Analysis Of Mary Pipher s The Storm - 936 Words

The age of adolescence has become universally known as an awkward period of growth and socialization. The article â€Å"Saplings in the Storm,† by Mary Pipher, was published in 1995 and gives an interesting look into some of the issues faced by adolescent girls, but gives little evidence to support her claims or ways in which to encourage the self-confidence in adolescent girls. More recently, there has been further research looking into the reasons as to why girls become more depressed, endure a decrease in self-esteem, and lose their curiosity after puberty. Pipher gives some compelling stories about the behaviors of some pre-adolescent girls she has encountered. Her cousin, Polly, was an energetic and opinionated girl when she was young. Upon puberty, Polly felt unable to connect to boys and girls her age until she became stylish and more subdued in her language. This gives the reader the feeling that Polly was not accepted until she changed her personality to fit that of h er surroundings. It is possible that Polly’s friends no longer enjoyed being around a girl who was opinionated or who would insult those with whom she did not agree. This story does not qualify as a valid, concrete premise to show the connection between changes an adolescent girl and her ability to connect with others. Research published eleven years after Pipher’s book shows a tangible connection between an adolescent girl’s self-esteem and the perceived importance of looks and social

Athlete Endorsements Free Essays

string(220) " a negative impact on perceptions about a brand, and 4\) Negative publicity generated by the bad behavior of well-known celebrities is harmful because consumers tend to pay more attention to it, then positive publicity\." Sport Marketing and Promotions Introduction What is an athlete endorsement and what significance does it play in the corporate world of advertising? According to dictionary. com an â€Å"endorsement† is the act of endorsing something through approval or sanction. Companies regularly use athletes and other high profile individuals to endorse their company and/or specific products as part of a comprehensive marketing strategy. We will write a custom essay sample on Athlete Endorsements or any similar topic only for you Order Now They use the popularity of their talents to entice consumers to look favorably on their brand and to increase sales of their products or services thru their tacit approvals.These approvals or sanctions are done by having the athlete align themselves with the company thru advertisement, commercials, product or service promotions, or sports gear contract arrangements. Many endorsements deals can bring great wealth and exposure to both an athlete and a company. However, in recent years we have seen the negative side of these endorsement deals when the athlete doesn’t behave in a manner that provides a favorable image to the consumer they wish to attract. This can create difficult decisions for the company when considering whether to use sports athletes to promote their brand and image.The subject of this paper is to explore the Pros and Cons of athlete endorsement arrangements and how they can be either beneficial or detrimental to a company choosing this method of brand awareness. The Origins of Athlete Endorsements In the early 1900’s, Honus Wagner was a well-known professional baseball player who played for the Pittsburgh Pirates. Honus signed a bat contract with Hillerich Bradsby Co. on September 1st, 1905. He was believed to be the first professional athlete with an equipment endorsement deal. During this time period, he was the first major leaguer to have his signature engraved onto a baseball bat.Following Hillerich Bradsby Co’s footsteps was a non-sports company known as Gillette Razor. In 1910, Gillette won the product endorsement deal with major-league baseball stars. Gillette was the 1st non-sport endorsement deal to use professional athletes to market their products (â€Å"History of Athletes,† 2009). With the success of Gillette, more and more companies recognized this great new method of promoting their products and jumped on the proverbial band wagon by hiring high profile professional athletes to market their products.In 1917, with the advent of the Industrial Revolution, Converse All star shoes became the first mass producer of sneakers. With these new production processes, companies began to focus their attention on methods that could attract larger numbers of customers to their products. Converse was quick to recognize the potential that high profile individuals could draw and they became the first to use athlete endorsements in the sneaker industry. Converse used basketball players, such as Akron Firestones and Chuck Taylor to market their shoes (â€Å"History of Athletes,† 2009).It didn’t take long for others to also utilize this new brand awareness that these modern day gladiators could bring to their companies and products and it began a trend many still follow today. However, it wasn’t until the 1960’s when the first issues arose about the negative aspects of athlete endorsements. A prominent Los Angeles attorney, who specialized in the field of athlete endorsements, stated that using an athlete to endorsement a product could be very risky.The example the attorney used to explain th e risk associated with athletes was as follows, â€Å"Suppose a company puts several hundred thousand into a campaign featuring an athlete and suppose that two weeks later the athlete is hurt and not heard from for the rest of the year? † This is something companies have to take into consideration where using athletes to market their products (â€Å"History of Athletes,† 2009). Racial controversies began to rise in the late 1960’s in regards to athlete endorsements.Media sources claimed that black athletes missed out on endorsement deals across the country unless they were playing out of New York, Chicago, or Los Angeles; It’s a subtle form of racism. † In the 1980’s, things changed a lot in regards to using African Americans and athlete endorsements. Michael Jordan’s sneaker, know as Air