Month: October 2012

Enrique’s blog post about Coca Cola’s reason for success being not only the fact that they were the first in their market but also to their constant desire to grow, made me think of the importance of market research to analyze consumer behaviour.

As Enrique mentioned, ever since Coca Cola was created it has successfully gained the largest market share in the market of fuzzy cola drinks due to their effective and cleverly-thought-out advertisements. These marketing techniques must have been  made after a rigorous process of market research. The importance of conducting a market research can’t be stretched enough. Consumers are unpredictable and often act inconsistently, however, when analyzed in larger groups they tend to show patterns of behaviour. Therefore, market researchers are able to identify the consumer behaviour and try to understand their way of reasoning. This is useful to determine the company’s business plan as well since it helps them take decisions about which should be their short term and long term goals.

Therefore, we can say market research must be conducted in order to withstand the fierce competition in highly competitive markets such. As Enrique said the sole fact that they were the original brand (“The Real Thing” ad), there is never guarantee to rule the market share forever.

Can’s blog post about Nokia loosing profits in the first quarter of 2012 due to the high competitive smartphone market reminded me of the concept of brand positioning and value propositions.

The smartphone’s market has some huge companies such as Apple and Samsung which launch innovative and even ‘revolutionary’ products every once in a while. Thus, it is very hard for Nokia to find a spot in the conceptual map of consumers. Its market share decreased from 40% a couple of years ago to 10%. Therefore, it is clear that consumers are appealed much more towards the point of differences of the competitors than to those of Nokia. This is probably the reason behind Nokia’s decision to change its  mobile operating system from Symbian to Windows Phone software, made by Microsoft. The extremely high competitiveness forced them to try to innovate their products too. However, this strategy was clearly unsuccessful since instead of gaining more market share, consumers disliked the change of software in the new product Lumia and so sales dropped significantly.

It is very likely that the demand for Nokia’s phones stays low for a long time since it is is extremely difficult to change the conceptual map of consumers regarding a product, once this has successfully established itself.

Apple’s new iPhone 5 was released for sale in the US and Canada on the 21st of September. Analysts expected a 6-10 million iphone 5s sold in the first weekend but this number was confirmed to be only 5 million. Apple’s CEO Tim Cook said this was due to a shortage in the supply. Although we may not know the holiday quarterly earning until January, it can be safe to assume that the demand for Apple’s newest product will keep growing and provide it with billions of dollars.

The reason behind this lies on the fact that Apple is probably the company with the most brand loyal consumers in the world. The brand positioning of Apple in the conceptual maps of the consumers is quite strong. Consumers are willing to pay Apple’s high prices since they have the habit of making each new product they launch highly innovative. The image Apple seeks to depict to consumers is that of a premium brand selling premium products (“Think different” ad). Thus, even though the new iphone 5 has only a couple of new features than the previous iPhone 4s or the other competitors’ ones, Apple’s fans will still feel the “need” to buy the product.