Consumer Behavior Project on

CONSUMER BUYING BEHAVIOR OF

MOBILE HANDSETS

Fr. Casimir Raj

Report by

206: Anmol Rohatgi | 220: Heemanish Mide | 260: Vivek Rajgopal

October 10, 2008

Xavier Institute of Management & Research, Mumbai

Mumbai University
Acknowledgment

We would like to thank Fr. Casimir Raj for providing us with an opportunity to work on this project.
We are also grateful for his support and guidance provided through the completion of the project.

We are also thankful to all the people directly or indirectly involved in completing this project. This
includes the 100 respondents who were patient and cooperative in responding to our questionnaires.

And finally we are thankful to the staff in the library that helped us in getting resources for our
secondary information.

- Anmol Rohatgi, Heemanish Mide, Vivek Rajgopal

1
Executive Summary

The concept of “buying behavior” is of prime importance in marketing and has evolved over the
years. It is important to understand consumer buying behavior as it plays a vital role in crating an
impact on purchase of products.

The human wants are unlimited and always expect more and more. Mobile handsets are no
exception to this behavior. This lead to constant modifications of mobile handsets and today we see
a new model coming into the market practically every month.

In this research study our findings gave us thorough insights of consumer buying behavior of mobile
handsets. We find that consumers consider various parameters while buying mobile handsets.
Factors such as price and functions availing and the utility and its hedonic aspects our considered
very important

We have been able to also infer that people sub consciously register the brand, tend to recall. We
also come to understand that most dealers have showed a tendency to market the mobile handset
which as per consumers requirement.

On the whole, the market is a very important place to study the behavior of consumers and also
provide useful insights what a consumer requires in a product. It is only through research that an
company will be able to study the buying behavior of consumers.

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Index

1. CONCEPTUAL FOUNDATION

1. Consumer Behavior

2. MOBILE INDUSTRY IN INDIA

2. RESEARCH METHODOLOGY

3. DATA ANALYSIS

1. Understanding Consumer Behavior

2. Understanding Brand Preference

3. Other observations

4. Hypothesis

3. RECOMMENDATIONS

4. CONCLUSION

5. Bibliography & Webliography

6. Annexures

3
 1

Conceptual Foundation
“The Consumer is not a Moron….She is your Wife….Complex and Smart…. ”

CONSUMER BEHAVIOR

Not understanding your consumer’s motivations needs and preferences can hurt. The aim of
marketing is to meet and satisfy target consumer’s needs and wants. The field of consumer behavior
studies how individuals or groups of individuals select, buy, use and dispose of goods or services.
Understanding consumer behavior and “knowing consumers” is not simple. Consumers may say one
thing and do another. They may not be in touch with their deeper motivations. They may respond to
influences that change their minds at the last minute.

But studying consumers provides clues for developing new products, product features, prices and
altering marketing strategies accordingly. Let us try and understand the buyer behavior process.

Problem Recognition: Perceiving a Need

Information Search: Seeking Value

Alternative Evaluation: Assessing Value

Purchase Decision: Buying Value

Post purchase Behavior: Value in Consumption or Use

4
Problem Recognition

The buying process starts when the buyer recognizes a problem or need. The need can be triggered
by internal or external stimuli. Marketers need to identify the circumstances that trigger a particular
need. By gathering information from a number of consumers, marketers can identify the most
frequent stimuli that spark an interest in a product category. They can then develop marketing
strategies that trigger consumer interest.

Information Search

An aroused consumer will be inclined to search for more information. Consumer information sources
fall into four groups

Personal Sources: Family, Friends, Neighbors, Acquaintances

Commercial Sources : Advertising, Salespersons, Dealers, Packaging, Displays

Public Sources : Mass Media, Consumer-Rating Organisations

Experiential Sources : Handling, Examining, Using the Product

Knowing about the sources will help the companies in preparing effective communications for the
target market.

Alternative Evaluation

How does the consumer evaluate competitive brands and make a final value judgment? There is no
single process used by all consumers or by one consumer in all buying situations. But some basic
concepts will help us in understanding consumer evaluation processes.

First, the consumer is trying to satisfy a need.

Second, the consumer is looking for certain benefits from the product solution.

