FMGT 1K
Team Zebra – Marketing Case Analysis 1
Blackberry’s Rise in Brand Power
The Duelling Marketing Strategies of RIM vs. Apple
Team Name:
Team Zebra
Team Members:
Tyler Blair
Sandeep Rakkar
Edith Szikinger
Zack Li
Ajay Randhawa
Kevin Nguyen
Nellie Zheng
Set:
1K
Course #:
MKTG 1102
Instructor:
Jeff Collier
Presentation Date:
Tuesday October 20, 2009
FMGT 1K
Team Zebra – Marketing Case Analysis 1
Introduction
Research In Motion, creators of the Blackberry product line are aware that in-order to maintain their success,
the company will have to continue to compete over the dominance in the market place for mobile
Smartphones.
Problem
What new strategies can RIM come up with in-order to continue growing their market share, both in North
America and worldwide?
Key Findings
Product(s): Inter@ctive Pager, Java Based Models (5000/6000 series), Colour Models (7000 series), Sure-Type
Models (7100 series)- Charm, Consumer Models (8000/9000 series)- Electron-Pearl-Pearl Flip-Curve-BoldStorm-Tour
Blackberry Storm
Features include: Wi-Fi® Enabled, 1 3.2 MP Digital Camera, Video Camera Capabilities, Supports BlackBerry
App World, Bluetooth Enabled, Multimedia Player, SMS/MMS, Wireless Email, Organizer , Browser, Phone,
Corporate Data Access
Size and Weight: Height is 112.5 mm, Width is 62 mm, Depth is 13.9 mm and the weight of the Blackberry
Storm is 155g
Display: High resolution 480 x 360 pixel color display, 3.25” (diagonally measured), Transmissive TFT LCD,
Supports over 65,000 colors, Dynamic hardware brightness
Data Input and Navigation: Sure-Press touch screen, portrait Sure-Type and multi-tap, landscape QWERTY,
dedicated keys: Send, End, Menu, Escape, Left/right convenience keys, 2X Volume/Zoom, Power/Lock, Mute
(Play/Pause)
Voice Input & Output: 3.5mm stereo headset capable, integrated speaker and microphone, hands-free
headset capable, Bluetooth headset capable, integrated hands-free speakerphone
Media Player : video format support, MPEG4 H.263, MPEG4 Part 2 Simple Profile, H.264, WMV Audio format
support: MP3, AAC, AAC+, eAAC+, WMA, WMA ProPlus
Ringtones and Notifications: tone, vibrate, on-screen or LED indicator, user configurable notification options,
32 polyphonic ringtones – MIDI, MP3
GPS & BlackBerry Maps: includes BlackBerry maps, stand-alone and assisted GPS
Security: password protection, screen lock
Memory: 1 GB Embedded Multimedia Card, 128 MB Flash memory
Battery and Battery Life: Standby time is 15 days (356 hours), talk time is 6 hours, battery type 1400 mAhr
removable/rechargeable cryptographic Lithium cell
FMGT 1K
Team Zebra – Marketing Case Analysis 1
Price: The price of the Blackberry storm in Canada is $599.99. Other Blackberry products range from $429 $649.00 on a 0 term contract. The Storm on a: 1 year contract is $549.99, 2 year contract is $499.99, 3 year
contract is $99.99. Monthly package rates vary depending on the carrier and the services used by the
consumer.
Place: RIM headquarters is located in Waterloo, Ontario Canada. There is currently one Blackberry store in
Farmington Hills, Michigan. Blackberry products can be purchased from electronic retailers and through the
following carriers:
Airtel, Vodaphone, T-mobile, O2 Wireless, Nextel, Telus, Southern LINC, Verizon, Sprint, Alltel, Bell, AT&T,
Rogers, Telefonica Moviles, US Cellular, NTT Docomo, Orange, TelCel, TIM, Essar, Mobily, Mobilink, MTN,
Ufone, Proximus, Bouygues, Telecom, SFR, LUXGSM, Telenor, Turkcell, Sure Mobile, BeeLine, Mobistar, British
telecom, Lusacell, Etisalat.
Products are sold in over 135 countries worldwide.
Promotion: Service providers often have term contract promotions with Blackberry products. Consumers are
encouraged to usually sign a one, two or three year contract and in return they receive a discount on the
Blackberry. Verizon Wireless is offering a “Buy one get one free” promotion in the US. Promotional Videos are
available at www.knowyourmobile.com to show the features and designs of different Blackberry models.
Assumptions:
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Prices for the Storm and other models in the key findings are from the Telus website, it is assumed that
other carriers across Canada and U.S. have similar prices.
SWOT Analysis
Strengths
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Blackberry is an established Brand name around the world which continually delivers award winning
products to consumers and businesses.
On 18 August 2009, Fortune Magazine named RIM as the fastest growing company in the world with a
growth of 84% in profits over three years despite the recession
12,000 employees, 11 Billion dollar yearly revenue, 1.8 Billion dollar net income
5.8 Billion dollar capitalisation.
Most customers are loyal to Blackberry.
