Analysis on Nokia Phones

Research Design

On

ANALYSIS OF THE SALES DECLINE OF NOKIA IN COMPARISON WITH SAMSUNG

TABLE OF CONTENTS

|S. NO. |TITLE |PAGE NUMBER |
|1 |Introduction | |
|2 |Statement of the problem | |
|3 |Need for the study | |
|4 |Objectives of the study | |
|5 |Sampling plan | |
|6 |Formulation of hypothesis | |
|7 |Questionnaire design | |
|8 |Tools used | |
|9 |Scope of the study | |
|10 |Limitations of the study | |

INTRODUCTION:

Nokia is one of the major mobile manufacturing companies in the world. Nokia launched its first mobile phone - the Mobira Talkman - in 1984. Weighing just over 11 pounds, the phone was revolutionary for its time. A little over 20 years later, in 2005, the company introduced its first multimedia smartphones, and in 2011 it introduced the Lumia line, the first Windows Phone handsets. Suddenly Nokia’s years of success was eaten away by other companies. Samsung has surpassed Nokia in cell phone sales, effectively ending Nokia’s 14-year run as the world’s top handset maker, according to reports from IHS iSuppli and Strategy Analytics. According to IHS iSuppli’s numbers, Nokia shipped 83 million handsets in Q1 2012, while Samsung shipped 92 million handsets. Strategy Analytics’ numbers were only slightly different, reporting that Nokia shipped 82.7 million total handsets and Samsung shipped 93.5 million. In the mobile industry, a 14-year lead is undoubtedly impressive. But Nokia’s lead has gradually declined in the past few years for a number of very specific reasons. Here’s what Nokia did wrong - or, alternatively, what Samsung did right - that led to one handset company’s rise over the other. This research design’s main aim is to analyse the reasons of the unexpected decline in the sales of Nokia and the takeover of the market by Samsung.

STATEMENT OF THE PROBLEM:

Nokia reported a steep drop in sales for the first quarter. The company experienced a 20 percent decline in quarterly sales, to 5.9 billion euros, or $7.7 billion. The sales decrease has been attributed to lagging demand in emerging markets for its simplest models. Nokia is based in Espoo, Finland.

Sales of Nokia’s Lumia Windows smartphones increased by 27 per cent, but sales of its basic cell phones were much weaker than expected. Nokia sold 55.8 million basic cell phones in the quarter, dropping from 70.8 million a year earlier. According to Benedict Evans, an analyst at Enders Analysis in London, this was the lowest level in more than a decade. Basic cell phones are the bulk of Nokia’s business.

It was in 1998, when Nokia overtook Motorola and got Top Rank in Mobile manufacturing and shipping arena. Nokia retained their number 1 position in Mobile manufacturing and market share for 14 years and Now South Korean Company, Samsung has beaten Nokia in terms of market share according to a report by research firm Strategy Analytics.

Nokia has been forced to step down to position 2 in the fast moving consumer goods with Samsung occupying the first place.

Nokia, the former cell phone market leader that has tied its future to smartphone collaboration with Microsoft, trimmed its quarterly loss to272 million euros, from 978 million euros a year earlier.

Two years into Nokia’s collaboration with Microsoft, the Finnish company is steadily building sales of the Lumia line, but those gains have not offset the erosion in sales of its basic models. Nokia sold 55.8 million of those so-called feature cell phones in the quarter, down from 70.8 million a year earlier, the lowest level in more than a decade.

That part of the business has been shrinking as half the buyers of mobile phones shift to smartphones. Those remaining buyers are lured by low-cost Asian rivals, like MediaTek of China, which are flooding China and India, two of Nokia’s traditionally strongest markets, with $20 cell phones.

NEED FOR THE STUDY:

➢ To know the market value for Nokia phone

➢ To know customer perception of Nokia phone.

➢ To identify the areas which Nokia has to carry out.

➢ To know the arduous whys and wherefores of the fall in the sales of many-year successful product that was liked and loved by almost all the countries.

➢ To identify the criteria which made Samsung outdo Nokia.

OBJECTIVES OF THE STUDY:

Primary objective:

✓ To identify the actualities why Nokia lost its market.

(What caused this huge setback for the company?)

Secondary objective:

✓ What effects it caused with the regular and loyal customers of the product?

✓ What measures should be taken by the company to overcome the plummet?

✓ To identify the market position of Nokia.

✓ What gauges they have to work on for the new products to astound the market?

✓ Where did Nokia loose its control over the market?

SAMPLING PLAN:

❖ Sample size: The sample size is taken to be 120.

❖ Sampling area: Corporate companies, youth citizens and businessmen.

