‘Nokia’s strategy won’t be based on what the competition does’

Nokia, once the largest handset brand, re-entered India earlier this year with its Android-based smartphones and feature phones.

HMD Global, the Finnish firm that manufactures and markets Nokia handsets, is looking to emerge a top player in the market over the next 3-5 years by banking on young customers and the brand’s solid reputation.

Ajey Mehta, Vice-President and Country Head - India, HMD Global, in an interview to BusinessLine talks about Nokia’s comeback plans, the response so far and 4G feature phone plans. Excerpts:

Could you run us through the response Nokia has received post its comeback?

We have launched four feature phones and three smartphones. The response has been amazing. We do see a lot of opportunities going forward.

We launched Nokia 3 and Nokia 5 (smartphones) offline. We ramped up our stocks, and even then, demand has been outstripping supply. We launched Nokia 6 exclusively through Amazon and it was sold out within minutes.

We are looking to be among the top players in the next 3-5 years.

Why did you opt for Android and not Windows?

Android is the operating system of choice. Around 85 per cent of the market is Android. We are in the business of delivering experience where the consumer is at the centre of everything we do. And consumers have endorsed Android as the operating system of their choice.

Your present offerings are priced ₹9,000-15,000, a segment dominated by Chinese players. How different is your strategy then?

We will attempt to have an offering for everybody and play across all price points. So we do plan to go up and down the price points over a period of time.

We started with the ₹9,000-15,000 range as it is where 50-60 per cent of the market is. So we entered a segment where there is maximum opportunity.

However, we will deliver products based on strong design and craftsmanship, real-life experience and pure Android (the operating system is more or less similar to how Google has made it, with least modifications.).

Will you explore the 4G feature phone segment?

We will. We are waiting for the segment to evolve and keeping a close watch.

Going forward, what will be your channel strategy then?

We determine the channel strategy depending on where and how the customer shops.

For us, the offline channel is very important. We have 450-plus exclusive distributors to cover 90,000 stores. With their help, we hope to grow to larger numbers in the future.

The online channel is almost 30 per cent of the market and most of our target consumers are there already. So the channel strategy for us will be the function of the consumer we target.

If so, will you have segregated online and offline portfolios?

In the future, we would like to take all our products across all the channels. Nokia is a people’s brand and we would like to maximise the reach of our devices.

But given the limited resources — in terms of products and in managing the business — we have at present, it has been decided to keep our online and offline portfolios mutually exclusive.

Does such exclusive portfolios help?

There is no one winning formula. It varies from product to product, and also on the consumers. For example, if a product has strong specs, it can work offline. If it has a better touch-and-feel quotient, it may be easier to take it offline.

Chinese players have been harping on specs and higher megapixels as their USPs. What is your strategy?

We are not shy of the specs of our phones. Our specs are equal if not better than competition.

But, we talk of consumer benefits. We are driving real-life experiences. We are there to provide to the consumer what they need, and at a price at which we think the price-value equation is fair. Our strategy will not be based on what the competition does.

Market sources say Nokia is banking on its previous brand heritage to push sales. Your comments...

I would disagree. I do not think people buy a phone just because the heritage of the brand is strong. Of course, the brand helps, but the product has to deliver. And people have appreciated our (devices’) features.

So what will be the ideal portfolio size for you?

It is difficult to say at this point. I believe, our products should straddle across all channels and all consumers. The brand’s positioning has stood us in good stead previously, and also now.

Are you looking at standalone Nokia stores or online ones?

As the business scales up, we will evaluate the commercial viability of such stores. The stores will have to be profitable and stand on their own feet.

We do have plans for an exclusive online store sometime in the future.

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