Describe the principles of customer relationship marketing
Loyal customers are very important to companies, they are customers that have been drawn in by the company’s marketing efforts and product quality, and stay loyal to that one company.
Nokia has always had a strong image for creating phones that are very durable, even when you drop a Nokia it will break into 4 or 5 different parts, but you can put it back together again and it will work the same.
Even though Nokia is known for quality phones that can take a hit, the market place and practises within it change and evolve and so will Nokia, this is because of price competition in sales between companies. The only way success is measured these days is by profitability, and if you make phones that just wont break, you wont have enough loyal customers that come and buy new phones.
In the current market it is increasingly common for phone prices to keep decreasing, Its like a domino effect, it all happens when one company lowers their price for a specific phone model another company will try and beat the low price of that model with one of their own similar products. Therefore the amount of consumers has risen and the quality of the phones has gone down.
Despite all the evolution that happens in the market place and with big companies Nokia has a very realistic way of going about its business and likes to keep its loyal customers; they can achieve this by creating new phone models that are more and more innovative and have more services that come at a cheaper price than its previous technology.
Keeping loyal customer (5P’s analysis)
Product:
In the past Nokia has had the image of a high quality phone vendor, but due to price competition in the current market place Nokia has had to change its strategy.
Nokia phones and other Nokia products usually all have warrantees, and some phones come with a code so that you can download music for free for a period of one year; in order to do this your Nokia phone has to be registered to the database, when you are registered Nokia can stay in touch with you through emails.
Place:
Nokia keeps its facilities and offices modern and very visually appealing to customers so that the Nokia concept doesn’t get boring, for example at one point Nokia had its own stores that sold handset, these stores where very modern and clearly made to look attractive to young customers.
Price:
There are many phones and services that are all in different price ranges for different target markets and countries, there may be phone models in one part of the world that may never even be sold in another part of the world, because people in different geographical locations like different designs, and have different needs due to different kind of environments.
Promotion:
Nokia keeps a tight grip in its role as a leading company in telecommunications and networking components, and there for advertises in many different events around the world. Nokia Uses many sources of media to advertise, All media that the youth uses has advertisement that is very colourful, fun and energetic, this is to keep young consumers. Then on other sources that are directed at business professionals, for example, the ads will be very simple and elegant but to the point, very different to the ads by Nokia targeted at the youth.
Packaging:
Nokia has different kind of packaging for different product lines and individual products.
Nokias Business handsets, like the E-series, are packaged in quite simple box’s, they are made of environmentally friendly packaging and are usually made as small as possible.
Phones that focus on music, media, social networking, features that are targeted at younger markets are packed in colourful packaging.
Mobile phones packaging dose not seem to play a huge roll in their sales in general, this is because the consumer usually only sees the packaging after the purchase has already been made or decided on, because phones are displayed with out packaging.
Competitive position in the market
Nokia is a Finnish company that operates internationally in 120 countries world wide and has done business in around 150 countries at some point in its history, Nokia also employs around 130000 employees globally.
Due to the massive growth that Nokia experienced in the mid 80’s to the early 20th century in the “www” era, not many phone companies could keep up, the two biggest competitors at the time were Motorola and Ericsson but their strong holds where in different markets.
In the current market place Nokia makes a hole range of phones for different market segments, but their biggest one is business phones, such as the E-series product line.
Nokia has created many loyal customers over the years with durable phones unlike any other mobile phone manufacturer; but in an ever changing market place this has had to change to create a higher sales rate of phones so that Nokia can continue to compete with other Telco’s.
Nokia has now been voted most sustainable technology company for a second year in a row.
Nokia utilizing competitive tools
Nokia still has the highest phone sales rates out of any of its competitors; in fact Nokia still takes a third of total global mobile handset sales, even with Iphone sales booming with a rapidly growing smart phone market. This means that Nokia has every reason to use economies of scale to its full advantage in every scenario.
Nokia has also done a fair share of outsourcing, it uses different companies in countries with cheap labor, such as, China and India to assemble its mobile phones, the minerals and components that are used are also from an external source, and even some of its employees are recruited via external companies.
