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Nokia shifts strategy

In a major shift from its product-centric strategy that it has successfully run with for years, Nokia has decided to become solutions-centric.What it’s beginning to do in India reflects a global shift in strategy, reports Anita Sharan.
By Anita Sharan | Hindustan Times
UPDATED ON FEB 15, 2008 03:49 AM IST

In a major shift from its product-centric strategy that it has successfully run with for years, Nokia has decided to become solutions-centric. What it’s beginning to do in India – its second largest market after China – reflects a global shift in strategy.

Devinder Kishore, director marketing, Nokia India, says, “We are moving into selling solutions. Devices will not be the only thing any longer. Over the next three-to-six months, we will be offering combinations of products and services…there will be lots of services.”

For example, the just-launched Nokia 6110 Navigator whose integrated GPS offers location-based services to the consumer, besides 3G, multimedia and camera features. While GPS is also integrated with Nokia N95, N82, E90, and S60 and Series 40 devices via Bluetooth, Kishore says the 6110 sets off the bundled solutions rollout.

The strategic shift is built on Nokia’s bid to retain consumers over their lifetimes. It therefore extends to very clear consumer identification. A major global study by Nokia has thrown up a segmentation model outlining 12 types of consumers – common to all markets – looking for very different things from their mobile experience. “Our research shows that our consumers are not cut by age or price, but choose by aspiration and involvement with the mobile category,” says Kishore.

The 12 segments have been distributed under four consumer categories – Live, Achieve, Connect and Explore. The ‘Live’ category is aspirational for whom the handset is a lifestyle accessory. Nokia Xpress Music targets this category. The ‘Achieve’ category wants products and services that help with the achievement endeavour. Nokia’s E-Series targets this category. ‘Connect’ is made up of simple “connectivity and progressive simplicity” users. The ‘Explore’ category loves technology, is fairly global, individual, but loves to share discovery. The N-Series targets Explore consumers.

Nokia’s product philosophy is guided by the Flow, Wow and Show aspects of mobile phone experiences. With ‘Flow’ the product works just the way the consumer likes it (example, E-Series). The ‘Wow’ product creates such a strong emotional response that it feels almost magical (N-Series). The ‘Show’ product appears “simply beautiful and just for me.” By pushing different combinations of these three aspects within each consumer category, Nokia’s attempt is to create four unique impressions.

The new categorisation requires differentiated communication – Nokia’s advertising varies, according to the categories, from a global look and feel to totally local messages. The N-Series and Xpress Music campaigns may be more global, but ‘entry level’ ads – such as the one where the worried wife uses the neighbour’s Nokia to talk to her husband and son, or where the bus battery dies and Nokia comes to the rescue – create a different connect.

Using Shah Rukh Khan as brand ambassador is something new for a brand that has all along talked leadership and technology. “He has a pan-India appeal and in smaller markets, a huge connect,” Kishore points out. “He’s tech savvy and comfortable talking about Nokia, which he uses. We took a calculated shot on SRK helping us explode the rural market for us.”

Nokia’s media planning tries to ensure that targeted category consumers get to see the ads meant for them, through a selection of different channel clusters.

“For N95, we advertise on Discovery, English movie channels, select news channels. For entry level, we would target a Doordarshan sponsorship on one-day cricket. We put big bets on the 20:20 matches, feeling that youth would respond well. Cricket is watched by all our consumer categories,” Kishore explains.

Beyond advertising, Nokia is trying to create more touch points through its concept stores, already opened across several major metros (Mumbai is still to see one, though) and cities, and a showcasing of its higher end products via malls and roadshows.

In the meanwhile, this market leader takes product complaints in its stride. There have been complaints, for example, of its N-Series phones hanging. “Yes, and we are working to fix the problem,” says Kishore. While Nokia’s servicing facilities are fairly widespread, it is also perhaps easier for a market leader to accept shortcomings and say something will be done about it, without getting defensive about it.

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