Jordan’s kicked off in 1986 and became the most successful athlete endorsement in history. Nike sold more than $100 million in a single year, which helped the company hit its first billion-dollar year (â€Å"History of Athletes,† 2009). Athlete endorsements today are seen through a variety of different media ources. You can turn on the television to see Tiger Woods wearing his Nike golf shirt or go online to purchase a football jersey and see Payton Manning using a MasterCard. Athlete’s endorsements have evolved with the latest technologies today and have kept pace in maintaining their relation with their consumers. Companies use Athletes as a marketing strategy to launch new products, reposition products, and/or to reinforce brand images. This paper will explain what researchers have found on the pros and cons of using Athletes to endorse a product. Review of LiteratureIn 2003, a study was conducted to evaluate some of the reasons why celebrity endorsements can be a bad idea for corporate brands. Researchers explained that relying on a single individual, as the exclusive spokesperson for an entire product line may not always be a good idea. Well-known athletes chosen to represent a product in a major advertising campaign can have a huge impact on the company if the athlete behaves in an unprofessional manner. Professional athletes that encounter trouble with the law or act in a manner that is considered culturally undesirable can have a negative ef fect on a company or brand they wish the athlete to endorse. Through this study, researchers came up with a few different conclusions on the reasons why celebrity endorsements can have a negative effect for the companies they represent, 1) Multiple endorsements by the same celebrity can reduce the credibility and increase the liability of the individual celebrity, 2) Because of the increased level of risk associated with using celebrity endorsers, advertisers have begun using more animated characters, 3) Negative information about a celebrity tends to have a negative impact on perceptions about a brand, and 4) Negative publicity generated by the bad behavior of well-known celebrities is harmful because consumers tend to pay more attention to it, then positive publicity. You read "Athlete Endorsements" in category "Papers" If companies want to use celebrities to endorse their products, researchers all agree that the endorser must be both credible and trustworthy.Advertising research indicated that endorsers perceived as being positive role mode ls could also positively influence the perception of the product/brand they are paired endorsing. The study suggests that in order for athletes to be selected for the endorsement job, they should, as a minimum possess credibility and desirable personal characteristics (Stone, Joseph Jones, 2003). Companies pay athletes a lot of money for endorsement deals, so it is the company’s responsibility to do their due diligence when hiring athletes to endorse their brand. Another study done in 2003, identified the key segments of the Canadian sport market and investigated how Generation Y defined a sports hero. The researchers asked several questions to see how this demographic group evaluated heroism. The questions and subsequent answers helped the researchers better understand what types of athletes were selected as heroes, what sport was most frequently associated with heroism, and the important features of heroism. Results reveled that majority of the respondents felt that someone in their family and/or someone who was classified as a sports star was a hero. The sports hero that was selected by the majority of respondents was NBA star Michael Jordan. The participants felt that Jordan’s strength, agility, and celebrity status made him a sports hero. In regards to the sports most frequently associate with heroism, the National Hockey League took 1st place, followed by Major League baseball, National Basketball Association, and National Football League.The results of this study found important implications for sport marketers in regards to the perception of sport heroes and the use of athlete endorsements to target Generation Y customers. As part of the study, they found th at sport endorsements and promotions should emphasize family based promotions, since this generation values family. Sport marketers should also select an athlete who has a positive image since the image carries meaning and relevance to these consumers (Stevens, Lanthrop, Bradish, 2003). A case study was done in 2005 on Soccer Star David Beckham and his athlete endorsements in the international sports industry. Beckham has endorsed several different international companies’ products, such as sports cars, airlines, chocolate, and electronics.Beckham is considered the best-known soccer player in the world, with his personal brand value estimated at $370 million. The case study explained that sponsors consider athletes recognition, appeal to customers, and credibility when choosing an endorser. Since Beckham is a high profile athlete, he is seen as valuable endorser. He is married to Victoria Adams, who is a former female pop star, and continues to be portrayed to the media as a devoted family man. He also uses his fashion to display confidence and sex appeal, which attracts a lot of female fans. The effectiveness of a celebrity endorser, like Beckham himself, relies on physical attractiveness, trustworthiness, personal characteristics, and cultural meaning.Companies, such as Gillette have used Beckham in their marketing strategy to target a younger, global consumer. Gillette feels that Beckham could improve their image and boost its brand internationally. By using Beckham, they can reach men aged 18-34. Findings have indicated that customers have a more positive brand attitude and purchasing intentions when the product is paired with an attractive celebrity endorser. Since David Beckham is considered a high profile athlete with physical attractiveness, he is a good fit for endorsements. The conclusions from this case study indicate both sports organizations and corporations use elite athletes to expand their fan base and reach