PROJECT

ON

“Digital Media Marketing

Nokia Channel of Distribution”

BACHELOR’S OF BUSINESS ADMINISTRATION

SESSION 2009-12

UNDER SUPERVISION OF SUBMITTED BY

Mrs. SUREKHA THAKUR A. Vani Madhavi

Faculty BBA IInd Year (IIIrd sem)

AGBS (HYDERABAD) Roll. No. 16

1

A

PROJECT

ONDigital Media Marketing

“NOKIA CHANNELS OF DISTRIBUTIONS”

SUBMITED TO AMITY GLOBAL BUSINESS SCHOOL

HYDERABAD

BACHELOR’S OF BUSINESS ADMINISTRATION

SESSION 2009-2012

Submitted To: Submitted By:

Mr. SUREKHA THAKUR A. Vani Madhavi

Faculty Guide Roll. No. 16

2

ACKNOWLEDGEMENT

I express my thanks to Mrs. SUREKHA THAKUR (faculty Guide) for granting

me the permission to work on the brand Nokia. Who guided and helped me in

all possible ways they could, at every stage of the project.

I would like to express my thanks to my company guide to Mr. Shishir

Priyadarshi (HCL-ASM) and Mr. Abhishek Jain (Nokia-ASM) who helped me in

my S.I.P. as well as to completion of this report.

I would also like to thank all the team members of Nokia who provided all the

relevant information and their kind support, on the basis of which this report

has been prepared.

A. Vani Madhavi

BBA 2009 – 2012

STUDENT DECLARATION

3

I A. Vani Madhavi student of BBA at AGBS(HYDERABAD) of hereby declare

that the Project work entitled “NOKIA-CHANNELS OF DISTRIBUTIONS" is

compiled and submitted under the guidance of Mr. SUREKHA THAKUR

(faculty guide), and company’s official website (Company guide), is my

original work.

Whatever information furnished in this project report is true to the best of my

knowledge.

SUBMITTED BY:

A. Vani Madhavi

BBA (2009 – 2012)

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PREFACE

As a student of management in Business administration, it is very

important to understand the practical way of doing work in an

organization. The project report provides student the opportunity to

study the organization and try to correlate the theoretical and practical

aspects of working in a real business environment.

A distribution system is a key external resource for any company

or firm. Normally it takes years to build, and it is not easily change. The

choice before an organization to have, indirect or joint distribution

depends upon the degree of control; flexibility depends upon the

degree of control, flexibility, cost and financial requirements.

For example, indirect distribution, there is less of control but is

more economical. In this sort of distribution lesser funds are tied up

and there is low fixed variable cost of managing the channel. On the

other hand in personal selling, there is better control but is more

expensive.

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Today most of the TELECOM companies including Nokia used

intensive distribution, which consists of manufacture placing the goods

or services in as many outlets as possible. Generally for the product it

requires great deal of location convenience. Management generally

needs to search for distribution economics in inventory control,

warehouse location and transportation modes. Distribution play the

vital for the success of any product in the market, out of 4 p’s of

marketing mix one is place which clearly indicate that consumers and

customers needs, wants and demand.

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Table of content

Topic Page No.

1. Introduction……………………………………………………….…………………………11

2. Device Business …………………………………………………………………………12

2.1 Service Business ……………………………………………………………….13

2.2 Infrastructure Business……………….……………………………………….12

3. R & D Centers…….………………………………………………………………………..14

4. Industry Overview……………………………………………………………………….14

5. Some Firsts for Nokia In India………………………………………………………..17

6. Some Achievements for Nokia…………………………………………………………18

7. Total Market size………………………………………………………………………….…19

7.1 Handset Market share…………………………………………………………….197.2 The Stat of the world wide mobile phone market …………………….217.3 World wide mobile terminal sales to end users………………….……22

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7.4 World wide smart phones sales…………………………………..………….237.5 Nokia still top dog in smart phone market……………………………....24

8. Networking equipment………………………………………………………….28

9. First mobile phones……………….……………………………………………..29

10. Involvement in GSM……………….……………………………………….…….31

11. Milestones and releases………………………………………………………..33

12. Devices………………………………….…………………………………………….36

13. Services……………………………….……………………………………………...37

14. Solutions…………………………………………………………………………….38

15. Markets………………………………………………………………………………38

16. Subsidiaries……………………….……………………………………………….39

17. Online Services…………………………………………………………………..40

17.1 mobi and mobile web………………………………………………………….40

17.2 OVI……………………………………………………………………………………41

17.3 My Nokia………………………………………………………………………… .42

17.4 Comes with Music……………………………………………………………..42

17.5 Nokia Messaging……………………………………………………………….43

18. Controversy…………………………………………………………………......44

19. Nokia Interactive advertising…………………………………………….46

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20. Nokia Corporation………………………………………………………………..49

21. Channel Support and coordination to sales strategies ………….52

22. Intensive distribution…………………………………………………………53

22.1 Extensive distribution………………………………………………………..53

22.2 Selective distribution…………………………………………………………53

22.3 Exclusive distribution……………………………………………………..…53

23. Vertical Integration……………………………………………………….….54

24. Market strategy for Nokia………………………………………………….55

25. Nokia Succeed in the Indian Mobile Market……………………….56

26. The Power of focus…………………………………………………………….58

27. The distribution Age…………………………………………………………..59

28. Investment in manufacturing…………………………………………….62

29. Building the Brand……………………………………………………………..64

30. Product for India………………………………………………………………..67

31. An Expanding Market………………………………………………………..70

32. Work performed by marketing channels…………………………....71

33. Distribution Channel flows………………………………………………..73

33.1 Physical flow………………………………………………………………………73

33.2 Title flow…………………………………………………………………………….73

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34. Channel level…………………………………………………………………..74

34.1 One level channel…………………………………………………………….74

34.2 Two level channel……………………………………………………………74

34.3 Three level channel…………………………………………………………74

35. Research Methodology……………………………………………………75

36. Research process……………………………………………………………76

37. Method of data collection………………………………………………..84

38. Collection of data through questionnaire………………………….91

39. Questionnaire……………………………………………………………………...93

40. Conclusion………………………………………………………………….….95

41. Limitations………………………………………………………………………97

42. Suggestion………………………………………………………………….98

43. Biblography……………………………………………………………………101

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INTRODUCTION

Nokia has played a pioneering role in the growth of cellular technology in

India, starting with the first-ever cellular call a decade ago, made on a Nokia

mobile phone over a Nokia-deployed network.

Nokia started its India operations in 1995, and presently operates out of

offices in New Delhi, Mumbai, Kolkata,Jaipur,Lucknow,Chennai, Bangalore,

Hyderabad, Pune and Ahmedabad. The Indian operations comprise of the

handsets business; R&D facilities in Bangalore, Hyderabad and Mumbai; a

manufacturing plant in Chennai and a Design Studio in Bangalore.

Over the years, the company has grown manifold with its manpower strength

increasing from 450 people in the year 2004 to over 15000 employees in

March 2008 (including Nokia Siemens Networks). Today, India holds the

distinction of being the second largest market for the company globally.

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Devices business

Nokia has established itself as the market and brand leader in the mobile

devices market in India. The company has built a diverse product portfolio to

meet the needs of different consumer segments and therefore offers devices

across five categories ie. Entry, Live, Connect, Explore and Achieve. These

include products that cater to first time subscribers to advanced business

devices and high performance multimedia devices for imaging, music and

gaming.

Nokia has been working closely with operators in India to increase the

geographical coverage and lower the total cost of ownership for consumers.

Today, Nokia has one of the largest distribution network with presence across

1,30,000 outlets. In addition, the company also has Nokia Priority Dealers

across the country and Nokia ‘Concept stores’ in Bangalore, Delhi, Jaipur,

Hyderabad, Chandigarh, Ludhiana, Chennai, Indore and Mumbai to provide

customers a complete mobile experience.

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Services business

With the global launch of Ovi, the company's Internet services brand name,

Nokia is renewing itself to be at the forefront of the convergence of internet

and mobility. From being a product centric company, Nokia is now focusing to

become solutions centric. The strategic shift is built on Nokia’s bid to retain

consumers and empower Nokia device owners to realise the full potential of

the Internet. Nokia will build a suite of Internet based services like Nokia

Maps, the Nokia Music Store and Nokia N-Gage around its Ovi brand.

Infrastructure business

Nokia Siemens Networks is a leading global enabler of communications

services. The company provides a complete, well-balanced product portfolio

of mobile and fixed network infrastructure solutions and addresses the

growing demand for services with 20,000 service professionals worldwide. Its

operations in India include Sales & Marketing, Research & Development,

Manufacturing and Global Networks Solutions Centre. Headquartered in

Gurgaon, Nokia Siemens Networks has 47 offices and presence in over 170

locations across the country.

