Nokia follows new path

29 June 2012

HELSINKI: Nokia, the ailing mobile telecoms giant, is looking to reformulate its marketing tactics, in order to re-engage consumers and tempt them away from rival operators.

At an event run by Marketing Week, Steven Overman, Nokia's VP, brand strategy and marketing creation, argued the firm must be a "homewrecker" to "break up the marriage" shoppers have with other devices.

This is especially true in the smartphone sector, where many "people are already married" to their handset. After falling behind competitors like Apple, Nokia is focusing on "having fun" with communications, not least by pursuing the unexpected.

"We realised that the very things that made us such a winner had become the very things that held us back. A complete personality change was in order and that is what Nokia is in the process of doing today," Overman said.

Alongside making its retail network a key element of branding and marketing efforts, the company intends to leverage a wide range of channels from digital media to point of sale.

"Television is not the most important channel, it's part of a system. It invites people to be engaged but it's the engagement that really matters and that's why point of sale really matters for us. For us, it started with the shop window, that moment of truth for the brand and then thinking back from that and designing a customer journey to lead up to that point of sale," Overman said.

According to Gartner, the insights provider, Nokia shipped 83.2m handsets in the first quarter of 2012, a 19.8% market share. This compared with 107.6m units just 12 months ago, when it held 25.1% of the market.

During this period, Samsung has increased its share from 16.1% to 20.7%, as it shipped 86.5m units in the opening three months of 2012. Apple has also doubled its share to 7.9%, up 33.1% on an annual basis.

Smartphones using Nokia's Symbian operating system made up 8.6% of sales to end users in Q1, or 12.5m devices. This marked a decline from 27.6m phones in Q1 2011, a 27.7% share. Google Android devices led on 86.1m, with Apple's iPhone on 33.1m.

Nokia did not even feature in the latest BrandZ rankings of the world's most valuable assets produced by Millward Brown Optimor, having been in 43rd position in 2010 and 81st spot in 2011.

"We compare our performance not just today to how our competitors are doing but to how they started when they launched. We are moving faster than [iPhone and Android] were then and it is only a matter of time before we catch up and surpass them," Overman said.

"Is the job done? Absolutely not. But we have to use very different marketing techniques to break a prejudice that the existing solutions are the best, because they are not."

Tim Long, an analyst at BMO Capital Markets, was less optimistic. "We assume zero value for the device and Nokia Siemens Networks businesses," he said. "We see little hope for a turnaround from here even with a refined strategy," he said.

Data sourced from Marketing Week, Gartner, Financial Times; additional content by Warc staf