Nokia goes for 1% market share in the US

Okay, I'll admit in advance that this is going to be a pretty snarky post, but it never ceases to amaze me how badly Nokia handles itself in the US market. In Europe and most of the rest of the world, Nokia operates like a fighter jet, incredibly nimble and powerful. But in the US, it's more like a biplane. An old biplane. With holes in the wings. Nokia's market share in the US has dropped from 20% to 7% in the last two years (link), and sometimes I wonder if it's trying for 1%.

Case in point: Nokia's "Open to Anything" ad campaign featuring people who have created software for Nokia N95 smartphones (link).

It features, swear to God, a guy who created a self-hypnosis application for the N95, someone who created a bad breath detector, a man in the Witness Protection Program who created a location-aware app to track the hit men chasing him, a ditzy woman who uses the phone to track fertilizer schedules for her plants, a jealous wife who created a lie detector, and a flake Jewish photographer who glued together two n95s to create a 3D camera.

"You've never really seen a bris until you've seen a bris in 3D." --Nokia's website

They're all fantasy applications from obviously fake people, but beautifully animated in an elaborate Flash-driven site.

From time to time, I've talked with Nokia employees who were confused about why people don't buy more application software for their Nokia S60 smartphones. There are a lot of reasons -- lack of awareness that they can do it, lack of a built-in software store on the device, incompatibility between various versions of S60, etc. But one huge reason is because no one has ever made a compelling case to most users on why they should care about smartphone software.

The triumph of creativity over business sense

The Open to Anything campaign is a great example of how Nokia's hurting itself in the applications business, and in the US market in general. I'm sure Nokia's intent was to do something light-hearted to draw attention to the N95, and if you view the ads as standalone short films they are moderately witty. You see this a lot in online marketing lately -- a creative agency will create humorous websites (often with video) designed to draw traffic from bored web surfers. But unless the ads also align with your strategy, they don't drive sales. In Nokia's case, they actually do harm:

--Once again, Nokia is communicating that its users are freaks and morons, which in the US is not the way to build a loyal following. Nokia has a long habit in the US of positioning itself as the preferred phone of people who lack social skills. At least this time there aren't any sluts in the ad (link).

--The benefit of an open phone is not that you can write your own apps, it's that you can buy applications created by others. Almost no one wants to create their own apps. So we're being told that N95 users are not only freaks and morons, but they are freaks and morons who have programming skills -- an even narrower demographic.

--Since the argument for why users should care about applications has not been made, showing a bunch of nonsensical applications actually makes people less likely to take an interest in mobile apps at all. It trivializes the whole idea of mobile software, at a time when Nokia claims it is trying to make itself into a computing company that can compete with Apple and Google.

Meanwhile, Apple's ads depict its users as smart and hip, it puts its CEO on stage with real developers showing lustworthy iPhone applications, and it plans a built-in software store for the iPhone. Care to guess which platform is going to get more user and developer loyalty?

I'm tempted to start taking bets on when the iPhone application base will be larger than S60's. Unless Nokia wises up quickly, it won't take long.


Michael Mace said...

There's an interesting thread discussing this post here.

Frans Thamura's Global Opinion said...

i discussed this several time with nokia, and nokia have nokia forum, the cool center but unmanaged and no vision.

sad they market here compared with a china brand that dont have cool operating system.

nokia never build community, never care about develoepr that develop software for him.

JavaME is one of the apps that more safe thatn S60 native (C/C++).

I see their market share will be in danger globally if there are connected application that change people use mobile phone.

Nokia charge to high for JavaME education, compare with our JENI or JEDI that are free... how can same material commercialled to high that will benefit his brand directly.

We can see nokia phone just a phone, u use, dump if u dont like the model.

Sad the S60 engineer that work hard but nokia dont care of this mvoement.

I am glad iPhone will develop this market, and we will see the battle field soon, and i can prove that nokia dont have people to handle this battle.

this happen to Sony Ericsson, and also Motorola. Their dont have cool developer program, development is just an addins there.