their global target markets successfully.Sports celebrities are appealing to global market players and can be used in other sport marketing activities, such as venue naming rights or event sponsorships. Given the advances in technology today, the growing interest in sports marketing is becoming more global then ever and future studies should be conducted to see what marketing strategies are most effective (Yu, 2005). David Beckham is a good example of an effective Athlete endorser who was used on an international level. In July of 2007, research was conducted on the effects of athlete endorsements on attitudes towards the product. Companies use athlete endorsements as a promotional strategy in launching new products, repositioning brands, or reinforcing brand images.In some endorsement strategies, athletes can be seen advertising non-sport pro ducts, such as computer products or electronic equipment. Marketing research asks the question, â€Å"Do consumers react favorably to non-sport endorsed products? † This study found that endorsers are more effective when there is a corresponding relationship between the endorser and the endorsed product. Researchers looked at the compatibility, creditability, attractiveness, and attitudes of individuals towards the athlete endorser and product they advertise (Kim Na, 2007). The analysis revealed that when an athlete endorses sports products, such as running shoes the credibility and attractiveness are more favorable to the consumer than non-sports products, such as perfume.Consumers see more of a relationship between the athlete and the product, especially if it related to the sport in which the athlete participates. For example, Tiger Woods can be seen wearing a Nike golf shirt when playing in the PGA Tour. This helps to show Tiger’s compatibility and credibility with the Nike brand. In 2008, Brad Carlson and Todd Donavan co nducted a study to look at athlete endorser’s effect on both brand and team-related outcomes. The study applied a social identity framework to investigate consumer responses to athlete endorsements. Researchers looked at the cognitive state of self-categorization, which exists when a fan feels belongingness with an entity, such as an athlete.They also looked at athlete identification, which is a cognitive state in which the individual evaluates the degree of overlap between their own self-schema and the athlete’s schema. The results found that fans that identified more strongly with an athlete were more likely to purchase the endorsed products. Athletes are effective endorsers when fans aspire to be like them, for example a person may associate himself or herself with the player by wearing their jersey. Fans who were identified less with an athlete endorser were more likely to abandon the teams market offerings. The findings confirmed that identifying with an athlete endorser is an important determinant of both team and brand related outcomes (Carison Donavan, 2008). Athlete Endorsements There are both pros and cons of athlete endorsements.Using an athlete as a spokesperson for an organization can be highly effective tool in building brand awareness, but it depends mostly on the target audience and how they relate to the athlete. According to Brooks International Online, some of the benefits of using an athlete to endorse products consist of raising awareness, generating media coverage, and attracting new audiences (Stuart, 2009). When selecting an athlete, companies should pick an individual whose demographics appeal to the target audience. Companies should also pick an athlete who will add value to the product they are endorsing. This past year, a case study was done on the marketing actives of Under Armor. The case looked at what types of marketing activities they used to help compete with their competitors. The main focus of this case was on athlete endorsements.Since the owner of Under Armor was an athlete himself, he felt the best way to advertise his product was by the use of athletes. He said that athletes are like a walking billboard and they help increase word of mouth marketing in the workplace (Kraft Lee, 2009). According to this article, in today’s marketplace, athlete endorsers are used to capture of attention of consumers, strengthen recall of the brand name, reinforce brand image, give the message credibility, increase product attractiveness, and increase the likelihood of purchase. The conclusion from this study showed that using athletes to endorse their product brought on more media attention then any other promotional strategies.The remaining section of this paper will give some examples of the pros and cons of athlete endorsements that have taken place over the past 20 years. PROS The following are just a few examples of positive athlete endorsers; Dale Earnhard t, Michael Jordan, Tiger Woods, LeBron James, and the Williams Sisters. Dale Earnhardt, who was teamed up with Pepsi, helped generate awareness for the energy drink Amp Energy. Pepsi feels that attaching an athlete to the marketing of their product is crucial for brand awareness. The endorsement deal with Earnhardt consisted of the Pepsi logo on his racecar and on his racing gear. When Earnhardt made the front cover of Sports Illustrated Magazine, this was huge for Pepsi.Earnhardt was basically a walking billboard for Pepsi, everywhere he was seen, and so was Pepsi (â€Å"Pepsi makes heavy,† 2009). The most successful and well-known athlete endorsement in history was Michael Jordan and Nike. The slogan that was created during Jordan’s endorsement with Nike was â€Å"Be like Mike. † Michael Jordan’s sneaker, know as Air Jordan’s kicked off in 1986 and Nike sold more than $100 million in a single year (â€Å"History of Athletes,† 2009). Michael Jordan created brand awareness and loyalty for the Company, which in return made Nike one of the best known show companies in the world. Not much longer after Jordan, Nike picked up another star athlete known as Tiger Woods. Tiger is the highest paid Athlete endorser at this time. According to Forbes. om, Tiger is the world’s top golfer and made nearly $110 million in endorsements from June 2008 to