Every kid who born in the 90s used Nokia once in his life, playing snakes game in Nokia's phone was one of the sweetest childhood memory. if you ask any teenager now about there favourite mobile phone manufacture company everyone will say about apple, oppo, Vivo, Samsung, MI and etc these company are the most famous company in the smartphone market but have you ever thought about what happened to Nokia the most demanding and profitable companies in just a few decades ago but now it's disappeared and how the small and new companies rise in the market. in this article, we are going to find out how Nokia rise? How Nokia fall? and where is Nokia now?
- Who is Nokia?
- How Nokia failed?
- What Nokia is doing?
- Stephen Elop's Negative Will
- Wrong Acquisition
- Slow Mover
- Come back of Nokia
- Conclusion
Who is Nokia?
Nokia is a Finland based mobile phone manufacturing, information technology and consumers electronics company. the core business is to manufacture a mobile phone handset. Nokia acquire a company called "mobira" and
In 1982 they introduce their first car phone "Nokia mobira senator" weight - 10kg,
In 1984 Nokia launched there first transportable phone "Nokia mobira talkman" which can be used inside and the outside of the car weight - 5kg,
In 1987 Nokia launched "Nokia mobira cityman" which can be used in the entire city via wireless communication weight - 800g this phone was a massive boom for Nokia millions of units were soled and Nokia earns lots of profit.
In 1991 Finland's PM Harri Holkeri made first GSM call via Nokia's manufactured phone.
In 1992 Nokia released it's "Nokia 1011" and start spreading in the US and Europe's smartphone market.
In 1994 Nokia launched it's "Nokia 2100" First feature phone gave Nokia an iconic growth, Nokia thought we can sell up to 400000 phones but they sold approx 2 Million phones.
Nokia predict mobile phone market approx 40million but the actual market size was 250million
Nokia was increasing there phone manufacturing capacity but the market size was increasing rapidly even faster than they thought.
Nokia became no. 1 Mobile phone company with the market size of 25%, in the starting they focused on developed economies like the US and Europe after that they dominate in the developing economy as well like India, Russia, China etc
List of 50 most selling mobile phone models 20 was from Nokia. and the other phone - Motorola and some other Chinese companies.
Between 2003 - 2005 Nokia launched it's 1100 and 1110 series and Nokia captured 70% of Indian Mobile phone market.
Nokia sells over 400 million mobile phones in 2008.
How Nokia fail?
In US Apple and google was entered in the smartphone business. Nokia still following their old business strategy, Nokia face major loses in the US and Europe but still in the Asian market Nokia was doing good. Now Samsung and Motorola entered in the India and china and start launching there mobile phones models. Nokia having huge loses in the Asian market also. Samsung and Motorola launched there flip phone in the Asian market to counter Nokia, Nokia losing market share in the US, Europe, India and China.
Chinese phones were cheaper then Nokia and people started shifting. Chinese was faster in manufacturing. all the major smartphone company shift there manufacturing factories to china and china became a smartphone manufacturing hub. Many Chinese companies came in the market and start dominating.
The world is moving toward the software, Nokia still making their unbreakable phones and stuck with "Symbion os" but this time Android and apple also making their own ecosystem, Apple and Google both created there own community apple with 300k and Google with 125k application, Nokia can't sustain even 20000 applications after these huge loses and decrease in market share Nokia think we should change our CEO and the new CEO is Stephen Elop.
When Mr. Elop came into the company they made some big changes First they tried to get a new Operating system and left Symbion behind, Now Nokia shift to Windows and try to revive the company but the problem is Microsoft also don't have an ecosystem for mobile phones in the starting Nokia Lumia doing great but it eventually it failed again. The problem is everyone is shifting to android and apple most of the traffic remains on these 2 platforms and every smartphone manufacturer company also shifting to android and apple, application developers also making their applications on these platforms nobody want's a new ecosystem and even Microsoft doesn't have it. Windows was never compatible with mobile phones.
Nokia failed due to lack of technology, Wrong decisions, Wrong leadership, Lack of ecosystem, Being not flexible, ignoring the feedback.
What Nokia is doing now?
Now some companies like HMD Global and Foxconn trying to make Nokia more profitable and Nokia is also owned by Microsoft, three companies trying to revive the company. Nokia has been shifted to android now we can hope for the best.
Till now we all know brief information about Nokia's failed strategies now in the upcoming article we will understand in-depth about this Nokia disaster.
