? Nokia has long established identity (1898); lots of available resources (financial, etc.)
? Schmohl is experienced in international marketing (Adidas and Uniroyal)
? Nokia has high penetration rate in Europe, especially in Northern countries (close to 100%)
? Nokia Consumer Electronics has access to innovative technology through group companies
? Lack of centralized marketing strategy and champion; completely different positioning strategy depending on the country
? Too many brand names (100) in one market; problem trying to find balance
? Corporate culture is highly technical and operational: “So what if the customer does not understand!”; lack of customer service priority
? Potential for brand name sales in Europe = differentiation
? Growing replacement and supplement television market
? NCE has opportunity of using its technology to enhance user-friendliness
? The market for color TVs and VCRs is a mature/saturated market; consumers are buying less often and only to replace older units (same trend for all countries across Europe)
? Cant differentiate based on technical advancement or price; competitors too fast to match
? Impact of recent purchases (for example, Sony) and mergers is unknown; competitors are getting larger and integrating supply chains
? Competitors (Samsung, Goldstar, Daewoo) quickly and successfully building brand name and image
In the colour TV market, neither technology nor price provides a competitive advantage. The decision a consumer makes to purchase is primarily motivated by emotion, and is driven largely by comfort level with a particular brand. A successful branding strategy for NCE is, therefore, critical to gaining a competitive advantage. Specifically, NCE should brand for the following reasons:
? Competitive advantage is gained through brand name (not technology or price)
? According to brand awareness studies, Nokia is recognized most of the time (in Germany, France, Italy, UK and Norway), but not necessarily affiliated with consumer electronics such as TVs and VCRs
? Consumers buy televisions based on emotion
? Consumers perceive value in features that are marketed as user-friendly
In the past Nokia has relied heavily on its ability to innovateit is a strong technology company. However, it is not good at introducing or packaging this technology for consumers. Schmohl must introduce a new mindset to NCE; a strategic shift that encourages customer service and international marketing.
Schmohl faces at least two challenges within NCE that he must address immediately:
1. Lack of a marketing champion in corporate headquarters
2. A continued reliance on technology as the main marketing approach. For example, the remote control TV mouse is centered on technology and may frighten away potential customers who may perceive it as too technical.
Options for solving these include: (1) “push down” his ideas and force all to comply using his positional power; (2) “soft approach”gradually getting buy-in to his plans from technical representative, sales and marketing. Option 1 is not viable since even though it may result in short-term agreement, it will result in resignations, poor morale and distrust in senior management over the long run. Since the change process can be slow, Schmohl should adopt option 2 that means getting buy-in at the senior management level. If there is disagreement at the highest level of the company on international marketing strategy, then the same can be expected throughout the ranks of the company. For example, the vice-president of engineering may agree on the surface, but tell his employees to continue to do what they have always done (dont play the new marketing tapes at the fairs, etc.).
Getting Buy-in from the Dealer Network
The dealer network is critical to their branding strategy. If a dealer is not satisfied or confident with a manufacturers market position, they may lead a potential buyer to a competitive brand. NCE must maintain its strong brand-marketing program. And it needs to dealers to support them or they will fail. To do this, Schmohl should be willing to increase margins to dealers or incentive programs to encourage them to sell the Nokia brand vision and concept. Ultimately a successful marketing campaign will draw customers into the dealers door. If Nokia is foremost in their mind, we want the dealer to sell them Nokia, not attempt to switch to a competitive brand.
Customer Brand Awareness and Association
The Nokia brand name has limited awareness across the