Third, the consumer sees each product as a bundle of attributes with varying abilities for delivering
the benefits sought to satisfy this need.

5
Purchase Decision

In the evaluation stage, the consumer forms preferences among the brands in the choice set. The
consumer may also form an intention to buy the most preferred brand. However, two factors can
intervene between the purchase intention and purchase decision.

The first factor is the attitudes of others and the second factor is unanticipated situational factors
such as loss of income, some other urgent purchase etc.

In executing a purchase intention, the consumer may make up to five purchase sub-decisions,

Brand decision

Vendor decision

Quantity decision

Timing decision

Payment-method decision

Post-Purchase Behavior

After purchasing the product, the consumer will experience some level of satisfaction or
dissatisfaction. The marketer’s job thus, does not end when the product is brought. Marketers must
monitor post-purchase satisfaction, post-purchase actions and post-purchase product uses.

6
AN EXAMPLE OF A PURCHASE BEHAVIOR BY A CONSUMER IS GIVEN BELOW

Problem Recognition

The need was recognized when my old mobile phone stopped working. I was using Nokia 5200 and
suddenly it stopped working and when given for repair, I was informed that the mobile can not be
repaired. The process of getting my mobile repaired took some 10 days i.e. for almost 10 days I was
without a mobile phone. The need was felt when it was my birthday and I was not able to be in
touch with my friends and family. Since I use my mobile even to surf my mails and internet I was not
even able to do that. All this caused a lot of in convince and finally I had to go for a new mobile
phone.

Information Search

For me my mobile phone is a high involvement product. Since am a student with limited disposable
income I purchase a mobile once in a wile. I don’t change my mobile set unless and until it stops
working and therefore at the time of making a decision to buy a new mobile I went through all the
various mobile phones available in my budget and of my preferred brand. i always look for various
offers and even compared rates at various stores and mobile dealers.

Alternative Evaluation

In identifying the various alternatives I went through various mobiles available of my preferred
brand. I even discussed with my family members and friends about which mobile do they
recommend. I met various dealers and stores to know the latest Nokia launches and various offers
available with all these dealers. No check out the rates and features I even visited various web sites
where I compared all the features and prices of various brands available in my budget.

Since I am a Nokia loyalist so I never preferred changing my mobile brand. although the other brand
offers were really tempting but they were still not able to influence me to change my brand. The
only issue was which mobile model I should go for. There were various mobiles available and were
almost similar apart from some features difference and design. Finally I decided to go for Nokia 3120
which was economical, had a good design, was Nokia latest launch and was satisfying almost all my
needs i.e. it was a 3g phone so apt for internet surfing and with all the latest features.

7
Purchase Decision

Finally the action taken by me was purchasing Nokia 3120. The mobile store had am offer of getting
a hand free on every purchase but some how that model was not available with them. i waited for
few days and then I finally bought the mobile from e store. Although that hands free offer was not
available but that was urgency since I was not able to avoid the need of having a mobile.

Post Purchase Behaviour

Am using the mobile since past 2 months and till now am quits content with my decision. Its working
pretty well and is apt for me.

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 2

Mobile Industry in India

With rapid consumerism sweeping the country, India has emerged as the second largest mobile
handset market, poised for explosive growth by 2007. The major drivers for growth have been the
demand and also the existence of companies providing the most technologically advanced handsets
at justifiable prices. The technological developments have been the driving factor for the increasing
demand graph.

The mobile handset market in India is estimated to be worth Rs.8.05billion (US $2billion) as of
2004/05 and will surge by 62% with approximately 100-million subscribers nationwide by 2007. It is
also learnt that the Indian mobile subscribers are willing to pay for upgrades, value-based services,
and advanced models that provide better services.

There has been a growth in the mobile handset market in India and the demand is increasing with
the increasing tele-density. The market is overloaded with the number of mobile handset providers
due to which the customer is able to bargain for a reasonable price for the mobile. The various
players are Nokia, Samsung, Motorola, Sony Ericsson, Alcatel, Panasonic, Siemens, BenQ, Mitsubishi
,Philips ,NEC ,Sagem ,LG ,Sharp, Sendo, Innostream, Pantech, VK Mobile, Palm, O2, i-mate, Qtek,
BlackBerry, Haier, Bird, Eten, HP and XCute.

