Marketing
Introduction
The Canadian Wireless Telecommunications Association represents the majority of the wireless communication industry in Canada with members ranging from wireless data and voice service providers to global smartphone brands. In order for the organization to better represent the telecoms industry to consumers in Canada, a market research of the top smartphone brands was conducted to determine the current market conditions of the three smartphone brands namely iPhone, BlackBerry, and Nokia. The analysis of the three brands involves gathering important information about including financial performance. In addition, the study will also determine what the customers are saying about the brands and the emerging trends and challenges that they are facing at the moment. The findings from the analysis are imperative for CWTA in order to create a more sustainable future for the focused brands within the Canadian market.
Research Objectives
The objective of this research is to identify the current market/industry situation of BlackBerry, iPhone, and Nokia in the Canadian market in order for CWTA to create a future strategic direction for the organization and its members.
Research Methods
The methodology employed in this research is through review of relevant literatures, but limited to secondary sources as the nature of the study only requires information that only the subject of the topic can provide such as company websites and other external sources linked to the topic at hand. The Internet is a global source of information that can assist the research in terms of gathering data for analysis and synthesis. Furthermore, the chosen methodology was based on convenience sample, which deemed appropriate for the subject of the research.
Findings
BlackBerry
Blackberry is a product of Canada-based telecoms company Research in Motion. As of 2015, the company has posted $3.3 billion in total revenue, which is only almost half of its 2014 revenue (Yahoo Finance, 2016). After the growth of more popular smartphone brands, the company has experienced massive decline in its volume of handsets sold year after year. In 2014, BlackBerry posted a total volume of four millions units sold (Statista, 2015), but the introduction of its Android based unit did not do much improvement. The company had its share of success after it was founded in 1984 in Waterloo, Ontario; BlackBerry became a flagship brand of the Canadian telecoms industry. Currently, the company is publicly trading with the ticker symbol BBRY on the NASDAQ (ca.BlackBerry, 2015). The brand still prides itself as the only smartphone that can be integrated into an enterprise environment because of its dedicated enterprise software.
Primarily, the largest concentration of BlackBerry users are in Canada and amidst the growing popularity of other smartphone brands, BlackBerry is still closest to the heart of the Canadian consumers. In 2011, the Huffington Post reports that out of the eight million smartphone owners in Canada, 35.8% own a BlackBerry (CP, 2011). With this that the Canadian smartphone consumers still consider them a BlackBerry nation. Based on customer feedback about the release of the brand’s new flagship units the PRIV and Passport, the new models are surprisingly better than expected. In a forum post, the response was overwhelming for the introduction of PRIV as it even gained more attention in telecom stores such as Telus in Canada as compared to more popular iPhone 6S. This means that smartphone consumers in Canada are looking forward again to what BlackBerry can offer them in terms of price, design, functionality, and innovation (CrackBerry, 2015).
Despite the positive outlook towards the new offering from BlackBerry, the future of the company and the brand itself is still facing uncertainty because of the marginal outcome towards sales volume and revenue. Part of the problem the BlackBerry is facing according to its Research in Motion CEO John Chen is because the newly introduced smartphone models are not getting significant response from the global consumers. Furthermore, the company is also facing challenges regarding encryption issues where the security features of the new model units have failed according to consumers (CBC News, 2016). In this issue, the company is facing a major ethical challenge amidst consumers accusing the company of giving the RCMP universal encryption keys to consumers. These problems have created further uncertainty about the security features of the BlackBerry phones where an encryption key will allow anyone to intercept messages between BlackBerry users. The executive leadership of the company is currently addressing the perceived fatal flaw on security of the new BlackBerry devices; otherwise it will be another reason for the global consumers to totally abandon the brand.
Based on the information gathered about BlackBerry, it appears that the brand is still struggling to compete with more popular brands considering the new issues that the company is facing with device security. On the other hand, the Canadian smartphone consumer market is still strongly considering the brand.
iPhone
iPhone is considerably one of the strongest smartphone brands globally. Founder Steve Jobs propelled the success of Apple upon the release of iPod followed by its flagship smartphone product. iPhone have penetrated the Canadian smartphone market with 25% share of users in the country as of 2014 (CP, 2011). Furthermore, the success of the company can be observed from its volume of sold units of 51.9 million in 2015 (Statista, 2016), which accounts to $234 billion in total revenue (Apple, 2016). The company is publicly trading in the NASDAQ under the ticker symbol APPL and its stock price value continuously rising by an average of 0.79% every trading close.
The anticipation of new iPhone release every year excites the Canadian smartphone consumers, but the buzz about new releases is still not enough to push the consumer market in the market to change devices every after a new release. In fact, more than half of the iPhone users in Canada are still on the 4s and 5s models and disregards new product offers because the consumers feel that the yearly cycle of new products in the market by Apple is too excessive (Bader, 2016). Furthermore, Canadian consumers feel that it doesn’t make sense to change a mobile device that is only a year old and still in great condition just because a new one just came out. In addition, considering the price of iPhone as compared to other devices, which makes it more reasonable for them to avoid replacing their 1-year old phones to a new one.
