Consumer Behaviour Theory Analysis In Nokia And Motorola Marketing Essay

The company manufactures mobile devices for almost every key market segment and protocol that also involves GSM, CDMA, and W-CDMA. In addition to manufacturing mobile devices the company also offers various internet services like applications, maps, games, media, music and messaging (Nokia Looks Beyond, 2004). The company’s subsidiary “Nokia Siemens Networks” manufactures telecommunications network equipment, resolutions and services. Moreover, the company also serves its customers with free digital map information and navigation services (About Nokia, 2010). The company operates as a leader in the mobile telecommunications and this competency of the company depends upon its abundant experience, technology invention and precise marketing strategy.

In the product category of mobile-phone brand, Nokia has attained number one position and it is all due to its approach towards its customers. In this project the product category selected for the discussion is “mobile phones” in which Nokia has established itself as leading brand in comparison to any other mobile phone manufacturer. With its advanced technologies and features the company has established itself a well-known brand in the mobile phone category (About Nokia, 2010). The company believes in offering handsets with attractive designs, advanced applications and moderate price and these factors have assisted, Nokia in establishing itself as number one brand.

Motorola, is a famous American, transnational telecommunication company that is situated in Schaumburg, Illinois. The company produces wireless telephone handsets and in addition to this it also plans and markets wireless network infrastructure instrumentations like cellular transmission base stations and signal amplifiers. The company operates as a worldwide communications leader that is leveraged by zeal to contrive and an everlasting allegiance to boosting the way through which the world can be connected (About Motorola, 2009). The communication solutions offered by the company facilitate its customers in becoming connected and mobile. Our communication solutions allow people, businesses and governments to be more connected and mobile.

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From the time the company has originated, it is trying to evolve a synergistic portfolio of technologies, solutions and services that involve wireless accessories, digital entertainment devices, wireless handsets, enterprise mobility solutions wireless access systems and voice and data communications system. All these services, technologies and solutions offered by the company enable its customers experiencing the advanced experience of mobile. Nowadays, the company is operating with a mission to direct the wave of new advanced and innovative products that could easily assist the customers in meeting with their needs.

Presently, the company is operating with the following three business segments:

Mobile Devices

Enterprise Mobility Solutions

Home & Networks Mobility (About Motorola, 2009).

The first category of its business segment had assisted the company in establishing itself as a leading brand. The mobile handsets developed and served by the company are very advanced featured with latest applications and features. The advanced features and applications offered by the company through its mobile handsets have made Motorola a leading brand in this product category (Company Spotlight: Motorola, Inc., 2009). MarketWatch This segment of the company is positioned in a way that helps it in leading the union of mobility, media and the Internet.

Relevant Theory/Concept to Nokia

Nowadays every organization makes use of different concepts and strategies for marketing their product. In present, marketing of a product have become critical for the success of a company (Vigneron & Johnson, 1999). Until or unless a company does not make use of various tactics and strategies related with the marketing of its specific brands, it is not possible for it to attain a significant position in the industry as well as in the minds of its consumers (Hawkins, 1986). Due to the increasing importance of marketing, every firm is trying to make use of different tactics, concepts and theories related with consumer behaviour.

In modern era, the practice of consumer behaviour is distinguished as an analysis of person, groupings and firms and the procedures that they apply for the purchase of a product, service or experience that is able in satisfying their needs (Foxall, 1993). By analyzing consumer behaviours an organization can easily position its product according to the needs of customers or in the manner through which they will easily get attracted toward using it (Armstrong, 1991). For attaining information regarding consumers buying pattern, the study of consumer behaviour is been used more and more (Ho, Lim & Camerer, 2006).

Similar is the situation with Nokia that also adopts different concepts and approaches related with consumer behaviour for marketing its different products and services. The company applies this study of consumer behaviour at customary basis so that what customers are looking and at what price can be identified from time to time (Hawkins, 1986). With this identification they become able in altering their products and services offered according to the need of present customers and the features and applications offered by other competitors.

The use of different concepts and consumer behaviour theories appropriate the company and its executives in the delivery of suitable and exact products to its target consumers (Albanese, 2003). All concepts and theories used by the company help it in its marketing practice of affecting the purchasing behaviour of its existing and potential customers (Neal, Quester & Hawkins, 2004). The applicability of consumer behaviour concepts and theories help Nokia in their marketing practice of influencing the behaviour of their consumers and that in turn influence the company (Santos & Boote, n.d.).

Nokia make use of various consumer behaviour related concepts and theories from time to time, but the most significant consumer behaviour theory used by the company is Psycho-Analytical Model. This model assists the company in introducing psychological elements of its consumers in their marketing decisions. With the help of this model, the company effectively design its marketing strategies and practices that are corresponded with the needs of its consumers (Kassarjian, 1971).

The company markets its handsets on the appropriate basis of segmentation, positioning and differentiation and it is all done by identifying the culture, social, personal and psychological factors that influences the needs and purchase decisions of its consumers (Hofmann & Strack & Deutsch, 2007). It is a well-known fact that the decisions made by consumers are not made in a vacuum as their all purchases are extremely determined by cultural social, personal, and psychological factors (Hoyer & Macinnis, 2008).

