Know why Nokia failed: Key causes

why nokia failed
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This post is a citation of a phrase that ” days don’t remain the same for everyone”. And Nokia works a good example of this phrase as once a dominating mobile phone player vanished from the market. In this article, you will get to know the prime reasons behind why Nokia failed? How it actually lost its market share and position from the entire mobile phone market and turned into a big failure.

Nokia was once among the top mobile phone brands that were widely preferred by people throughout the globe. And during its early days of launch, it has impacted the phone market so strongly that people recall the term mobile as Nokia. For instance: If asking someone do you have a mobile, they use to call that do you have a Nokia.

Early days to Nokia’s success

Nokia from being a diversified brand that deals in rubber, paper, communication cables, and plastic products shift itself into the telephone industry in the late 1970s. And very soon it captured the major mobile phone share by being one of the best mobile phone company in the world. 

It was also the first mobile company to introduce a handheld GSM device in the market. Being a first entrant with a handheld mobile phone technology, Nokia lifted its brand to new heights of success. It managed to build a positive perception in the minds of the customers by launching a handy, sleek, and multi-featured phone.

You may have seen or used Nokia’s first 1011 phone and at that time it was the first unique multi-feature mobile phone. And people blindly followed all the product line under the same model and give a purpose to the success of Nokia. It enjoyed remarkable growth and demand for its products till the early 20s. After that, there were a various set of reasons and factors that sets responsible for why Nokia failed?

Why Nokia failed?

In this we have laid down some of the prime causes that have contributed to the downfall of this rising mobile phone brand:

Lack of innovation– Innovation gives an advantage to our products or services. It sets one apart in this competitive business environment and Nokia was missing in this trait. It was not able to cope with the brands that were bringing innovation in mobile devices. Although it was the first company to introduce handheld mobile devices and also the first 3G compatible phones in the market. 

But at the later stage, it failed to take part in the race of advancement and innovation that other brands like Apple, Samsung, and LG bring in. Nokia was sharing basic features that were quite outdated and lack advance & attractive features. Due to its slow move in innovating its features and technology, it vanished from the consumer’s wishlist.

Change in management– A management is that constituent of a business that is responsible for the proper functioning of the business and its work structure. A frequent change in the code of conduct will definitely adversely affect the business in the long term. It harms the employee’s compatibility and ability to do well. 

With the arrival of new leadership, the way business was done by Nokia earlier was changed totally. Now, the strategies and decision making becomes ineffective also a large part was invested in planning the new technologies & features rather than implementing on gadgets. A delay in the fast adoption of new features resulted as one of the reasons why Nokia failed?

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Joining hands with Microsoft– Nokia decided to join hands with computer software company Microsoft. And it was decided that Nokia will look after the hardware development of the mobile phones while Microsoft will produce the operating system for the phones. 

Despite knowing the taste and preference of the customers Nokia starts pushing its Microsoft based smartphones in the market. Ultimately failed to convince the customers to buy their smartphones because their phones were lacking in the features and applications that were offered by Android and IOS devices. And the small share in the mobile phone market that was previously held by Nokia was now slipping away.

Competitors in the market– The mobile phone industry was not much affected by the competitors in the market during the rise of Nokia. It also got an early mover advantage for launching its first hands-free phone but it was not able to grip the market share it has already captured.

With the arrival of new entrants with better technologies and software, Nokia stayed over-confident with its 1st position in the market structure. It thought that its position is unbeatable and victorious, even never consider the other mobile phone players in the game. But, the high competition in the market destroyed the wrong perception that the company was having.

Failed to adapt to the change– Bringing the changes often is not a good decision but being adaptable as per the flexible environment is a great strategy. Nokia failed to adopt that strategy and keep on introducing the low feature mobile phones in the era of smart technology. When it was time to switch to the android operating system it carries on with the old Symbian technology, this was the prime reason why Nokia failed?

Take away

There are many companies in the world that have lost their market share after a stellar performance in the initial years of their launch. Nokia was also one of the companies that were once the most powerful mobile phone player and consistently lost its market position every passing year. In the above article, we discussed the key factors that held responsible for the decline in position hold by this mobile phone company. And how it lost its market share because of some wrong decisions and plans. 

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