Most common used PDA by business executives due to Blackberry Smartphones trusted platform for emails and ability to view and edit MS OFFICE documents.
Their products have well established North American carrier distribution.
Blackberry Smartphones are available in over 135 countries.
Source code licences amongst other technical assets contribute to company success.
Strong inter-company culture.
Central access to N. American Corporations by being located in Southern Ontario.
CO-OP program with Waterloo University gives RIM access to new technical talent.
Weaknesses
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The phones primarily appeal to business people.
FMGT 1K
Team Zebra – Marketing Case Analysis 1
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There is not a lot of advertisement in North America for Blackberrys, it is more word of mouth.
All phones are similar to a certain extent.
Internet browsing is not as easy as on IPhone.
Limited “apps” for Blackberry Smartphones in comparison to IPhone.
Limited access to World Markets.
Opportunities
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Expand their products to countries that don’t have access to their Smartphones.
Try to make different models that appeal to not just business people but to the average person.
Bring out more applications for the phones.
More advertising to let people know about different features on the phones.
Economic situation: many smaller firms and technology start ups are struggling financially.
Analysts predict an immense opportunity for Smartphone sales in the near future with shipments soon
reaching the Billions worldwide.
Threats
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Increasing amount of competitors in different countries.
Some consumers are loyal to one brand, so if competitors bring out a PDA that appeals to the
consumer they may not consider Blackberrys.
People are coming out with knock off’s ( The Blueberry, The Blockberry)
Increasing competition for the business segment, as Microsoft, Google, LucasArts and Motorola are
now targeting this segment.
Key competitors have expanded globally.
Source code loss, software piracy and product imitations are more common in developing countries
where IP protection laws are less enforced.
Competitive Analysis
Current Competitors
Nokia: Currently as the largest share of the market, selling phones in 125 regions worldwide.
64% share in Europe, the Middle East and Africa
Global sales went from 72% in 2006 to 50.3%,
Products
o Nokia N97 ($599.99)
 Released June 9, 2009
 Reported sold two million in 3 months
 resistive Touch screen + qwerty keyboard
 Sold to 75 countries
o Nokia X6
 Expected release November 12,2009
 Music centered
FMGT 1K
Team Zebra – Marketing Case Analysis 1
Palm Inc.: Originally manufacturing PDA’s, has been selling Smartphone’s since 2005
Announced that they will no longer be manufacturing PDAs
Currently only has 3% of market share
Products
o Palm Pre($149.95 CDN on 3 year contract )
 Released June 6, 2009 (Sprint Nextel)
August 27, 2009 (Bell Mobility)
 Capacitive multi-touch screen + qwerty keyboard
 Available in Canada USA and Europe
o Palm Pixi
 Announced September 8, 2009
 Capacitive multi-touch screen + qwerty keyboard
o Palm Treo Pro
HTC:
manufactures Microsoft Windows Portable and Google-Android products
Currently has 2.8% of market share
Products
o HTC Magic / T-Mobile myTouch 3G (599.99)
 Released June 2, 2009 (Canada)
July 28, 2009 (United States)
 Capacitive touch screen+ trackball
 Available in Spain, Taiwan, USA, Singapore, Hong Kong, Canada, Neitherlands
o HTC Hero / T-Mobile G2 Touch
 Released October 11, 2009
 Capacitive multi-touch screen
 First android based device to Support Adobe Flash
Apple: RIM’s fastest growing competitor. Very well know for the iPod product line. Started selling the original
IPhone in the summer of 2007
Now holds 13.7% of the global market share, 13.6% in Europe, the Middle East and Africa and 23% in
North America
Products
o Apple iPhone 3G / 3GS ($599)
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Released 3G: July 11, 2008
3GS: June 19, 2009
 Capacitive Multi-touch screen
 Now in handheld gaming market
 Largest Apps store
Global Market Share / Sales
FMGT 1K
Team Zebra – Marketing Case Analysis 1
Global Smartphone Sales by Operating System Q2
2009
Other (Palm
Google Android, 2.80%
WebOS), 3.30%
Nokia Symbian
Microsoft Windows
Mobile, 9%
Apple iPhone, 13.70%
RIM BlackBerry,
20.90%
RIM BlackBerry
Nokia Symbian ,
50.30%
Apple iPhone
Microsoft Windows Mobile
Google Android
Target Market
In the past BlackBerry had generally targeted the professional world. These people would most likely use the
Blackberry for email and other business related subjects that other Smartphone’s can’t do.
Number of employees for Business, finance, administrative, and Management positions
Canada:
3,757,200
USA:
12,288,170
Total in NA: 16,045,370
With the newest BlackBerry on the market, the Storm, RIM appears to now be targeting the general
populace rather than just the business professionals. As the Storm, and soon Storm2, is more than just
business phone, it would appeal to high school students and young adults
Recommendations
Alternative #1
Based on the rapid growing demand of the consumers, Blackberry should develop a new product to enlarge its
market share and increase its revenues.
