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The use of electronic communication
Electronic Commerce is the use of electronic communication to do business. It means as commercial transactions involve the production, distribution, sale and delivery of goods and services that are carried out over open networks like the Internet (DigitSmith, 2006). Nowadays, the huge success of commerce on the Internet, electronic commerce usually refers to shopping at online stores on the World Wide Web, when the customer and the merchant are in different geographical places. Besides, E-commerce operates via the Internet using all or any combination of technologies designed to exchange data, access data, and capture data. For example, customer and merchant's can exchange data in every single time or place by using via e-mail.
Currently, E-commerce provides many new ways for businesses and consumers to communicate and conduct business in this new era. The Internet is a valuable communication tool which offers small business with a great opportunity to market internationally and reach a global client base. Through internet, allow some businesses to remain small while building a larger turnover by reducing the cost of doing business. For example, a greengrocer provides a service for people to order fruit and vegetables over the Internet and to have those items delivered at a cost competitive price; as a consequence people who would not normally shop in that area have become a rapidly increasing market.
Besides, electronic commerce can provide many benefit or advantages over non-electronic communication which are (1) reduced cost, (2) reduced time, (3) flexibility with efficiency, (4) Enhanced Long-Term Trading Partner Relationships, (5) Lock in Customers, (6) New Markets. Therefore, e-commerce has a potential to expand a business or company into wider geographical locations with a necessary production capacity and distribution channel to support the market demand in the larger marketplace (iSoS, 2007). For example, the company or organization has ability to handle complex situation, product range, and customer profile without the situation becoming unmanageable. Therefore, company or organization is able to perform or manage well in this competitive environment. As a result, based on the mentioning explanation, E-commerce is very important for an organization or company to generate by promoting their business in this new era.
Referencing - electronic sources
1) DigitSmith, 2006. E-commerce Definition and Types of Commerce. [online] Available at: http://www.digitsmith.com/ecommerce-definition.html [Accessed 23 November 2009].
2) iSoS, 2007. Advantages of E-business Application. [online] Available at: http://www.isos.com.my/ecommerce/advantages.htm [Accessed 23 November 2009].
Cell phones have become a necessity for many people throughout the world. The ability to keep in touch with family, business associates, and access to email are only a few of the reasons for the increasing importance of cell phones. Today's technically advanced cell phones are capable of not only receiving and placing phone calls, but storing data, taking pictures, and can even be used as walkie talkies, to name just a few of the available options. Nokia Company, as a part of largest mobile phone company in the world, engaged in the manufacturing of mobile devices and in converging Internet and communications industries. Since 1985, Nokia is founded by Fredrik Idestam at Tampere, Finland. It consider as a telecommunication, internet and computer software industries that covered worldwide. It produces mobile phone, smartphone, mobile computer, and network all over the world.
Target market is defined as the market segment which a particular product is marketed to. It is often defined by age, gender and or socio-economic grouping. Market targeting is the process in which intended actual markets are defined, analyzed and evaluated just before the final decision to enter is made.(Kapoor, 2009) Nokia Company has come out a process call Nokia segmentation study. It divided its market in few level that include the classification relies on lifestyle, income levels and intended usage. Nokia Company has chosen it own target market that can bring a lot of benefit and profit to the company and is not only for now, but trying to continue contribute in future time. Just like target their market at all countries over the world that potential as mention above for example USA, China and other potential countries to expand its business.
Besides that, by looking into the age of the consumers, like targeting the teenagers that have more interest in new and modern functions product; middle age adults and some more the old age adults. All this customers have their own different demand; Nokia Company has to differentiate their demand well so that it can successfully satisfy the need of consumers in order to get the profit. For example, just like what we mention above, teenagers are more prefer to have a multi function cell phone like walkman phone that provide a well music sounds system. Furthermore, 3G function that provide on screen chatting also can help to attract certain type of consumer. So, it is important to set up the target market by Nokia Company.
In the world of electronic commerce, Nokia Company is only one part of them. A lot of competitors have come out in the same industry making a lot of competition among them days to days. Nokia Company has to face various types of macro environment difficulties and problems since it is in the market. First of all, political environment which consists of laws, government agencies and pressure group that influence or limit various organizations and individuals in a given society. (Clapp, Dauvergne, 2005) From this book, it shows that government is trying to green our earth from now onwards. As one f the electric commerce industry like Nokia Company, it will has to follow the policy set by government by producing the product related. For example, Nokia has decide to become a green explorer and some more provide recycling service to its customers in order to follow the policies set.