Dominated largely by Nokia with a total market share of 60%, followed by Samsung (14%) and
Motorola (7%) respectively, Indian mobile handset market is currently catering to 45 million
subscribers (June 2005).

Recent records show that Indian GSM cellular user base has grown from 43 million, as estimated in
May, to 45 million in June 2008, representing a growth of 3.50% in the month under review,
witnessing large and propitious foreign investors flooding the market eyeing for large chunks.

In addition, recent changes imbibed in the government policies that price mobile handsets at a lower
end with flexible custom-duty for new entrants are startling the market with multiple models largely

9
aimed to higher and middle-income groups. Industry sources, though, view the market to be at its
nascent stage, many large EMS (Electronic Manufacturing Services) companies are seriously
considering setting up their handset facilities in India.

MAJOR PLAYERS

Nokia

A world leader in mobile communications, Nokia has established itself as the leading preferred
brand in many markets. Backed by its experience, innovation, user-friendliness and secure solutions,
Nokia is the world's leading supplier of mobile phones, fixed, mobile and IP networks. Nokia offers a
line of versatile business phones incorporating mobile voice, mobile messaging, email solutions and
business-critical applications and all the latest applications to meet the needs of different user
groups.

Samsung

Samsung manufactures leading models in all segments of the mobile handset market. The
company's aim is to launch a slew of mobile phones with unique features that satisfy different
customer and market segments. Samsung's key insight is that apart from technology and
functionality, a critical factor for generating customer preference would be 'glamour' and
'innovation'. Innovation is just one of the things that have kept Samsung at the top of the mobile
market. The conglomerate has made great strides in customer satisfaction through a strong local
presence via a dual partner distribution strategy. It has an all-pervasive supply chain that delivers
greater value to over 5,000 sales points and retailers.

Motorola

Motorola offers market-changing icons of personal technology - transforming the device formerly
known as the cell phone into a universal remote control for life. A leader in multi-mode, multi-band
communications products and technologies, Mobile Devices designs, manufactures, sells and
services wireless subscriber and server equipment for cellular systems, portable energy storage
products and systems, servers and software solutions and related software and accessory products.

10
Sony Ericsson

Their mission is to establish Sony Ericsson as the most attractive and innovative global brand in the
mobile handset industry. Their latest technological applications make them stand at the forefront of
innovation.

[Annexure 1]

11
 2

Market Research on Consumer Behavior

PURPOSE OF STUDY

The purpose of the study is to find the Consumer Buying Behavior of Mobile Handsets

SCOPE OF STUDY

There are more than 28 Brands of Mobile phones available ion the market. Within each brand there
are various models, each with different attributes and functions. This research will open the doors of
the consumer buying behaviour of a mobile handset.

RESEARCH OBJECTIVE

To find the Consumer Buying Behavior of Mobile Handsets

RESEARCH DESIGN

This is a Descriptive Market Research. This research will explore the consumers’ behavior towards
buying a mobile handset.

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 3

Research Methodology

DATA COLLECTION

The secondary data study gave us insights on understanding consumer buying behavior and various
concepts on purchase of mobile handsets.

Primary data will be collected through Questionnaire

SAMPLING

We have used the Convenience Sampling Method. The primary sample of 100 in which 50 were
working professionals and the rest 50 are students.

From our sample size we came to understand that mobile handsets which came up with latest
handsets would be preferred by students and the younger segment of the working professionals.
However in case of working professionals over the age 35 give more priority to handsets which
provide maximum utility and a very sophisticated look.

HYPOTHESES

To further prove our analysis we had taken three hypotheses into consideration which proved vital
in understanding the buying behavior of mobile handsets and the preference for the purchase of
mobile handsets. To prove the hypothesis, two different statistical tests were used, Z-test and Chi-
Square test. A test survey was conducted for the assumptions made in Chi-Square and Z-test.

Through the entire process of our study we also came to understand the brand preference and the
brand recall of Nokia is higher as compared to the rest in the mobile handset industry in India.

13
 4

Analysis

UNDERSTANDING CONSUMER BEHAVIOR

Let us begin with the foremost reason why consumers buy a particular mobile handset. The word is
out and it’s simple,

“Consumers buy a particular handset more for its utility than for its aesthetics….”