All these factors cannot be controlled by a marketer but by taking it into account can assist him in his further marketing decisions like segmentation, positioning and differentiation. Similar is the practice of Nokia Corporation as it takes into account these factors that influence the behaviour of their consumers and subsequently it makes its decisions related with the psychological needs of its consumers (Frank & Riedl, 2004).

Adoption of this model significantly helps the company in marketing its mobile handsets all over the world. Analysis of various factors pertinent to a nation and its individuals assists the company in its further marketing decisions for marketing their mobile handsets (Schiffman, Kanuk & Wisenblit, 2009). The application of this model by Nokia can also be understood by analyzing how this model assists the company in marketing its mobile handsets. Subsequent are the various factors that are analyzed by Nokia for identifying the purchase behaviour or psychological needs of its consumers:

Cultural Factors: Every country of the world is quite diversified and is comprised of several cultures that exert the largest and intimate influence on consumer behaviour. The company critically analyse the cultural factors of a nation in which it starts operating along with the role of a buyer’s culture, subculture and social class on its purchasing (Hoyer & Macinnis, 2008).

Social Factors: Purchasing behaviour of an individual is also affected by his social factors that include a consumer’s reference group, family, social roles and statuses. Nokia analyses all these social factors and subsequently make use of these in the marketing of their mobile handsets.

Personal Factors: Personal factors like age, income, life style and occupation of a consumer also make substantial effect on his purchase decision that is essential to be analyzed before targeting a consumer. Nokia imperatively analyzes the personal factors of its consumers and due to this it is able to increase its market share in more and more countries.

Psychological Factors: Every consumer has some specific set of beliefs, perceptions and attitudes and if a marketer is able to understand these aspects, he can easily motivate his consumers towards purchasing his products (Riesenbeck & Perrey, 2009). Nokia also market its products by understanding the perceptions, beliefs and attitudes of its consumers and due to this the company is so successful that it had attained number one position in the market.

Analysis of all these factors that affect the purchasing decision of consumers facilitates the company in their further marketing decisions like segmentation, positioning and differentiation in the following manner:

Market Segmentation:

With a thorough analysis of various factors that affect consumers’ decision-making and psychological needs the company is able to identify that different individuals have different needs related with the use of a mobile phone (Lye, Shao & Thiele, 2005). Some of the consumers want a mobile phone with the most latest and sophisticated data-concerned characteristics and functions, whereas some desire for fundamental voice connectivity (Nokia Leads Change through Continuous Learning, 2003). This analysis of the factors and psychological needs that affect consumer behaviour has facilitated the company in its market segmentation and on this basis the company has classified its overall market in following segments:

Fundamental – Fundamental consumers look for voice connectivity and well-built style.

Expression – This type of consumers look for custom-made and individualized features.

Traditional – Traditional consumers like a traditional representation and web browser aspect.

Fashion – This type of consumers look for a very small or slim phone as it is just an item of fashion for them.

Value – This type of consumers prefer mobile with overall technical and service features.

Communicator – This type of consumers look for the handsets that offer all features of connectivity and device combinations like phone or laptop and phone or TV.

This segmentation approach of the company demonstrates that Nokia make use of psychographic approach for marketing its mobile phones. The company segments it’s various markets by psychoanalyzing its consumer’s lifestyles, actions, concerns and notions (Riesenbeck & Perrey, 2009). After identifying the basis of segmentation the company determines the various product lines for its different segments.

Positioning and Differentiation

With the help of analysis of factors that affects consumer behaviour and their psychographic needs, Nokia has effectively positioned itself in the market along with the help of differentiation strategy. The company has specified the brand in the minds of its consumers by following a human and touching sensitivity and all this has been done by analyzing its consumer’s life style, attitudes, cultural and social factors (Steinbock, 2010).

The company position its mobile handsets on the fundament of features like easy to use, excellence, consistency, design, durability and style as all these are the features that its consumers wants (Bhutto, 2005). For marketing its mobile handsets the company make use of various positioning strategies’ that are a compounding of desire, gains, feelings and competition (Mitry & Smith, 2009). The company has positioned itself on the basis of human attribute of mobile communications that deviates its competitors now what else they can own for positioning their mobile devices.

The identification of cultural, social, personal and psychological factors that affect Nokia’s consumer behaviour assist it in all of its further marketing practices like segmentation, positioning and differentiation (Steinbock, 2010). This analysis assists the company in making use of points-of-difference as its positioning strategy. With this the company is able in claiming a benefit of connecting people that incites category use.

In the direction of claiming its benefit the company also make use of higher-up advertising and marketing techniques that in turn help in gaining competitive advantage in spite of its competitors (Nokia Leads Change through Continuous Learning, 2003). For differentiating its mobile handsets from its competitors the company make use of product differentiation and image differentiation and insights regarding these differentiation are attained through analysis of factors that influences its consumer behaviour (Kennedy, 1992). In this way, it can be said that the company make an appropriate use of concept of factors that affect consumer behaviour for designing and determining its further marketing decisions.