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R & D centers

Nokia has three Research & Development centers in India, based in

Hyderabad, Bangalore and Mumbai. These R&D hubs are staffed by engineers

who are working on next-generation packet-switched mobile technologies

and communications solutions to enhance corporate productivity.

The Center in Bangalore, the biggest R&D site in the country comprises S60

Software Organization, Common Technologies, Next Generation now called

Maemo Software, Productization and Software & Services.

INDUSTRY OVERVIEW

Nokia Corporation is a Finnish multinational communications corporation

that is headquartered in Keilaniemi, Espoo, a city neighboring Finland's

capital Helsinki.Nokia is engaged in the manufacturing of mobile devices and

in converging Internet and communications industries, with over 123,000

employees in 120 countries, sales in more than 150 countries and global

annual revenue of EUR 41 billion and operating profit of €1.2 billion as of

2009 It is the world's largest manufacturer of mobile telephones: its global

device market share was about 39% in Q4 2009, up from 37% in Q4 2008 and

38% in Q3 2009, and its converged device market share was about 40% in Q4, 14

up from 35% in Q3 2009. Nokia produces mobile devices for every major

market segment and protocol, including GSM, CDMA, and W-CDMA (UMTS).

Nokia offers Internet services such as applications, games, music, maps, media

and messaging through its Ovi platform. Nokia's subsidiary Nokia Siemens

Networks produces telecommunications network equipment, solutions and

services Nokia is also engaged in providing free digital map information and

navigation services through its wholly-owned subsidiary Navteq.

Nokia has sites for research and development, manufacture and sales in many

countries throughout the world. As of December 2009, Nokia had R&D

presence in 16 countries and employed 37,020 people in research and

development, representing approximately 30% of the group's total workforce.

The Nokia Research Center, founded in 1986, is Nokia's industrial research

unit consisting of about 500 researchers, engineers and scientists. It has sites

in seven countries: Finland, China, India, Kenya, Switzerland, the United

Kingdom and the United States. Besides its research centers, in 2001 Nokia

founded (and owns) INdT – Nokia Institute of Technology, a R&D institute

located in Brazil. Nokia operates a total of 15 manufacturing facilities located

at Espoo, Oulu and Salo, Finland; Manaus, Brazil; Beijing, Dongguan and

Suzhou, China; Farnborough, England; Komárom, Hungary; Chennai, India;

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Reynosa, Mexico; Jucu, Romania and Masan, South Korea Nokia's Design

Department remains in Salo, Finland.

Nokia is a public limited liability company listed on the Helsinki, Frankfurt,

and New York stock exchanges. Nokia plays a very large role in the economy

of Finland; it is by far the largest Finnish company, accounting for about a

third of the market capitalization of the Helsinki Stock Exchange (OMX

Helsinki) as of 2007, a unique situation for an industrialized country. It is an

important employer in Finland and several small companies have grown into

large ones as its partners and subcontractors. Nokia increased Finland's GDP

by more than 1.5% in 1999 alone. In 2004 Nokia's share of the Finnish GDP

was 3.5% and accounted for almost a quarter of Finland's exports in 2003.

In recent years, Finns have consistently ranked Nokia as one of the best

Finnish brands. In 2008, it was the 27th most respected brand among Finns,

down from sixth place in 2007.] The Nokia brand, valued at $34.9 billion, is

listed as the fifth most valuable global brand in the Interbrand/BusinessWeek

Best Global Brands list of 2009 (first non-US company). It is the number one

brand in Asia (as of 2007) and Europe (as of 2009), the 41st most admirable

company worldwide in Fortune's World's Most Admired Companies list of

2010 (third in Network and Other Communications Equipment, seventh non-

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US company), and the world's 85th largest company as measured by revenue

in Fortune Global 500 list of 2009, up from 88th the previous year. As of 2009,

AMR Research ranks Nokia's global supply chain number six in the world.

Some firsts for Nokia in India

1995 – First mobile phone call made in India on a Nokia phone on a Nokia network

1998 - Saare Jahaan Se Acchha, first Indian ringtone in a Nokia 5110

2000 - First phone with Hindi menu (Nokia 3210)

2002 - First Camera phone (Nokia 7650)

2003 - First Made for India phone, Nokia 1100

2004 - Saral Mobile Sandesh, Hindi SMS on a wide range of Nokia phones

2004 - First Wi-fi Phone- Nokia Communicator (N9500)

2005 – Local UI in additional local language

2006 – Nokia manufacturing plant in Chennai

2007 – First vernacular news portal

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Some Achievements for Nokia

Ranked No 1 Most Trusted Brand Survey by Brand Equity, 2008

Ranked the No 1. MNC in India by Businessworld, India’s leading

business weekly, 2006

Ranked as the No. 1 telecommunications equipment vendor in the

country by Voice & Data for five consecutive years –2008, 2007,

2006,2005 and 2004

Ranked as the 9th most powerful brand by Millward Brown’s BrandZ

2008

Ranked world’s 4th most valuable brand by Interbrand, 2007

Ranked Asia’s most trusted brand by the Media-Synovate, 2006

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Handset Market Share

Nokia: 59.5%

Sony: 8.1%

Samsung: 7%

Motorola: 5.9%

Nokia said on Friday the cellphone market totaled 1.26 billion phones

last year, above its earlier forecast of 1.14 billion, and reduced its share

of sales to 34 percent from an earlier forecast of 38 percent.

Research group Gartner said the grey market -- mostly in China, India

and Latin America -- totaled 145 million phones last year.

Nokia said new measurement tools enable it to better estimate the

number of handsets being sold by some new players.

"These include vendors of legitimate, as well as unlicensed and

counterfeit, products with manufacturing facilities primarily centered

around certain locations in Asia and other emerging markets," Nokia

said.

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Nokia repeated it expected the overall 2010 phone market to grow 10

percent while its market share would be unchanged at 34 percent.

The comments boosted Nokia shares, which trimmed an earlier high of

10.91 euros to settle at 10.80, up 2 percent, by 1539 GMT.

"This is a good thing for Nokia because it is really showing that they

want to measure the real market and grey market has been a big driver

in 2009," said Gartner analyst Carolina Milanesi.

"It is an opportunity for them to go after and try and actually win over

users in that segment as well," he said.

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The State Of The Worldwide Mobile Phone Market, 2009

Gartner just released a report highlighting the state of the mobile phone

worldwide market for 2009.  In terms of units sold, Nokia leads,

unsurprisingly, given its history.  In the smartphone market share segment,

Nokia, through its Symbian operating system, leads again, again

unsurprisingly.  What is again unsurprising is the fact that Nokia lost market

share both in terms of the units shipped, as well as smartphone market share.

In terms of units shipped, Nokia lost 2.2%, and 5.5% in terms of its

smartphone market share.

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Worldwide Mobile Terminal Sales to End Users in 2009 (Thousands of

Units)

Company 2009 Sales

2009

Market

Share (%)2008 Sales

2008

Market

Share (%)

Nokia 440,881.6 36.4 472,314.9 38.6

Samsung 235,772.0 19.5 199,324.3 16.3

LG 122,055.3 10.1 102,789.1 8.4

Motorola 58,475.2 4.8 106,522.4 8.7

Sony Ericsson54,873.4 4.5 93,106.1 7.6

Others 299,179.2 24.7 248,196.1 20.3

Total 1,211,236.6 100.0 1,222,252.9 100.0

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Worldwide Smartphone Sales to End Users by Operating System

in 2009 (Thousands of Units)

Company 2009 Units

2009

Market

Share (%)2008 Units

2008

Market

Share (%)

Symbian 80,878.6 46.9 72,933.5 52.4

Research In Motion 34,346.6 19.9 23,149.0 16.6

iPhone OS 24,889.8 14.4 11,417.5 8.2

Microsoft Windows Mobile15,027.6 8.7 16,498.1 11.8

Linux 8,126.5 4.7 10,622.4 7.6

Android 6,798.4 3.9 640.5 0.5

WebOS 1,193.2 0.7 NA NA

Other Oss 1,112.4 0.6 4,026.9 2.9

Total 172,373.1 100.0 139,287.9 100.0

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Nokia Still Top Dog In Smartphone Market, But Is Bleeding

Share

Gartner, a global market research firm, reported the smartphone market

segment results recently for the whole of 2008.  As expected, Nokia shipped

the most units, with around 61 million units (that’s not a lot is it, judging by

the fact that a high percentage of the world’s population now own cellphones,

but this is the smartphone market we’re talking about, so the market is much

smaller).  This translates to around 44% market share, more than twice the

share of its closest competitor, Research in Motion – “RIM” (makers of the

Blackberry) with around 17%.  However, Nokia’s market share has been

declining of late, as in 2007, its market share was around 49% and has been in

steady decline recently.  Bad news for Nokia indeed, but not especially

surprising, given that its competitors have introduced a slew of new products

and new competitors have been slowly building their own momentum.

