to form buying centers. It is proffered in this paper that
organizations that are ready for change are conducive to enhancement of sales team learning.
Organization readiness for change is a condition impacted by a variety of organizational
antecedent variables such as culture and climate. This paper proposes that sales team learning is
impacted by team members' perceptions of the organization's readiness for change. In addition,
we also posit the moderating influence of two environmental variables: turbulence and
competitive intensity on the relationship between readiness for change and sales team learning.
Sales team learning is then proposed to be related to a variety of sales outcomes. In this paper,
we present a conceptual framework for understanding the contexts in which team learning occurs
and the impact of team learning on team effectiveness. Throughout the paper, we present
research propositions that provide opportunities for future examinations of team learning.

The Customer Development Process

Nokia acquires its customers through many different sorts of media as well as services. Nokia
can usually be seen as the biggest sponsor at sport events, fashion shows, motor sports and many
other major events.

Nokia has many so called Premium partners that are a huge relief in Nokia’s large scale
marketing efforts. These companies include RTL which is based in Germany, News
International, Trinity mirror (also includes mirror mobile) and one of the biggest news agencies
in the world Reuters.
Even-though Nokia only has so many premium partners, it still strives to market its products
through other multinational corporations such as Coca-Cola, Unilever, BMW, Dolce & Cabana,
Ford, Kraft and HP Compaq, which are also major brands and have a lot of brand loyal
customers.

Business to Customer
Nokia has a huge market; almost 5 billion people own a mobile phone in the world, and Nokia
has about a third of all handsets sold.

Nokia’s biggest customer group at the moment would have to be young people. It shows it
Nokia’s ads, they are very colorful, fun and show connectivity.

Today’s youth wants connectivity and social media in their hand set, like access to face book,
twitter and other social networking sites.

Business to business
Nokia uses different companies in different market segments to reach their target market for a
specific product, service or series of a product (Series meaning e.g. N-series, E-series...).

Meaning that Nokia products created for people who are concerned with appearance would be
“tied” to other companies products that are in the same segment, for example using Dolce &
Cabanas hand bags to market the 8800 sirocco diamond edition, by promoting the phone with the
hand bag and then giving a discount for the phone with every hand bag purchase.
What is meant by this is that, marketing stylish phones to people would be accomplished by
cutting a short term marketing deal with, for example Dolce & Cabana, so when the customer
walks into the store and purchase the hand bag they will have an incentive to purchase that phone
because they would be saving some money.

Segmenting by Purchase Behavior

Nokia has a huge market with many different segments divided by needs, therefore Nokia has
come up with different product lines for different segments.

Some examples of Nokia’s product lines include the C-series, E-series, X-series, N-series and the
N-gages.

Nokia has a number of different product lines for its customers’ demands:

1000 series – the ultra-basic and most affordable Nokia handsets, at first designed for developing
countries.

2000 series – Basic series is a small upgrade from the 1000 series, it may have a camera or
Bluetooth.

3000 series – Expression series is targeted at the youths, they are affordable and have all the
basic features plus a camera, gps, mp3 and additions of that price level.

5000 series – Active series phones are very similar to the 3000 series phones, but are targeted at
active individuals so their make might be stronger or they might be shock or water proof.

6000 series – Classic business series has phones from the lower range to higher range phones,
usually with a respectable amount of functions meant for business professionals.

7000 series – Fashion & experimental series is for fashion conscious users, and user that want
new features on their phones.

8000 series – Premium series consists phones are categorized by ergonomics and attractiveness.
9000 series – Communicator series has been discontinued but consisted of business
communicators with full keyboards, created for business professionals.

C series – is optimized for social networking and sharing, the c series phones are also meant to
be affordable to the younger market.

E series – (Enterprise class) Are phones optimized for business professionals.

N series – Has the most advanced smart phones, they are meant for people who want
connectivity and multimedia features, and they have as much technology put into them as
possible.

X series – Music & entertainment series that targets a young audience.

N-gage series – Gaming series that came out with two models and was then discontinued.

Dependent Variable:

Sales

Independent Variable:

Competitors introducing new products and innovation to the market

Dependent Variable:

Sales

Independent Variable:

Customer Loyalty

Dependent Variable:

Sales

Independent Variable:

Customer Satisfaction
 Task 6

The purpose of this study is exploratory as we observed something and we seek to understand
more about it. The research project is an attempt to lay the groundwork that will lead to future
studies, or to determine if what is being observed might be explained by a currently existing
theory.

The study setting is non-contrived because as we can see the interference in the work
environment or the normal work flow is minimal

The research strategy here is by observation and checking statistical reports and facts about
events that’s happening or already happened

The population studied in this research is organizational and seeing the organization as a whole
with different perspectives

The time horizon is cross sectional in order to sort out the existence and magnitude of causal
effects of one or more independent variables upon a dependent variable of interest at a given
point in time.
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