Relevant Theory/Concept to Motorola

Motorola is also one of the well-known companies in the field of manufacturing mobile handsets. It stands at second position in the market after Nokia. This company also make use of various consumer behaviour related concepts and theories as it known that in present competitive environment it is essential for attaining success and maintaining its business. The company is aware with the fact that in present the marketing strategies of most of the companies are based on consumers’ explicit and implicit beliefs (Company Spotlight: Motorola, Inc., 2009).

The company operates with the fact that in order to survive it is essential for it to provide its target consumers with more value in comparison to their competitors. This can only be done by analyzing the behaviours of its target consumers (Hoyer & Macinnis, 2008). Analysis of consumer behaviour can significantly assist the company in developing and positioning products in a way that corresponds with the needs and desires of consumers so that they can be influenced positively (Karjaluoto, Karvonen, Kesti, Koivumäki, Manninen, Pakola, Ristola & Salo, 2005).

With this discussion of company’s beliefs and notions it is clear that the company also make use of various consumer behaviour theories and concepts for influencing the purchase decision of their consumers. The most substantial consumer behaviour theory adopted by the company is Stimulus Response Theory based on “Learning Model”. This model was originated by Russian psychologist Ivan Pavlov (Frank & Riedl, 2004).

This model implies that the behaviour of a consumer can be conditioned on the basis of some fundamental factors. In this model it is said that the process of learning is grounded on four factors that are as follows:

Drives: It is a firm internal spur that enforces action at the part of consumer.

Cues: It is a weak spur from the surroundings that facilitate in when, where and how an individual react to the drive.

Response: It is an action to the cue.

Reinforcement: It occurs when response is positive (Theoretical Aspects of Consumer behaviour, n.d.).

Motorola make use of this model for marketing its mobile devices to its consumers. With the discussion of this theory it can be said that the company tries to create the demand for its mobile devices by linking it with strong drives like next generation phones. In addition to this, it also makes use of motives as cues that furnish positive reinforcement (Hopkins, 2007). It motivates its consumers by making use of its advanced features provided through its stylish mobile handsets.

This model assists the company in marketing its handsets in the present competitive environment. For building up its brand loyalty the company displays its features and applications that are provided through its phones (Kardes, 1999). In this way, the use of this model depict that the company make use of learning approach to influence the behaviour of its consumers. Motorola tries to influence the purchase decision of its consumers on the basis of experience and learning (Theoretical Aspects of Consumer behaviour, n.d.).

The managers of the company relate the product with the internal drives of its consumers rather than external drives. It makes use of internal stimuli rather than external stimuli.

The company associates the internal drives of its consumers with the features of its products like advanced technology, high-tech accessories, inventive applications etc. All these words work as a stimuli for customers for reinforcing its internal drives (Theoretical Aspects of Consumer behaviour, n.d.). The use of this learning model is effective but not in terms of present day competitive environment as it is very much affected by external environment rather than internal stimuli or drives (Frank & Riedl, 2004).

The use of this theory has assisted the company significantly in segmenting its consumers on the basis of their different and diverse internal drive but in present due to this the company is facing severe competition and is losing its position in the minds of its consumers (Elliott, Auty & Eccles, 1995). Presently, it is essential to make use of psychoanalytical factors as these are the most affecting factors that influence consumers purchase decision (Singh & Goyal, 2009). The effective use of this model by Nokia depicts its importance and benefits.

The learning model applied by Motorola for driving the behaviour of its consumers was effective in past but now it has become outdated and due to this the company is confronting the situation of crisis. If company undertakes an analysis of its external environment and the factors that are affecting the decisions of mobile phone consumers it can substantially enhance its present position and the competition confronted from other mobile manufacturers (Kardes, 1999). By analysing the needs and preferences of consumers in relation to the trends followed in the industry, the company can develop excellent way to market its phones.

Analysis of internal as well as external stimuli that drive consumers towards mobile phones can assist the company in developing mobile phones by improving their innovation and technological advantages (Ratneshwar, Shocker, Cotte & Srivastava, 1999). The discussion of Nokia and its success in comparison to Motorola depicts that some of the present time substantial factors that affect a business performance are competitors, technology and suppliers (Bhutto, 2005). Till a company does not analyses these factors in relation to their consumers it will not be able to serve its consumers in the most advanced and effective manner.

The need of market analysis is vital for the success of a mobile phone company as nowadays the mobile phone industry is becoming more and more competitive with the entry of new players with new advanced features and applications (Singh & Goyal, 2009). In coming time, the consumers will be disposed with new generation mobile phones that will bring revolution and a complex situation for existing mobile phone companies if they didn’t updated and advanced themselves in every aspects of their operation.

So, with this discussion it can be said that Motorola need to modify its approach as in concern to learning model it should also make use of psychoanalytical model or various other advanced consumer behaviour approaches to approach its consumers.