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In particular, Apple and RIM recorded impressive year-on-year growth, which

mainly came at Nokia’s expense.  Gartner reports that Nokia higher end N-

series smartphones are facing increasingly stiff competition from RIM’s

Blackberries as well as Apple’s iPhone.  When Palm’s Pre is finally unleashed, I

think it’s safe to say that Nokia’s market share is going to decline even further.

It’s probably in Nokia’s best interests to get the latest N series phones out the

door as quickly as possible.  Perhaps its flagship E series phones need to be

25

refreshed as well.  The other challenge comes in the form of the very gloomy

outlook for the global economy – so it looks like Nokia is facing a double

whammy of increasingly serious competition and a tough operating

environment (although, to be fair, its competitors are facing this as well).  The

surprising item in the market share list was the inclusion of Samsung – from a

share of 1.8% the previous year, it jumped to 4.2% last year, due to the

success of its Omnia handset.  If that’s what they can do with only one handset,

imagine what can happen if Samsung put their minds to it and releases more

smart handsets.  More headache for Nokia, especially seeing that Samsung is

going to position its OmniaHD product directly against the Nokia N97.  If

Samsung manages to make this happen quickly, and a reasonable price point, I

foresee Nokia’s mindshare in the eyes of consumers quickly evaporate.  Come

on Sammy – get it out the door quickly, and show us what the OmniaHD can

do, and if it can do it better than Nokia’s own N97!

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The Nokia House, Nokia's head office located by the Gulf of Finland in

Keilaniemi, Espoo, was constructed between 1995 and 1997. It is the

workplace of more than 1,000 Nokia employees.[23]

27

Fredrik

Idestam,

founder of

Nokia.

Statesman Leo

Mechelin, co-

founder of

Nokia.

Networking equipment

In the 1970s, Nokia became more involved in the telecommunications

industry by developing the Nokia DX 200, a digital switch for telephone

exchanges. In 1982, a DX 200 switch became the world's first microprocessor

controlled telephone exchange and the first fully digital exchange to be taken

into service in Europe. The DX 200 became the workhorse of the network

equipment division. Its modular and flexible architecture enabled it to be

developed into various switching products. In 1984, development of a version

of the exchange for the Nordic Mobile Telephony network was started.

For a while in the 1970s, Nokia's network equipment production was

separated into Telefenno, a company jointly owned by the parent corporation

and by a company owned by the Finnish state. In 1987, the state sold its

shares to Nokia and in 1992 the name was changed to Nokia

Telecommunications.

In the 1970s and 1980s, Nokia developed the Sanomalaitejärjestelmä

("Message device system"), a digital, portable and encrypted text-based

communications device for the Finnish Defence Forces. The current main unit

used by the Defence Forces is the Sanomalaite M/90 (SANLA M/90).

28

First mobile phones

The Mobira Cityman 150, Nokia's NMT-900 mobile phone from 1989 (left),

compared to the Nokia 1100 from 2003. The Mobira Cityman line was

launched in 1987.

The technologies that preceded modern cellular mobile telephony systems

were the various "0G" pre-cellular mobile radio telephony standards. Nokia

had been producing commercial and some military mobile radio

communications technology since the 1960s, although this part of the

company was sold some time before the later company rationalization. Since

1964, Nokia had developed VHF radio simultaneously with Salora Oy. In 1966,

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Nokia and Salora started developing the ARP standard (which stands for

Autoradiopuhelin, or car radio phone in English), a car-based mobile radio

telephony system and the first commercially operated public mobile phone

network in Finland. It went online in 1971 and offered 100% coverage in

1978.

In 1979, the merger of Nokia and Salora resulted in the establishment of

Mobira Oy. Mobira began developing mobile phones for the NMT (Nordic

Mobile Telephony) network standard, the first-generation, first fully-

automatic cellular phone system that went online in 1981. In 1982, Mobira

introduced its first car phone, the Mobira Senator for NMT-450 networks.

Nokia bought Salora Oy in 1984 and now owning 100% of the company,

changed the company's telecommunications branch name to Nokia-Mobira

Oy. The Mobira Talkman, launched in 1984, was one of the world's first

transportable phones. In 1987, Nokia introduced one of the world's first

handheld phones, the Mobira Cityman 900 for NMT-900 networks (which,

compared to NMT-450, offered a better signal, yet a shorter roam). While the

Mobira Senator of 1982 had weighed 9.8 kg (22 lb) and the Talkman just

under 5 kg (11 lb), the Mobira Cityman weighed only 800 g (28 oz) with the

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battery and had a price tag of 24,000 Finnish marks (approximately €4,560).

Despite the high price, the first phones were almost snatched from the sales

assistants’ hands. Initially, the mobile phone was a "yuppie" product and a

status symbol.

Nokia's mobile phones got a big publicity boost in 1987, when Soviet leader

Mikhail Gorbachev was pictured using a Mobira Cityman to make a call from

Helsinki to his communications minister in Moscow. This led to the phone's

nickname of the "Gorba".

In 1988, Jorma Nieminen, resigning from the post of CEO of the mobile phone

unit, along with two other employees from the unit, started a notable mobile

phone company of their own, Benefon Oy (since renamed to GeoSentric). One

year later, Nokia-Mobira Oy became Nokia Mobile Phones.

Involvement in GSM

Nokia was one of the key developers of GSM (Global System for Mobile

Communications), the second-generation mobile technology which could

carry data as well as voice traffic. NMT (Nordic Mobile Telephony), the

world's first mobile telephony standard that enabled international roaming,

31

provided valuable experience for Nokia for its close participation in

developing GSM, which was adopted in 1987 as the new European standard

for digital mobile technology.

Nokia delivered its first GSM network to the Finnish operator Radiolinja in

1989. The world's first commercial GSM call was made on July 1, 1991 in

Helsinki, Finland over a Nokia-supplied network, by then Prime Minister of

Finland Harri Holkeri, using a prototype Nokia GSM phone. In 1992, the first

GSM phone, the Nokia 1011, was launched The model number refers to its

launch date, 10 November. The Nokia 1011 did not yet employ Nokia's

characteristic ringtone, the Nokia tune. It was introduced as a ringtone in

1994 with the Nokia 2100 series.

GSM's high-quality voice calls, easy international roaming and support for

new services like text messaging (SMS) laid the foundations for a worldwide

boom in mobile phone use. GSM came to dominate the world of mobile

telephony in the 1990s, in mid-2008 accounting for about three billion mobile

telephone subscribers in the world, with more than 700 mobile operators

across 218 countries and territories. New connections are added at the rate of

15 per second, or 1.3 million per day.

32

Milestones and releases

Reduction in size of Nokia mobile phones.

Evolution of the Nokia Communicator. Models 9000, 9110, 9210 and 9500

shown.

Nokia opened its Komárom, Hungary mobile phone factory on May 5, 2000.

33

In March 2007, Nokia signed a memorandum with Cluj County Council,

Romania to open a new plant near the city in Jucu commune. Moving the

production from the Bochum, Germany factory to a low wage country created

an uproar in Germany.

In May 2007, Nokia announced that its Nokia 1100 handset, launched in 2003,

with over 200 million units shipped, was the best-selling mobile phone of all

time and the world's top-selling consumer electronics product.

In November 2007, Nokia announced and released the Nokia N82, its first

(and currently, only) Nseries phone with Xenon flash.

At the Nokia World conference in December 2007, Nokia announced their

"Comes With Music" program: Nokia device buyers are to receive a year of

complimentary access to music downloads. The service became commercially

available in the second half of 2008.

In April 2008, Nokia began finding new ways to connect people, asking the

"audience" to use their creativity and their mobile devices to become Nokia’s

production company – to take part in filming, acting, editing and producing a

collaborative film. Nokia Productions was the first ever mobile filmmaking

project directed by Spike Lee. This was a collaborative experience that existed 34

across borders and perspectives, working off a common script. The film

premiered in October 2008.

In 2008, Nokia released the Nokia E71 which was marketed to directly

compete with the other BlackBerry devices offering a full keyboard and

cheaper prices.

Nokia announced in August 2009 that they will be selling a high-end

Windows-based mini laptop called the Nokia Booklet 3G.

On September 2, 2009, Nokia launched two new music and social networking

phones, the X6 and X3. The Nokia X6 features 32GB of on-board memory with

a 3.2" finger touch interface and comes with a music playback time of 35

hours. The Nokia X3 is a first series 40 Ovi Store-enabled device. The X3 is a

music device that comes with stereo speakers, built-in FM radio, and a 3.2

megapixel camera.

On September 10, 2009, Nokia unveiled a new handset 7705 Twist, a phone

with a sports square shape that swivels open to reveal a full QWERTY keypad.