We found that about 76% expect maximum utility out of the cell phones. According the sample
population we find that almost 80% of the sample size expects value for money. There was another
set of population, which expected hedonic aspects the reason being external appearance being of
core importance.

[Annexure 2]

Major Influencers

The purchase of any product gets influenced by different factors which might range from a group of
people insisting to buy the product to the promotional schemes luring the consumers to make the
purchase.

The adjacent exhibit shows us the various influencers in a radar or web format with the center point
having the least percentage i.e. 0 % and increasing upwards along each strand in the web.

If you observe, friends and family play a important role in influencing a student in buying a handset
whereas, the working professionals get more influenced by promotional offers and advertisements.

Surprisingly, unlike what many would have assumed, distributor does not play any role in buying a
handset as none of the respondents from either of the groups believe distributor can influence them
to buy a handset. [Annexure 3]

14
The Possible Reason here could be that, because students still do not have the purchasing power in
their hands, whether to buy a new mobile handset or not largely depends upon how much their
friends insist them for buying it and how much the family supports them in making the actual
purchase. Whereas, for a working professional, though friends and family do influence to some
extent, their major influence is promotions and advertisements considering which they can decide
on their own whether to go for a handset or not.

[Annexure 4]

Influential Factors

Again, if we try and study the factors that influence the most in the purchase of a handset, we find
that for both the groups, cost and features hold important place, followed by brand name and other
factors such as service centers available and the resale value they can get from a particular brand.

The only minor difference here is that, in case of students, cost is the most important factor with
almost 40% picking this option followed by features. Whereas, for professionals features stand out
more important (42%) than cost.

So if a company wants to target a group of people to make a shift from their current handset to their
brand, it should focus more on reducing cost and improving its features as these are the two most
important factors people would consider while buying a mobile handset.

Now, to consider, why would people want to shift from their current handset to another one. The
probable reasons to shift from one brand of handset to another are up-grading to a new technology,
unhappy with the current handset, lost or damaged or any other reasons. When asked to a group of
working professionals and non-earning students, the responses from both groups were similar with
only minor differences. While a major percentage (68% for professionals and 52% for students) in
both groups agreed that they would shift to another handset just for up gradation, many students
also believed that the reason to shift from one handset to another is only because of the loss or
damage of the current one.

But considering Up-gradation is still the number one reason within both groups, handset companies
can concentrate on upgrading their handsets and become more competitive to the other brands in
the market. This would certainly help them, to some extent, in shifting brand loyalty from
competitive brands to their own handsets. [Annexure 5]

15
Promotional Schemes

Promotional schemes and discounts are considered a very important factor in shaping the buying
behaviour of consumers. But do promotional schemes play a role for mobile handsets? The answer
to this could be dicey. When asked a 100 people whether they would post-pone or pre-pone their
decision of buying a handset if they knew a promotional scheme was on the way, most respondents
(almost 44%) gave a negative nod to it. And only 24% said they would definitely wait and make use
of the promotional scheme. A large number, almost 32% also said that it would depend how far or
near the time is to make use of the promotional discounts. If it is quite near, say 1-2 months away,
they would wait for it or else just buy whenever they feel the need.

If we get carried away by the 44% figure and say that promotional schemes are probably not
important for handsets, we might be being very pessimistic. This result also shows the importance of
having a good promotional scheme and the importance of timing in launching promotional schemes.
If the promotional scheme is good enough and launched at regular intervals most people (56% -
adding 24% and 32%) would want to wait for it and make use of it.

And finally, consumers tend to shift to newer technology over the years and would want to upgrade
to a new model due to newer technology available. Also we found that a major proportion of
population tends to shift to newer models in less than 2 years.

[Annexure 6, 7]

16
UNDERSTANDING BRAND PREFERENCE

Current Handset

Across the mobile handset industry in India we find that Nokia has been the most dominant player in
the industry in the Indian market and boasts of a market share of 75%. The below exhibit gives a
clear picture of the share of handset brands within the respondents participated in our research.

Nokia is a straight winner with almost 73 % of the respondents currently using Nokia. This further
proves the overall market share of Nokia handsets in India. Other brands such as LG, Sagem, BenQ,
etc together hold the second position with 11%, followed by Samsung, Sony Ericsson and Motorola.

