Vitaly Demin Senior Strategy Consultant Read about Vitaly

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August 2011

This brief take on the Nokia situation is not about the numbers. The latest numbers are here. The point of this article is below.

Nokia needs to understand today that nothing is going to happen for them. Why? Because they reached the point of brand irrelevane. Stephen Elop most likely doesn't see it because everything looks really exciting for him now that the deal between Microsoft and Nokia is all done and the plan to make Windows Phone Nokia devices is aiming at the beginning of 2012.

Why they reached the point of irrelevance? Because it's too late in the game. People buy what they believe is the latest and greatest. When you think about smartphones, which are the top three brand names that come to your mind? iPhone, Samsung and probably HTC or Motorola. iPhone is an absolute leader and the other guys were smart enough to jump on the new wave of mobile technology. Nokia didn't do anything. Partially because of their arrogance as the world leading cell phone maker, partially because of not seeing the big picture of where the mobile industry is going.

Stephen Elop will not understand this because he's a left brain CEO. And even if he did, it's still too late. The question that I always ask companies that I consult is - Why would people buy your product? It would be interesting to hear Mr. Elop's answer.

Nokia is known as a company that sells mobile phones running a now obsolete Symbian operating system which is absolutely irrelevant these days. Now they partnered with Microsoft, a company that is known for its desktop operating systems and that named their mobile operating system "Windows Phone" because Steve Ballmer, the Microsoft CEO, is another left brain CEO who thinks that extending existing brands is a good thing, even if these brands stand for old technology.

Bottom line, here we have a cell phone hardware maker that reached the point of irrelevance and it joined forces with a software maker that is very close to becoming irrelevant due to the late entrance and grave errors in branding.

Nothing is going to happen for the Nokia and Microsoft alliance no matter what marketing efforts they apply. While Microsoft can still get some traction on the market due to the fact that early entry companies like Samsung and HTC are manufacturing phones for them but Nokia as a hardware maker will remain on the outskirts of the market. Branding is all about perception and it will be very hard to make customer perceive the Nokia brand as an authority in mobile technology.

They only way to stay relevant as a brand in people's minds is to be there when the change in the industry starts. When it already occured, there's absolutely no way to stay in the game.

Read also:

• Three strategies that can give Nokia and Microsoft a chance

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Free on iBooks

This eBook is a brief insight into the core of the executive management of Sony Corporation, the core that is unfortunately filled with one of the most perilous human qualities – arrogance.

For a very long time now Sony has been known as an organization permeated by arrogant attitude toward their suppliers, their distributors and now their customers. This culture is felt everywhere in the world. I remember having meetings with Sony people in Moscow Russia when I consulted the largest electronics retailer in the country. These meetings were very adversarial and not a most pleasant experience. Also, as I worked with electronics retailers in Kuwait, Emirates, India, England, US and other countries, the opinions I received about Sony were the same. Nobody liked them and nobody wanted to do business with them because it was just too painful. Obviously, they could not stop carrying Sony products in their stores but some of them did try to reduce the assortment. Sony rarely partners. They dictate.

This work is an attempt to show how corporate arrogance affected the decisions Sony made along the way, the decisions that led to mistakes, mistakes that got them dethroned from the position of being the best and the most admired consumer electronics company in the world.

I hope this eBook helps other companies see a bigger picture of how decisions that are made inside their organizations affect their brand, their customer loyalty and profitable business growth. Very often top managers do not realize that many of wrong decisions are made not due to the lack of knowledge about the problem but due to the mentioned above human flaw – arrogance.

The 2nd edition includes financial updates from 2010 as well as other recent events associated with the Sony organization.

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