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Nokia continues to lose Marketshare,Brand Appeal and Pricing Power

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Nokia’s trajectory  has been going downhill from the peak reached when Motorola nearly self destructed. Now it looks that Nokia is following the same path as the other old mobile handset makers like Siemens,Sony Ericsson,Motorola and others.Though it still commands an impressive 36% marketshare of the world mobile market,that has been steadily coming down.More importantly its share in the lucrative high end smartphone market is falling faster . It looks with the hypercompetition in the smartphone market , Nokia has an extremely low chance of regaining its lost profits and margins.It is concentrating on the other segments of the mobile market to defends its units  where it is also getting hammered by competition from Samsung,LG in the middle segment and local players at the lowest segment.Can’t see Nokia being a Buy anytime in the future.The main problem in its current problems lies in its very unsuccessful R&D which despite its long history in the mobile market and huge amount of dollars has failed to compete against much  smaller rivals like HTC.Nokia forms a classic cases study of a Technology Company which failed due to failure of its R&D though Marketing also played a Role.

Nokia Shareholders Lose Patience in Third Year Without Response to IPhone – Bloomberg

Nokia, based in Espoo, Finland, spent almost six times as much as Apple on R&D last year, yet has failed to develop a device with the same mass appeal as the multi-application iPhone. The company’s shares have tumbled about 20 percent in the two weeks since it reported first-quarter earnings that missed analysts’ estimates, wiping out 8.2 billion euros ($10.5 billion) in market value.

Now 34 billion euros, or $44 billion, the company’s market capitalization compares with Cupertino, California-based Apple’s $230 billion, and is a shadow of its 1999 peak of 203 billion euros, the highest of any European company.

Nokia came in 43rd in a brand-ranking study released last week by Millward Brown Optimor, tumbling 30 places in a year. It lost 58 percent of its brand value, the biggest plunge in the top 100 brands, according to the study.

In a push to defend market share, Nokia slashed prices and sold cheaper models, sacrificing profit as the average smartphone price fell 18 percent in the last nine months. Even with the price cuts, its share of the global handset market fell almost 2 percentage points in the first quarter to 36.6 percent, International Data Corp. said April 30.


Sneha Shah

I am Sneha, the Editor-in-chief for the Blog. We would be glad to receive suggestions, inputs & comments on GWI from you guys to keep it going! You can contact me for consultancy/trade inquires by writing an email to

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