Executive Summary
The BlackBerry series of phones are made by the Research in Motion (RIM). The BlackBerry phones target the business and professional people as their features made it possible for the owners to carry out a good number of office function through the devices. The BlackBerry phones have a strong presence in the market, and therefore, they are widely popularly.
Though RIM has been locked in court over infringing a number of patents, its technology is still away ahead of its rivals, and therefore, it still enjoys market popularity. RIM carried out aggressive marketing on behalf of the BlackBerry phones.
The pricing of the BlackBerry phones are dependent on the level of technology of a particular BlackBerry phone. In order for RIM to continue enjoying its popularity in the market, it will have to continuously adjust its phone prices in proportion to the value and technology level of the phones. RIM also needs to be at the top of the game in relation to the issues touching phone technology.
Introduction
There have been many innovative solutions for wireless communications that have been evolving in the recent years. Mobile phones have been considered one of the sectors that have witnessed numerous inventions where state of the art technologies are under constant implementations in the handsets that are manufactured by popular mobile phones manufactures.
This paper provides an environmental scan for Research in Motion (RIM) which is the company under which the BlackBerry portfolio falls and its associated services. The paper will define the market structure of BlackBerry and a detailed analysis of the marketing mix or programs and macro-environment trends as well as their effect on the competitive analysis of the product and their demand and market segmentation.
Project Scope
This project is mainly theoretical and will seek to evaluate the marketing program of BlackBerry. The report examines BlackBerry’s macro and competitive environment, its marketing program elements which it employs and the recommendations which can enhance its popularity. An analysis of the marketing environment of Blackberry based on the five porter’s forces is also included together with the SWOT analysis. The life cycle of the product is also given.
A critical response to the Introduction
Product Brand
BlackBerry is one of the mobile phones that have created a phenomenal brand in the mobile phone market. BlackBerry phones are well-known for their sleek look, design and style with other features. With BlackBerry, an individual can access email, data-transfer services and web serving.
In basic terms, BlackBerry handsets are just camera phones with the various functions that are required and are used by people of business class. Traditionally, it was launched and meant for the high class and the rich people but from its transformation and quality, some phones of BlackBerry brand are available for people of average class (Sweeny, 2009).
This has provided tough competition to its business competitors and other established players in the market. Players like Nokia, Sony Erickson and Motorola have developed better quality devices, but they have not reached or matched the feat of BlackBerry.
There are various types of BlackBerry phone models that have been introduced into the market. BlackBerry 7130G and BlackBerry pearl 8100 are the best and the most selling BlackBerry models in the international mobile phones’ market. The introduction of camera phones has been in high demand in the United Kingdom market.
BlackBerry was considered as a business phone and its introduction into the global market in 1999 confirmed this expectation because it built a strong presence in the mobile phone industry within the short period of time.
The success of BlackBerry was attributed to three main features: Technology looks and innovativeness and a lot of attention have been placed to strengthen these factors which have led to the launch of revolutionary mobile phone devices that attract the rich and the high-class segment of the population (Dictionary, 2012, p. 1).
Macro-environment Trends (PESTEL Analysis)
Economic Environment: there has been varied opinion as to whether the UK has emerged from the economic recession but the fact that the world stock markets have improved and that the earnings of many companies have improved are indications that the economy is growing. This will be reflected in the markets share and the sales of BlackBerry phones (Scribd, 2011, p. 6).
Social Environment: this includes the greening of technology, security threats and education level of the workforce. The pressure to create eco-friendly products has been both a legal and social issue, and it is likely to heighten due to consumer awareness on environmental pressures.
Lobby groups have stressed the role of electronic companies to clean up their acts due to the toxic nature of their components. On security threats, viruses and others malicious files and spy ware have a lot of social impact. Cyber criminals have taken advantage of the lee way that has been created by technological developments of BlackBerry.
Consequently, regarding the education of the workforce, UK has higher transition of students from elementary and secondary education into tertiary and higher education. This has the net effect of creating a more educated workforce and also because smart phone customers are the educated class, the market of the product is likely to increase (Sweeny, 2009, p. 4).
Technological Environment: Among the technological factors to be analyzed are mobile convergence, mobile payment technologies, the internet on the go and the diminishing of non-smart phones. Mobile phones are slowly growing as gadgets of electronic needs, and they are replacing newspapers and television since people are able to access information anytime.
Non-smart phones are slowly and naturally getting out of market; they will be phased out completely by the mass introduction of smart phones. The internet on the norm is becoming a norm in BlackBerry, and it is projected to increase in the near years. It is projected that the number of mobile phones that will be used to access the internet will exceed the PCs.