[77] The new mobile, which will be available exclusively through Verizon

Wireless, features a 3 megapixel camera, web browsing, voice commands and

weighs around 3.44 ounces.35

Devices

The Nokia N900, a Maemo 5 Linux based mobile Internet device and

touchscreen smartphone from Nokia's Nseries portfolio.

The Devices division is responsible for developing and managing Nokia's

mobile device portfolio, including the sourcing of components, headed by Kai

Öistämö. The division consists of the previous mainline Mobile Phones

division with the separate subdivisions Multimedia (Nseries devices) and

Enterprise Solutions (Eseries devices) as well as formerly centralized core

devices R&D – called Technology Platforms.

This division provides the general public with mobile voice and data products

across a wide range of mobile devices, including high-volume, consumer

36

oriented mobile phones and devices, and more expensive multimedia and

enterprise-class devices. The devices are based on GSM/EDGE, 3G/W-CDMA

and CDMA cellular technologies. Nokia's Nseries Multimedia Computers

extensively uses Symbian OS.

In the first quarter of 2006 Nokia sold over 15 million MP3 capable mobile

phones, which means that Nokia is not only the world's leading supplier of

mobile phones and digital cameras (as most of Nokia's mobile telephones

feature digital cameras, it is also believed that Nokia has recently overtaken

Kodak in camera production making it the largest in the world), Nokia is now

also the leading supplier of digital audio players (MP3 players), outpacing

sales of devices such as the iPod from Apple. At the end of the year 2007,

Nokia managed to sell almost 440 million mobile phones which accounted for

40% of all global mobile phones sales.

Services

The Services division operates in five areas of consumer Internet services:

music, maps, media, messaging and games. The division consists of the

previous enterprise and consumer driver services businesses previously

hosted in Multimedia and Enterprise Solutions divisions, as well as a number

37

of new acquisitions (Loudeye, Gate5, Enpocket, Intellisync, Avvenu and OZ

Communications), headed by Niklas Savander.

The group works with companies outside the telecommunications industry to

make advances in the technology and bring new applications and possibilities

in areas such as online services, optics, music synchronization and streaming

media.

Solutions

Solutions is responsible for Nokia's offering of solutions, where the mobile

device, personalized services and content are integrated into a package for the

consumer. The unit is led by Alberto Torres.

Markets

The Markets division, the successor organization to Nokia's Customer and

Market Operations division, is responsible for the management of the supply

chains, sales channels, brand and marketing functions of the company, headed

by Anssi Vanjoki.

38

Subsidiaries

The Nokia 5800 XpressMusic, a touchscreen smartphone and portable

entertainment device which emphasizes music and multimedia playback.

Nokia has several subsidiaries, of which the two most significant as of 2009

are Nokia Siemens Networks and Navteq. Other notable subsidiaries include,

but are not limited to Vertu, a British-based manufacturer and retailer of

luxury mobile phones; Qt Software, a Norwegian-based software company,

and OZ Communications, a consumer e-mail and instant messaging provider.

39

Until 2008 Nokia was the major shareholder in Symbian Limited, a software

development and licensing company that produced Symbian OS, a

smartphone operating system used by Nokia and other manufacturers. In

2008 Nokia acquired Symbian Ltd and, along with a number of other

companies, created the Symbian Foundation to distribute the Symbian

platform royalty free and as open source.

.

Online services

mobi and the Mobile Web

Nokia was the first proponent of a Top Level Domain (TLD) specifically for the

Mobile Web and, as a result, was instrumental in the launch of the .mobi

domain name extension in September 2006 as an official backer. Since then,

Nokia has launched the largest mobile portal, Nokia.mobi, which receives over

100 million visits a month. It followed that with the launch of a mobile Ad

Service to cater to the growing demand for mobile advertisement.

40

Ovi

Nokia Ovi logo.

Ovi, announced on August 29, 2007, is the name for Nokia's "umbrella

concept" Internet services. Centered on Ovi.com, it is marketed as a "personal

dashboard" where users can share photos with friends, download music,

maps and games directly to their phones and access third-party services like

Yahoo's Flickr photo site. It has some significance in that Nokia is moving

deeper into the world of Internet services, where head-on competition with

Microsoft, Google and Apple is inevitable. The services offered through Ovi

include the Ovi Store (Nokia's application store), the Nokia Music Store, Nokia

Maps, Ovi Mail, the N-Gage mobile gaming platform available for several S60

smartphones, Ovi Share, Ovi Files, and Contacts and Calendar. The Ovi Store,

the Ovi application store was launched in May 2009. Prior to opening the Ovi

Store, Nokia integrated its software Download! store, the stripped-down

MOSH repository and the widget service WidSets into it.

41

My Nokia

Nokia offers a free personalised service to its subscribers called My Nokia

(located at my.nokia.com). Registered My Nokia users can avail free services

as follows:

Tips & tricks alerts through web, e-mail and also mobile text message.

My Nokia Backup: A free online backup service for mobile contacts,

calendar logs and also various other files. This service needs GPRS

connection.

Numerous ringtones, wallpapers, screensavers, games and other things

can be downloaded free of cost.

Comes With Music

On December 4, 2007, Nokia unveiled their plans for the "Nokia Comes With

Music" initiative, a program that would partner with Universal Music Group

International, Sony BMG, Warner Music Group, and EMI as well as hundreds of

Independent labels and music aggregators to bundle 12, 18, or 24 months

worth of unlimited free music downloads with the purchase of a Nokia Comes

With Music edition phone. Following the termination of the year of free

42

downloads, tracks can be kept without having to renew the subscription.

Downloads are both PC and mobile-based.

Nokia Messaging

On August 13, 2008, Nokia launched a beta release of "Nokia Email service", a

new push e-mail service, since graduated as part of Nokia Messaging.[135]

Nokia Messaging operates as a centralised, hosted service that acts as a proxy

between the Nokia Messaging client and the user's e-mail server. It does not

allow for a direct connection between the phone and the e-mail server, and is

therefore required to send e-mail credentials to Nokia's servers. IMAP is used

as the protocol to transfer emails between the client and the server.

Controversy

43

NSN's provision of intercept capability to Iran

A cartoon about Nokia's provision of intercept capability to Iran and people

who were arrested in Iran by IRI regime using intercept capabilities

In 2008, Nokia Siemens Networks, a joint venture between Nokia and Siemens

AG, reportedly provided Iran's monopoly telecom company with technology

that allowed it to intercept the Internet communications of its citizens to an

unprecedented degree. The technology reportedly allowed it to use deep

packet inspection to read and even change the content of everything from "e-

mails and Internet phone calls to images and messages on social-networking

sites such as Facebook and Twitter". The technology "enables authorities to

not only block communication but to monitor it to gather information about

individuals, as well as alter it for disinformation purposes," expert insiders

44

told The Wall Street Journal. During the post-election protests in Iran in June

2009, Iran's Internet access was reported to have slowed to less than a tenth

of its normal speeds, and experts suspected this was due to the use of the

interception technology.

The joint venture company, Nokia Siemens Networks, asserted in a press

release that it provided Iran only with a 'lawful intercept capability' "solely for

monitoring of local voice calls". "Nokia Siemens Networks has not provided

any deep packet inspection, web censorship or Internet filtering capability to

Iran," it said.

In July 2009, Nokia began to experience a boycott of their products and

services in Iran. The boycott was led by consumers sympathetic to the post-

election protest movement and targeted at those companies deemed to be

collaborating with the Islamic regime. Demand for handsets fell and users

began shunning SMS messaging.

Nokia Interactive Advertising

45

Nokia mobile phones by series

Nokia 1000 series1011 · 1100/1101 · 1110/1110i · 1112 · 1200 · 1208 ·

1600 · 1610 · 1650

Nokia 2000 series2110i · 2115i · 2310 · 2600 · 2600 classic · 2610 ·

2630 · 2650 · 2651 · 2700 classic · 2730 classic · 2760

Nokia 3000 series

3100/3100b/3105 · 3110 · 3110 classic · 3120 · 3120

classic · 3155 · 3200/3200b/3205 · 3210 · 3220 · 3230 ·

3250 · 3310 · 3315 · 3330 · 3410 · 3500 classic ·

3510/3590/3595 · Nokia 3530 · 3510i ·

3600/3620/3650/3660 · 3600 slide · 3720 classic

Nokia 4000 seriesSeries skipped as a sign of politeness from Nokia

towards Asian customers. See tetraphobia.

