Why Nokia’s Marketing Strategy Failed

Nokia's Marketing Strategy is Like Jumping Into a Well

Nokia’s marketing strategy gave them little chance of surviving—they practically jumped into a well.

Since Stephen Elop became Nokia’s CEO in September 2010, Nokia’s stock price has nosedived. That’s an impressive feat; Nokia’s stock was going up steadily at that time.

Now Microsoft bought Nokia—presumably to save the biggest Windows Phone manufacturer from looming bankruptcy.

But what made Nokia fail? After all, their products aren’t worse than the competitors’ products.

Their value proposition and marketing strategy, however, are shining examples of mistakes you just can’t afford to make.

Nokia’s marketing people don’t seem to understand what their value proposition is—what are the best reasons people should buy their products. And when you don’t know what your marketing should focus on, there’s little chance for it to work.

Nokia’s value proposition (or lack of it)

You need to know what is your value proposition.

In short, it describes why your products and services are the best choice for your target customers.

If you don’t have a strong value proposition, people have no reason to buy anything from you. They don’t even have a reason to pay attention to you.

iPhones are often considered the most prestigious, and if you have a Mac, there are several reasons for choosing the Apple-family member.

Samsung’s Android phones are often seen as the most versatile, and they keep up the idea of being more user friendly than iPhones.

But Nokia’s phones aren’t connected to anything special. They’ve now tried to create an idea of superior phone cameras. But that’s too little too late.

It seems there’s hardly anything that would make them better than their competitors.

But just like almost every other company on the planet, something is different and better about them. The problem is that they don’t seem to know what it is.

Even architects can have clear value propositions that make them stand out from their competitors and the best choice for their target customers. And you might think that the only thing they can use to differentiate their services is their sense of style.

So, when you talk about smartphones, it shouldn’t even be difficult to create a compelling value proposition. Nokia just hasn’t done it.

Nokia’s marketing strategy

Nokia’s marketing strategy is good, or at least they’re doing all the right things.

But Nokia’s marketing messaging is all over the place. The lack of consistency guarantees that people have no idea what makes Nokia products better than others.

Their marketing won’t work until they understand what the message should be that the marketing delivers.

Right now, all they’re doing is trying almost random messages to see if something would magically change the company’s future.

For example, TV advertising can be a great marketing method (though for small businesses it’s usually a waste of money). But when your marketing is as unfocused as Nokia’s, TV ads are only good at draining your marketing budget; you need to be consistent with your messaging for it to work.

When you’re clear about what your value proposition is, you can focus all your marketing efforts to it. Everything you do then can revolve around just the key ideas that make the biggest difference to your target customers (and your success).

That’s all an effective marketing strategy does; it makes people understand what are the best reasons they have for buying from you. Nothing more, nothing less. So, use your value proposition in marketing—always.

What’s your value proposition?

Creating a strong value proposition is a significant project. But it’s also extremely important because all your marketing should be based on it.

Nokia’s marketing strategy fails because it’s not based on a clear value proposition. It’s focusing on just some almost random factors that don’t create a compelling message that would create real results.

If your marketing is equally unfocused and weak, you can’t expect to reach your goals.

You can find the core of your value proposition quickly with a 5-step system.

 
Peter Sandeen

Do you want to improve your value proposition or conversion rates?

Or create an effective marketing strategy based on your strengths?

Click here to see how I work with businesses and how I can help you.

26 Comments

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  1. Peter,

    “If nobody thinks you’re crazy, you haven’t done anything worthwhile.” – Einstein… I love this quote and the entire idea behind it…

    Push the boundaries… Make the bold statements that need to be made… Do what others are unwilling to do.

    Love it… Great post!

    Ryan H.

    • Peter Sandeen said:

      Hi Ryan,

      That should be the essence of entrepreneurship; do what others aren’t doing. But for many that’s too scary :D

  2. Great insight. It’s all about creating that WOW moment. This is what creates dynamic loyalty, trust, and fascination.

    • Peter Sandeen said:

      Hi Brent,

      That’s absolutely true. People may buy commodities that are nothing more than commodities, but they’re much more likely to buy the WOW product (and they’re wiling to pay more for it).

  3. Peter this post hits on so many great points, and its seems their troubles all come down to complacency. I have a saying I like to use “If you aren’t moving forward you ARE falling behind.” Today’s world changes so quickly no one can assume because they have been the leader for so long it will always be that way. I think this attitude is what makes companies vulnerable.

    You conveyed your point very well with the point “Today’s craziness is tomorrow’s innovation and next year’s basic work.” I am a new entrepreneur and I need to seriously think about getting a little more crazy!

    Thanks for the thought provoking post Peter!

    ~Freedom Sentinel
    (Adam)

    • Peter Sandeen said:

      Hi Adam,

      I think the craziness is especially important for new businesses. Who would notice a new company if they’re not doing something really surprising?

      On the other hand the craziness is risky; unless you have unusual cash reserves you need to be able to sell something quite fast…

      Well who thought business would be “easy”? :)

  4. Paul said:

    I’m glad to see this happening. No matter how big someone gets, they cannot rest of the laurels of their success. That is exactly what Nokia did, and they are paying for it now.

    Finally, the scales are tipping back to smaller businesses (who HAVE to succeed) rather than the deep pockets from giant corporations who think they can buy a relationship with a consumer.

    • Peter Sandeen said:

      Hi Paul,

      Actually the pockets of Nokia are getting empty quickly. At the current rate of losses they’ll run out of cash reserves in two to three years. And then there’s no money.

      I hope it doesn’t get into that.