❖ Sampling method: The sampling method used is stratified random sampling.

❖ Sampling period: The sampling period is about 35 days.

FORMULATION OF HYPOTHESIS:

➢ The independent variable is the decline in the sales of Nokia phones.

➢ The dependent variable would be the operating system which Nokia is using (Symbian, Windows).

➢ In testing hypothesis using chi-square,

▪ The Null Hypothesis (H0) will be “There is no significant relationship between the sales decline of Nokia and the operating system Nokia is using.

▪ The Alternate Hypothesis (H1) will be “There is significant relationship between the sales of Nokia and the operating system Nokia is using.

QUESTIONNAIRE DESIGN:

I, Abitha Naomi R., student of ST. MARY’S SCHOOL OF MANAGEMENT STUDIES pursuing Masters in Business Administration doing a research study about the rapid decline in the sales of Nokia mobile phones and its position being replaced by Samsung. For this purpose, a questionnaire has been prepared and given to you for data collection.

Name:

Gender: (a) Male (b) Female (c) Neutral

Age:

(a) Below 20 (b) 21-40 (c) 41-60

(d) Above 60

Monthly Income:

(a) Below 10000 (b) 10001-30,000

(c) 30,001- 50,000 (d) Above 50,000

No. of family members:

(a) 2 (b) 3 (c) 4 (d) more than 4

Address:

Phone number:

Email-id:

1. Have you heard about the brand “NOKIA”?

(a)Yes (b)No (c)Maybe

2. Have you heard about the brand “SAMSUNG”?

(a)Yes (b)No (c)Maybe

3. Have you ever used Nokia phone?

(a)Once (b)More than once (c)Never

4. Which is your favourite Nokia phone? Why ?

5. Have you ever used Nokia phone?

(a)Once (b)More than once (c)Never

6. Which is your favourite Samsung phone? Why ?

7. Have you used both the brands?

(a)Yes (b)No

8. If yes, which brand you are comfortable with?

(a)Nokia (b)Samsung (c)Both

9. What are the features you like in Nokia?

(a)Games (b)Messaging and calling (c)Internet access

(d)Apps like Whatsapp, photo editor,etc

(e)Others

10. What features you like in Samsung?

(a) Games (b)Messaging and calling

(c)Internet access

(d)Apps like Whatsapp, photo editor,etc

(e)Others

11. What are the problems you face with Nokia?

12. What are the problems you face with Samsung?

13. What mobile you are using right now?

(a)Nokia (b)Samsung (c)Others

14. What are the advantages you experience by using other brand mobiles?

15. What is the maintenance level of Nokia phones?

16. How will you rate the after-sales service of Nokia phones?

(a)Best (b)Good (c)Bad (d)Worst (e)Not up to the mark

17. Rate the availability of Nokia phone accessories.

18. What more do you except from Nokia phones?

19. Is your liking towards Nokia phones is the same initially and now?

(a)Yes (b)No (c)Comparatively yes (d)Comparatively no

20. Are you satisfied with the offers given by Nokia?

(a)Yes (b)No (c)Sometimes (d)Never

21. How is your experience with Nokia?

(a)Best (b)Good (c)Bad (d)Worst (e)Can’t be defined

22. How convenient are you while accessing social networking sites in Nokia phones?

23. What is the main disadvantage of using Nokia phone?

24. If you get an offer to purchase Nokia or Samsung, which one would you prefer?

(a)Nokia (b)Samsung

25. Why?

26. Are you comfortable with the Symbian/Windows operating system of Nokia?

Thank you for your patience in filling the questionnaire. Each of your answers will be of great help in completing our survey.

********THANK YOU******

TOOLS USED:

➢ Chi-square

➢ Percentage analysis

➢ Factor analysis

➢ Rank correlation

➢ One-way ANOVA

SCOPE OF THE STUDY:

The study is applicable for the people in Industrial sectors, Business to Client industries (B2C).

LIMITATIONS OF THE STUDY:

➢ The result we found that the operating system is the major constraint that caused sales decline cannot be changed or removed all of a sudden.

➢ The modifications needed to increase sales would be a time consuming process.

➢ There are other factors also such as selling price, quality, additional features, and value added services contributing for the migration of Nokia users to other companies.

➢ Introduction of new mobile companies offering mobiles for low prices is also one of the reasons..

----------------------- St.Mary’s School Of Management Studies Jeppiaar Nagar, Rajiv Gandhi Road, Chennai - 600 119.

[pic]

SUBMITTED BY

R. ABITHA NAOMI

MBA 1ST YEAR ‘A’

SUBMITTED TO

DR. N. KANNAN