46

Nokia 5000 series

5070 · 5100 · 5110 · 5130 Xpress Music · 5200 · 5210 ·

5220 Xpress Music · 5230/5235 · 5300 · 5310 Xpress

Music · 5320 · 5330 Mobile TV Edition · 5500 Sport ·

5510 · 5530 · 5610 · 5630 · 5700 · 5730 · 5800

Nokia 6000 series

6010 · 6020/6021 · 6030 · 6070 · 6085 · 6100 · 6101 ·

6103 · 6110/6120 · 6110 Navigator · 6111 ·

6120/6121/6124 classic · 6131/6133 · 6136 · 6151 ·

6170 · 6210 · 6210 Navigator · 6220 classic · 6230 ·

6233/6234 · 6255i · 6260 Slide · 6260 · 6265 · 6270 ·

6275i · 6280/6288 · 6290 · 6300 · 6300i · 6301 · 6303

classic · 6310i · 6315i · 6500 classic · 6500 slide · 6555 ·

6600 · 6600 fold · 6600 slide · 6610/6610i · 6620 ·

6630 · 6650 · 6650 fold · 6670 · 6680 · 6681/6682 ·

6700 classic · 6710 Navigator · 6720 classic · 6730 ·

6800 · 6810 · 6820 · 6822

47

Nokia 7000 series

7110 · 7160 · 7210 · 7250 · 7280 · 7360 · 7380 · 7390 ·

7500 Prism · 7600 · 7610 · 7650 · 7700 · 7710 · 7900

Prism

Nokia 8000 series8110 · 8210 · 8250 · 8310 · 8600 Luna · 8800 · 8850 ·

8910

Nokia

Communicator

9000/9110/9110i · 9210/9290 · 9210i · 9300/9300i ·

9500

Nokia Cseries C3 · C5 · C6

Nokia EseriesE5 · E50 · E51 · E52 · E55 · E60 · E61/E61i · E62 · E63 ·

E65 · E66 · E70 · E71 · E72 · E75 · E90 Communicator

48

Nokia Nseries

N70 · N71 · N72 · N73 · N75 · N76 · N78 · N79 · N80

(Internet Edition) · N81 (N81 8GB) · N82 · N85 · N86

8MP · N90 · N91 (N91 8GB) · N92 · N93 · N93i · N95 ·

N95 8GB · N96 · N97 · N8

Nokia Xseries X3 · X6

Internet Tablet 770 · N800 · N810 (WiMAX Edition) · N900

N-Gage Classic · QD · QD Silver Edition

Nokia Corporation

49

Industry

Telecommunications

Internet

Computer software

Founded

Tampere, Finland (1865)

incorporated in Nokia

(1871)

Founder(s) Fredrik Idestam

Headquarters Espoo, Finland

Area served Worldwide

Key people

Jorma Ollila (Chairman)

Olli-Pekka Kallasvuo

(President & CEO)

Timo Ihamuotila (CFO)

Mary T. McDowell (CDO)

Products Mobile phones

Smartphones

50

Mobile computers

Networks

(See products listing)

ServicesServices and Software

Online services

Revenue ▼ €40.99 billion (2009)[1]

Operating

income▼ €1.197 billion (2009)[1]

Net income ▼ €891 million (2009)[1]

Total assets ▼ €35.74 billion (2009)[1]

Total equity ▼ €14.75 billion (2009)[1]

Employees 123,171 (2009)[1]

Divisions Devices

Services

Solutions

51

Markets

Subsidiaries

Nokia Siemens Networks

Navteq

Symbian

Vertu

Qt Development

Frameworks

Website Nokia.com

Channel support and coordination to sales strategies :

This is an import consideration for the formula of sales strategy. If indirect

distribution is adopted it is imperative that sales organization indicated dealer

cooperation programmes. Support is to be given for maintenance of adequate

stocks, local promotions in the form of P. O. P. (Point of Purchase) displays and

for local advertising. Feed back from the dealer is an important area of support

52

and can’t be ignored. In the dealer management programmes, for the success of

channel support an d coordination.

Adequate incentives for a dealer are must.

Proper feedback and communication is important.

Measures have been taken to promote dealer loyalty

The degree of coverage and support you want from the channel depends

on how intensively or extensively you want to distribute your products.

INTENSIVE DISTRIBUTION

In this the distribution is made to all the outlets, which are many in number and

spread in big area. Maximum exposure to the product is given.

EXTENSIVE DISTRIBUTION

It is the distribution in which we will cover a great area but do not concentrate on

all customers in the area.

53

SELECTIVE DISTRIBUTION

Here goods are distributed to selects outlets. These may be specially stores or

prominent stores in one area. The distribution is done through more than one

outlet but less than all e. g. designer shirts, cosmetics, T. V. electrical equipments.

EXCLUSIVE DISTRIBUTION

This is done exclusively be one dealer who provides after sales service like

in automobiles. This is done for the cultivation of an exclusive image.

VERTICAL INTEGRATION

It is a process of requirement membership rights at various levels of

distribution channel. It is costly affair for absolute channel control. Business has

been maintained between desire for market control, coordination and

distribution costs and specialization. A balance should be maintained between

channel control and the cost incurred in it.

54

Marketing Strategy for Nokia

For this project I have been instructed to come up with a marketing strategy for

an existing company/product I have chosen to do Nokia communications,

particularly the mobile phone sector of Nokia's business. To do this properly I will

need to:

* Appropriately identify, collect and use primary and secondary data that is

55

relevant to the marketing strategy of Nokia.

* Produce a clear analysis of the external influences affecting the development of

a marketing strategy.

* Complete a realistic rationale for the development of a coherent marketing mix

for Nokia communications.

* Show a full understanding of a marketing strategy for Nokia with a clear

understanding of marketing principles.

* Produce a full, well-balanced marketing strategy that reflects appropriate use of

marketing models and tools.

How Did Nokia Succeed in the Indian Mobile Market, While Its

Rivals Got Hung Up?

By most accounts, India is among the world's fastest-growing

markets for mobile phones. The country has some 170 million

subscribers and adds 6 million to 7 million more each month.

(China, in contrast, adds 5 million subscribers, and the U.S. 2

56

million subscribers a month.) Recognizing this potential, several

global telecom giants jumped into the fray when the Indian

government first opened up the country's telecom market to

private enterprise in 1994. Among them, one company -- Finland-

based Nokia -- forged ahead of rivals and today commands a 58%

market share for mobile phones (also called "handsets"). In

specific segments, such as GSM telephony, Nokia's market share

in India is as high as 70%. (GSM, which stands for Global System

for Mobile, is the world's most popular standard for mobile

communications.)

How did Nokia take the lead in the Indian mobile phone market,

ahead of companies such as Ericsson, Motorola, LG and Samsung?

According to company executives and industry experts, Nokia's

strategy combined focusing on the mobile phone market,

establishing crucial distribution partnerships, making early

investments in manufacturing and brand-building, and developing

innovative product features -- such as mobile phones that could

double as flashlights. Ravi Bapna, professor of information

systems at the Indian School of Business in Hyderabad, says, "As

57

far as Nokia's India strategy is concerned, the numbers speak for

themselves. The company is a key cog in India's wireless value

chain, and it has used India as its emerging market lab."

The Power of Focus

D. Shivakumar, Nokia India's vice president and country manager,

believes that focus played a key role in the company's growth in

India. "If you look at the [mobile phone] landscape in 1995,

anybody could have succeeded if they had done the same things

as Nokia did," he says. "But all the other companies had

something else to focus on, some other business. Nokia was

completely focused on mobile phones; others had consumer

electronics, home appliances, etc." Nokia's focus was not just on

handsets, of course. The mobile infrastructure business -- then

58

part of Nokia India -- was equally important. But, as of April 1,

2007, Nokia's joint venture with Siemens for mobile infrastructure

has become an independent entity. Thus, Nokia India has become

even more sharply focused.

Being ahead of the curve was another component of Nokia's

strategy. "We invested before everybody else -- in the brand, in

people, in distribution," says Shivakumar. Adds Pankaj

Mahendroo, president of the Indian Cellular Association: "Nokia

invested in each vertical of the handset ecosystem --

manufacturing, distribution and design R&D."

Nokia has invested more than $1 billion in India so far, and

company headquarters at Helsinki has repeatedly said that more

funds will be made available if required. The Indian company had

revenues of more than $3.5 billion in 2006, which means there is

also money to be reinvested. (The company does not disclose its

profit numbers.)

The Distribution Edge

59

Investment in people is difficult to judge; every company claims

to have the best talent in the business. But when it comes to

distribution, Nokia's lead is clear. Today, India has some 95,000

outlets that sell mobile phones. "In 50,000 of them -- and that's a

conservative estimate -- only one brand is available, Nokia," says

Shivakumar.

Nokia started distributing its phones through a partnership with

HCL (formerly Hindustan Computers Ltd.), which had already built

an extensive network for its own products. Recently, Nokia has

decided to supplement that with its own distribution efforts. "Both

companies realized that there was a tremendous growth

opportunity and it was best that we utilized the resources of both

organizations in an optimum manner," says Nokia India director of

sales Sunil Dutt. "We decided that we would address some

markets jointly, and that we would individually address some of

the other markets."