Next, as an electric commerce industry, technology is the main power that has to fully control by Nokia Company. However, in this condition, Nokia Company has to face the technological environment which is one part of macro environment. As in (Kurtz, 2009), technological environment represents the application to marketing of knowledge based on discoveries in science, invention ad innovation. We know that in this 21st century, technology has making improvement in every minute every second. Everything is getting modern and modern, including cell phone. Last time, cell phone has only one function just can use for calling. Now, technology has helped the cell phone to become a tool that can taking picture, listen music, storing data, and even recording video and sounds. For example, Nokia Company has produced the cell phones for more functions that are useful and reliable for customers and even smaller sizes phone for customers as it brings convenience to them.
Besides, Nokia's large market share in developing markets such as India, which have been insulated against the full extent global economic recession (Parker, 2008), has provided Nokia with a financial advantage over its competitors. However, according to Nokia Company, 37 percent of sales originate from the European market which is heavily affected by the global economic crisis. This has affected the ability of customers to purchase reduced profits and has lead to reduced R&D budget. China is the largest market by sales and India is predicted to become the second largest market by 2010 (BBC website, 2007). Africa, South America and Eastern Europe are also growth markets. Nokia's experience in developing markets may provide a competitive advantage over competitors who are only just beginning to venture into what is relatively unknown territory. The fact that Nokia has existing distribution channels combined with competencies such as knowledge, understanding and experience of these markets for example India, China and South America, will provide a competitive advantage over their competitors. Further, Nokia's ability to keep costs down through economies of scale and effective operations means that high margins can be maintained even in the face of price competition.
As a conclusion, setting a profitable target market by producing profitable product and well defined the organization macro environment can help the Nokia Company to make sure it can successful in this electric commerce industry. This is the mains key for Nokia Company to become the largest mobile phone company in the world.
Referencing - textbooks
1) Clapp J., Dauvergne P., 2005. Paths to a green world: the political economy of the g lobal environment. United State: massachusetts institute of technology.
2) Kurtz D.L., 2009. Contemporary Marketing. United State: South-Western Cengage Learning.
Referencing - electronic sources
1) BBC website. 2007. India now Nokia's second market. [Online] Available at: http://news.bbc.co.uk/1/hi/business/6960520.stm. [Accessed 27 November 2009].
2) Parker, A. 2009. Nokia vows to exact revenge on rivals. Financial Times. [Online] Available at: http://www.ft.com/cms/s/ [Accessed 26 November 2009].
Nokia and Apple iPhone are a company known around the world for mobile, wireless, and broadband communication. They helping users to get and stay connected to the people, information and entertainment in the whole world. Today, the major marketing management decisions can be classified in four categories which are product, price, place, and promotion. These variables are known as the marketing mix or 4P of marketing. The marketing mix work together usually determine how to sell a product or service well (McCarthy, E.J., Cannon, J.P., & Perreanult, W.D., 2009). It is used by the mobile phone marketer to reach different part of population. The mobile phone industry divides the population into demographic groups such as age, race, gender, occupation, income, geographic region of the country and other statistics. Besides, the mobile phone industry also mixes different kinds of product, price, place, and promotion to reach each different demographic group (Kotler, P., & Armstrong, G., 2008). For example, a stylish mobile phone with high technology or function will be attached young customer market. This will be a potential target market because young teenagers or adult in the global community want to be up to date with technology. Therefore, marketing mix is the best strategic framework that marketer implement to have competitive advantages in the market.
Product defined as anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need. In this way, creating the right product is an essential first step in a successful marketing mix (McCarthy, E.J., & Perreault, W.D., 1990). Nowadays, Nokia and Apple iPhone main products are mobile phones which are allowed users easier to stay, connected or share with people. The Nokia is a leading brand in mobile communication and mobile phone supplier. In recently, Nokia has designed a new mobile phone named as Nokia 5800 XpressMusic. Nokia XpressMusic series has been widely famous for its great music quality. Besides, Nokia XpressMusic also pushed in a new online music store and come in with a one year subscription to download unlimited songs. This mobile phone comes in with a 3.2 Mega pixel camera with Carl Zeiss Optics & Dual LED Flash. It also has a 3.2 screen with a high resolution of 640*360 and offer multi touch screen which are gives users better choice on the input method. In addition, its can claim up to 35 hours of music and standby 9 hours of talk time. Moreover, video recording is another common feature of a Nokia mobile. Users can record videos with the standard Nokia application and able to make video call through this phone. It also comes with an 8GB Micro SD Card, so it is definitely better because upgrading memory would be very cheap and easy. Lastly, Nokia units come with a standard one year warranty for part or functionality and six month for battery (Phonegg, 2009).