[Annexure 8]

Brand Recall

Our research tried to study the most recalled brand of handset in the minds of consumers, and the
result, as would look obvious was Nokia, with almost 95% recalling Nokia. When asked which, is the
next brand that they were able to recall, Samsung was a close fighter, being the second most
recalled brand with almost 34% respondents mentioning the brand.

Semantic Differential

Semantic Differential is a tool used to compare two of more brands along different parameters. As
can be seen in the following exhibit, Nokia gets full marks for all the parameters whereas the other
brands are only little behind with Sony Ericsson and Motorola getting almost similar scores along
three parameters. However, Motorola can work a little better on its distribution network. Probably it
can come out with more service centers or better service facilities within its service centers.

The following exhibit shows bi-polar scaling for 4 different parameters on a rating of -2 to 2, -2 being
the least preferred and 2 being the most preferred.

[Annexure 9]

17
Strength Character Analysis

Strength Character Analysis is used to measure the hold of the brand in the market and the positive
image for a brand in the market. The Strength criterion is measured in the following way.

If a 100 people are asked to mention any brand they can recall, then the Strength of the brand would
be

No. of Mentions

Strength = * 100

No of Respondents

The Character criterion is measure in the following way.

If a 100 people are asked to mention any brand that they think is having a particular good
feature/factor, then the Character of the brand would be,

No. of Positive Mentions

Character = * 100

No of Mentions

Let us do the Strength Character Analysis for the brand Nokia which is supposedly the most strong
brand amongst all other brands of handsets.

When 100 respondents were asked to mention any brand that they could recall, around 95 people
mentioned Nokia and only 5% mentioned other brands.

Hence,

Strength = (95 / 100) * 100 = 95 %

18
When the 100 respondents were asked to mention any brand which they thought were cost
effective and gives maximum features, around 85 respondents mentioned Nokia and remaining
mentioned other brands.

Hence,

Character = (85 / 95) * 100 = 89%

We now try and plot Nokia in the Strength Character Matrix. In both, Strength and Character, Nokia
has high values, so it falls in the lower-right box. And the strategy suggested in the same, is to
Maintain. Nokia should try and maintain its strategies so that its position in the market remains
stable and doesn’t fall.

STRENGTH
CHARACTER Low High
Low Lie Low Change Image
High Gain Attention Maintain

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OTHER OBSERVATIONS

Current Handset v/s Preferred Handset

The below given exhibit has linked the current handset usage to what the consumers would prefer in
the future. Most respondents want to shift to Nokia in the future irrespective of what they are using
right now, say Samsung, Sony Ericsson, Motorola or others.

An interesting observation here is, among the current users of Sony Ericsson, there are around 18%
want to stay with the same brand while the remaining want to shift to Nokia. Surprisingly, there is
also a group of Nokia users (around 12-15 %) which wants to shift to Sony Ericsson as their next
handset.

100

90

80

70
% O f R e s p o n d e n ts

60

50

40

30

20
Pre f e rre d Ha n d s e t

10 N o ki a

0 S o n y E ri c sso n
S a m su n g N o ki a O t h e rs
S o n y E ri c sso n M o t o ro l a

Curre nt Han ds et

Demand for Nokia has been great in the Indian market and seems will be quite good in the future as
well. But players like Sony Ericsson if become more aggressive, which, though sounds far fetched,
can pose a problem to Nokia.

20
Linking Consumer Behavior to Brand Preference

It is said that there is a direct relationship between Consumer Buying Behaviour and the brand that
they prefer. This was further proved from one of the results of our study. When the influential
factors in buying a brand were linked to the preferred brand by consumers, certain interesting facts
came out.

Out of the 100 who said cost is the most important factor they consider while purchasing a handset,
almost 85% preferred the brand Nokia followed by Sony Ericsson. This shows Nokia sells itself at the
right price and therefore cost-conscious people prefer Nokia.