While Dutt does not spell out how the two partners will divide the

markets, some clues exist in the way demand is shaping up. In

the cities where the market is maturing, buyers are looking at 60

more sophisticated mobile phones, such as Nokia's E-series

phones (which serve business users) and the N-series (which have

multimedia features). In rural India -- which constitutes 70% of

the population -- affordability is an issue. So there is a different

range for this constituency.

The price points sometimes dictate the type of outlet. "As the

[telecom] operator footprint expands into different markets, all

kinds of retail outlets get into selling mobile phones and airtime

connections," says Dutt. "People who have been selling consumer

electronics, STD booth owners and even cloth merchants get into

this business." A stationery store stocks mobiles in a corner; a

mom-and-pop grocery store moves beyond rice and lentils. "Then

there are people with existing businesses who decide to set up a

separate shop only for mobile phones," he continues. "And why

do they feel the need to set up a different outlet? In this business,

customer engagement … requires a completely different

approach. Even the retail outlets realize this and [have started]

separating the two businesses."

61

Dutt notes that in the mature urban markets, "such as the metros

and Tier I towns where mobility has been around for a few years,

customer expectations are more evolved, and are continuously

evolving. Our task here is to provide our people with relevant

competency and skills sets." Nokia has begun to set up concept

stores -- seven so far -- in Indian cities. "At our concept stores, we

have tried to bring to life all the experiences that we offer at

Nokia experiential zones across the world," he adds.

Investment in Manufacturing

The other big investment area that has set Nokia apart from other

telecom firms is manufacturing facilities and R&D. Nokia has

several R&D centers and labs in India. More importantly, it

established a $150 million handset manufacturing facility in

Chennai in 2005. The total production at this unit has crossed 25

million handsets. "Some 30% of our production is being exported

to neighboring countries," says Sachin Saxena, Nokia India

director of operations in charge of the factory.

62

Other companies, such as Motorola, LG and Samsung, have also

lined up similar investments or are in the process of setting up

manufacturing units, but Nokia has had a clear head start. Also,

the Chennai factory is devoted to handsets, whereas other

companies are planning to make a whole range of consumer

electronics products. "Domestic manufacturing has worked to

Nokia's advantage," says Ravinder Zutshi, deputy managing

director, Samsung India Electronics. "Samsung India is looking at

making its Chennai facility a global hub for its consumer

electronics products."

Industry analysts note that Nokia's strategy is potentially risky.

When the going is good -- as it is now -- the company can do well.

But Samsung's approach is more flexible, these analysts note. If

demand for mobile phones were to slump, Samsung could switch

its manufacturing lines to other products. In contrast, Nokia

India's focus on mobile phones mirrors the priorities of its parent

company. Nokia traditionally was in a whole range of businesses

-- from toilet paper to power. But in 1993, CEO Jorma Ollila

63

decided to sell off everything else and concentrate on mobile

telephony.

Building the Brand

Another crucial aspect of Nokia's investment strategy focused on

building its brand. Here, the company ran into a problem. The

Nokia range available in India extends from Rs 1,499 ($37) at the

lower end to Rs 45,000 ($1,125) at the high end. Marketing theory

says a brand cannot be all things to all people. This is the reason

that Hindustan Unilever, with quality built around its brand,

refused to match Nirma, which came out with a cheap detergent.

This is also why Eveready, the battery manufacturer, refused to

lower prices when faced with a Chinese challenger in the dry cell

market.

64

But Nokia has a problem promoting other brands under its

corporate umbrella. "Unlike the FMCG (fast-moving consumer

goods) market -- where the product lifecycle is at least 10 and

sometimes 50-100 years -- models have a lifespan of 15-24

months here," says Devinder Kishore, Nokia India's director of

marketing. With such a lifecycle, promoting various models would

mean watching money go down the drain in a couple of years.

Instead, Nokia is promoting platforms -- music, for instance. With

this approach, one model can replace another while the branding

remains the same, or is extended slightly with the E series and N

series. "Nokia has done well to focus on the 'mother' brand rather

than on 'another' brand," says Jagdeep Kapoor, chairman and

managing director of Samsika Marketing Consultants. Kapoor,

who has written several books on brand management, says that

Nokia has understood the Indian market by straddling all

segments: the high, the middle and the low end. "The company

has created a ladder for consumers to climb from the low end to

the middle end to the high end, while being fully assured that

they will be with the mother brand Nokia."

65

Kapoor views the Nokia brand in terms of his proprietary "REAPS"

model, which takes into account five needs -- rational, emotional,

aspirational, physical and spiritual -- of the Indian consumer.

"Nokia as a brand has been able to address all the five needs to

various degrees at various stages," he says. "The rational need of

quality versus price has been met across price segments with

options. The emotional need of being able to keep in touch with

near and dear ones during times of joy and sorrow is being

adequately fulfilled. The aspirational need with the new models

and features and the look-good approach has helped the brand

become a sought-after, must-have brand. The physical need has

been taken care of through size and comfort. And, finally, the

spiritual need has been met through (local) languages and people

--whether they are 18 or 80 -- being able to greet one another via

SMS [text messages] during religious festivals."

ISB's Bapna offers a prescription for Nokia. "Going forward with

the premise that the mobile infrastructure will serve as India's

information infrastructure -- given the lack of substitute physical

and digital infrastructure -- I would encourage Nokia to take a

66

more active role in nurturing content and application-creation

communities that bring a range of services to all layers of the

population," he says. "It's in [Nokia's] own interest to do so."

Products for India

The Nokia story in India has not been about grafting a model that

has worked abroad. In fact some of its models -- the handsets, not

the strategies -- are unique to India. Consider this example: It

would probably be inconceivable to mobile phone users in the

U.S. or Europe that their mobile phones should incorporate a

flashlight, or torch. But in India -- where large numbers of the

rural population do not have electricity, and power cuts are

commonplace even in the cities -- having a torch built into a

mobile phone is a distinct and tangible benefit. The Nokia 1100,

the first made-for-India phone, has been a runaway success.

Manufactured at Chennai, it is also being exported. The 1100

incorporates a torch, an alarm clock and a radio. "Innovation is

67

something which consumers reward in this market," says

Shivakumar.

Similar plans are in the works at Nokia's three India R&D labs,

which employ 700 people. For obvious reasons, most of the

activity is under wraps. Nokia is, however, willing to talk about the

"shared" phone. This is, again, something that mobile phone

users in affluent countries might find puzzling, but the concept is

simple. For reasons of affordability, in rural areas a phone may be

shared by several people. The models being launched to cater to

this need will have separate address books, individual billings and

more. Will it work? People initially doubted the torch phone, too,

but it became a popular product.

Shivakumar offers some reasons to explain why he thinks the

Indian market is different and needs out-of-the-box thinking.

"Fundamental consumer differences exist between India and

other countries," he says. "A cell phone is a huge style icon for

the Indian masses: 62% of Indians buy a cell phone because of its

looks. That is something that is not true anywhere else in the

68

world. It's as huge a style statement as your watch, pen, cufflinks

or bag. Hence, the brand matters quite a lot.

"Second, it is a safety product for women in small towns, because

with a cell phone you are in touch all the time; you're accessible.

Next, it is a huge productivity vehicle. When somebody calls you,

you do not need to take your bike out; you don't need to take

your car out. You make a phone call and it's over.

"It is also a driver of a lot of economic activity. If you go down the

roads of Gurgaon and Delhi, you will find that lots of people have

written their [mobile] phone numbers on the walls -- a plumber,

an artisan, a carpenter, a tailor. I think the whole service sector

has gotten a huge lift, thanks to this. This has killed the visiting

card business…. It is also the ultimate entertainment device. You

have music on it now, in terms of radio and stored music. The day

is not far when you will see movie clips and TV. One of our

products has that, so that's TV on the go."

69

An Expanding Market

The Indian market for mobile phones, in addition to its base of

170 million subscribers, is also one of the most cost-effective in

the world. Call rates in India are among the lowest anywhere --

making a mobile phone call costs two cents in India, compared

with about four cents in China. The market also has tremendous

growth potential. So far, most of the growth has been

penetration-led, which means placing devices in consumers'

hands. The bulk of the growth going forward will be replacement-

led, where consumers come back for more. In India, consumers

tend to change their phones faster than in most other places. And

whenever they change their phone, 60% are willing to pay a

higher price.

Shivakumar offers examples of future services that might be

delivered over cell phones. "The cell phone could be the future

bank -- a full branch of the bank. You don't need 20 people, a

70

security guard or a vault. This is a passbook plus bank rolled into

one. It can be your payment system." Another possible use is

navigation, where cell phones could be used to provide maps of

an area where the user is based. Such services, whenever they

are launched, could help Nokia keep going and growing in India.

Work Performed By Marketing Channels

Today, the markets use to delegate some of the selling jobs, to

intermediaries for the effective distribution of the products at the right time, at

right place and right customers.

Delegation means relinquish some control over how and whom the

products are sold, but producers do again several advantages by using

intermediaries :

Many producers lack the financial resources to carry out direct marketing.

