Nokia Brand Audit

Brand Audit: Nokia... What’s Next?

Introduction
Click on the Nokia Philippines website and you will get the image above. This pretty much sums up Nokia at the end of 2014. A long history of dominance in mobile communication has succumbed to the pressures of innovation (and lack thereof). Nokia will go down in history as a case of “What not to do!”.
Beset with declining sales, Nokia merged with Microsoft and licensed its Lumia and Asha line to the software giant. By the end of 2014, Microsoft dropped the name ‘Nokia’ and introduced its first Lumia smartphone without the Nokia logo. At the same time, Nokia launched the N1 tablet which will start selling by early 2015. It also introduced an app called the Z Launcher.
The purpose of this Brand Audit is to conduct an an in-depth examination of a major brand and suggest ways to improve and leverage that brand equity by providing recommendations to the brand concerning how the brand should be managed over the next three years by critically analyzing the brand inventory and brand exploratory.
This report hopes to analyze how Nokia plunged into a 90% decline in brand equity in just seven years, by providing secondary sources and the writers’ own experiences and insights. It would aim to focus on the latest results based on online sources beginning on the merger and acquisition with Microsoft and the launching of Nokia’s latest product.
A. Sales and Brand Planning

I. Brief History
1. 1865-1960’s
Started as a lumber mill near the banks of Nokia River in Finland. It diversified into a pulp factory, a paper factory then to electrical power generation. Towards the early 1900’s it expanded its electrical power generation line and the company went public. It merged with two independent companies to become Oy Nokia Ab with four divisions: forestry, rubber, cable and electronics.
2. 1970’s - 2000’s
Increased research on electronics and gained a reputation of being the “Nordic Japan”. Gained international recognition, strengthen its branch image, acquired Scandinavia’s largest television manufacturer Salora Oy and became the third largest television manufacturer in Europe.
The early 1990’s saw the transformation of Nokia from a diverse industrial European conglomerate into the main global player in the fast-growing mobile telephony market. The mid-1990s were spent on building value on ‘Nokia’ and established itself as a leading player in the consumer wireless industry.
Launched the first enabled GSM handsets in the market. Nokia equipment were used to make the world’s first GSM call. Launched the Nokia 1011 as the first GSM phone, the Nokia tune in 1994, launched the famous Snake game in 1997 and by 1999 the Nokia 7110 was the first WAP-enabled mobile phone.
3. 2000-2010
This was the rise and fall era of Nokia. The company was hoping to target a global market share of 40% with the rise of mobile telephony. Strains include competition with Sony Ericsson, Motorola and Samsung. Increased sales where noted in developing countries e.g. India, China, Brazil and Indonesia but was not enough to increase profit. By 2002, Nokia released its first 3G phone, launched the first gaming phones (Nokia N-Gage), sold it’s billionth phone in Africa then launched the Ovi which was an internet-based service.
The biggest challenge began in January 2007 when Apple introduced the iPhone. The smartphone revolution began and by the end of 2010, Nokia experienced an important shift. For the first time in its history, the largest concentration of employees was found outside of Finland. India and China accounted for almost a quarter of the company’s total revenue. It released the N8 which was to become it’s flagship product and updated Symbian OS. The product didn’t take off and Kallasvuo stepped down as CEO to be replaced by Stephen Elop a former Microsoft executive.
4. 2011 - 2013
Nokia signed a strategic licensing agreement with Microsoft to use the Symbian and Meego. Nokia’s share continue to drop. The battle of the ecosystems started1. Nokia licensed its patents to Microsoft including the use of Lumia and Asha2. Adopted the Windows platform and positioned itself in the low-end smartphone category.
5. 2014 to the present
Nokia completes the sale to Microsoft in April of this year3. Microsoft released the Lumia 535 without the Nokia logo4. Nokia launched its flagship product, the N1 tablet set for release in February 2015. According to Interbrand 15th Annual Best Brand Report, Nokia drops to 98th place. 6 It experienced the largest decline in value among the Top 100 Brands (-44%) from the 57th place in 2013. Microsoft on the other hand jumped 3% and is currently in 5th place. In the Philippines, Nokia is still the Most Trusted Brand in Mobile Phones together with Samsung. 7 It’s new CEO Rajeev Suri replaced Stephen Elop who moved back to Microsoft.
II. Product-Related Attributes
Nokia is still known for its sturdiness and simplicity. Given its current position the following attributes still hold true.
1. Innovative
2. Pioneer
3. Simplicity
4. Evolving
5. Resilient
III. Brand Portfolio8

