Product availability in….
Product Availability in India
Product Availability in India
The market for feature phones ‘dumb phones’ continues to shrink as more people embrace smartphones. These phones are still indispensable. Nokia 208 Black is a very convenient phone. It allows one to do basic things like call and send messages. It’s a dual SIM phone that enables call swapping. It also has pre-installed Twitter and Facebook for anyone who wants to connect and chat with friends. The phone camera is 1.3MP, with a 6.1cm screen size and 3× digital zoom. The screen resolution is 300×210 pixels. As a music lover, this phone comes in handy with a playback time of up to 30 hours. The internal memory of the phone is 64MB, but it can support a 32 GB memory card. The phone has an alphanumeric keypad with a 4-way navigation key. One of the features that I love most about this phone is its battery life – a BL-5C (1020 mAh) battery with 20 days standby time. The phone also has personal management features such as notes, to-do list and reminders. One can also view emails and attach files whenever they want.
India is an emerging market and is predicted to be the 5th largest consumer market globally by 2030. Its area is about one-third of the U.S. and occupies the majority of the Indian subcontinent in Southern Asia. The country shares its borders with Pakistan, Bangladesh, Nepal, and China. The population of India is 1.295 billion with an annual growth rate of 1.22% and a life expectancy of 63 years. The Republic of India is divided into twenty-nine states. Rajasthan is the largest state and shares its border with Pakistan and other states. The smallest state is Goa found towards India’s southwest. Other significant states include Uttar Pradesh – the most populated – and Gujarat – the most prosperous state. New Delhi is the capital city with a population of 25 million. Other significant cities are Mumbai, Chennai, Kolkata and Bangalore. 32.7% of the population lives in urban centers with the rate of urbanization at 2.4%. Hindi is the main language spoken by 41% of the population. Other languages include Punjabi, Gujarati, Bengali and Telugu. English is used as an official language for national and commercial communication. Hindu religion is practiced by approximately 80% of the population, followed by Islam (14.2%) and Christianity (2.3%). The economy of India is transforming into an open-market system with measures such as privatization of state-owned corporations. The country’s GDP (PPP) is $5.1 trillion with an annual growth of 4.4%. The GDP per capita is $4,077 CITATION Cen151 l 2057 (Central Intelligence Agency, 2015). The main economic activities are services, industry and agriculture.
The mobile phone market in India is growing at a very fast rate. The period between 2000 and 2012 experienced a growth of mobile phone subscribers by 937 million. 203 million handsets were sold between 2004 and 2012, and it is projected that by the end of 2015, the handset market will be above one billion. An interesting or rather an unexpected fact is that the sale of feature phones in India surpassed smartphones by a big margin in the third quarter of 2015. 43.5 million feature phones were sold in the same period compared to 27.01 million smartphones. This represented a 35.3% increase in sales from the previous quarter CITATION New15 l 2057 (New Delhi Television Limited, 2015). The reason behind this is that rural India is yet to embrace smartphones – they are expensive and still not a necessity. The average cost of a smartphone is $139 compared to a feature phone that goes for $21. The long battery life is another appeal to this market, and they hardly use social media because it is not a priority for them. With about 70% of the Indian population in a rural setting, Nokia 208 sales would do extremely well in such a huge and untapped market.
Nokia had a handset manufacturing plant in Sriperumbudur, India that was closed down in November 2014 after it sold its handset manufacturing business to Microsoft. It is believed that Microsoft failed to acquire the manufacturing plant because it had an unresolved tax dispute with the Indian government. With a manufacturing plant, skills and labor locally available, it would be cheaper to make the Nokia 208 handset. Microsoft Mobile Device Sales vice-president, Chris Weber, said in an interview that the company was looking for ways to reopen the plant and manufacture the handsets locally CITATION ETB15 l 2057 (ET Bureau, 2015). Currently, the only way to get the phone into the country is through importation.
A good regional sales center would be in Bangalore. Bangalore has a population of nine million people and is well known, globally, as a tech outsourcing destination. This means that the company would have many skilled workers at their disposal. The city boasts of the first Indian Institute of Science and Technology that was built in 1909. The city has available space that can accommodate more than 9,000 businesses and has an excellent IT infrastructure CITATION Des15 l 2057 (Destination Bungalore, 2015). Moreover, the cost of opening a business in Bungalore is lower when compared from a global perspective.
The product would do extremely well in this new environment because of the available cheap labor and huge local market. There is a locally existing plant that was running with full-time employees. Microsoft can reopen the plant to enable local manufacturing of Nokia 208 handsets as this would reduce the cost of importing the devices. Also, the distance from Chennai to Bangalore is 347km (5hr drive) with a class A road network. The report that feature phones outperformed smartphones in India shows that there is the market for the handsets. The main market is the rural population that makes up 70% of the total population – roughly 1.6 billion people.
An immediate step the company should take when it comes to marketing the product is to study the market properties such as market share, competition and pricing. On competition, the company should review the products of other market players and analyze their strengths and weaknesses. Then it should position each player’s product against the new product. This is done to define the product in the market against the competition CITATION Hil91 p 67 l 2057 (Hillestad & Berkowitz, 1991, p. 67). The company then should come up with a statement that defines the benefits of the product to the consumer. Another plan in marketing is to summarize the pricing strategies. This is done to compare the price of the product to other similar products. The company should then summarize the relevant policies involving pricing. A later strategy would involve distribution, where the company analyzes the available distribution channels. To reach the rural setting, they may need to partner with local mobile retail shop business owners.
BIBLIOGRAPHY Central Intelligence Agency. (2015). The World Factbook: India. Retrieved from Central Intelligence Agency: https://www.cia.gov/library/publications/the-world-factbook/geos/in.html
Destination Bungalore. (2015). Why Bangalore is best suited for Business? (Destination Bangalore Panelists Discussion). Retrieved from Destination Bungalore: http://www.destinationbangalore.in/why-bangalore-is-best-suited-for-business-destination-bangalore-panelists-discussion/
ET Bureau. (2015, April 29). Microsoft mulls manufacturing handsets in India after government decree on import. Retrieved from The Economic Tmes: http://articles.economictimes.indiatimes.com/2015-04-29/news/61652744_1_microsoft-mobile-device-nokia-handsets
Hillestad, S. G., & Berkowitz, E. N. (1991). Health Care Marketing Plans: From Strategy to Action. New York: Jones and Barlett Learning.
New Delhi Televison Limited. (2015, November 06). Smartphone Contribution to Mobile Sales in India Dips in Q3: CMR. Retrieved from Gadgets 360: http://gadgets.ndtv.com/mobiles/news/smartphone-contribution-to-mobile-sales-in-india-dips-in-q3-cmr-762233