For example, General Motors sells its cars through more than 8,100 dealer

outlets in North America alone. Even General Motors would be hard-

pressed to raise the cash to buy out its dealers.

71

In some cases direct marketing simply is not feasible. The William Wrigley

Jr. Company would not find it practical to establish small retail gum shops

through the world or to sell gum by mail order. It would have to sell gum

along with many other small products and would end up in the drugstore

and grocery store business. Wrigley finds it easier to work through the

extensive network privately owned distribution organizations.

Producers who do establish their channels can often earn a greater return

by increasing their investment in their main business. If a company earns a

20 percent rate of return on manufacturing and only a 10 percent return on

retailing. It does not make sense to undertake its own retailing

Intermediaries normally achieve superior efficiency in making goods

widely available and accessible to target markets. through their contracts,

experience, specialization, and scale of operation, intermediaries usually

offer the firm more than it can achieve on its own.

Intermediaries smooth the flow of goods and services. This procedure is

necessary in order to bridge the discrepancy between the assortment demanded

by the produce a large quantity of a limited variety of goods, whereas consumers

usually desire only a limited quantity of a wide variety of goods.

72

Distribution Channel Flows :

1. PHYSICAL FLOW

2. TITLE FLOW

Channel Levels :

The producer and the final customer are of part of every channel. We will

use the number of inte4rmediary levels to designate the length of a channel. The

above figure illustrates several consumer goods marketing channels of different

lengths. Collectibles through mail order. Shearson-Lehman brokers use the

telephone to prospect for new customers some exercise equipment

manufacturers sell through TV commercial or hour-long “information’s”. Amazon

sells books on line, and Gateway sells computers through its own stores.

73

Suppliers Transporters Manufacture Warehouse

re

Distributers

Dealers Customer

Suppliers Manufacture Distributers

dealers Customers

3. One Level Channel : It contains one selling intermediary, such as a retailer.

4. Two- Level Channel : It contains two selling intermediaries. In consumer

markets, these are typically a wholesaler and a retailer.

5. Three-Level Channel : It contains three intermediaries.

About end users and exercising control becomes more difficult as the number

of channel levels increases.

End users and exercising control becomes more difficult as the number of

channel levels.

74

Research Methodology

Research methods may be understood as all those methods or

techniques that are used for the conduction of research. Research methods

and techniques, thus refer to the methods are researcher use in performing

research operations.

In other words, all those methods, which are used by the researcher

during the course of studying his research problem, are termed as research

methods. Since the object of research, particularly the applied research is to

arrive at the solution for a given problem, the available data and the unknown

aspects of problem have to related to each other make a solution possible.

Research methodology is a way to systematically solve the research

problem. It may be understood as a science of studying how research is done

scientifically. In it we study the various steps that are generally adopted by a

researcher in studying his research problem along with the logic behind them.

It is necessary for the researcher to know not only the search methods or

techniques but also the methodology.

75

Research Process

Research process consists of a number of closely related activities. The various

steps in a research process are as follows:

1. FORMULATING THE RESEARCH PROBLEM ;- The first step in research is

formulating a research, as poorly defined problem. It is most important

stage in applied research, as poorly defined problems will not yield useful

results. It is rightly said that “a problem well defined is half-solved”. Poorly

defined problems cause confusion and do not allow the researcher to

develop a good research design.

2. EXTENSIVE LITERATURE SURVEY ;- Once the problem is formulated, the

next step is to write down a brief summary. For this the researcher should

undertake extensive literature survey connected with the problem. For this

purpose, the abstracting and indexing journals and published and

unpublished bibliographies are the first place to go to.

3. DEVELOPMENT OF WORKING HYPOTHESIS :- Working hypothesis is

attentive assumption made in order to draw out and test its logical or

empirical consequences. As such the manner in which research hypothesis

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are developed is particularly important since they provide the focal point

for research.

Working hypothesis can be developed by using the following approach.

Discussion with colleagues and experts about the problem, its origin and

the objectives in seeking a solution.

Examination of data and records.

Review of similar studies in the area or of the studies on similar problems;

and

Exploratory personal investigation, which involves original field interviews

on a limited scale with interested parties and individuals with a view to

secure insight into the practical aspects of the problems.

4. PREPARING THE RESSEARCH DESIGN :- Research design is the conceptual

structure with in which research should be conducted. A research design

specifies the method and procedures for conducting a particular study. It is of

three types :-

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EXPLORATORY RESEARCH :- An exploratory research focuses on the

discovery of ideas and is generally based on secondary data. It is

preliminary investigation, which does not have a rigid designs.

DESCRIPTIVE RESEARCH :- A descriptive study us undertaken when the

researcher wants to know the characteristics of certain groups such as age

sex, educational level, income occupation, etc.

CASUAL RESEARCH :- A casual research is undertaken when the researcher

is interested in knowing the cause and effect relation between two or more

variables. Such studies are based on reasoning along well-tested lines.

Consideration should be made during the preparation of research design

The means of obtaining the information.

The availability and skills of the researcher and staff (if any)

Explanation of the way in which selected means of obtaining information

will be organized and the reasoning leading to the selection.

The time available for research.

The cost factors relating to research, i.e., the finance available for the

purpose.

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5 Determining Sample Design: All the items under consideration in any field

of inquiry constitute a ‘universe’ or population’. Some important sample

designs which should be consider for the research are:

Deliberate Sampling: Also known as purposive or non-probability sampling

this sampling method involves purposive or deliberate selection of the

particular unit of the universe for constituting a sample which represents

the universe.

Convenience sampling: When Population elements are selected for

inclusion in the sampling based on the case of access, it can be called as

convenience sampling.

JUDGEMENT SAMPLING ; The researcher’s judgment is used for

selecting items, which he considers as representative of the population.

SIMPLE RANDOM SAMPLING ; Also called as “Chance Sampling” or

‘Probability Sampling’ wherfre each and every item in the population has an

equal chance of inclusion in the sample and each one of the possible

samples.

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SYSTEMATIC SAMPLING; Where an element of randomness id introduce

by using random numbers to pick up the unit with which to start, this

process of sampling known as systematic sampling

STRATIFIED SAMPLING; In this method, the population is stratified into a

number of non-overlapping subpopulation or strata and samples items is

based on simple random sampling the entire procedure, first stratification

and the simply random sampling, is known as strategies random sampling.

QUOTA SAMPLING: In stratified sampling the cost of taking random

samples from individual strata is often so expensive that interviewers are

simply given quota to be filled from different strata, the actual selection of

items for sample being left to the interviewer’s judgment. This is called

quota sampling.

CLUSTER SAMPLE : Cluster sampling involves grouping the population and

then selecting groups or the clusters rather than individual element for

inclusion in the sample.

AREA SAMPLING : When the total geographical area of interest is big one,

then area sampling method is taken. We first divide the total area into a

number of smaller non-overlapping areas, then a number of these smaller

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areas are randomly selected and all units in these small areas are included

in the sample.

MULTI-STAGE SAMPLING : This technique is meant fir big inquires

extending to a considerably large geographical area like an entire country.

The first stage is to select large primary sampling units such as states, then

districts, then towns and finally certain families within towns.

SEQUENTIAL SAMPLING : In this the ultimate size of the sample is not fixed

in advance but is determined according to mathematical decisions on the

basis of information yielded as survey progresses. This design is usually

adopted under acceptance sampling plan in the context of statistic quality

control.

6. COLLECTION OF DATA ; The next step is to determine the source of data to

be used. The researcher has to decide whether he has to decide whether

he has to collect primary data or depend exclusively on secondary data.

Sometimes the research study is based on both secondary and primary

data.

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7. EXECUTION OF THE PROJECT : The researches should see that the project

is executed in a systemmatic manner and in time. A careful watch should

be kept for unanticipated factors in order to keep the survey as such

realistic as possible. This means that steps should be taken to ensure that

the survey is under statistical control so that the collected information is in

accordance with the pre-defined standard of accuracy.

8. ANALYSIS OF DATA : The analysis of data requires a number of closely

related operations such as establishment of categories, the application of

these categories to raw date through coding, tabulating and then drawing

statistic inferences.

9. HYPOTHESIS TESTING : In this , the researcher has to test the hypothesis,

various tests, such as Chi-Square test, t-test, f-test, have been developed by

statisticians for the purpose.

10.GENERALIZATION AND INTERPRETATION: When hypothesis is tested and

upheld several times, it may be possible for the researcher to arrive at

generalization, i.e. to build a theory. If the researcher had no hypothesis to

start with, he might seek to explain his finding on the basis of some theory.

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11.PREPARATION OF THE REPORT : For the preparation of the report

following principles should be adopted by the researcher.

There should be objectivity, coherence and clarity in the presentation of

ideas.

