Nokia Pricing Strategy

Nokia Pricing Strategy Background of the company Nokia is an electronics company, founded in 1865 by Fredrik Idestam; the company started as a paper manufacturing company but in the 1970s, it changed its line of business to electronics (Nokia Official website ,2010). It has a strong brand; some of its products include phones and laptops.Advertising We will write a custom essay sample on Nokia Pricing Strategy specifically for you for only $16.05 $11/page Learn More In 2009, it was the second largest company in electronics industry from Apple Inc; the company’s positioning statement is technology connecting people. To remain competitive, the company uses an integrated pricing strategy. This paper discusses how the company determines prices of its products. Product attributes Nokia phones are in different shapes, technology level and have different features; each category of phone has the target market it aims. The following are the common products attributes of Nokia Phones: They have a target market; the section of the market is in need of phones Has high value products that can be up of phones for this class is Nokia 1200 and Nokia 1210.Advertising Looking for essay on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Middle class They are people who need a higher tech phone than the lower earning class; to target the population, the company has develops phones with more features, for example it may include internet services to the gargets of cheap technologies like GPRS. Well-to-do Well-to-do people need a number of applications in their phones, when the company is developing products for this target market; it uses high technology and includes a number of features and technologies for example they use Edge technology for internet. To sell in this market, the company uses price-skimming strategy Niche markets The company’s research and development department has the role o f recognizing a need that current phones in the markets are not meeting, then develop product that meet the market. Some of the phones in the market include touch screens ( Kotabe and Helsen, 2004). Distribution Depending with the target market, the products are distributed differently; the company has established Nokia collection centers in different countries where traders can get the product for distribution; alternatively, if a trade is willing to buy in bulk, the company offers the option; it has both online and desk selling. Who carries the products? In different countries, the company has established collection centers called authorized dealers who are given the responsibility of distributing the products in their countries. When the dealers have received the products, they are supposed to ensure they get to the target market in the best form. The approach to selling increases the cost of the product to the final consumer since all people in the chain will have to benefit fro m the transaction. Where can it be found? Nokia phones can be found in the following places:Advertising We will write a custom essay sample on Nokia Pricing Strategy specifically for you for only $16.05 $11/page Learn More Authorized dealers and sub-dealers premises Shopping malls Supermarkets Stalls Electronic shops among other electronic garget selling points (Nokia Official website ,2010). What type of promotions does this company use and how does that influence price? The company uses â€Å"pull† promotion strategy, under this approach, massive advertisements and persuasion mechanisms are adopted to ensure that an organization’s products knowledge of existence has been created. The end user and the promoters are at close links and interact in the course of advertising. The cost incurred is passed to the final consumer increasing the price of the phones. What are some suggestions on how this product or service could be improved and how mi ght that influence pricing? Nokia management team should think of improving operating technology adopted in phones, so as it can accommodate modern applications. Currently, the highest technology used for internet applications is EDGE technology; however, some of its competitors like Apple Inc have switched to 2G and 3G technology. When the technology adopted has been improved, then, the company is likely to enjoy a higher share of the market. The second improvement that the company should make is to incorporate low earning and middle class market segments in its twin-Sims products; the approach is likely to increase the company’s sales. References Hooley, G. and Saunders, J.(1993). Competitive Strategy: The Key to Marketing Strategy. New York: Prentice Hall. Kotabe, M. and Helsen, K. (2004). Global Marketing Management.New York: John Wiley Sons. Nokia Official website.(2010). Nokia.