June 2009. Some of the other endorsement deals Tiger has are Buick, Gatorade, Tag Huger, ATT and Gillette. Gatorade launched Tiger Gatorade in March of 2008, which claims that it â€Å"helps focus your mind and your body†. Tiger actually picked out the flavor himself and even gets a percentage of all sales sold under his name. Tiger is predicted to be the number one sports endorser again in 2010 (Paulson, 2007). Another great sports endorser is Lebron James. Lebron James entered into the NBA right after High School at age 18. The same day James signed with the Cleveland Cavilers, Nike signed him for a $90 million endorsement deal (â€Å"Pros and Cons†, 2009).This deal was another big hit for Nike. LeBron and the Cavilers have been a playoff team for several years now and Nike has enhanced their image by using athletes who have a history of winning. The final example of positive athlete endorsements is the Williams Sisters. Both Serena and Venus have endorsement deal with large companies due to their high profile status in professional Tennis. Serena Williams currently has deals with Nike, Kraft, Wilson, and Hewlett Packard (â€Å"Serena williams hopes,† 2009). Serena just singed a new deal with Tampax. After Serena’s outburst at the line judge in the 2009 US Open, tampax decided to keep Serena as the endorser and use her temper in the ads.His latest advertisement shows Serena taking her temper out on a woman’s dressed as Mother Nature (Picchi, 2009). Serena’s older sister Venus Williams signed the most lucrative deal ever for a female athlete with Reebok. Both Sisters’ have been classified as positive athlete endorses and help build brand awareness for the companies they endorse. CONS The following are some examples of negative athlete endorsers; Michael Vick, Kobe Bryant, Manny Ramirez, and Michael Phelps. Michael Vick, who was convicted of dog fighting crimes in 2007, lost his endorsements deals with several different companies. Nike who was just about to launch the Air Zoon Vick V shoe cut all endorsement ties with Vick immediately after his conviction (Lippert, 2007).They removed all items bearing Vick’s name from company stores. This hit Nike hard financially. Reebok also pulled all Vicks jerseys and merchandise from their shelves. AirTran Airways stripped Vicks contract and made him give back his $20-$35 million signing bonus money (Kruse, 2009). All of the companies who endorsed Vick felt the negative impact on their companies. The second example is Kobe Bryant. Bryant who endorsed companies such as Nike, McDonald’s, Sprite, and Rawlings was convicted for sexually assaulting a 19-year-old woman in 2003. McDonald’s got hit the worst from this outburst since its marketing strategies are geared towards mothers and families.The study by ESPN found that incidents such as Bryant’s tarnish a company’s image (Rovell, 2003). Regardless of whether or not Bryant sexually assaulted this woman, the companies associated with him felt a negative impact through using him to promote their products. Another athlete who had a negative impact on an endorsement deal was Manny Ramirez. Ramirez, who plays for the LA Dodgers used performance-enhancing drugs and got suspended for 50 games (Jones, 2009). The game company EA Sports used Ramirez to endorse their products. Since EA sports targets younger teenagers, this had a negative impact on their brand. What mother would want to purchase a video game with Ramirez on the cover?These are some of the issues EA Sports now faces with their image. The final example of a negative athlete endorsement is Michael Phelps and his endorsement deal with Kellogg’s. Michael Phelps who is an Olympic gold medalist, had some issues with the law with drinking and driving. He was also found smoking marijuana from a picture that was posted on the Internet. Even though some companies stuck by him, Kellogg’s dropped Phelps immediately (McCarthy, 2009). Kellogg’s main target market is mothers and children. This puts a bad image on Kellogg’s to endorse an athlete who drinks and takes drugs. Ever since Phelps issue with the law, companies now see him as a risk. ConclusionThere are both pros and cons with using athletes for endorsements. Companies use Athletes as a marketing strategy to launch new products, reposition products, and/or to reinforce brand images. In many cases, the affiliation is a positive one that brings great financial reward to both an athlete and the company. When companies select athletes of high integrity and character, they impart a positive brand image on their products and generally reap the rewards of increased sales and revenue. However, when companies hire endorsers who do things culturally unacceptable for the products they are trying to sell, the relationship can have a negative impact on the bottom line.This has caused some concern among company executives and many are questioning the use of athletes to promote their products due to the risk associated with not being able to control their actions on and off their field (Sandomir, 2007). Researchers question how credible and believable athlete endorsements are in promoting their products but some case studies have proven that using athle tes to endorse sports products is more effective then endorsing non-sports products. This allows the consumer to see a relationship between the endorser and the product being endorsed. According to Millsport. com, companies need to pick an athlete who they can trust, has credibility, and demonstrates moral character.Avoiding risky endorsement deals with questionable athletes is a primary concern to decision maker’s at large national and international companies. It is important, if using an athlete to endorse your product, that a company does their due diligence in investigating the high profile individual and that it makes economic sense to insure a positive return on the investment. The athlete must fit their marketing strategies and fit the target market they are trying to reach. If companies do find an athlete that provides a good fit with their organization and brand, then using an athlete to endorse their products could be a successful way of raising brand awareness and revenue.However, do your homework as a bad endorsement deal can quickly tarnish a brands image that has taken many years to build. There are many endorsement opportunities that can build additional sales but companies need to be aware of the aspects that could negatively affect their business. References (2009). Millsport and the marketing arm. Retrieved from http://millsport. com (2009, September). History of athlete endorsements. Retrieved from http://google.com (2009). Serena williams hopes to ride u. s. open to win new endorsements. Sports Business Daily, Retrieved from http://www.sportsbusinessdaily. com/article/123828 (2009, September 5). How to cite Athlete Endorsements, Papers