There have been also a lot of debates regarding the destination and the trend taken by mobile phones money payment, others have projected that it will grow steadily while others are skeptical. The convenience of using mobile phones to purchasing goods, paying bills and purchasing of digital items represents the new age of mobile convenience (Bikowski, Bryant, Crossin, Dillon, Giles, Lawson, McConville, 2009, p. 9).
Environmental Aspect: Environmental aspect has a lot of impact on the mobile phone industry because manufacturers have to comply with various environmental standards. RIM has in several cases ensured that their manufacturing is fair and eco friendly because any environmental mishap can destroy the image of the company in the global market.
Legal Issues: The operations of the company are secure, and it is very difficult to monitor or regulate, and this has made various regulatory bodies to contemplate banning its operations, which will impact on its business operations. Rim is also experiencing legal battles with various companies like Visto, and Motorola and these have had implications on the operations of the company.
RIM has also been locked in court battle with Minerva industries, which has accused it of infringing on its patent; MSTG has also filed a case of the same nature. All these have impacted on the performance of the company since settling legal issues is expensive.
Political Climate: The political environment in the UK has made the Smartphone industry to flourish, and BlackBerry is a beneficiary of this favorable political environment, and it is estimated that smart phones will overtake the feature phones by 2015.
The main challenge is the situation where some countries have raised concerns about the security features of BlackBerry, which emerges from the fact that it has become very hard for government authorities to monitor operations of BlackBerry phone users. There is also the political concern where UK with other EU countries has imposed strong regulations regarding the hygiene and the safety standards for various manufacturers who have negatively impacted on the operations of RIM (Scribd, 2012, p. 1).
Perceptual Map
Perceptual map is a demonstration of attributes that influence the consumer decision making which are later considered as focal points when designing the product or in the making of advertising decisions. Perceptual map indicates the strength of the firm’s brand and the features of the mobile phone that make it score and gain preference in the mind of consumers. The perceptual market map of BlackBerry phone (Mohr, Sengupta, & Slater, 2009, p. 255) is as demonstrated below:
Competitive Environment
The established competitors in the Smartphone market include apple, Samsung, Motorola, Nokia and LG. The competitive environment of Blackberry is an intense one because of its launch of new products and new brands from the already established ones.
What enhances the competitiveness of blackberry form its competitors is its development of black messenger that allows all the users with Blackberry to message each other all over the world without any charge. Rapid advertisements are also another strategy that allows Blackberry to survive in the very competitive environment hence giving it commercial advantage.
A reflection on Loop 1
Marketing Programs or Elements: Marketing mix Elements Employed
Marketing mix is a term that is used to describe all set of activities that make up the marketing programs of a firm. Among the various elements of a marketing mix are: place, product, people, process, physical evidence, promotion and price. Marketing mix is also considered to be the tools that are used to position the product into the target market.
Product
The RIM has brought a revolution into the mobile phone markets through the introduction of BlackBerry Smartphone. This was aimed at enhancing the depth of their products through the introduction of BlackBerry into their product line by creating a multimedia device that can satisfy the needs of their consumers. By enhancing the features of a Smartphone and the ultimate redesigning of BlackBerry, it is projected that it will attract a lot of customers and to dominate the mobile phone global market.
Customer decisions are based on the understanding of the product in the market; product offering is not the only thing but is considered as a total package of benefits that are obtained by customers.
The product is analyzed from the perspective of customer value, which is in turn analyzed based on the following aspect of BlackBerry mobile phones: their physical product and shape, the design style of the mobile phone, its brand name, the reputation of the company, convenience of the company’s operation and its financial plans.
The analysis of the product under marketing mix deals with the design, features, packaging, variation and brand quality and quantity. For a product to occupy a distinct place in the market, it should differentiate itself from that of its competitors. This can only be achieved by positioning the product in such a manner that the customers can be able to perceive the product differently.
Any element of the marketing mix can be used to realize a differentiated positioning. The RIM entity sells their products to the entire customers, but their distribution options may vary based on the market segment (OECD, 1997, p.12).
Price
Price is understood to be the value of money that is attached to particular product. It is through price the consumers can get to understand about the value of the product, its quality and status. The degree of price is determined by either demand or cost. The reference point of the pricing of BlackBerry will be pegged on that of its competitors.