On the other hand, Apple iPhone 3G most recent release of the iPhone series has met real competition with the new release from Nokia. Apple online music store, iTunes has been a major player for their music advance, but their music qualities and online integration have made them really popular in term of music. The iPhone 3G is offers finger touch as the input method. It has a small resolution on the big screen because the iPhone 3G just only provide 3.5 screens with a resolution of 480*320. Besides, an iPhone came in a 2 Mega pixels camera and without Carl Zeiss Optic. In addition, it has up to 24 hours of music but other technical specifications regarding the battery life are below the Nokia 5800. Although the iPhone is capable of playing some video formats but some services have to be installed whereas they come pre-installed in Nokia 5800. Warranty period of Apple hardware product is under one year from the date of user purchase (Phonegg, 2009).
Presently, price is one of the major variables of the marketing mix, and the only one that considered as pure revenue generating. Price can be defined as a measure of the value exchanged by the buyer for the value of the product or service offered by the seller. The main objective of pricing decision is to maximizing profit and increasing market share (McCarthy, E.J., Cannon, J.P., & Perreanult, W.D., 2009). Nokia and Apple iPhone are in the oligopolistic competition because it is difficult for other new sellers to enter the mobile industry. It means that the market consist of a few sellers who are highly sensitive to each other pricing and marketing strategy. Therefore, each seller or merchant is alert to competitor strategies and moves (Kotler, P., & Armstrong, G., 2008). For example, the Apple iPhone 3G price ranges from RM2540 to RM2960. This can be considered as extremely expensive as the teenagers or young adult market will not be able to afford it. Therefore, Apple has tried to put the prices as low as possible to target the teenagers or young adult market (edwardkhoo, 2009). On the other hand, the Nokia 5800 has similar features as the Apple iPhone 3G but the price range only set from RM1040 to RM1070 (mobile88, 2000-09). In this way, Apple Company desired to adopt good-value price that offering just the right combination of quality and good service at a fair price. In recently, Apple Company decreased the base price from $199 to $99 in United State because the whole world economic was facing crisis. As a result, they set prices at competitor's level to stabilize the market (Apple, 2009).
Thirdly, place represent the location where a product can be purchased. It is often referred to as the distribution channel which is a process of moving goods from manufacturer to retailer or customer (Groucutt, J., Leadley, P., & Forsyth, P., 2004). Nowadays, Internet shopping is become popular and many people especially the younger generation are purchasing products online. Therefore, direct selling of the Nokia and Apple iPhone is available on the internet. For example, the Nokia 5800 XpressMusic is available to buy on Nokia website as well as a range of internet mobile shops such as Phones 4 U and Dial a Phone. Phone 4 U and Dial a Phone are usually able to offer customer at better price compared with retail outlet (Phones 4 U, 1996-2009). Besides, Nokia and Apple iPhone also provide other product and services for customer to purchase in phone online such as download software or games (Apple, 2009). Moreover, the Nokia 5800 and Apple iPhone 3G is also available through the retail outlets. They purchase the products from Nokia and Apple and then sell it to the customers. Currently, Nokia and Apple iPhone have found a new distribution channel is super market which is self-services store that carries a wide variety of grocery and household product. For example, the Tesco hypermarket is selling Nokia and Apple mobile phone in their entire branch. Therefore, customer is easier to buy or find a Nokia or Apple product in everywhere.
Lastly, promotion represents all of the communication that a marketer may use in the marketplace. It consist of the specific blend of personal selling, advertising, public relation, sales promotion, and direct marketing tool that the company uses to persuasively communication customer value and build customer relationship. Personal selling of the Nokia 5800 and Apple iPhone 3G is in mobile phone shops. Personal selling and trade promotions are often the most effective promotional tools for Nokia and Apple (Kotler, P., & Armstrong, G., 2008). For example, offering subsidies on the handsets to encourage retailers to sell higher volumes. Besides, staffs are trained to learn information about the phone so that they can offer help on any queries of the customer. The Nokia 5800 and Apple iPhone 3G is also advertised on magazines and newspapers. Besides, celebrities also will use the Nokia 5800 and Apple iPhone 3G in adverts and films. In addition, direct marketing of Nokia 5800 can be bought directly form Nokia website. Nokia allowed customers to phones online to see other products and services that they offer such as downloading software and games (Nokia Connecting People, 2009). Therefore, younger generation may find quicker and easier just to buy a product using the internet especially now as most internet shops provide three day delivery guarantee. Moreover, sales promotion of Apple iPhone 3G will offer the 8GB and 16GB iPhone 3G models with four new and specially designed postpaid plans called iValue by Maxis which are voice-data bundled price plans starting from RM100 per month.For customers who sign up for a monthly commitment of RM375 over a 24-month period on the iValue 4 plan, the iPhone 3G 8GB will be free of charge (Maxis, 2009).