Despite the massive success of iPhone in the global smartphone industry, the company is still facing significant challenge and it is a long-term dilemma that haunts the company’s leadership because of the potential backlash to its current success. Currently, iPhone contributes 63% of the company’s annual revenue. This means that subsequent products are not doing as well as the iPhone does (Kingsley-Hughes, 2015). With that in mind, the company is relying on the sales performance of one product that is still widely popular among consumers. However, very product undergoes the birth, growth, and decline phase, which the other product lines are experiencing. It is not the case with iPhone because it still appears to be in the growth phase. On the other hand, the company has not yet uncovered a new gold mine to replace iPhone in case it reached the decline phase, which the company should be doing at this point.
Nokia
When it comes to mobile phone the most iconic of all brands is Nokia as it once a global giant in the mobile phone industry. The company had been in a roller coaster ride since the consumer market had a first glance of a smartphone and its sudden popularity killed the Nokia global dominance up to the point that Microsoft had to come in and buy them off. However, the move was not proven wise at all because it did very little to save the iconic brand from the brink of total eradication from the market. In 2014, Nokia under the Lumia umbrella posted its annual revenue of $1.9 Billion and a total sales volume of 5.8 million (Dano, 2014). It is still considered impressive, but it is only a fraction of what Nokia can pull in during its prime.
Canada appears to be a loyal consumer market when it comes to mobile phones. In fact, 41% of the consumers are retaining their Nokia handsets and still goes out of their way to buy the Lumia series because they believe in the brand’s quality when it comes to two things, the phone’s camera quality and network quality. With the perceived quality in network and connectivity, the consumers believe that the Nokia smartphones are still reliable when it comes to network and connectivity performance despite the demand for higher grade applications, which some of the lower grade Nokia models fail to accommodate.
The deposed king of mobile phones that is Nokia is still on the search for a better home after it lost its massive empire in the early 2000. The plans of leaving Microsoft because of the failed attempts of the Lumia series brought Nokia to the doors of a European brand Alcatel, which is a strategic move to transition from Windows-based phone to Android platform. The primary issue that the company is facing from time of its decline until now is that the company is burning cash more than they can earn it. This means overspending on research and development with clear result is eating up the financial resources of the company and it still not able to produce a strong product. This is potentially fatal for the company if it did not change its current strategies (Gasse, 2012).
Study Implications
The implication of the study involves better understanding of the products/brands that will consumers to make better choices. In addition, the findings will also enable CWTA to create strategies that will be beneficial to its members based on the brand’s strength. In addition, the findings provide a relevant insight towards establishing a better organization for telecoms.
Study Limitations
The research provides fundamental information regarding the featured brands, but the extent of relevance of the information provided by the research for industry application is still lacking and requires further research.
References
Apple,. (2016). Apple - Press Info - Apple Reports Record Fourth Quarter Results. Apple.com. Retrieved 27 May 2016, from http://www.apple.com/pr/library/2015/10/27Apple-Reports-Record-Fourth-Quarter-Results.html
Bader, D. (2016). More than half of Canadian iPhone owners still use a 5s or earlier. iMore. Retrieved 27 May 2016, from http://www.imore.com/iphone-se-makes-more-sense-you-think
BlackBerry,. (2016). BlackBerry - Company - Canada. Ca.blackberry.com. Retrieved 27 May 2016, from http://ca.blackberry.com/company.html
CBC News,. (2016). BlackBerry CEO tries to reassure users on encryption questions. CBC News. Retrieved 27 May 2016, from http://www.cbc.ca/news/technology/john-chen-blackberry-encryption-1.3541169
CP,. (2011). Canada 'Still A BlackBerry Nation'. The Huffington Post. Retrieved 27 May 2016, from http://www.huffingtonpost.ca/2011/12/01/rim-blackberry-canada-market-share_n_1123184.html
CrackBerry,. (2015). Finally tried the Priv today - BlackBerry Forums at CrackBerry.com.Forums.crackberry.com. Retrieved 27 May 2016, from http://forums.crackberry.com/blackberry-priv-f440/finally-tried-priv-today-1048919/
Dano, M. (2014). Updated: Microsoft's profit declines, Lumia smartphone sales reach 5.8M in quarter.FierceWireless. Retrieved 27 May 2016, from http://www.fiercewireless.com/story/microsofts-profit-declines-lumia-smartphone-sales-fall-58m-q2/2014-07-22
Gassée, J. (2012). Nokia: three big problems for deposed king of mobile phones. the Guardian. Retrieved 27 May 2016, from https://www.theguardian.com/technology/2012/apr/23/monday-note-nokia
Kingsley-Hughes, A. (2015). Three huge challenges facing Apple in 2016 | ZDNet. ZDNet. Retrieved 27 May 2016, from http://www.zdnet.com/article/three-huge-challenges-facing-apple-in-2016/
Statista,. (2015). Blackberry smartphone shipments worldwide 2007-2013 | Statistic. Statista. Retrieved 27 May 2016, from http://www.statista.com/statistics/263395/rim-smartphones-shipped-worldwide-since-1st-quarter-2007/
Statista,. (2016). Apple iPhone unit sales worldwide 2007-2016 | Statistic. Statista. Retrieved 27 May 2016, from http://www.statista.com/statistics/263401/global-apple-iphone-sales-since-3rd-quarter-2007/
Yahoo Finance,. (2016). BBRY Income Statement | BlackBerry Limited Stock - Yahoo! Finance.Finance.yahoo.com. Retrieved 27 May 2016, from https://finance.yahoo.com/q/is?s=BBRY+Income+Statement&annual