Nokia Study free essay sample

In recent 2 decades, people have seen the big convenience brought by colour TV, telephone, laptops, mobile phone and etc. Among them, the contribution of mobile phone is especially prominent: given the integration of technologies of Internet, laptop, and communication etc, the small and good looking handset will enable us ubiquitous application of modern multi-functions. The advantage of 3G even further attracts our minds with colourful imagination. During the up gradation of our living style, we owe a lot to the companies of the handset industry, especially those popular giants including Nokia, Motorola and Samsung etc When they change our living successfully, they realize their developing targets as well. For example, according to the Fortune Global 500 in 2005, Nokia and Motorola ranked 130th and 138 respectively1. Thus, they are recognized by the society. It’s unpredictable for a company to achieve great goals without correct strategies to employ. In the fierce competition of handset industry in China, the correct competitive strategies are required for the participant to win market shares. Surely, sometimes the right strategies are ifficult for survival. Nokia, as the no. 1 in the handset industry of China, is certainly the biggest winner through exertion of correct competitive strategies. As is mentioned above, the competition in handset industry in China will become even fiercer along with the emerging trend such as the advent of 3G, the alteration of distributing channels, and the improved level of industrial centralization etc. So competitors should promptly adopt relevant changes of their competitive strategies to adapt to new environment. 2. Company Background Nokia Corporation is a Finnish multinational communications and information technology corporation that is headquartered in Keilaniemi, Espoo, Finland. Over the past 150 years, Nokia has evolved from a riverside paper mill in south-western Finland to a global telecommunications leader connecting over 1. 3 billion people. During that time, Nokia made rubber boots and car tyres. They generated electricity. They even manufactured TVs. Changing with the times, disrupting the status quo – it’s what Nokia always done. Early Days In 1865, mining engineer Fredrik Ides tam sets up his first wood pulp mill at the Tammerkoski Rapids in south-western Finland. A few years later he opens a second mill on the banks of the Nokianvirta River, which inspires him to name his company Nokia Ab in 1871. In 1898, Eduard Polon founds Finnish Rubber Works, which later becomes Nokia’s rubber business, making everything from galoshes to tyres. Nokia rubber boots become a bona fide design classic, still on sale to this day – though Nokia no longer make them. Electronics go boom In 1912, Arvid Wickstrom sets up Finnish Cable Works, the foundation of Nokia’s cable and electronics business. By the 1960s, Finnish Cable Works – already working closely with Nokia Ab and Finnish Rubber Works – starts branching out into electronics. In 1962, it makes its first electronic device in-house: a pulse analyser for use in nuclear power plants. In 1963, it starts developing radio, telephones for the army and emergency services – Nokia’s first foray into telecommunications. By 1987, Nokia is the third largest TV manufacturer in Europe. Three become one Having been jointly owned since 1922, Nokia Ab, Finnish Cable Works and Finnish Rubber Works officially merge in 1967. The new Nokia Corporation has five businesses: rubber, cable, forestry, electronics and power generation. But as the 1980s come into view, it’s an entirely new industry that makes Nokia a household name around the world. The mobile era begins Nokia sets the ball rolling in 1979, creating radio telephone company Mobira On as a joint venture with leading Finnish TV maker Salora. 1981 then sees the launch of the Nordic Mobile Telephone (NMT) service, the world’s first international cellular network and the first to allow international roaming. The NMT standard catches on fast and the mobile phone industry begins to expand rapidly. In 1982, Nokia introduces the first car phone – the Mobira Senator – to the network. That same year, the Nokia DX200, the company’s first digital telephone switch, goes into operation. First handheld mobile phone Then in 1987, Nokia introduces the Mobira Cityman, the first handheld mobile phone for NMT networks. Despite weighing in at 800 grams and a price tag of Rs. 24, 000. The Cityman even earns a nickname, the â€Å"Gorba†, after Soviet leader Mikhail Gorbachev is pictured using one to make a call from Helsinki to his communications minister in Moscow. In 1987, GSM (Global System for Mobile communications) is adopted as the European standard for digital mobile technology. With its high-quality voice calls, international roaming and support for text messages, GSM ignites a global mobile revolution. A new direction On July 1, 1991, Finnish Prime Minister Harri Holkeri makes the world’s first GSM call, using Nokia equipment. And in 1992, Nokia launches its first digital handheld GSM phone, the Nokia 1011. That same year, new Nokia President and CEO Jorma Ollila make a crucial strategic decision: to focus exclusively on manufacturing mobile phones and telecommunications systems. Nokia’s rubber, cable and consumer electronics divisions are gradually sold off. Name that tune In 1994, Nokia launches the 2100 series, the first phones to feature the Nokia Tune ringtone. Based on Gran Vals, a classical guitar piece composed by Francisco Tarrega in the 19th century, it is probably one of the most frequently played pieces of music in the world. The Nokia 2100 series goes on to sell 20 million phones worldwide. Nokia’s target had been 400,000. On top of the world By 1998, Nokia is the world leader in mobile phones. The strategic decision to focus on telecommunications, plus early investment in GSM, has paid off. Between 1996 and 2001, Nokia’s turnover increases almost fivefold from EUR 6. 