Currently, software that they applied into the mobile phone between the Nokia and Apple iPhone is the biggest differences between both companies. The Nokia Company still sticks to the Symbian OS while the Apple iPhone has its own OS that is based on Apple's OS X for Mac. Besides, the price that set by the Apple Company is much higher that the Nokia Company but the feature of the mobile phone between both companies are similarly same. For example, the price range that set by Apple for iPhone 3G from RM2540 to RM 2960, while the Nokia Company only set the price at RM1040 to RM1070 for the Nokia 5800 (Apple, 2009) & (Nokia Connecting People, 2009). The price differences exist in both companies because competitive landscape may influence customer price sensitivity. Therefore, easy product comparison helps customers to assess the value of different options and decide what prices they are willing to pay. In this way, customer will be more price sensitive that they can switch easily from one product to another if it has a lower price. The place and promotion of the marketing mix that they used were totally similarly to each other. Both companies also used advertising, personal selling, direct marketing and sales promotion as their promotion tool (Mccarthy, E.J., Cannon, J.P., & Perreanlt, W.D., 2009). For example, they promote their new mobile phone by advertised in magazine or newspaper. Therefore, customer can get very first information or recognize about their company product by advertising. In addition, customer can purchase or buy their company product or accessories through internet, retailer outlet or supermarket in the whole world.
As a conclusion, Nokia and Apple have put together a successful marketing mix to ensure achieve the customer value and satisfaction.
Referencing - textbooks
1) Cannon, J.P., McCarthy, E.J., & Perreault, W.D., 2009. Basic Marketing: A Marketing Strategy Planning Approach. 17th ed. New York: McGraw-Hill Publishing Limited.
2) Groucutt, J., Leadley, P., & Forsyth, P., 2004. Marketing: Essential Principles, New Realities. 1st ed. Great Britain: Kogan Page Limited.
3) Kotler, P., & Armstrong, G., 2008. Principles of Marketing. 13th ed. America: Pearson Publishing Limited.
4) McCarthy, E.J., & Perreault, W.D., 1990. Basic Marketing: A Managerial Approach. 10th ed. Japan: Richard D. Irwin, Inc.
Referencing - electronic sources
1) Apple, 2009. iPhone. [online] Available at: http://www.apple.com/asia/iphone/ [Accessed 25 November 2009].
2) EdwardKhoo, 2009. Apple iPhone Price in Malaysia. [online] Available at: http://edwardkhoo.com/apple-iphone-price-in-malaysia/ [Accessed 25 November 2009].
3) Maxis, 2009.Choose the Right iPhone 3G Plan. [online] Available at: http://www.maxis.com.my/iphone/rateplan1.asp [Accessed 26 November 2009].
4) Mobile88, 2000-09. Nokia 5800 XpressMedia. [online] Available at: http://www.mobile88.com.my/cellphone/Nokia/Nokia-5800-XpressMedia/index.asp [Accessed 25 November 2009].
5) Nokia Connecting People, 2009. Nokia Online Support. [online] Available at: http://www.nokia.com.my/get-support-and-software/product-support [Accessed 26 November 2009].
6) Phones 4 U, 1996-2009. Nokia Connecting People. [online] Available at: http://www.phones4u.co.uk/Nokia/ [Accessed 26 November 2009].
7) Phonegg, 2009. Nokia 5800 vs Apple iPhone 3G. [online] Available at: http://www.phonegg.com/compare/24/Nokia-5800-vs-Apple-iPhone-3G.html [Accessed 25 November 2009].
In conclusion, marketing environment and marketing mix is important for a company or organization to target a market in this new era. Through marketing environment, marketer can easier understand of the nature and scope of the internal and external marketing environment with broad consideration of the impact of international or global marketing. On the other hand, mixing of a variety of factor in marketing mix or strategies can reach all different type of customer groups as well as the organization objectives are reached. Therefore, marketing environment and marketing mix can greatly enhance the opportunities for success when a product or services offer to the market.