Thursday, December 30, 2010

NOKIA vs. BLACKBERRY Building Brand with Character

THE NEW CHALLENGE
"Our challenge is to figure out how to strengthen and accelerate the growth of our market leadership," stated Riadi Sugihtani, Marketing Director for Nokia Indonesia - "Therefore, it is imperious that we confirm our dominance in all aspects, especially in the Smartphone category."

Smartphone has the fastest growth rate in Indonesia -consequently, risking Nokia's dominance in this category will be a great threat to Nokia's market leadership. Nokia, however, plans to use the Smartphone to confront BlackBerry, a rising star from Canada.

BlackBerry's market growth has been accelerating in the last year (300% growth), reaching 500,000 distributed units with a rate of 3000 new users per day in Indonesia. It is indeed still quite far from the 180 million total mobile subscribers in Indonesia (August 2009).

"Nokia has operated efficiently and effectively in a global level -but we need to be more globalized -Globalized but also localized," stated Riadi, "That is why we need a new strategy."

THE EMERGING CONTENDER
BlackBerry's growth for individuals can be especially seen in markets with a strong base of pre-paid customers, such as Indonesia, Venezuela, and Thailand (95% of Indonesia's mobile subscribers are pre-paid customers). BlackBerry fails to gain popularity in countries with a high percentage of post-paid subscribers, such as Hongkong and Singapore. With pre-paid subscriptions, future users of BlackBerry are able to activate their BlackBerry Services via SMS, avoiding all the unnecessary and complicated administrative matters when applying personally through mobile operators. Other than that, another BlackBerry subscription alternative is the daily" subscription, with a rate of around Rp 5000/day. This enables users, with limited allowance," to still enjoy the BlackBerry lifestyle.


BlackBerry's booming is also supported by Indonesia's Smartphone market character, also known as the Type Market," where consumers prefer mobile phones with a QWERTY keyboard. In contrast to Singapore and Hongkong, the market there is moving more into the direction of Touch Market," which is perfect for touch-screen Smartphones, such as iPhone.


UNEXPECTED BEHAVIOR
The behavior of BlackBerry users in Indonesia is unexpected. Mobile operators have stated that data load on the network for mail usage is only 45%. In Indonesia, the other 45% is used for chatting and social media (mainly Facebook) and the rest 10% is used for browsing the internet.

Essentially, consumers do not need to purchase BlackBerry to be able to chat and access Facebook! (Don't forget to consider the unlimited" subscription packages that averages above Rp 150,000/month). With a normal data package subscription around Rp 50,000/month or Rp 1/kilobyte,almost all of the new mobiles now (Nokia, Sony Ericcsson, Samsung and Motorola) are able to provide data access to consumers.

Professionals are well known for using emails, but push email's high speed is usually used for emails that are really urgent (which almost never happens). In the US, people are quite reluctant to receive emails after office hours and consider push email as torture. It's also the same for students, where there is high traffic in chats and Facebook and a little bit of browsing here and there. It is enough for them to subscribe normal data packages (non BB) and there is no need to use an expensive device. By the end of the day, it's all about status and trend�" Riadi said while laughing, But, that's the beauty of marketing."



COMMUNITY & "PIN"
The BlackBerry brand continues to grow with the help of various communities that emerged voluntarily, such as id-BlackBerry (the largest one with more than 3000 members), idbb, faceberry-id, and an even more exclusive community, Canisius High School BlackBerry Community. Not to mention the communities that were created by operators, such as Isat-bb (the largest one with more than 3000 members), Telkomselbb, and XLbb. These types of communities almost does not exist in the US and Canada!

NEXT GROWTH & PENETRATION

With a high price level, BlackBerry Bold priced around Rp 6 million, Storm with Rp 5.5 million, and Javelin around Rp 5 million, a continued penetration is not expected at all. However, BlackBerry's maneuver to create more inexpensive devices (such as the BlackBerry Gemini that will be launched with a price of less than Rp 4 million) might create quite a wave in the middle class market. Consumers who are thinking to buy a mobile phone with a range price of Rp 3 million might end up buying the BlackBerry Gemini instead.

THE BATTLE OF CHARACTERS


BlackBerry's growth was setback for a bit with the emergence of products from China. We might have thought that, That's it. The hype is over - and everyone will be bored with all of this." In a broader context, the battle to fight BlackBerry is not only against products that are trendy at the moment. Technology's advancement will soon create device accommodation and inexpensive prices. Device accommodation is already being practiced in well-developed countries, where the operator holds the key in device distribution.

In today's context, though, the battle has moved from design battle to the real connection" battle. The real business for mobile producers is Connecting People." Nokia is the first brand that truly understands this essence and was victorious over incumbents, such as Ericcson and Motorola. Like it or not, we now see BlackBerry as a more successful company in introducing connection services" to the market (although push email and BlackBerry Messenger can be irrelevant to the consumer). Nokia, on the other hand, is seen by the public as a device company that is far from technology advancement and connection services, in which it actually already has.

The real battle is not between brands, but rather about Character" from Connecting People." Brand and image can be changed, but character is the essence of a brand. Who ever is able to preserve their character will definitely win any future rivalries.


OVI.com is Nokia's latest giant project to enter a new phase in its own revolution to be the True People Connector." It is a mega portal for mail, stores (games & music), maps (with the ability to view Nokia users on screen), file sharing (photos and videos), storing, and also a virtual office. This idea can be a competitor to Facebook, YouTube, Flickr, Yahoo!, iTunes, etc. With the largest number of users, Nokia is the only one who is able to do this. The new definition for Connecting People" has started.

The question here is: Is Nokia ready for this? Will customers appreciate all the long-term steps that Nokia took? And will Nokia be able to preserve the connection" with its fans until OVI is present in the middle of all of us? The device business and social connection business are two different things, and to realize their dream, Nokia needs to divide their focus and tackle each matter with passion and character.

Question:
1.How does Nokia keep in exist as market leader?
2.What is needed to be evaluation which is related to Nokia’s product strategy?
3.How does Nokia concern in differentiation and positioning their product compared with BB?

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