Nokia Starts To Re-Focus

With a market share of Seventy Percent, one might think that mobile handset and accessory maker Nokia might take it easy but the Finnish company has absolutely no intention of losing it’s staggering market share in the world’s second largest mobile and telecom market.Nokia has been pretty casual in it’s Indian approach for the past two years and that has led them to losing almost five percent of their market share. The rate at which India’s mobile market has grown during this time has been stagerring.Nokia have not failed in terms of earnings, they have done so in adding newer customers.

Two years ago Nokia had a two third share of the Indian market. Three people out of four who used a mobile in India used a Nokia mobile. Things were going fine for Nokia and they started to divert their attention towards the high income sector .We thus saw a slew of high end models with an amazing number of features right from a camera phone to internet connectivity all on a single mobile.

It was never this end of Nokia’s handsets that have made them the force they are. It’s always been their systematic targeting of lower and middle income groups that has made them very rich. Cheap handsets made with cheap but durable material and fitted with quality accessories had led to the same being gulped down in huge quantities by almost every working Indian.

Most of these handsets cost around a thousand rupees and they have for long been the driving force behind Nokia’s success in india.They’ve been low cost solutions without fancy gizmos helping to fulfill the basic need to communicate.

But from the moment Nokia started to concentrate on their higher end models, their competitors’ swooped in. Everyone from LG to Sony adopted the same mantra of making cheap handsets and marketing them with the help of a telecom service like Airtel or Vodafone at a subsidized price.

Over the months, this has led to Nokia losing out on newer customers but it hasn’t been the big brands that have caused the biggest headache for Nokia.It’s been the relentless onslaught of extremely cheap imported mobiles from china - manufactured and sold for prices as less as 500 rupees.

These Chinese mobiles are unbranded and are sold at local shops over the counter instead of exclusive showrooms. The middle and lower income group has been buying into these at an astonishing rate that has led the Chinese made mobiles  to capture around five percent of the Indian marketplace in less than three years and this is significantly more than branded phones sold by LG,Sony,Panasonic,etc.

Nokia has awakened to this phenomenon and announced that they will be introducing a new range of low cost mobiles aimed exclusively at rural and semi urban customers. The idea is to entice these users with the promise of a better product at a lower rate than before. It’s a significant development as Nokia will aggressively market their mobiles in rural areas to offset the number of customers they're losing in cities.

It could well be another huge step for Nokia.