For those consumers who desire satellite services; there will be a predetermined additional charge that will be added. Price factors in all the relevant costs of producing the product form the factory to the distributor and then the profit margin in included. Price is the sole determinant of demand of goods.
Place
Place is marketing program that touches on the channels of marketing, which are the mechanism with which the companies venture into the market and expose their physical presences in commercial activities regarding the mobile phone products. Distribution of the product into the market can be both direct and indirect.
Middlemen or third parties are considered reliable for distribution of the products and the best way of having them is to contract them. Distribution is the main channel of actualizing product availability in the market. BlackBerry products can be distributed through their dealers, global service carriers, BlackBerry promotional websites and agents.
Promotion
RIM communicates the utilities and the benefits of BlackBerry to its consumers by the use of tailored advertisement campaigns, viral marketing, internet marketing, offering exclusive offers to current and prospective customers and using social media channels (Gowda, Szabo, Choi, Hauk & Salt, 2009, p. 9).
Process
This is the primary element of marketing that is instrumental in the allocation of resources, identification of opportunities and crafting of development strategies. RIM has proper mechanism that facilitates the handling of complaints and identifying the customer needs. The RIM Company has a well-planned process that defines how the customers receive their services and access the goods and for feedback mechanisms.
Physical Evidence
Research in Motion has opted to provide offers to elicit excitement form the customers about the BlackBerry product; RIM also guarantees warranty and has provisions for after-sale services as a show of support and care for their products and the customers. This will also make the customers to develop a better picture about the RIM products.
People
Research in Motion trains its employees on tactics of being customer centered to enable them to build good attitudes when dealing with the customers. They also employ people form the host country because they know the habits and the preferences of the native customers (Lamb & Hair, 2009, p.47).
SWOT Analysis
Strengths
Blackberry has managed to keep the UK consumers to be conscious about their products. Their strength is due to their market share that exclusively comes form the business world and other IT professionals. From an IT perspective, no competitor has managed to emulate the Blackberry Enterprise server that is only excusive to the Blackberry phone. Blackberry has attempted to garner an expansive market by upgrading the looks and the appeal of their products to attract more customers.
Weaknesses
RIM depends on business operators to launch its Blackberry services, this is time consuming and the costs can be high for smaller operators. Their Network operating centre can be considered to be a weakness today. Another weakness is also the high costs of ownership since it has been considered to be high end product and hence costs effective.
Opportunities
One of the greatest opportunities lies in the Blackberry partners that help create downloadable applications form independent company. Blackberry had been slow in venturing this market which had been dominated by Apples iPhone and by embracing this it will be able top embrace the widely growing market.
Threats
With the production of Smartphone by other electronic manufacturers like Nokia, LG and Samsung, Blackberry is facing a lot of threats particularly due to its weakness the web interface (Lion & Green, 2006, p. 2).
Porters Five Forces
Threat of entry: among the threats of entry is huge capital demand like manufacturing costs and the constants for rapid innovations and high costs that may be aimed to driving profits high.
Supplier power: there are various sources of mobile operating system providers and hence plenty of options. This has the effect of lowering the bargaining power of software providers. The same scenario applies to the hardware providers.
Substitute: the influence of substitute is a reasonable level and proportionally varies with similar goods. Other formidable substitutes are PDA and table PCs are viable substitute.
Buyer power: there is a high bargaining power of the buyers due to the choice of the products with limited differentiation. There is also an elastic demand which is sensitive to the economy where buyers can delay the buying of new models.
Rivalry:there is a high rivalry in the smart phone market because there is minimal product differentiation which is only based on the services offered and the applications. The exit barriers are low for manufacturers particularly those on the value chain.
Complements: complements are considered to be critical to the development of a product and have a low or rather moderate bargaining power. This can be subsidized by increasing the network capabilities. Its complements are Maps and GPS, applications and e-mail (Lion & Green, 2006, p. 1).
Product Life Cycle
This consists of the five main aspects which included product development, introduction, growth, maturity and decline. This is illustrated in the following chart.
In the chart, the red graph is adopted to explain the life cycle of Blackberry. At present, the Blackberry is entered the maturity phase. The introduction phase was carried out in 1997 to 1998. At this time, Blackberry was the only smart phone and therefore it registered a rapid growth as it provided a ready solution to corporate clients.
Private users have also joined the client base. Introduction phase can be said to have stretched from 1998 to 2004/2005. RIM registered huge success from 2005 to 2011. Due to the many entrants into the Smartphone arena, Blackberry has been forced to enter the mature stage.
