Marketing Strategies of successful 5 MNCs in India

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This Marketing Project contains the strategies adopted by 5MNCs in India. Nokia, Samsumg, LG, Hyundai, P&G

Text of Marketing Strategies of successful 5 MNCs in India

  • 1. MARKETING STRATEGIES OF ANSHUMANDUTTA RollNo.215111070,SUCCESSFUL MNCS IN 1yr MBA, 2011-13 INDIA An Analysis of the Pioneers
  • 2. ContentsIntroduction1Marketing Strategy....2Nokia...3Procter and Gamble...4Samsung......9Hyundai...13LG16Conclusion...17References...18 1
  • 3. INTRODUCTIONWith developed world markets becoming increasingly saturated,multinational corporations(MNCs) have turned to emerging economies such as India, Indonesia, Brazil, China, andMexico,as key locations for future growth. In their efforts to enter these markets of the future,most MNCs have focused on the wealthy with products and business models similar to thoseused in the developed world (Arnold and Quelch, 1998;Prahalad and Lieberthal, 1998).Low-income markets in emerging economies present both tremendous opportunities andunique challenges. There can be little doubt that the four billion customers in these base-of-thepyramid markets represent a vast potentiallyuntapped market opportunity. Dawar and Chattopadhyay (2002) observed, it makes little sense for MNCs to think in terms of distinct country strategies (e.g., China strategy) in the context of Emerging Markets. Instead, it might be more appropriate to develop separate strategies for wealthy, rising middle class, and poor customers across country markets (Hart and Milstein, 1999).The majority of the MNCs investing in India about 53 percent are focused on asingleactivity or product, while another 35 percent are diversified into relatedbusiness sectors.Thissuggests that only MNCs with clear business focusenter India, possibly with a well-definedbusiness strategy, whether seeking resources or markets. Economic development at the base of the economic pyramid may not follow familiar patterns found in the developed world (Arnold and Quelch, 1998; Hammond, 1998). As the Nobel prize winning economist Joseph Stiglitz suggests, the failure of the worlds global financial institutions in their efforts to facilitate economic development that is more inclusive demonstrates the dangers of relying on traditional players and their limited views of what is appropriate and effective (Stiglitz, 2002).The eight resources deemed most important for success by the MNC affiliates arebrand,business network, distribution network, equity, machinery and equipment,managerialcapability, marketing capability and technological know-how.Importantly, most of these areintangible resources. 2
  • 5. NOKIA-Nokia is one of the largest mobile phone manufacturers in the world. While it is in a verystrong leadership position right now, the future of the company is in balance as the industrymatures.Headquartered in Finland, Nokias business is divided into four divisions: Nokia Mobile Phones Nokia Networks Nokia Ventures Organizations Nokia Research CentreNokia brand is an asset that has been carefully cultivated over the years, throughout whichthe company has managed to predict and satisfy consumers needs and preferences ahead thecompetition.In 1989, Matti Alahuhta developed a new strategy for Nokia that focused on three key points: The development of a product with global appeal, Nimble movement to sell it internationally, Most importantly, a commitment to learning what consumers want, without consideration of the limits of existing technology In the highly competitive $3 billion mobile phone market in India, Nokia has managed to make its brand the phone of choice for millions. It currently has a market share of over 70 per cent.The Marketing Strategy of Nokia [15] 4
  • 6. MARKETING STRATEGIES By 1990, Nokia identified some of the features that eventually establish it as the leader in setting industry benchmarks. The Nokia 2110 launched that year, gained popularity with a large screen, elegant design, and a clean user interface. During the early 1990s, Frank Nuovo, head of Nokias worldwide design team, led Nokia to design phones that offered customizable rings, elliptical designs, and custom faceplates. Although such features may appear trivial or obvious in hindsight, Nokia continued to gain market share by paying attention to the details that worked to enhance ease of use and customizable preferences. The insight that the handset could be a stylish fashion accessory, rather than merely a communication tool, allowed Nokia to lead the trends and direction of the entire handset industry. In addition to a superior design effort, Nokia assembled a diverse team to research how consumers can use its phones. The team consisted of engineers, graphic designers, sociologists, psychologists, and even a theatre director. While theyve designed similar, easily recognized handsets, Nokia has successfully segmented the market to target specific demographic groups. For example, in the year 2000, different phones were marketed to appeal to the rugged user, the sophisticated user, and the youth market, among others. With all these product innovations, designed to satisfy customer preferences, Nokia has reinforced its brand image of providing cutting-edge communications technology. Analysts have positively characterized the company by describing it as young, sexy, sophisticated, hip and generally with it. 8 Alternatively, theyve compared Ericsson as an austere, conservative, middle-aged Swedish engineer, which supports the widely held belief that Ericssons handsetshare unfashionable. Since Motorola lethargically moved from analog to digital phones, Nokia was able to overtake them as the leader in the handset. Subsequently, Nokia leveraged its superior marketing strategies and powerful brand to avoid the price wars that have afflicted its key competitors. Nokia embarked on direct-to-consumer advertising, including sponsorships and product placements. Nokias handsetspositioned as stylish and cutting edge, customers will continue to pay for the perceivedadded value of the brand. It also has strategically placed its products in movies such as The Matrix. The youth market, the handset should add services with an emphasis on entertainment. For instance, MP3 players, short message services, chatting, and mobile gaming are some promising examples. Also for the youth market, careful attention should be paid to the design of the handset. Teenagers and young adults simply wont buy if the new handset does not look cool or hip. 5
  • 7. For professional users, Nokia should provide the ability to remotely access their data and files through the handset. Calendars, conference schedules, e-mails, PowerPoint presentations, spreadsheet, and word processing documents should be obtained with the touch of a button, at least in the corporate site, if not nationally. Due to the limited memory capacity available to handsets, Nokia should also provide the means to transfer information from the handset to a computer or PDA. Professional users are known to pay premium prices for convenience.FLOW CHART OF NOKIAs MODEL FOR MARKET PENETRATION[15]With mobile handset penetrating through the mass market, it is becoming increasinglydifficult for handset makers to sell additional mobile phones and sustain growth. This is Our firm opinion continues to be that the replacement will continue to grow and the share of replacements in the total market will grow, MattiAlahuhta, president of Nokias mobile phone division.especially true for a market leader like Nokia. Nokia has fully recognized the potential of thereplacement market. 6
  • 8. POCTER AND GAMBLE-P&G ranks #39 in the list of Fortune 500 companies [4], before its main competitor Johnson &Johnson (#57) and Kimberly-Clark (#142). P&G also outperforms Unilever and Nestle, thecompanys main competitors overseas.The P&G business dates back to the mid-1800s when it began as a soap and candle-makingcompany. The company started sponsoring radio programs which became known as soapopera