By Vishal Kale

The mobile device space is an unforgiving space for any brand; one small mistake can have drastic implications for the company’s revenue, market share, and future. This is further complicated by rapid change, technological development and obsolescence, and shifting consumer preferences. Conceding this is imperative to understanding why the Lumia series by Microsoft-Nokia has failed to live up to expectations and generate value, despite its potential.

The Lumia series was a product that was a complete variance to everything that a ‘smartphone’ (something that the market was saturated with) was increasingly assumed to be. Thus, the endeavour was an attempt to make a mark in a market that was blooming with a certain prototype; in that sense, it was in virgin territory. This creation of a space within an ultra- competitive and dynamic market is just about the hardest challenge any company can undertake. And, it is exactly what Lumia attempted and continues to do. It was and remains a completely different and divergent product to the prevalent market trends.

The specs that matter

Consumer off-take is mostly based on a combination of price segmentation and feature segmentation, with the latter gaining more salience for the consumer in recent times.

Sales of smartphones rely on its attributes like screen size, computing power (number of cores, processor speed), display (LCD/LED/AMOLED), resolution, protection (gorilla glass etc), camera, and battery. Minor parameters may include speaker quality, sound quality, device colours, talk-time, wifi and hotspot settings, and similar characteristics. These minor parameters may of course become major parameters in individual cases, but from a strategic aspect, the market is segmented along the major factors listed above. Consumer off-take is mostly based on a combination of price segmentation and feature segmentation, with the latter gaining more salience for the consumer in recent times.

The basic interface between the device and the consumer remains the screen: it provides a window to explore the device. To a consumer used to the now-ubiquitous Android/iOS user interface, Lumia’s interface was completely different.  It was and remains simplistic, minimal and functional in comparison to the colour rich and vivid interface sported by its competitors. That was the first challenge.

The second challenge is something that has been extensively spoken about and analysed: the competition in the app world and marketplace on mobile devices.

The question remains, how do you sell such a device?

How does one sell the Lumia?

The answer is: sell its plus points, focus on what differentiates it, place it where it adds value. When Lumia came into the market, it had a clear set of differentiating principles that, in my opinion, were focused on customer interactions. However, despite the good start, the company failed to capitalise on the same and failed miserably. The basic differentiators included durability, construction quality, sound quality and playback, security, Internet experience (especially in 3G), seamless interoperability with laptop and desktop windows systems, MS-Office and support to Word, Excel and PowerPoint, online music library with an almost unparalleled diversity in terms of Indian languages and an easy user-friendly interface.

Despite its easy interface, Lumia continues to face several challenges: it does not offer the vividness or richness of its competitors. The app market is not completely mature, brining to surface the obvious weaknesses. These two parameters are at the forefront of the consumer experience. The greater challenge, then, is to reach the right consumer set, and further the selling concept of Lumia. This is not a task of channel or B2B sales, it is one of concept marketing.

The failure of devising a concept marketing strategy was further complicated by the failure to fully leverage its strength.

A lacking consumer experience

This happened in a situation when Blackberry was under severe duress from all fronts, especially the growing Android platform which was capturing the imagination of all. This left a gaping hole in the market: the one currently held by Blackberry. That is, Blackberry’s target market of industry leaders and professionals at the top levels and middle levels was now in a state of flux. Exploiting the potential of this niche for positioning Lumia would have ensured a strong market base as well as given the company time to set about improving the app universe, something that was bound to take time to develop.

The error was that entry into this club was undertaken through person-to-person interaction through trade fairs, CXO meetings and industry meetings, company events, B2B promotions through on-site customer experience interactions. When you are introducing a revolutionary concept device in the telecom market, customer experience during the first exposure to the technology matters the most. The devices should have been ‘enabled devices’, fully loaded with working apps, games, 3G internet , live Word/Excel/Powerpoint presentations, active music of at least 3 languages – Hindi/English/local language – and the live Outlook account.

The experience of the customer should have centred around the existing strengths of the device, like the comparative advantage of being fully equipped with a laptop (to demonstrate to customers the interconnectivity with the same), connectivity with sufficient live devices, enhanced music quality and headphones and the first-hand experience of the demonstration screen. This would have ensured that the customer experienced, for themselves, the power of the device beyond its obvious differences, and related to the same.

Frankly, in my opinion, none of this happened. The net result was that the customer got to feel a live device without experiencing its real power, and was dependent on the words of the “expert” at the counter. It is a moot point that with better customer experience, the conversion rate would have inevitably been much higher. Yet, nothing was materialised. The impression left a lot to be desired for.

Flawed strategy: Nokia Music

No market sustains a gap for long. A gap exists only under particular circumstances for a given time. The dynamic nature of markets ensure adapting, shifting and filling the gap. The one to quickly capitalise on the situation with the optimal offering suitable at that particular time, wins. Blackberry had created a gap that could have been exploited much more effectively by Lumia. Though it did achieve the same to some extent, it made other errors that were to prove costly. So costly that this was to exacerbate its existing strengths. Nokia Music is one such example. Nokia Music has had an excellent library of music, cutting across languages. Lumia gave free access to its consumers for a limited time period, and then it had affordable vouchers thereafter. There were inherent flaws in this strategy.

First, it did not build a distribution for these vouchers. You had to visit a service centre for the same! How hard would it have been to populate the NPDs or selected counters with these vouchers? This was never done, and subsequently even Service Centres discontinued the vouchers.

Second, no attempt was made to highlight the ease of usage, free access, breadth and depth of the library, digital music quality. This might have been based on the need to position itself as a ‘professional’ product.

The inability to gauge the interests of the niche exposed the fallibility of its own strengths.

Third, creation of negative publicity left the consumers high and dry, eventually giving up the hunt for the music vouchers.

A lot has been said about the Lumia and its app marketplace, its interface. The design elements are central to the Lumia and the app market was always going to take a lot of time. The question is and remains: how does one launch a revolutionary concept device that goes against the rhetoric of prevalent GUIs, and market design practices? What were the segments that could have been exploited and subsequently built upon? Based on my industry experience, the inability to answer these questions effectively was the real problem. It was a challenge that required concept selling combined with flawless execution. That said, Lumia may still rebound, for the device market is such that no one has the right to sleep.

The author is an MBA Marketing with 16 years of experience in Sales, Marketing & Operations across various industries, with end-to-end specialisation in telecom sales and marketing. He has expertise in the  telecommunications domain and e-commerce operations.

Posted by The Indian Economist