General and Justified Recommendations
The desire to make sales and derive a lot of profits from it is the primary objective of several firms, and the amount of profits from the revenue base of the organization.
Due to the fact that is the main component of marketing mix, companies may be tempted to utilize it in gaining competitive edge over their rivals. Blackberry has applied strategies such as increasing the quality of their products, creating good consumer relationships and performing consumer education regarding their products in order to meet the price demand of its competitors.
In the modern competitive environment, the mobile phones’ market has grown to be one of the consumer oriented and one driven by products. With the changing trends in shopping patterns and customer behavior, mobile phone investors, services providers and manufacturers need to place a lot of focus on multi-marketing approach in order to increase their sales and profits.
Customers have been fed up with the common and popular mobile phones brands hence there is a need for the players to enhance their technological tactics. In order to enhance their profitability, there is a need for a consumer-oriented marketing strategy that can preempt the marketing strategies of its competitors.
In order to successfully increase their profits, RIM, should adopt balance between marketing and pricing.
Pricing Strategy
Pricing of BlackBerry is one of the delicate matters. It has been established that business owners and executives are reluctant to pay more for a gadget that lacks clear impression of how it will enhance their business.
The strategy of pricing is a critical element because it concerns the positioning of the product in the market the level of pricing is dictated by such elements as the phone features, advertisements and channels decisions.
An efficient and effective strategy of pricing can emanate from the following processes namely the development of a marketing strategy, undertaking the calculation of costs and making relevant marketing mix decisions.
Marketers make the prices of their products in a way that is likely to receive a fair value because price is considered a parameter under which the customers rate the product, and it can be also used to reflect on the practices of particular organizations.
Care should be taken, and mechanisms of cost should be applied in determining the price of BlackBerry. BlackBerry is a customized product and therefore, has a competitive edge over its rival products because no product can act as its perfect substitute. The better pricing of BlackBerry will create the impression that it is a sophisticated product and different from other mobile phone gadgets (Mobile Beacon, 2011, p. 1).
Marketing Strategy
Increasing their marketing development strategy encompasses the offering of BlackBerry phones and devices in the market segment where their competitors dominate. This can also be enhanced by co branding using popular and established software companies. There is also need for the introduction of an effective and efficient customer care centre for their green marketing initiative and software matters.
There is also the adoption of market development strategy that will enable BlackBerry to reach to other new or potential markets. There is a massive untapped market for Smartphone particular the lower cadre social class which can be a ready and lucrative market for the RIM thus the introduction of BlackBerry at a cheaper or affordable price or in various price points is considered to be profitable.
BlackBerry or RIM should adopt the principle that with the introduction of new models of the phone, the old ones can be sold at discounted prices. There is also need for BlackBerry to, manufacture blackberries that have similar sleek look but with few features so as to increase the depth of their products and to be able to capture the middle-class population and students or teenagers.
BlackBerry should also employ market penetration strategy that will increase their revenue base and enable them to attract new customers. This can be realized through enhanced sales promotion and advertisements; they can, for instance, provide their existing customers and especially family members or their children with discount since they can form part of the potential market (Bikowski, Bryant, Crossin, Dillon, Giles, Lawson, McConville, 2009, p. 3).
There is a need for BlackBerry to be marketing through the application of Robust marketing strategy that is aimed at increasing the market share of the company. One of the means of increasing the market share is through advertisements by used of newspapers, magazines, business journals and in business news and channels; these advertisements should deliver the nutshell of the exclusive features of BlackBerry while excluding the pricing to avoid the mental set among customers that it is expensive.
For the company to increase its market size and profitability, good marketing strategies and marketing planning are essential. It is important for Research in Motion to write down a perfect marketing plan while examining the business environment. A good marketing plan should contain current and potential marketing focal points to exploit (Silk, 2006, 19). Good marketing strategies endear the products to the market and have the net effect of enhancing the volume of sales.
The marketing manager should place a lot of focus on the resources of the organization like costs of production, the brand image, employee capability, available technology and financial resources. Analysis of marketing environment is necessary since they directly affect the organization or might hinder the implementation of the organizations’ marketing plan.
This is referred as environmental scanning, and it serves to identify the market threats and the opportunities that are necessary in the designing of the market strategy. In the UK markets, the brand and product name is very important in terms of the brand image, and all that accompany it.
In the case of BlackBerry for example, the brand image begins from the technological design of the phones, and the features that the phone has and also its maintenance costs and the safety standard as well as the way it is presented in advertisement and sales promotions (Lamb & Hair, 2009, p.34).
Appendix
References
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