5 billion to EUR 31 billion and with the new millennium comes a host of new possibilities as the internet goes mobile. No longer are phones just for phone calls. Multi-tasking mobiles In November 2001 Nokia launches its first phone with a built-in camera, the Nokia 7650, and in September 2002 its first video capture phone, the Nokia 3650. Nokia launches its first 3G phone (third generation), the Nokia 6650, in 2002 that things really take off. With 3G technology, phones can now be used to browse the web, download music, watch TV on the move, and more. One billion and counting In 2005, Nokia sells its billionth phone – a Nokia 1100 – in Nigeria, and global mobile phone subscriptions pass 2 billion. Two years later, Nokia is recognised as the 5th most valued brand in the world. Dominated by others By 2010, having dominated the mobile world for over a decade, Nokia no longer has things all its own way. In the all-important Smartphone market, competitors such as the iPhone and Android-based devices now pose a serious challenge. Clearly, it’s time for a rethink. A fresh face at the helm In September 2010, Nokia appoints Stephen Elop as President and CEO. Formerly head of Microsoft’s business division, following roles at Juniper Networks and Adobe Systems Inc. , Elop has a strong software background and proven record in change management. In February 2011, Nokia announces it is joining forces with Microsoft to strengthen its position in the Smartphone market. The strategic partnership sees Nokia Smartphone’s adopting the new Windows 7 operating system, with the Symbian platform gradually being sidelined. The goal is to establish a third ecosystem to rival iOS and Android. Nokia launches its first Nokia with Windows phones, the Nokia Lumina 800 and the Nokia Lumina 710, in October 2011. . Strategic Analysis Nokia has three Strategic Business Units/Divisions (SBUs): Mobile Phones, Smart Devices and Location and Commerce. a) Mobile Phones Its Mobile Phone team focuses on bringing a modern and affordable mobile experience to people around the world. b) Smart Devices The Smart Devices team focuses on the creation of smart phones – this is the SBU responsible for the partnership with Microsoft and the Windows Phone platform. c) Location and Commerce The Location and Commerce team are responsible for developing a new class of integrated social location products and services for consumers, Nokia Maps. In addition to the services based aspect the Location and Commerce SBU provide digital map information, related location based content and services for mobile navigation devices, automotive navigation systems, governments and business solutions through Navteq, which was acquired in 2008 On 11 February 2011, Nokias CEO Stephen Elop, a former head of Microsoft business division, unveiled a new strategic alliance with Microsoft, and announced it would replace Symbian and MeeGo with Microsoft’s Windows operating system except for mid-to-low-end devices, which would continue to run under Symbian. Nokia was also to invest into the Series 40 platform and release a single MeeGo product in 2011. As part of the restructuring plan, Nokia planned to reduce spending on research and development, instead customizing and enhancing the software line for Windows Phone 7. Nokias applications and content store (Ovi) becomes integrated into the Windows Phone Store, and Nokia Maps is at the heart of Microsofts Bing and AdCenter. On 19 June 2006, Nokia and Siemens AG announced the companies would merge their mobile and fixed-line phone network equipment businesses to create one of the world’s largest network firms, Nokia Siemens Networks. Each company has a 50% stake in the infrastructure company, and it is headquartered in Espoo, Finland. The companies predicted annual sales of â‚ ¬16 billion and cost savings of â‚ ¬1. 5 billion a year by 2010. About 20,000 Nokia employees were transferred to this new company. In October 2007, Nokia bought Navteq, a U. S. -based supplier of digital mapping data, for a price of $8. 1 billion. Nokia finalized the acquisition on 10 July 2008. 3. 1 Corporate level Strategy On the corporate echelon Nokia is cultivating a growth strategy. Its growth is obsessed principally by acquisitions and concentrated RD. During the past few years Nokia has been vigorously obtaining companies with new technologies and competencies, including besides investments in alternative positions. All of these acquisitions and investments were embattled to improve Nokias ability to assist form the Mobile World. 3. 2 Business Level Strategy Nokias trade level strategy is based on a cost leadership. Nokia has an outsized product portfolio which would gratify consumers all over the world. It strives to keep low costs for its products throughout firm costs management and economies of scale. Nokia utilizes strategic suppliers all over the globe to attain extremely modified subassembly apparatus which are used to generate its elevated tech savvy devices. 3. 3 Operational Strategy In 2011 Nokia had 130,000 employees in 120 countries, sales in more than 150 countries, global annual revenue of over â‚ ¬38 billion, and operating loss of â‚ ¬1 billion. It was the worlds largest manufacturer of mobile phones in 2011, with global device market share of 23% in the second quarter. The Nokia Research Centre, founded in 1986, is Nokias industrial research unit consisting of about 500 researchers, engineers and scientists; it has sites in seven countries: Finland, China, India, Kenya, Switzerland, the United Kingdom and the United States. Besides its research centres, in 2001 Nokia founded INdT – Nokia Institute of Technology, a RD institute located in Brazil. Nokia operates a total of 9 manufacturing facilities located at Salo, Finland; Manaus, Brazil; Cluj, Romania; Beijing and Dongguan, China; Komarom, Hungary; Chennai, India; Reynosa, Mexico; and Changwon, South Korea. Nokias industrial design department is headquartered in Soho in London, UK with significant satellite offices in Helsinki, Finland and Calabasas, California in the US. 3. 