Nokia in India: Staging a Comeback

Nokia in India: Staging a Comeback
Case Code: BSTR549
Case Length: 13 Pages
Period: 2017
Pub Date: 2018
Teaching Note: Available
 Price: Rs.300
Organization: Nokia, HMD Global
Industry: Mobile Phones
Countries: India
Themes: Market Entry , Global Strategy, Corporate Strategy
Nokia in India: Staging a Comeback
Abstract Case Intro 1 Case Intro 2 Excerpts

Abstract

The case is about Finland-based telecom company Nokia’s second innings in the Indian market after it made an exit in 2007. Nokia, which entered India in the early 1990s, played a huge role in the Indian telecom revolution and became a synonym for mobile phones in the country. It made several products specifically for the Indian customer, keeping in mind the climatic conditions in the country and the fact that there were multiple users for a single mobile phone. Moreover, these sturdy mobile phones were priced reasonably. Over the years, Nokia introduced a wide range of models that were highly popular among Indians from the metropolitan cities to the rural hinterlands. Nokia also developed a wide distribution network to make its products available across the country.

However, a few missteps by the top management and its inability to bring out phones with popular software like Google’s Android resulted in Nokia losing its grip on the global smartphone market, and in the emergence of competitors like Apple and Samsung. A similar trend was witnessed in the Indian market too. Subsequently, Nokia was acquired by Microsoft in 2013. However, in 2014, Microsoft chose to exit from non-core businesses and decided to shut down the mobile phone business.

In 2015, HMD Global Oy was incorporated in Finland. It was headed by former Nokia executives, and most of its key personnel were former Nokia employees. The company got the license to use the Nokia brand for mobile phones and tablets, related patents, software, etc. Foxconn, Taiwan-based contract manufacturer, obtained Nokia’s other assets from Microsoft.

Both the companies decided to relaunch Nokia mobile phones that were made by Foxconn and sold by HMD. The first Nokia mobile from HMD was launched in 2017. HMD wanted to reenter India, once Nokia’s key market.

In the decade after Nokia’s exit from the market, the Indian mobile market had undergone a sea change. But the market was still dominated by feature phones and low-priced phones, where Chinese brands and local Indian brands were competing fiercely. Samsung, which dominated the smartphone market, was slowly losing its share to Chinese players like Oppo, Vivo, Xiaomi, and Huawei.

Nokia launched a few feature phones and three smartphone models in 2017 to mark its reentry into India. It started developing a distribution network and a network of dealers. Ajey Mehta, Vice President-India for HMD Global, planned to take advantage of the nostalgia Nokia held for the Indian consumers. He needed to devise plans to compete and make a mark in the highly competitive Indian mobile phone market, which was witnessing huge and rapid changes.

Issues

The case is structured to achieve the following teaching objectives:

  • Understand the main reasons for the fall of mighty corporations and the stages a company goes through before failure
  • Understand the importance of the African market to TECNO's growth
  • Analyze how companies can be brought back from failure
  • Examine the strategies that MNCs can follow in emerging markets
  • Understand the challenges faced by companies reentering a market from which they made an exit
  • Analyze the opportunities a company can have when it reenters a market

Contents

Keywords

Nokia, HMD Global, Indian Mobile phone market, Failure, Reentry, Country analysis, Competition, Competitive advantage, Emerging markets, Strategic decisions, Collapse

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