Report should be written in a concise and in simple language

Charts and illustrations in the report should be used.

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Methods Of Data Collection

The task of data collection begins after a research problem has been defined and

research design/planed out. The primary data are those , which are collected a

fresh and for the first time, and thus happen to be original in charracter..d The

secondary data. on the other hand, are those which have already been collected

by someone else and which have already been through the statistical process.

Collection Of Primary Data

We collect primary data during the course of doing experiments in an

experimental research but in case we do research of the descriptive type and

perform surveys, whether sample surveys or census survey, then we can obtain

primary data either through observation of through direct communication with

respondents in one form or another or through personal interviews. This in

another words means that there are several method of collecting a primary data

particularly in surveys and descriptive researches important ones are, collecting

primary data, particularly in surveys and descriptive researches. Some important

ones are :-.

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1. Observation Method.

2. Interview Method.

3. Through Questionnaire.

4. Through Schedules.

Observation Methods :

The observation method is the most commonly used method especially in studies

relating to behavioral science. In a way we all observe things around us, but this

sort of observation is not scientific observation. Observation becomes a scientific

tool and the method of data collection for the researcher, when it serves a

formulated research purpose , is systematically planned and recorded and is

subjected to checks and controls on validity and reliability. Under the observation

method, the information is sought y way of investigator’s own direct observation

without asking from the respondent.

The main advantages of this method are :

Subject bias is eliminated, if observation is done accurately.

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The information obtained under this method relates to what is currently

happening : it is not complicated by either the past behavior or future or

attitudes.

This method is independent of respondent’s willingness to respond.

Such is relatively less demanding of active cooperation on the part of

respondents as happens to be the case in the interview or the questionnaire

method. However, observation method has various.

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Limitations :

It is expensive method.

The information provided by this method is limited.

Sometimes unforeseen factors may interfere with the observational

task. If the observer observes by making himself, more or less, a

member of the group experience, the observation is called as the

participant observation.

Emissary without any attempt on his part to experience through participation

what other feels, the observation of this type is often termed as non – participant

observation. There are several merits of the participant type of observation.

The research is enabled to record the natural behavior of the group.

The research can even gather information, which could not easily be

obtained if he observes in a disinterested fashion.

The researcher can even verify the truth of statements made by informants

in the context of a questionnaire or a schedule. But there are also certain

demerits of this type of observation viz.

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The observer may lose the objectivity to the extent he participants

emotionally; the problem of observation control is not solved; and may

narrow-down the research’s range of experience.

Interview Methods :

The interview method of collection data involves presentation of oral-verbal

stimuli and reply in terms of oral-verbal responses. This method can be used

through personal interview and, if possible, through telephone interview.

Personal Interviews : Personal method requires a person known as the

interviewer asking questions generally in a face-to-face contact to the other

person or persons. This soft interview may be in the form of direct personal

investigation or it may be an indirect oral investigation. In the case of direct

personal from the source concerned. He has to be on the spot and has to meet

people from whom data have to be collected.

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The method of collecting information through personal interviews usually

carried out in a structured way. As such we call the interview as structured

interviews.

The chief merits of the interview methods are as follows:

1. More information and that too in greater depth can be obtained.

2. Interviewer by his own skill can overcome the resistance, if any, or the

respondent; the interview method can be made to yield an almost perfect

sample of the general population.

3. There is grater flexible under this method as the opportunity to restructure

questions is always there, especially in case of unstructured interviews.

4. Samples can be controlled more effectively as there arise no difficulty of

the dismissing returns: non-response generally remains very lows.

5. The language of the interview can be adapted to ability or education level

of the person interviewed and as such misinterpretations concerning

questions can be avoided.

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Weakness Of Interview Method :-

1. It is a very expensive method, especially when large and widely spread

geographical sample is taken.

2. There remains the possibility of the bios of interviewer as well as that of

the respondent, there also remains the headache of supervision and

control of interviewers.

3. This method is relatively more time consuming, especially when the sample

is large and re-calls upon the respondent are necessary,. Interviewing at

times also introduce systematic errors.

4. Effective interview presuppose proper report with respondents that would

facilitate free and frank response. This is often very difficult requirement.

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Collection Of Data Through Questionnaire :

This method of data collection is quite popular, particularly in case of big

enquires. It is being adopted by private individuals, research workers, private

and public organizations and even by government. A questionnaire consists of a

number of questions printed or typed in a definite order on a form or set of

form. The questionnaire is mailed to respondents who are expected to read

understand the questions and write down the reply in the space meant for the

purpose in the questionnaire itself. The respondents have to answer the

questions on their own.

The merits are :

There is low cost even when the universe is large and is widely spread

geographically.

It is free from the bias of the interviewer, answers are in respondents.

Respondents have adequate time to give well through out answers.

Large samples can be made use of thus the result can be made more

dependable and reliable.

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Demerits Are :-

It can be used only when respondents are educate and cooperating.

The control over questionnaire may be lost once it is sent.

It is difficult to known to whether willing respondents are truly

representative.

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QUESTIONNAIRE

Name of Retailers :…………………………………..

Address :…………………………………..

Phone Number :…………………………………..

1) Nokia Sales Man is coming to your shop everyday.

a) Yes [ ] b) No [ ]

2) Sales man gives the full information about the product scheme.

a) Yes [ ] b) No [ ]

3) Whose delivery is good ?

a)Nokia [ ] b) Samsung [ ]

c)Lg [ ] d) Other [ ]

4) Which company fulfills the requirements of you ?

a)Nokia [ ] b) Samsung [ ]

c)Lg [ ] d) Other [ ]

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5) Different SIS(Shop in Shop) units available which one would prefer

to use

a) Nokia [ ] b) Samsung [ ]

c) LG [ ] d) Other [ ]

6) Which feature do you think are very satisfactory in Brands.

a. On time Delivery [ ]

b. Communications [ ]

c. Daily visit of S.E [ ]

d. Goods after sales service [ ]

e. Others [ ]

7) Are you satisfied with existing Service?

a) Yes [ ] b) No [ ]

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8) Are you facing any following problem

a)yes [ ] b)No

9) Supply of which product is insufficient

a. Nokia [ ]

b. Samsung [ ]

c. LG [ ]

d. Other [ ]

10) How many times in a month, officials from company come to

your shop to listen your problem

a. One [ ]

b. Two [ ]

c. Sometimes [ ]

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CONCLUSIONS

On the basis of above analysis with reference of tables and charts, I

reached to the conclusion that distribution system is a key external resource

for any company or firm including Nokia

Normally distribution channel takes several year to build and it is not easily

changed. From all the above tables and charts it is clear that distribution or

availability of Nokia is on the top.

I also conclude that the Nokia has to target on that distributors, sub-

distributors and retailers who has closed his selling’s , they have to

find out the problems of switching off and switching to other brands.

So that the customer and consumer remain brand loyal to their

products.

To achieve and to maintain the goodwill of the Nokia and its products,

Nokia has to discover some innovative products which will maintain the brand

loyalty and goodwill of the Nokia with the help of distributors, sub-distributors,

retailers and customers/consumers.

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For raising the sells of Nokia, the distribution channel must be kept tight so

that each and every channel of distribution ( i.e. Distributors, Sub-Distributors,

retailers and customers/consumers ) will be benefited maximum from the Nokia

and its products.

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LIMITATIONS

Generally our outlets use to purchase Nokia mobiles daily, so there is a

possibility that my visiting day is not alternate day.

Sometimes the delivery Van has delayed the stock delivery etc. but outlets

demanding so under this situation are quite difficult to get exact figure of

availability.

Since most of the person of the outlets is not aware of English language so

questions of questionnaire are asked to them and then filled by me. So

there may be a chance of communication gap or biasness.

Most of the outlets are busy to there customers. So there is possibility of

some irrelevant answers. Some retailers were not in the mood to give

response. So some refuse while did not give answer to some questions.

Some retailers give response half-heartedly of error.

Through at most care has been taken for collecting the data yet it is not as

final proof elimination the error of sampling.

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Dealers do not cover all area of the own region.

Fair dealers cover 20 % area of the market and they created problem to the

dealers.

Sales man does not cover the each retailers or shopkeepers. They cover

only daily purchases retailers.

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Suggestions

Dealer’s relationship should be improved. They should be given more

facility and should be provided with novelties.

Company repetitive should give regular visits to the dealers. Annual or half

yearly meeting should be hold by the company of all the dealers where

they can put up their problems.

Publicity should be done heavily so as to make people aware of the

products and painting, hoarding, television and radio are the best media for

advertising.

Dealers network should be properly available to the dealers.

Dealer’s liabilities to cover all area through the area sales man each

retailers or shopkeeper.

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BIBLIOGRAPHY

www.Nokia.com

www.wekipedia.com

www.google.com

BOOKS:

Marketing Management -Study Material

Principles of Marketing-P.Kotler & Armstrong

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