4 Supply Chain Strategy Nokia’s supply chain strategy is decentralized as its operational and marketing facilities are worldwide. 3. 5 Defensive Strategy In order to go with iPhone and Blackberry smart phones and protect its share in the converged handsets market, Nokia introduced 5800 touch screen. As a consequence, after the first quarter of 2009, Nokias market shares in smart phones augmented by 3%. 3. 6 Competitive generic strategies In particulars, the competitive strategies lead the success in the marketing. The key attitude for a competitive strategy is how to build advantages in market competition. Cost leadership differentiation and focus is three competitive generic 3. 6. 1 Cost leadership Strategy Nokia claims a cost reducing on its capital markets day at the end of this year. Nokia CFO, Rick Simonson emphasized that Nokia is practicing a cost reduction which is effective now and is continuing to keep the strategy for 2009 and 2010. Nokia is always using a highly variable, low fixed cost business model. The balance sheet of 2007 gives us a clearer view of this. The cost leadership strategy is possible to follow and the switching cost for customers of mobile telecommunication industry is very low, almost zero. So its rather easy for a customer to purchase another brand of mobile phone only for a lower price. 3. 6. 2 Differentiation Strategy Differentiation strategy means providing diverse products or services from competitors to attain competitive advantages focused on enormous market. Modern telecoms market is changing quickly, grows up rapidly, and compete fiercer than most other markets. In Japan Nokia closed the mobile handset distribution and also cancelled the distribution of E71 handset due to low market preference. Opportunities ?In 2011, the global cell phone industry expected to grow by double digits ? Today, Asia-Pacific mobile phone industry is one of the fastest-growing industries in the world. ?Developing countries like China, Bangladesh, India and Pakistan has enormous demand potential. ?Nokia had a 50-50 joint venture with Siemens of Germany ?Youth wants the stylish aesthetics, fashionable handsets, it drive the new market for players. Threats Consumers are becoming more complicated in the choice of handset due to new styles by china mobiles. ?Difficult for sellers to differentiate their products and retain loyalty. ?Nokia is facing very strong price pressure from china and other mobile producers ? Nokia is losing global market share after the arrival of several Chinese producers ? In the Asia/Pacific emerged competitive forces. ?Apple, RIM and the other different sellers have created strong pressure for Nokia. 8. Competitive Analysis: Porter’s five forces model The micro environment is the internal factors that are affected by the customers, staff, shareholders and competitors. The best model for evaluating the micro environment of Nokia is Porter’s 5 forces as this takes into consideration the competitors, customers, suppliers and new entrants. Threat of new entrants: †¢The mobile phone industry is already a well established market and the threat of a new entrant is quite low, as the technology needed to rival the devices already available is quite advance if they want to differentiate from them †¢The barriers to entry in the mobile phone industry is high because any new entrants will need high investments in RD, technology and marketing in order to compete with the established organisations. New entrants want to take market share from the larger organisations but Nokia hold 29% of the market share in the industry, the highest market share in the industry. The threat of new entrants into the mobile phone industry is very unlikely as the start up cost of entering into the market at a high level needs a lot of investments and time to be considered a respectable competitor of the already established organisations. Nokia currently hold a 29% of the entire mobile phone market worldwide and for a new competitor to obtain some of their market will take either a very long term plan or something that is truly innovative and unseen before. This is because realistically the new entrant will need very high investment for RD and marketing, and would not be able to publish positive result for a long time as they try to build a customer base and a name for itself in an established market. In conclusion the threat of new entrants is very low and not a factor which Nokia will have to worry about in the near future. Power of suppliers: †¢Although Nokia rely on its suppliers to supply equipment for their advanced mobile phones there are actually a number of large equipment makers, which Nokia could switch to. The software suppliers for their Smart phones are now Microsoft, who will have a very high bargaining power. †¢As the leading mobile phone company in the industry they are in a very strong position when bargaining with their suppliers. Nokia are in the position where they can bargain and negotiate with any mobile phone hardware maker because there is a high number of equipment suppliers that are readily available to them should their current suppliers attempt to bargain for more money with them. Nokia’s main argument would be the fact that they are a global organisation that has the highest market share in the industry, so the suppliers would not want to lose such an illustrious organisation. On the other hand, Nokia have recently created an alliance with Microsoft for their software which would be considered a major coup for Nokia more than Microsoft. As a result, Microsoft will have a lot of power when negotiating a price and share because the deal is more beneficial to Nokia