SWOT Analysis

SWOT Analysis of Nokia

by Faizul Haque

The SWOT of Nokia elaborates the strength & weakness of, opportunities & threats for Nokia Corporation. It will provide an overview that will elaborate discussion around the company’s strategy and situation. This analysis can be used to evaluate the position of their business. This can be used to guide the overall business strategy session of Nokia. It also can be used to go deep into a specific segment like Marketing, production, and sales.

Nokia Company Overview

Nokia is a Finnish technology and multinational communication company. It’s headquartering in Espoo, Uusimaa. In 2014, Nokia employed 61,656 persons all over the world. It reported annual revenues of around €12.73 billion by conducting sales in more than 151 countries. Being a public limited liability company, listed on the Helsinki Stock Exchange and NYSE, it became the world’s 274th-largest company measured by Fortune Global 500 in 2013.

In 2013, Microsoft announced it would be acquiring Nokia’s phone’s business. Stephen Elop, Nokia’s former CEO, and several other executives joined the new Microsoft Cell phone subsidiary of Microsoft as a part of the deal, which was completed on April 25, 2014. In November 2014, Nokia started licensing product designs and technologies to third-party manufacturers, to enable a continued presence for the Nokia in consumer electronics hardware market.

 SWOT Analysis of Nokia Corporation

The analysis will elaborate on the internal and external strategic analysis of Nokia. It can be a great addition to a further analysis of the company.

The Strengths of Nokia

  • Experience Base
  • Expertise
  • Knowledge of Customers
  • Distribution Network
  • Reputation
  • User-friendliness of Smartphones
  • High resell value

As one of the oldest companies, Nokia has gained several strengths in the field of technology. First, I will talk about the experience base. Nokia is one of the oldest companies in the world. As an old company, it has leading experience in the field of communication and technology. It was founded in the year of 1865 which tells us that it is a 151 years old company. Through this time, it has gained strong experience and knowledge about the markets around the world. Second, Nokia possesses the most experienced and technologically advanced people in its workforce. In the field of mobile and smartphones, it had gained a strong reputation for providing quality handsets. Without an efficient workforce and expertise, it would not happen. In the 1990s, there Nokia was an emperor in the field of technology.  Third, Nokia has been providing different types of products to its market and have also been taking customer feedback. By this, they have been developing strong knowledge-base. Fourth, Nokia has a large and strong distribution channel. To distribute its products through the countries of South Asia, it has set up customer care points and retail shops to sell its mobile phones. But still, the largest distribution network is not that much strong. Fifth, Nokia manufactures and distributes durable products. By providing quality products, it has developed a strong reputation on durability. They have a long-lasting reputation for a long period. Sixth, in mobile phones, they have a huge number of user-friendly accessories. And finally, the products they produce and sell have a long-lasting reputation. As a result, the resell value remains high. So, when a person by a product from Nokia, they know they can sell it at a high price if they need to do it in future.

 The Weaknesses of Nokia

  • Slow reaction to the competition
  • Poorly Designed Smartphones
  • Low performance of Smartphones
  • Poor After-Sale-Service
  • Low Sensitivity to Industrial Changes

Nokia has also some weaknesses for which it has been suffering in the technology sector. The first weakness is that it is slow to react to the competition. In the growing marketplace, they are very slow to take an initiative to be more competitive in this sector. Also, they have not taken the competitions created by small companies in the field. The second weakness is the low sensitivity to industrial changes. They are not very much sensitive and responsive to the new changes to user expectations. Fourth, Nokia sells poorly designed smartphones. These handsets did not allow them to attract more new customers. Most of them are not very much attractive unlike that of HTC, APPLE, or Samsung smartphones. Fifth,  they manufactured and sold low performing smartphones at the beginning of the introduction of a smartphone period. These phones were not very high in quality. And finally, the company does not offer quality after-sale-service; they had very few service centres.

 The Opportunities for Nokia

  • Ever growing Market
  • Growing Demand for Smartphones
  • Development of Underdeveloped Countries
  • Adaptation of Android

As other companies do, Nokia also has many opportunities to grow their business further. As we considered the mobile phone segment of Nokia mostly, we will be talking about the opportunities of this segment as well. The topmost opportunity for Nokia is that the smartphone market is ever-growing. The smartphone market is growing vastly day by day. So, there will always be big opportunities to have a large market to sell the products. The second weakness is related to the first one. Third, the adaptation of the Android operating system in the place of Symbian can give it more successful. And finally, the demand for smartphones is at the edge. Finally, Nokia had a strong image of its products as it is an old company. So, there is already a demand for Nokia phones.  If it again starts to produce smartphones, it will be able to make a better profit.

 The Threats for Nokia

  • Stronger Competitors
  • iPhone’s Popularity
  • Samsung and other Competitors
  • New Entrants

When we first published the Nokia SWOT in October 2015, we talked about a few threats which have become true now. We talked about increasing competitions and new entrants.  Now we have emerging competitors such as Oppo, Meizu, & Xiaomi. The first and foremost threat to Nokia is that these companies are becoming strong competitors. They are spreading their businesses all over the world. The near competitors like Apple, Samsung have become the market leaders. So, Nokia has a huge threat that it will have to face. The iPhone has the most popularity. iPhone gained the most popularity in the term of new technology, and quality. Companies such as Samsung, HTC and other big manufacturers are getting the strength of the Android operating system. Finally, there are new entrants in the market. Many new and strong competitors are emerging, so the market is becoming more and more competitive.

In Conclusion

The SWOT of Nokia Company elaborated the strengths & weaknesses of and opportunities & threats for Nokia Corporation. After conducting the analysis we now find that the Nokia was a very reputable company, and still has a strong reputed customer history. It can make its way in the market of smartphones.  Currently, Nokia Mobile is going through its difficult time but those can be overcome within a short time if new strengths are developed and the potential opportunities are utilized properly.

Competitors’ SWOT

References