100

90

80

70
% O f R e s p o n d e n ts

60

50
B r a n d P r e fe r e n c e
40
O th e r s
30

M o t o r o lla
20

S o n y E r ic s s o n
10

0 N o k ia
Cost R e s a le V a lu e S e r v ic e C e n te r s
F e a tu r e s B rand Nam e

Im p o r ta n t F a c to r

Similar is the case for other factors such as Features, Resale Value, Brand Name and Service Centers
available. Nokia is preferred in almost all cases. This shows the strength of the brand in all these
factors which has been possible because of the time it has spent in the market and the experience it
has gained about the consumers in the market.

Interestingly, the second brand in line after Nokia for Resale Value is Motorola i.e., out of 100 people
who are influenced by resale value while purchasing a brand, around 65% prefer Nokia and the
remaining 35% prefer Motorola.

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HYPOTHESIS

Research Question 1

Who influences the consumer the most while taking a purchase decision?

Hypothesis: 1

H0: p0 ≥ 0.5 i.e. 50% of the population is influenced by friends and family while purchasing a mobile
handset.

H1: p1 i.e Less than 50% of the population is influenced by family and friends while purchasing a
handset.

Particulars Values
Therefore it is a Two Tail Test.
n 100
Applying Z test using SEP p (claim) 0.5
q 0.5
P 0.53
SEP 0.05
Z-cal 0.6
Z-tab 1.645

A test survey was carried out before the main survey and as per the results; “p” is assumed to be 0.5.

Since Zcal<Ztab, we accept H0 i.e. more than 50% of the population are influenced by friends and
family while purchasing a mobile handset.

Our research also showed that 21% is influenced by advertisement and 26% by promotional
schemes. Out of the people influenced by promotional schemes most of them are working
professionals.

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Research Question: 2

What are the most important factors for a consumer while taking a purchase decision?

Hypothesis: 2

H0: p0 ≥ 0.5 i.e. 50% of the target population consider cost and features as important factors while
purchasing a mobile handset.

H1: p1 i.e. less than 50% of the target population consider cost and features as important actors
while purchasing a mobile handset.

Therefore it is a Two Tail Test.

Applying Z test using SEP

A test survey was carried out before the main survey and as per the results; “p” is assumed to be
0.75.

Particulars Values
n 100
p (claim) 0.75
q 0.25
P 0.79
SEP 0.043301
Z-cal 0.92376
Z-tab 1.645

Since Zcal<Ztab, we accept H0 i.e. for more than 50% of the population cost and features are
important factors while purchasing a mobile handset.

Our research also showed that 14% of the population considers brand name most important while
purchasing a mobile handset most of which constitutes college going students.

23
Research Question: 3

Is there a relationship between occupation of a person and features of a mobile handset?

Hypothesis: 3

H0: There exists no relationship between occupation of a person and features of a mobile handset.

H1: There exists a relationship between occupation of a person and features of a mobile handset.

Applying Chi-Square Test, the results are as follows,

(O-
Occupation OBSERVED EXPECTED (O-E)2 E)2/E

Features Students Professionals TotaltTotal 38 41.69 13.6 0.33

Outlook 38 37 75 33 32.24 0.58 0.02
Voice 33 25 58 36 37.8 3.23 0.09
Display 36 32 68 107 102.28 22.32 0.22

Functions 107 77 184 37 41.69 22 0.53

Total 214 171 385 25 32.23 52.27 1.62
32 37.8 33.64 0.89
77 102.27 638.57 6.24
2
Χ CAL 9.93
Χ2TAB 7.815

Since Χ2CAL> Χ2TAB we reject H0.

Therefore there exists a relationship between occupation and features of a mobile handset.

Our studies showed that the working professionals were not much concerned with cell features in
comparison with college going studies. As per our research most of the professionals in the age
group 35 and above preferred a mobile phone with fewer features. This could be because mobiles
with few features are less complicated .It is also a fad for students to posses a mobile with more
features.

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 5

Recommendations

The survey and analysis that we have conducted has brought out certain interesting facts and given
insights into the buyer behaviour in case of mobile handsets. Using these insights we suggest a few
recommendations to the handset brands to beat the ever-winning brand Nokia and a few
recommendations to Nokia on how it can maintain its position in the market.

How Can You Beat Nokia ?