      But it is refreshing to see that smaller companies can outgrow and outperform giants :)

  5. I’d like to highlight a part of this that I feel some people might skim past:

    “Forget for a while what your competitors are doing, what current technology is capable of, and what you know how to accomplish. Just let go of all that and imagine what would fulfill your wildest dreams … and then some.”

    AMEN TO THAT.

    Seriously, Peter. I’m so happy to read this, because, get this… most of the advice on the net is ALL ABOUT PAYING ATTENTION to competitors, tech, and How-Tos.

    Good lord.

    Enough.

    A little more focus on leading edge, fresher-than-fresher, abundant DREAMS is just what the doctor ordered.

    Or at least what Ryze orders :D

    Rock on and ryze up.

  6. Jackie said:

    Peter

    I really don’t think I could improve on what Jason had to say. It pretty much sums up my thoughts when I read this too.
    Gears can shift pretty quickly especially in the tech environment, and its plain stupid to think that you can continue to do what you’ve always done and stay ahead of the pack.

  7. WOW! Great post Peter! With this Nokia news and the RIM news here in Canada I think it hits home on one thing…business is tough whether you are just starting or you are a multi billion dollar company. You have to continually push the envelope and work on being as remarkable as possible.

    On another note, I know Nokia and RIM are receiving a ton of negative press recently but what they did for the industry should also be celebrated. Like most things there is always a beginning and an end. Just the way it is. :-)

  8. Jason said:

    Nokia lacked the same level of convincing power that Apple had. They cannot maintain a level of excitement over their products, so they are bound to lose in the long run.

    On the other, I agree with you that the company needs to do something drastic to be able to mount a comeback in the mobile phone game.

  9. Peter – I lovet he Einstein quote and I had to steal it. Some of my friends have actually called me crazy for the work that I do as an Entrepreneur and as a student of Finance and Economics. THis brought a smile to my face and I had to post it on my FB wall.

    Anyway – I loved your short answer to Nokias problem. Aside from their marketing strategy, they have no innovation, no cause – no WHY?

    I dont think that people really like Apple products, for example, because they look cool. I think that Apples underlying message is what attracts people to Apple – the fact that they are different, they challenge the status quo and make beautifully designed products that are user friendly. This is Apples CAUSE, PURPOSE and WHY and its something that people everywhere want to associate with because owning an Apple products subconsciously reflects those same values.

    Every other mobile company just copied Apple for their products and sure they will have some customers here and there who dont care about Apples values enough to buy their products. In the Law of Diffusion of Innovations these are usually the Laggards which make up about 16% of the market. But these other companies that dont innovate because they dont have a CAUSE, a WHY or a BELIEF – they will never surpass Apples loyal fan base and are destined to fail.

  10. bilal said:

    nokia can fight back by making a phone with those specification: very thin edge, camera 12MP or higher, 2GB of RAM, cpu with 2GHZ, quad core, NFC tech..screen 4.2 inch or higher, 1 terrabyte internal memory(if possible). upgrade their applications by increasing their number of apps…

  11. Ahmed said:

    Nokia cheated consumers many time
    .
    A simple samsung or sony offers every app. which I need. Nokia gives camera without flash, download games and u will be irritated with adds, if one nokia set have one good option that option will be missing in other nokia set. Nokia, please leave market for samsung and xperia

    • Peter Sandeen said:

      Hi Ahmed,

      I don’t know if anything you described is cheating. It is however annoying, which makes it a bad business decision.

  12. [...] has the most likes in Pakistan and is rapidly losing its grip, foothold and brand preference in Pakistan. While it does have brand awareness, it has no brand preference. Its the difference [...]

  13. Gary said:

    Nokia is irrelevant, it’s that simple. I could not believe it when they chose Microsoft for their replacement of Symbian. Nokia were failing anyway and the MS operating system will only hasten their eventual demise.
    I recently bought a Galaxy S3 and it never occurred to me to look at anything Nokia were offering.

    • Mercy said:

      Yes, I believe irrelevant is the word. Just bought myself galaxy S4 and don’t even dare to check on Lumina. Why would Windows OS makes a lot of difference? I’m using it on PC and I want something different on my phone. Android is a lot better than Windows. If only Android will have OS for PC i think it can overcome windows too.

      • Peter Sandeen said:

        Hey Mercy,

        Yeah, they’ve missed their chance to make people pay enough attention to even potentially see the benefits of Nokia. I wouldn’t be surprised if Google created its own OS ;)

        Cheers,
        Peter

  14. thunguyen said:

    firstly i want to thanks you for your article. and i want to ask you some questions because i’m going to have a presentation.Can you help me please???

    • Peter Sandeen said:

      Hi,

      Sure, ask away :)

      Cheers,
      Peter

  15. John Torres said:

    Value proposition? Nokia is so stupid it thinks customers will actually jump carriers just for a particular modal. I don’t know if that’s pure hubris or sheer stupidity. A Lumia 1020 or 1500 is not a iPhone of 6 years ago yet Nokia is fool enough to alienate what slim chance it might have have had. I actually wanted a Lumia 1020 but I actually like T-Mobile so good residence Nokia.

    • Peter Sandeen said:

      Hey John,

      I didn’t know Nokia does that in the States. But sounds idiotic, you’re right :)

  16. Rintu das said:

    (I am one of the fans of NOKIA brand).though Nokia is a Unique brand and they do have their own specialization,but as a large competition is going on in market between android ph and windows ph,and in which Nokia is getting a large failure,why Nokia is not to Launch android ph in market? they can easily get a good market share with that,

  17. Rintu das said:

    Now a days if you are following the reviews about Nokia brand,you will get to know so many fan followers are leaving this brand because of the problem of supporting apps in it.i hope if they can bend upon to launch the android ph in market,,they will get back customers….

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