WINNING MARKETING STRATEGIES IN SMARTPHONE INDUSTRY: A CASE STUDY OF MEXICO
According to new research, the demand for Smartphone is going to hit 1.2 billion by the end of 2014 (eMarketer 2014; Dolcourt, 2014). With mature markets like USA and UK having stagnated, emerging markets such as China, Brazil, Mexico, Indonesia, Russia, South Korea, Saudi Arabia, South Africa, Turkey and others are expected to be the drivers for the increased sales. Most of the researches conclude that close to half of the Smartphone sales will be made in the emerging market (Ashdown, 2011; IDC, 2014). This reality presents emerging markets as the new battleground for Smartphone sales. Buoyed by this information, most of the leading Smartphone companies have unveiled products designed specifically for the emerging markets (Krishna, 2014). At least all of the well known brands (Apple, Samsung, Nokia, Lenovo, Huawei) and other emerging brands are already competing for a share of the emerging markets. It is therefore important to study clearly the marketing strategies that will help these firms establish themselves sin the new markets (McKinsey & Company 2012). Yes, the emerging market has the potential to drive Smartphone growth, but only companies with the right marketing strategies will succeed to win a sizeable market share.
Mexico stands out as a good case example of Smartphone uptake in the new markets. In 2013, Mexico was the leading Smartphone market in Latin America (Whitney, 2014; Dolcourt, 2014). Its Smartphone market grew by over 50 percent in 2013 and is expected to maintain a double digit growth up to 2017 (eMarketer, 2014). Due to that increased growth, over 33.3 million of Mexicans, who represent about one-quarter of the country’s 118.4 million inhabitants, are now Smartphone users (eMarketer, 2014). Using Mexico as a case study, the study will explore the winning marketing strategies that Smartphone companies can apply to unlock the potential of the emerging markets.
1.2 Problem statement
With mature Smartphone markets such as United States and United Kingdom stagnating, Smartphone manufacturers have to come up with appropriate strategies to increase their sales in emerging markets. However, the marketing strategies that were used to woo customers in developed markets may not apply in emerging markets (Ferrell and Hartline, 2010). Smartphone companies have to come up with marketing strategies that are designed for the new markets. Apple and Samsung, for instance, may have conquered the developed market, but they continue to face significant challenges from local players in emerging markets (Juniper Research 2011). History has shown that mobile companies that will fail to explore new growth strategies as it is the case with Motorola, Blackberry and Nokia, may find it hard to continue operating in the new competitive market.
1.3 Purpose of the study
The purpose of this study is to explore the marketing strategies that Smartphone companies can use to increase their sales in emerging market. Since the marketing strategies that have been successful in mature markets may not be successful in emerging markets, the study will recommend new strategies that Smartphone markets can use to penetrate the new markets.
1.4 Aims and objectives
(i) Explore the potential of the emerging markets to sustain the growth of Smartphone companies
(ii) Understand which Smartphone features drive sales in emerging markets
(iii) Understand how Smartphone fit in emerging mobile market
(iv) Recommend winning strategies for marketing Smartphone in emerging markets
1.5 Research Questions
(i) How do Smartphone fit in Mexico’s mobile market?
(ii) What influences the demand for Smartphone in Mexico?
(iii) What are the features that attract Mexicans to Smartphone?
(iv) How do different brands interact with Smartphone users in Mexico?
(v) Which marketing strategies have been used to win new customer
The research methodology in this case will be a case study. The paper will look at the Mexico’s mobile market to explore the marketing strategies that are critical to increasing Smartphone sales in emerging market. Mexico, shares some of the defining characteristics of emerging markets with other countries such as India, Brazil, South Africa, Turkey and Saudi Arabia. It is experiencing rapid growth, has a young and growing population and underdeveloped infrastructure.
List of References
Ashdown, D (2011) The Smartphone Opportunity. Basingstoke: Juniper Research
Dolcourt, J (2014) Emerging markets: The Smartphone battleground (Smartphone Unlocked) [Online] http://www.cnet.com/news/emerging-markets-the-smartphone-battleground-smartphones-unlocked/ (Accessed Sept, 20, 2014)
eMarketer (2014) Mobile Mexico 2014: Consumers and Advertisers Meet in the Smartphone Market. London: eMarketer
Ferrell, OC & Hartline, M (2010) Marketing Strategy. New York: Cengage Learning
International Data Corporation (IDC) (2014) Smartphone Outlook Remains Strong for 2014, Up 23.8%, Despite Slowing Growth in Mature Markets. [Online] http://www.idc.com/getdoc.jsp?containerId=prUS25058714 (Accessed on Sept. 19, 2014)
Juniper Research (2011) Smartphone evolution strategies: premium, Standard and Economy Markets 2011-2016. Basingstoke: Juniper Research
Krishna, J (2014) Google unveils $105 Smartphone for Emerging Markets. Wall Street Journal [Online] http://online.wsj.com/articles/google-unveils-105-smartphone-for-emerging-markets-1410785613 (Accessed on Sept 20, 2014)
McKinsey & Company (2012) Building brands in emerging markets. Mckinsey Quarterly. [Online] http://www.mckinsey.com/insights/winning_in_emerging_markets/building_brands_in_emerging_markets (Accessed on Sept, 20, 2014
Whitney, L (2014) Worldwide Smartphone shipments to touch 1.2B this Year. [Online] http://www.cnet.com/news/worldwide-smartphone-shipments-to-hit-1-2-billion/ (Accessed Sept 20, 2014)