*lifted from company website (company.nokia.en)
1. Nokia Networks
Nokia Networks is the world’s specialist in mobile broadband. From the first ever call on GSM, to the first call on LTE, we operate at the forefront of each generation of mobile technology. Our global experts invent the new capabilities our customers need in their networks. We provide the world’s most efficient mobile networks, the intelligence to maximize the value of those networks, and the services to make it all work seamlessly.
We have an extensive installed base of customers, including many of the world’s largest mobile operators such as Bharti Airtel, China Mobile, Deutsche Telekom, NTT DoCoMo, Softbank, Sprint, Telefónica, Verizon and Vodafone. Together our customers serve over 4 billion subscribers. Nokia Networks was formerly known as NSN.
2. HERE
HERE is a global leader in the mapping and location intelligence business. Rooted in almost three decades of experience in cartography, our vision is simple: offer the world 's best maps and location experiences across multiple screens and operating systems. We want to help people navigate their lives with ease and confidence every day and everywhere. We believe that giving people a better and deeper sense of location will be essential to live a modern urbanized life.
Our maps can be found in four out of five cars in North America and Europe with integrated in-dash navigation. In 2013, more than 10 million new cars were sold with our maps on board. We also power mobile devices, connected devices and enterprise solutions. We offer maps for 196 countries, voice guided navigation in 97 countries in more than 50 languages and live traffic information for 41 countries.
3. Nokia Technologies
Nokia Technologies pursues new business opportunities built on Nokia innovations and the Nokia brand. We develop and license cutting-edge innovations that are powering the next revolution in computing and mobility, starting with the new Nokia N1.
At the heart of Nokia Technologies is a world-class research and development team. Our scientists, engineers, and licensing experts draw on deep expertise in everything from imaging and sensing, wireless connectivity and power management, to advanced materials and beyond.
We are developing and investing in our industry-leading innovation portfolio, including the expansion of our successful IP licensing program. We enable other companies and organizations to benefit from our breakthrough innovations, and explore new technologies for use in consumer-branded products and services.
At the time of this writing, Nokia finalized its sale of its mobile phones division to Microsoft. Thus, the writers did not include it as part of the company’s brand portfolio.
III. Brand Hierarchy
Currently, Nokia’s Brand Hierarchy is pretty much represented by its current Brand Portfolio having divested itself of the mobile phones division. However, under Nokia Technologies, its flagship product is the N1 tablet set to be out early 2015. And the Z Launcher an app for the Android.
IV. Strategic Brand Alliances
The most significant Brand Alliance was with Microsoft which started in early 2013. Nokia launched its high-end line using Microsoft’s Windows in most of its Lumia and Asha products. While Nokia was transitioning its mobile division unit to Microsoft, they came out with the Lumia 520 as the lowest Windows Phone as of August 2014, “Nokia intends to top the low end smartphone market and push a strategy of “brinkmanship”. This is a the situation where you push dangerous events to the verge of disaster in the hopes that your opponents will have to make concessions and/or back down. In this case, Nokia is in a position to own the low-end smartphone market because companies like HTC, Blackberry, and Apple won’t be able to make appealing devices at low prices”.2
V. Brand’s Current Positioning
By late 2013, Nokia produced the last of its mobile units. By 2014, it finalized the sale of its license to Microsoft.
Currently, the Lumia 530 is the latest of the low-end smartphone market running Windows 8.1 3 Before the end of this November 2014, it will launch the Lumia 535 which is Microsoft’s first branded smartphone without the Nokia logo.4
Nokia still intends to dominate the low-end tablet category and position themselves there when they launch the N1 tablet in 2015. Until such time, its marketing mix using the 4 P’s will be difficult to judge. They still plan on launching the device in China where they hope to catch a large market share.
Nokia’s Brand elements underwent some changes too:

A. Logo - removed the “connecting people” slogan; Logo of its Z Launcher App

B. URL - http://www.nokia.com/ph-en/selection/ will lead you to http://www.microsoft.com/en-ph/mobile/ Microsoft is allowed to use the Nokia brand for the next 10 years.
C. Slogan - for the Z Launcher App for the N1 tablet “Thinking Ahead”

B. Brand Building Assessment - assess brand capabilities

I. Customer-Based Brand Equity (CBBE) Pyramid

II. How much brand resonance does your brand have?
Based on the most recent survey by Reader’s Digest, Nokia still is the most trusted brand in the Philippines. This holds true to other developing countries e.g. India. Nokia has created a niche as one of the most reliable low-end mobile phones/smartphones that inspite of the sale to Microsoft, it still has a loyal following. It is also evident that Microsoft has acknowledged it, otherwise, it would have not purchased the license for 7.2 Billion if they themselves didn’t believe in the brand name. Microsoft used it to leverage Microsoft Mobile which pretty much uses the Windows Phone platform.
III. What are the key marketing activities that have most contributed to the success of achieving resonance and positioning?
In the Philippines, the key marketing activity that launched Nokia in the minds and hearts of the Filipinos was when Globe Telecoms carried the Nokia Handsets as part of the GSM technology that was currently booming in the early 1990s. The HandyPhone brand was the postpaid plan name that carried the Nokia unit which made it a household brand. At that time, Globe Telecom was the leading GSM provider having bought Islacom, the first company that brought GSM technology in the country.

Up until now, Globe carries a slew of Lumia’s and Asha’s in its postpaid category. Affiliating itself to the Philippines most innovative mobile network, helped in increasing its brand resonance.

C. Brand Growth Assessment - assessing growth potential and providing recommendations

I. Mental Maps

In the Philippines, those who still look for basic phones with long battery life still use Nokia. As the texting capital of the world, Loading Businesses (kiosks that provide additional minutes to phones) are quite ubiquitous. Most of these entrepreneurs would still use the old and reliable Nokia phones which basically promote the phone’s durability.
II. The Rise and Fall of Nokia
The world 's most valuable brands: 2007 versus 2014
Brand
2007 rank
2007 value ($ billion)
2014 rank
2014 value ($ billion)
Coca-Cola
1
65
3
82
Microsoft
2
59
5
61
IBM
3
57
4
72
GE
4
52
6
45
Nokia
5
34
98
4
Toyota
6
32
8
42
Intel
7
31
12
34
McDonald’s
8
29
9
42
Disney
9
29
13
32
Mercedes-Benz
10
24
10
34

The table in the previous page shows that in seven years, Nokia lost his 5th spot and is now down to the 98th position. Given its meteoric rise during the early 90’s and its fall during the early 2000s, it is quite possible that Nokia will be able to maintain its spot on the Top 100 albeit impossible to go back to the Top 10.
III. Competitor Analysis
The iPad Mini 3 (stylized and marketed as iPad mini 3) is the third-generation iPad Mini tablet computer designed, developed and marketed by Apple Inc. It was announced alongside the iPad Air 2 on October 16, 2014. It uses primarily the same design and hardware as that of its predecessor, the iPad Mini 2. Its main new feature is the addition of the Touch ID sensor compatible with Apple Pay. However, given that the device does not include an NFC chip like the iPhone 6 and iPhone 6 Plus, it only supports Apple Pay online. Additionally, iPad Mini 3 is the first iPad Mini to be available in the color gold.

The Nokia N1 is a tablet developed by Nokia, running on Android 5.0. Unveiled on 18 November 2014, it is Nokia 's first mobile device since the sale of its original mobile phone business to Microsoft earlier in the year. It is expected to be released in February 2015.