Advantages
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Release of new product can catch consumers’ eyes on the company
Opportunity to fix up the problems of old phones and re-brand business.
Open new market through promoting its new products.
Innovation gives consumers good impression on the company and lead to the development of every
department in the company. (Potential chances to seek partners, etc)
Disadvantages
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Cost of developing new product.
Cost of advertisement.
Tend to make the company focus on the new product whereas neglects old ones.
Competition between new product and old ones.
Alternative #2
FMGT 1K
Team Zebra – Marketing Case Analysis 1
Focus on Increasing Market Share in other developing countries and penetrating into new markets
worldwide. Developing countries like China, India and Brazil are untapped markets for RIM and its
Blackberry line of Smartphones. These countries have high GDP growth rates, new industrial development
and growing markets for goods.
Advantages
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Increased sales and revenue.
Opening doors to new markets.
Disadvantages
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Large amount of investment needed to make impact in new markets.
Risks in terms of consumer acceptability.
Government Regulations may limit access to markets or prevent profitability.
Alternative #3
Develop more applications that would appeal to a wider audience and update current software to fix
current bugs and glitches
Advantages
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Might draw potential customers who are borderline between Blackberry and other smart phones
More applications allow for a bigger range of uses.
Fixing buggy software will reduce the number of complaints (freezing, lagging)
Disadvantages
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Pointless/useless 3rd party apps
Chance of new bugs/glitches occurring with new software
Solution
Due to the mixed reception of the Blackberry Storm, RIM should develop a new and improved product to
compete with IPhone in N. America and comparables worldwide (Nokia). Using the launch of this new product
and associated promotion and advertising RIM will be able to re-enforce its position in the N. American
market as a leader of innovation and continue to improve upon its market share worldwide.
Implementation Plan
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Develop technologies, license software and secure hardware needed to improve the keyboard and WIFI connection (the two biggest disappointments of the original Storm)
Develop contracts with carriers to add Storm 2 to existing lines of phones offered.
Develop advertising and promotion for Storm 2, with emphasis on improved features, usability and
new Blackberry App Store.
Launch Storm 2 on large N. American carriers to create media blitz and generate excitement (and
hopefully positive reviews) for the new Storm 2, positioning Storm 2 Head to Head with IPhone for
high-end Smartphone dominance in North America.
Launch Storm 2 on smaller N. American carriers to maximize N. American sales, and continue to
expand the worldwide distribution of Blackberry Smartphones.
FMGT 1K
Team Zebra – Marketing Case Analysis 1
Plan B
Alternative #2
Focus on Increasing Market Share in other developing countries and penetrating into new markets worldwide.
Developing countries like China, India and Brazil are untapped markets for RIM and its Blackberry line of
Smartphones. These countries have high GDP growth rates, new industrial development and growing markets
for goods.
Course Concepts
The following Course Concepts were used in this Marketing Case Analysis:
How psychological, social, cultural, and situational factors influence consumers’ buying behaviour.
How firms create value through innovation.
How firms position themselves vs. competitors.
References
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15.
http://www.nokia.com/locations
http://www.nokia.com/press/press-releases/showpressrelease?newsid=1319081
http://en.wikipedia.org/wiki/Nokia_N97
http://www.mobilenewscwp.co.uk/News/313619/n97_defies_critics_with_2m_sales.html
http://en.wikipedia.org/wiki/Nokia_X6
http://en.wikipedia.org/wiki/IPhone
http://kotaku.com/5355969/apple-takes-swipe-at-nintendo-ds-psp-in-portable-game-war
http://en.wikipedia.org/wiki/Palm_Pre
http://en.wikipedia.org/wiki/Palm_Pixi
http://blog.palm.com/palm/2009/09/introducing-palm-pixi-the-newest-member-of-the-palm-webos-family-1.html
http://en.wikipedia.org/wiki/HTC_Magic
http://www.droiddog.com/android-blog/2009/09/htc-sapphire-magic-t-mobile-mytouch-3g-with-google/
http://en.wikipedia.org/wiki/HTC_Hero
http://www.droiddog.com/android-blog/2009/09/htc-hero/
http://www.appleinsider.com/articles/09/08/21/canalys_iphone_outsold_all_windows_mobile_phones_in_q2_20
09.html
16. http://www40.statcan.gc.ca/l01/cst01/labr69a-eng.htm
17. http://www.techeblog.com/index.php/tech-gadget/blueberry-the-rim-blackberry-knockoff
18. http://www40.statcan.gc.ca/l01/cst01/labr69a-eng.htm
19. http://www.bls.gov/news.release/ocwage.t02.htm
20. http://www.chinawirelessnews.com/2009/06/26/9244-china-telecom-will-introduce-blackberry-handsets-intochina/