than Microsoft. In conclusion, there is a moderate threat from the powers of suppliers because although the hardware suppliers have a very low power, Microsoft’s power over the software is very high because they’re very few other organisations who have the expertise and skills to rival Microsoft. Powers of buyers: †¢The power that customers have is rising because of the increasing number of choices in the mobile telecommunication industry. †¢With a lot of the Nokia competitors all offering similar packages (e. g. nlimited texts and calls) the industry is very price sensitive with customers seeking out the best value for money. †¢Many of the consumers will also be tied into long term contracts so switching from one handset to another will be difficult and expensive for the consumer, as a result they may not want to change until the contract is finished. The mobile phone industry is a competitive market where the number of choices is very wide, resulting in the consumer ha ving a lot of power because they can choose to go to one of Nokia’s many rivals if they feel Nokia are not good enough. As Nokia do not have a direct store to sell to their consumers, intermediaries such as Car phone warehouse or network stores such as Orange also have other handsets readily available for the consumers, which makes it difficult for Nokia to have a direct impact on the selling of their handsets. As a result this has created a very price sensitive market because consumers will always be on the lookout for the best deals. In conclusion, the buyers have a high amount of power because of the other handsets they can purchase instead of Nokia. Threats of substitute’s products Mobile phones are an everyday essential in people’s lives today and people would find it hard to replace, as customers would not be able to be in constant contact when away from the house. †¢On the other hand, it could be said that customers would be able to contact people through others types of media such as social networking websites, email and home telephones. Although staying in constant contact would be hard in customers’ day to day life. †¢However, smart phones are capable of a lot of functions so there are many substitutes if the substitute focuses on one of the functions, e. . digital camera can take better photos then smart phones, notebooks can surf the web just as effectively and PDAs can plan a day the same way a smart phone can. Mobile phones have become an everyday necessity in peoples’ lives because of the important functions that they can do and are all available in just one handset. No other product has the ability to make phone calls, send messages, surf the web and many more in one device. The idea of being in constant communication with someone at anytime and anywhere makes the mobile phone a very important device to people. On the other hand, a mobile phone can be dissected into the key function where there are substitutes for the functions, such as the camera function on a mobile phone can be substituted for a digital camera which can do a better job than the camera in a mobile phone. In conclusion, the threat of a substitute product is very low due to the fact a mobile phone is no longer just for making calls but for all the other function as well are expected on all mobile phones. So, the only real substitute is to buy all the functions of a mobile phone in the individual products which would not be plausible to carry all around on a person at the same time. Without mobile phones consumers would find it very difficult to replace, as it can offer so much to the consumers all in one device, no matter what the needs of the consumer are. Consumers rely on mobile phones a lot and would not be able to find a substitute that has all the function of a mobile phone. Competitive rivalry: †¢Nokia rivals have moved to smart phones and androids while Nokia have only just recently released their first smart phones leaving them trailing their rivals such as Apple and HTC. There is also very little differentiation between the competitors which means any new smart phones in the market, like Nokia Lumina, will find it difficult to tempt existing iphone and HTC customers to switch. †¢Intense competition from large companies such as; Apple, HTC, Blackberry, Sony Ericson and LG, ect. Nokia operate in an industry where the competition is extremely fierce with high investment in RB and marketing to compete with some of the biggest organisations in th e world. This year Nokia’s market share has dropped to 29% and it is forecast to continue to fall because of the rising popularity of the Apple Iphone. After Nokia’s slow move into the Smartphone market it has left them trailing their rivals, and has just released their Lumina range which will find it difficult to compete and win over consumers from their iphone. In conclusion, competitive rivalry is very high and Nokia must be aware of the threat that competitors have on their business especially with the growing popularity of the Apple iphone and RIM blackberry. The competitive rivalry is the biggest threat to Nokia because in the Smartphone market they are considerably behind and to increase their market share will take a lot of work in a market where some of the biggest names in business operate in such as Apple and Sony. 9. Financial Ratio Analysis Financial analysis helps in establishing a relation between various financial statements’ elements which can then be compared with other information about the business. This also determines the future prospects of the company and the area that needs improvement. The basic purpose is to analyze the current financial position performance of the company according to which a judgement can be made regarding future performance of the business. One has to look carefully to the annual accounts of the company and the yearly growth trend in terms of revenues, profit and its market share. For the analysis purpose, consolidated accounts of Nokia i. e. Income Statement, Balance Sheet, Cash Flow Statement for the last four years from 2007 to 2010 is taken into account and theses figures obtained from the company’s website are given below.