When approaching this assignment, the second topic attracted us given its interest and the challenges it represents. We wanted to study a successful and well known company, constantly looking for new markets and offering new variants of known devices, to find out what a wrong Marketing-mix consists of for a global company promoting global products. In this way, and without hesitations, Nokia seemed to be relevant in this particular case. Indeed, the example of the famous "N-Gage" strokes our mind and could be linked with the word "failure". The N-Gage began as a concept when Nokia noticed that more gamers were carrying a Nintendo Game Boy and cell phone simultaneously.
In order to argue why the giant mobile phone manufacturer failed to produce a multi-purpose device -encompassing the portable gaming-console and the phone's function- has failed, we decided to contrast it with the success of the mobile phone called the "N-70". The Nokia N-series such as the N-70 model has greatly contributed to the success lately as Jormal Ollila points out:
"I am delighted that our strategy to target new mobile communications market segments is working well, as evidenced by the success of the Nokia N-70 multimedia device: the highest revenue generator for Nokia this quarter and the world's number one selling WCDMA device"
However, it is important to introduce in a first part a history of Nokia and point out key numbers dealing with its industry. Finally, in order to illstrate the contrast, the 2 products will mainly be analyzed through the most relevant P's which are the Product and the Price.
[...] Finally, the N-Gage wasn't able to compete in a market where the technology is an important factor and was therefore outdated very quickly in the mobile phone market. In order to save its invention, Nokia tried to adapt itself to the market factors but negative words of mouth and public relation sunk the Finnish new invention. Appendix A. Worldwide Mobile Terminal Sales to End-Users in 2005 (Thousands of Units) Sales Share Ericsson Source : Gartner Dataquest (Feb 2005) B. The N-Gage C. [...]
[...] They did not take into consideration the pricing strategy of its competitors who was rather in the entertainment and video game sector than the mobile phone industry. Given this product is unique and was available at a high standardized global price, it is clear that this is a skimming strategy according to Hollensen (2001). However, potential buyers -the “early adopters”- had trouble with its price and still saw it as an expensive phone replacement, not a game console. Even if mobile retailers cut prices down, sales have not been affected and still stay under expectations. [...]
[...] In contrast, the N-70 design is very attractive and is highlighted with its luxurious metal impression which epitomizes a robust and pleasant product to touch. The hand and the silver bezel around the large screen focus the eye. With this new trendy design, Nokia tries to attract and reach fashionable people with high expectations The quality Dave Kosak “Among the gaming audience, the N-Gage has absolutely no credibility, they don't consider it a viable platform at Big dimensions, slow frame rates, small screen, inconvenient buttons often pressed wrongly have to be pointed out. [...]
[...] Secondly, Nokia expanded its portfolio based on the feedback they received: only seven months after the launch of the N-Gage, Nokia released the N-Gage QD in July 2004 ('Quaque Die' which is Latin for 'everyday'), a smaller and more rounded version. Despite the fact that it fixes the “sidetalking” problem, and the game system the device still had several problems such as the rubber around the sides, the absence of blacklight for the joystick, a poor game library, a badly developed N-Gage Arena service where its main function is publishing one's own best results. [...]
[...] On the other hand, the N-70 has a low risk of failure because Nokia concentrates itself on its core business and has the “know in this field. Thus, the N-70 is considered as a line extension and improves existing products Product positioning Vesa-Pekka Kirsi “Where Nintendo's Game Boy Advance ends, Gage starts. I can definitely say this is not a product that will be aimed at 10-year-olds” The N-Gage has been poorly positionned mainly by the fact that it offered too many features which were basically from two totally different ativities (console and mobile). [...]
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