Criticized to just be an IPad mini wannabe, the Nokia N1 has the following specifications:
“The overall design and hardware specifications of the N1 are very similar to the iPad Mini 2, featuring an aluminium unibody chassis, a laminated 7.9-inch IPS LCD display, a 64-bit, 2.4 GHz quad-core Intel Atom system-on-chip with 2 GB of RAM, and 32 GB of internal storage. The N1 includes an 8-megapixel rear-facing camera, and a 5-megapixel front-facing camera.
The N1 runs an otherwise stock distribution of Android 5.0 "Lollipop", but includes an alternative home screen known as Z Launcher. Z Launcher emphasizes the use of gestures for navigation; users can search for applications or contacts by tracing letters onto the device 's screen. Z Launcher was also released via Google Play Store for Android smartphones, but the tablet version is exclusive to the N1. The N1 is the first Nokia-branded device to officially support Google Mobile Services and ship with access to Google Play Store; the discontinued Nokia X series used a fork of Android, Nokia X software platform, which substituted Google 's proprietary software with similar apps from Nokia and Microsoft, and used a Nokia-specific application store.”
Further analysis would show that other players in the market would include Nexus 9 and Jolla.
A brief history of Jolla would show that it is a distant relative of Nokia...
“after rapidly losing marketshare in the smartphone market, Nokia decided to create a new operating system based on Linux, naming it Maemo. After merging with Intel 's Moblin project (also an open source Linux system), the project was renamed MeeGo.
In October 2011, many of the MeeGo team left Nokia to form Jolla, utilizing funding from Nokia 's "Bridge" program which helps establish and support start-up companies formed by ex-Nokia employees.
Nokia paid employees leaving the company €25,000, but had not given any rights to patents or other intellectual property to Jolla. While Jolla 's Sailfish OS can be considered a direct successor to Nokia and Intel 's MeeGo and the N9 mobile phone, only its software is based on the open-sourced components of MeeGo, while the closed-source user interface design for all future devices had to be developed from scratch.”

Comparison of the different specs

*For purposes of brevity, the writers only considered Jolla Tablet, Nokia N1 and IPad mini 3.
Recommendation on how to build and manage equity of the brand

References

1 Weintraub, Seth. "Nokia 's Elop Drops the Bomb: The Platform Is on Fire." Fortune, 9 Feb. 2011. Web. 26 Nov. 2014.

2 Roberts, Jeff John. "Microsoft 's $2B Patent License: Why the Nokia Deal Won 't Change the Outcome of the Smartphone Wars." GIGAOM, 3 Sept. 2013. Web. 26 Nov. 2014.

3Press, Release. "Nokia Completes Sale of Substantially All of Its Devices & Services Business to Microsoft." Nokia. N.p., 24 Apr. 2014. Web. 25 Nov. 2014.

4"Lumia 535: Microsoft 's First Non-Nokia Lumia Phone Launched at Rs 9,199 in India; Features a 5-inch Display, 5MP Cameras." IBNLive. N.p., 26 Nov. 2014. Web. 26 Nov. 2014.

6 "Interbrand 's 15th Annual Best Global Brands Report – News – Interbrand." Interbrand 's 15th Annual Best Global Brands Report – News – Interbrand. N.p., 9 Oct. 2014. Web. 26 Nov. 2014.

7 "Trusted Brands 2014 | Reader 's Digest Asia." Trusted Brands 2014 | Reader 's Digest Asia. N.p., n.d. Web. 26 Nov. 2014.
Strom, Rolf and Serena Mutjaba. "The extraordinary rise and rather undistinguished decline of NOKIA." Critical Perspectives On Management, Feb. 2014. Web. 19 Nov. 2014.
8 "Our Businesses." Nokia. N.p., n.d. Web. 26 Nov. 2014.