I never us blackberry, but i can see there is enterprise market development in US, i saw Siebel on BlackBerry, but here in Asia, i never hear what is blackberry for, except for push mail.

Anonymous said...

i really do not think that the big market base for smartphones cares at all about applications. i do not think that they use any third party apps on there PC's right now. what they do is point there browser at all sorts of 'sites' mostly social networking and hosted webmail and chat sites as well as blogs, forums, news sites, etc etc. but the new young cool generation is just not about apps(or anything that they can not share with others no matter what types of different platforms they are using)

Anonymous said...

This campaign is really curious because I've always admired Nokia brand positioning in Europe. It was reminiscent of the great, emotional Orange "The Future is Bright" campaign that focused less on the service/device and more on how it fits into a person's life - a regular person in "slice of life" situations.

I don't know who runs Nokia's North American business or how much influence Finland has on US marketing operations, but I really think this campaign suggests a shocking misunderstanding not only of a typical mobile user, even a smartphone user, who is likely more sophisticated than average. Even adapting their European campaigns would be better than this.

Is it possible they really were targeting geeks with this? Maybe someone at Nokia needs to read "Crossing the Chasm". With advertising like this, its chasm will soon be the size of the Grand Canyon.

Anonymous said...

Yep Nokia doesn't get the US, no surprise there. Frankly they haven't had to yet, and with the promise of China and India, they probably never have to.

Point of information: the S60 implementation of Symbian has had an on device software store, since S60 3.0... its called "Download". The fact that you do not know about it clearly demonstrates the fact that people really don't know most of what the software does already provide.

scribblercraig said...

The N95 is a great phone - I have one and went for instead of the iPhone (disclaimer: UK resident) but the UI for the N95 is horrific.
It does a number of things right - decent size, microphone, MP3 playback.
The stills camera is average.
Where it falls down and falls down terribly is in the following:
UI - not only onscreen but when trying to find pictures or files on the actual phone or memory card. Someone really should have put some thought into the file management.
Apps - they apps never quit after you leave them. Now for most that isn't an issue but why the Log always feels the need to stay open is ridiculous.
Maps - dear god, that's the worst SatNav ever.

I've got it for another year or so - and I'll happily keep it until then, but if there's an iPhone v3 next June/July then I'll be looking at that instead of just keeping the N95.

Anonymous said...

Since Nokia bought Symbian there is a chance it will become better or worse. If they create a developer program, which I presume they want to do, since in businss the services the way to go (see some similarities to IBM?) and in consumer business is the advantage of software and hardware integration (see Apple). All else will be downgraded to a) commodity market (some Asian brands) b) phone and software under tight grip from your cell phone provider (see Rogers in Canada building their own applications for web) c) innovative advertising driven business models (Google phone).

Nokia might inject millions of dollars in the software business, so this relationship might turn to be good actually.

Anonymous said...

Yes, I forgot to mention Microsoft looks like a last year's movie in this year film festival ;-)

Anonymous said...

Nokia will remain the leading mobile-phone manufactorer in the world, wheter or not they would not sell one single phone in the US ...

Anonymous said...

Although Nokia has not been doing so good in US market , but their dominance in Europe and Emerging Markets(India ,China) is quite apparent with sales in 1st and 2nd quarter this year .I do not blame the strategy and Marketing team completely for their failures in the US , one important reasons of Nokia's poor performance in the US over the past few years is their sour relationships with operators who have their own favorites when it comes to Smart phone business.

Anonymous said...

perhaps US is not that big a market in global scheme of things.

Cellphones4us said...

If cell tower ID is enough resolution to do what needs to be done by the application, appreciating battery and processor demands, can you extract cell tower ID from voice and data streams and just tell applications when they change from one tower to the other? This eliminates polling for tower ID every minute when other primary phone uses are active. This makes low res tracking accessible to Cell phone applications with almost no incremental battery life cost.