Focus On Product & Price

In the analysis we found the major influential factors are Cost and Features while purchasing a
mobile handset, with more than 40 % people mentioning it as the major influential factors. Cost and
Features are parameters of Price and Product respectively. It is recommended that companies
concentrate more on developing these two “ P’s ” and spend more time on enhancing their products
at offer it at lower prices which can be done by employing cost-reduction measures.

Be a Technology Driven Company

When asked if they would upgrade to a new handset due to this innovative technology, a majority of
70% people gave a positive nod. This implies that people attracted towards newer technology and
will be able to shift from one handset to another if it uses better technology. Brands such as Sony
Ericsson, Samsung, LG can dream of catching up with Nokia if they put more efforts on improving
their technology. They can spend more in R&D and less on promotions which would help them in
developing innovative products which would sell itself without much promotion.

Utility more important…Aesthetics come second…

25
A whopping 76% said they would buy a mobile handset for the utility it provides rather than for its
aesthetics. Even in the Product, companies should concentrate more on the internal features, i.e.
functions it can offer rather than the display or color of the handset. Nokia as placed itself as the
brand which offers maximum features in reasonable prices. So if you want to reach Nokia’s position,
this is one focus area the companies can consider to work upon.

How Can Nokia Maintain Its Position?

As we have seen in the Strength – Character Analysis, Nokia is a very strong brand and lies in a
comfortable position as of now. Nokia is already a market leader. But it needs to hold its position in
the market. In one of our analysis, we found that some of the users of Sony Ericsson want to stay
with the same brand and few other users who were using different brands such as Motorola,
Samsung wanted to shift to Sony Ericsson. To fight players such as Sony Ericsson, Nokia has to
maintain its present strategies or else they might become a threat in the future.

26
 6

Conclusion

This project has helped us in understanding the behavior of consumers towards mobile handsets and
what they prefer in different brands.

Nokia stands out as a clear winner. It is because of the experience it has in the market. Handset
buying is a high involvement product wherein the consumer wants to know from different sources
about brands, though Nokia is the first name that comes to their minds.

Word of mouth plays an important role in such products and therefore it is important for the
product to be of important quality.

Companies should therefore concentrate more on developing the first P and make it available at
reasonable and reachable prices.

So the product itself becomes the promotion for the brand…….

27
Bibliography & Webliography

BIBILIOGRAPHY

MARKETING MANAGEMENT –BY PHILIP KOTLER

CONSUMER BUYING BEHAVIOUR-

MARKET RESEARCH-NARESH MALHOTRA

WEBLIOGRAPHY

www.nokia.com

www.samsung.com

www.sonyericsson.com

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Annexure

Annexure 1

MARKET SHARE OF MAJOR MOBILE HANDSET

PLAYERS

7% 2%
10% NOKIA
SAMSUNG
7% MOTOROLA
SONY ERICSSON
60%
14% LG
OTHERS

Annexure 2

Preferred Aspects

Aesthetic
24%

Utilitarian
76%

29
 Annexure 3

Major Influencers
Friends
30

20

Promotion 10 Family

0
Students
Professionals

Distributor Advertisements

Annexure 4

Reasons To Shift

100
80
68
% U sers

60
52
40 32
14
20 8
8 14 4
0
Upgradation Unhappy Lost/Damaged Others
Reasons

Students Professionals

30
 Annexure 5

Influential Factors

100

80 Cost
% Users Features
60 40 42
40 36
Resale Value
40
16 Brand Name
12
20 6 4 2 Service Center
2
0
Students Professionals
Segments

Annexure 6

UPGRADATION DUE TO TECHNOLOGY

100
70
80
% USERS

60
30
40
20
0
yes no
RESPONSES

31
 Annexure 7

PRE/POSTPONING DECISION DUE TO

PROMOTIONAL SCHEMES

100
80

% USERS
60
44
32
40 24
20
0
yes no depends
RESPONSES

Annexure 8

CURRENT HANDSET USERS

100
90
80 73
70
% USER

60
50
40
30
20 11
9 6
10 1
0
samsung sony ericsson nokia motorola others
BRANDS

32
 Annexure 9

-2 -1 0 1 2
User Friendly

-2 -1 0 1 2
Cost

-2 -1 0 1 2
Distribution

-2 -1 0 1 2
Brand Image

Sony Ericsson
& Nokia
Samsung Motorola

*****

33