9 http://company.nokia.com/en

10 Husson, Thomas. Nokia Launches "HERE" to Build Equity Beyond Mobile Phones. Forbes, 13 Nov. 2013. Web. 27 Nov. 2014.
2Sabri, Sam. "Forbes: Nokia Positioned to Own the Low-end Smartphone Market." Windows Central, 14 Aug. 2013. Web. 24 Nov. 2014.
3 Tech2, Newstaff. "Lumia 530: Microsoft Latest Smartphone with Windows 8.1." Tech First Post, 24 July 2014. Web. 24 Nov. 2014.
4 Tech2, Newstaff. "Lumia 535: Microsoft’s first non-Nokia smartphone ‘Lumia 535′ to launch on 26 November in India
." Tech First Post, 24 November 2014. Web. 24 Nov. 2014.

12Al-Qudsi, Ali. "Tablet Fight: Jolla vs Ipad vs Nexus vs N1." Geek On Gadgets, 19 Nov. 2014. Web. 28 Nov. 2014.

Kasznick, Efrat. "Industry Report - What 's in a Name? Valuation Lessons from the Demise of Nokia 05 Nov 14." What 's in a Name? Valuation Lessons from the Demise of Nokia. Iam Magazine, 5 Nov. 2014. Web. 25 Nov. 2014.

Warren, Tom. "Nokia Looks to Resurrect Its Valuable Brand on Future Devices." The Verge. N.p., 17 Nov. 2014. Web. 25 Nov. 2014.

References: 1 Weintraub, Seth. "Nokia 's Elop Drops the Bomb: The Platform Is on Fire." Fortune, 9 Feb. 2011. Web. 26 Nov. 2014. 2 Roberts, Jeff John. "Microsoft 's $2B Patent License: Why the Nokia Deal Won 't Change the Outcome of the Smartphone Wars." GIGAOM, 3 Sept. 2013. Web. 26 Nov. 2014. 3Press, Release. "Nokia Completes Sale of Substantially All of Its Devices & Services Business to Microsoft." Nokia. N.p., 24 Apr. 2014. Web. 25 Nov. 2014. 4"Lumia 535: Microsoft 's First Non-Nokia Lumia Phone Launched at Rs 9,199 in India; Features a 5-inch Display, 5MP Cameras." IBNLive. N.p., 26 Nov. 2014. Web. 26 Nov. 2014. 6 "Interbrand 's 15th Annual Best Global Brands Report – News – Interbrand." Interbrand 's 15th Annual Best Global Brands Report – News – Interbrand. N.p., 9 Oct. 2014. Web. 26 Nov. 2014. 7 "Trusted Brands 2014 | Reader 's Digest Asia." Trusted Brands 2014 | Reader 's Digest Asia. N.p., n.d. Web. 26 Nov. 2014. Strom, Rolf and Serena Mutjaba. "The extraordinary rise and rather undistinguished decline of NOKIA." Critical Perspectives On Management, Feb. 2014. Web. 19 Nov. 2014. 8 "Our Businesses." Nokia. N.p., n.d. Web. 26 Nov. 2014. 2Sabri, Sam. "Forbes: Nokia Positioned to Own the Low-end Smartphone Market." Windows Central, 14 Aug. 2013. Web. 24 Nov. 2014. 3 Tech2, Newstaff. "Lumia 530: Microsoft Latest Smartphone with Windows 8.1." Tech First Post, 24 July 2014. Web. 24 Nov. 2014. 12Al-Qudsi, Ali. "Tablet Fight: Jolla vs Ipad vs Nexus vs N1." Geek On Gadgets, 19 Nov. 2014. Web. 28 Nov. 2014. Kasznick, Efrat. "Industry Report - What 's in a Name? Valuation Lessons from the Demise of Nokia 05 Nov 14." What 's in a Name? Valuation Lessons from the Demise of Nokia. Iam Magazine, 5 Nov. 2014. Web. 25 Nov. 2014. Warren, Tom. "Nokia Looks to Resurrect Its Valuable Brand on Future Devices." The Verge. N.p., 17 Nov. 2014. Web. 25 Nov. 2014.