1. Stephen Elop's Negative WILL
Stephen Elop's was a Leader with Favourable Skill But Unfavourable Will, He was a leader with high competence but low character. Let's understand who was Stephen Elop
Before joining Nokia in 2010 Elop was an internal business head at Microsoft, Elop is one of the biggest reason behind the fall of Nokia. Stephen Elop always wanted Nokia to be acquired by Microsoft: Forbes ( Sept. 2013 ), Elop knows that Nokia should use Android as an operating system in their phones, Elop knows that Nokia's OS "MeeGo" Can be a game-changer, some of the phones with "Meego" OS has Outstanding reviews "MeeGo" have the power to compete with Android and IOS. But Elop shut down the MeeGo Program Basically Nokia Have two OS "Symbian" and "MeeGo", Symbian was not a suitable or compatible OS for smartphones But MeeGo has the potential to grow. Stephen Elop wants to be the successor of Steve Ballmer ( Former CEO at Microsoft ) Elop was thinking that Microsoft will acquire Nokia then Elop will be the next CEO of Microsoft Some people compare Elop as Trojan Horse because Elop is the head of Nokia but wanted to be of Microsoft, Elop Know that Symbian is outdated and Meego has potential but Elop shut down MeeGo project. at that time almost every smartphone manufacturer shifting to Android except Nokia, Nokia was a Global Giant with high brand equity if Nokia chooses Android rather than Windows so definitely, some manufacturers like Apple and Samsung might not even exist right now.
2. Wrong Acquisition
Actually, Steve Ballmer wasn't a great CEO for Microsoft. Steve Ballmer Lead's Microsoft to the disaster, Wrong acquisition is one of the major reason, In 2013 Microsoft Acquire Nokia for there handset business this deal cost Microsoft $7 Billion and as you can see it wasn't a great movie, Second worst decision was not using Nokia's brand value, After the acquisition of "Nokia" Microsoft use "Microsoft" as a brand name for there phones rather than Nokia, Microsoft should use Nokia because Nokia has a very high Brand value and this thing can make easy for Microsoft to sell their products. if Microsoft doesn't want to use "Nokia" as their brand name then they can purchase any Chinese phone manufacturing company, A Chinese company can cost them around $1 Billion and Nokia cost them $7 Billion. Microsoft thinking if they purchase Nokia then they have their own Hardware and Software, Third mistake - Windows was never compatible with phones and Nokia's Acquisition was very expensive, Microsoft's strategy was to capture the Asian market with their feature phones but in Asia, many Chinese companies like Xiaomi, Vivo etc.. already enjoying their heavy share of the market, Microsoft Can't even sustain there. The third mistake is Microsoft's phones were really expensive if you compare them to the other Chinese phone manufacturer.
3. Slow Mover
"It's okay to be the last mover but at least be a fast mover"
In early 2013 - 2014 android and apple has completely built their eco-system and Microsoft was very slow and last in the race but sometimes be the last mover gives you an advantage but in this case, Microsoft was even slow Operating systems like Android and IOS attract millions of applications and developers, in Microsoft, it was really tough to create an application in simple language Microsoft has low feature then other competitors their user interface is not user friendly if we compare android.
"I Voted no for NOKIA, I Did not get why the world needed a third Eco-system in phones unless we change the rules but it was too late to regain the ground we had lost. We were chasing our competitors and their tail lights" - Satya Nadella
4. Come back of Nokia
In 2016 Nokia's ex Employees formed a brand called HMD Global and purchase Nokia's rights for 10 yrs, This time HMD Global solve every past mistake and start manufacturing their phones with the android operating system. Let's understand Hmd global's business strategy, Hmd global currently focussing on sales, marketing and branding, the phone's brand name is Nokia and Foxconn manufacturing it. Hmd global is on fly lit modal and focussing on feedbacks by customers. Hmd global is focussing on low range segment mobile phones for maximum opportunity market Hmd global brin there feature phone and smartphone both. Hmd global sold 21 Million Nokia phones ( Q3 2017 ) IDC Report Hmd global launch 6 smartphones and 5 feature phone in 2017 - 2018, Build 400+ Distributors and 8000+ Retailer 2017 - 2018 Report.
Conclusion
In this article, I tried to explain how Nokia rise and fall reasons behind it in a very simple language. this article will really help you grow your business and avoid some serious mistakes. I hope you like this article and learned some important lessons from it, tell me in the comment section what you say about this Case study and is it really helpful for you. If you want more articles like this then let me know in the comment section and don't forget to follow us on social media platforms for an instant reply.
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