Nokia - Why?!!

[hydra22uk]

Hi All,
Just wanted to get people's feeling about Nokia at the moment... is it me or are they trying the manufacturing equivalent of carpet bombing? By my count Nokia will have a handset range of some where in the region of 25 handsets within about 6 months... can anyone tell me the point?!

From my point of view (as a phone dealer) it just seems to confuse customers and bog the market down with handsets which are essentially the same!! If anyone from Nokia is reading this, you were a much better manufacturer when you had about 5 handsets in your UK range than you are now!

In my opinion there should be:

1 Entry level basic phone (2100)
2 Simple business phone (6310i)
3 Flash business phone (6610)
4 Small toy phone (6100)
5 Tough phone (5100)
6 ULTIMATE phone (6600)
7 Gadget phone (7250i)
8 Consumer toy phone (7210)
9 Exclusive phone (8910i)
10 Carphone (a la 6090)

AND THATS IT! The trest of your range is just FLUFF! I am more a Nokia fan than a SE fan but lets face it, their range is better! Consumers have a set of clear simple choices, they are unique, seperate and individual and a JOY to sell, where as selling Nokia mainly consists of "OK... whats the ACTUAL differnce?" to which the answer is mainly "NOT A LOT!"

Is anyone in agreement? Or am I off base here?

Cheers,
S

[Viipottaja]

Most consumers don't in the end care much that there is very little difference between the models. They care about the looks and the price and the image. And Nokia cares about profit margin per a hand set.

Plus new models keep people coming to your store. You should be happy and just lay it down to your customers: choose the one that appeals to you, and you are guaranteed to get solid performance and functions.

They are doing things right, otherwise they would not be the only cell phone manufacturer making a decent profit.

[hydra22uk]

Nokia are #1 because everyone gets a "warm, fuzzy" feeling and Nokia have done thier life style branding VERY well. At the end of the day consumers DO want to know what they ae getting for their money and are becoming increasingly savvy, especially in my sector (Business). Recently I supplied a 3100 to a corporate client who commented that it is a 6610 with a plastic case on, how true?!!

Increasingly Nokia's margins are being erodded by the likes of Samsung, SE and Siemens, why? Because the handsets are unique and not just the same old tat reboxed. I think that Nokia is heading for trouble if it keeps churning out this junk.

Come on Nokia... remember what got you here.... a small range of good quality that stood out from the mass produced rubbish of everyone else!!

[Michael]

I tend to disagree.

While I find all the new handset introductions a bit of a pain to keep on top of, I think it is a decent move in poor economic times.

They are always doing variations on a theme. The R&D time required is minimal, they make use of the same basic hardware.

This keeps costs down.

But all of the new models keeps them in the press, and keeps people able to buy the "newest" thing, without Nokia having to really develop something new from scratch.

There is the effect of what I call the 'i syndrome', though. Announce a new phone, and then before it even starts shipping, announce a new 'i' version of it. 7250/7250i, for example.

People waiting for the original might want to wait further for the new 'i' variant, holding on to their money longer than Nokia would like.

But otherwise I have found Nokia to be brilliant in their business plan. The effects of said plan annoy the heck out of me and other hi-tech users, but we make up only a very small minority of the consumer base.

[g_vanzyl]

nokia is churning out a heap of (mostly) cheap phones to keep the fashion/youth crowd happy. decent phones, especially for the business user, are a lot less important. i think nokia is just cashing in on the shallow fashion sense of the modern individual. just read the blurbs!!

i am unsure of the financial success, though. it must be more expensive to produce smaller numbers of a lot of models.

if i am wrong, stone me.

[Viipottaja]

Well, I guess financial success is on agregate evidenced by their market position (35-40% of global market) and their annual profits and profit per one stock (I don't remember the fancy financial term for it).

I think I read somewhere that in 2002 (or was it 2001?) they were pretty much the only hand set manufacturer in the world to make profits (about $2-3 billion I think).

This is not to say that they can now rest and just enjoy the ride. The competition is tough and getting tougher, in particular by SonyEricksson and Motoral seems to be getting their act together as well.

Some analyst said after the latest Nokia profit reports that they should focus more on emerging markets and low end models that have bigger volumes and better margins. That's what they seem to be doing now (1100, 2100, 2300, 3100, 3200).

Their success in branching out to riskier segments (N-Gage, 3300, 7600) remains to be seen, as well as the success of their recently announced restructuring (to anticipate market growth in mobility products in general) and of the new "life-style products" (which for the most part seem pretty redigulous, but hey.... maybe someone is buying a pendant..).

In summary, I agree with Michael: not all their products appeal to the gadget freaks and hi-tech consumers, but hey, business is about making money too.. :)

[orthotomeo]

Car models don't go through major changes for 5 years, only after that do they get a new look. If they changed completely, you'd be paying a whole lot more for all of the R&D that went into developing a sturdy new platform and engine and working out all the errors in it. Why do you think Nokia series 60 phone architecture is being licensed out to 8 or more diferent companies? It's cheaper for them to do this than to start from scratch.

That's what making a profit is all about. You go with what is new and you customize.

Cheap phones? While some of us may be able to afford a new 3650 or 6600 as soon as it comes out, others of us are not so fortunate. Some parents want to be able to keep track of their kids or get them a nice gift for their birthday. The kids want something "cool" the parents want something cheap, hence the cheap fashion phones.

I know I'm not preaching anything new, but to complain at a company for marketing research (and effective research at that) should be done carefully.

The reason that Nokia may be loosing a bit of Market share is because the other companies are finally following suit.

Nokia has come a long way from making galoshes and tires and have prospered all of the way.

[srchurch]

Seems to me Nokia has always had creative design and generally durable phones. However, they are not always as quick at producing what upgraders want in new phones. It took a little longer for them to come out with a camera phone and color screens than their asian competitors, and they are only now just going to release a 65,000 color screen (the 6600). Many upgraders don't want to wait.

I hope this is all because they want to produce a more solid design so the users don't become beta testers. However, their software on their latest handsets seem prone to glitches from some forum posts I have seen. In general though I do love their series-60 platform and the Symbian OS is very nice.

On the other hand many new phones don't get it quite right. For example, the 3650 has a hard to use key board and only 4Mb of memory, which is not enough for a phone of it's power. Ok, it has a 16Mb MMC which can be upgraded to 128Mb, but why not use SD which would allow memory up to 1Gb for users that like to store movies on the phone.

They are however whay ahead of Motorola.

[Michael]

Nokia releases new technology when they have to, not when the first small group of users starts demanding it.

That way they get to wait for the prices to come down a bit, for the tech to stabalize.

There are often great advantages to not being first.... They can afford to let some smaller, hungry company be the guinea pig.

[jim]

Originally posted by srchurch
On the other hand many new phones don't get it quite right. For example, the 3650 has a hard to use key board and only 4Mb of memory, which is not enough for a phone of it's power. Ok, it has a 16Mb MMC which can be upgraded to 128Mb, but why not use SD which would allow memory up to 1Gb for users that like to store movies on the phone.

Even tho Nokia claim that the 3650 only takes MMC up to 128MB, I've read in some forums that there have been a number of people who have gotten the phone to work with 256MB and 512MB MMC. The only thing is that it doesn’t work with every type of MMC card it has to be a specific brand