Nokia, according to Counterpoint Research, stood fourth in India’s feature phone market with 11% share (based on volumes) in Q3 2020.
The company has been taking an online-first approach to sell its feature phones.
To carve a niche in the entry-level smartphone market, Nokia is eyeing prospective smartphone users with 4G feature phones. HMD Global, the official licensee of the Nokia brand, introduced two 4G feature phones (that support web browsing and Facebook) in the Indian market in October — Nokia 215 and Nokia 225.
Although smartphones hog all the limelight, feature phones have been holding their own in the Indian mobile phone market. Analysts attribute this to the lack of digital literacy, higher-priced smartphones, and high data costs. According to IDC, the overall mobile phone market in India saw shipments of over 130 million feature phones in 2019, as opposed to 152 million smartphones.
Nokia, according to Counterpoint Research, stood fourth in India’s feature phone market with 11% share (based on volumes) in Q3 2020. The top three players in the segment were — Itel (20%), Samsung (18%), and Lava (17%). However, when it comes to market share based on value, Nokia stood second to Samsung, the data shows.
HMD Global is focussing on three user groups for its feature phone range — the first-time users, feature phone loyalists, and smartphone users seeking a digital detox. “There are consumers who are overwhelmed digitally, and want feature phones as a companion device with smartphones. That is a key segment for us,” says Sanmeet Singh, VP, HMD Global. In June, the company had launched Nokia 5310, priced at Rs 3,999, to cater to this segment.
The company has been taking an online-first approach to sell its feature phones. Nokia 215 and Nokia 225 were initially launched on Flipkart and Nokia.com, before being launched through offline channels; the Nokia 5310 was launched on Amazon first. “Earlier, our retailing strategy was centred around offline, but we have seen a good response for these phones online in recent times,” informs Singh.
A mix of digital marketing combined with BTL activities such as roadshows and in-store activations are being employed to promote these products.
Nokia’s feature phones are priced in the Rs 1,000-4,000 range, which is higher than the range Itel and Lava operate in (Rs 789-2,300). Justifying its premium positioning, Singh says Nokia devices “pack in quality with ergonomic design”. “Our overall proposition is very strong; given that it is a Nokia device, it evokes trust,” he adds.
HMD Global aims to garner a bigger pie in the entry-level smartphone market with these feature phones. “When these consumers upgrade to smartphones, they would prefer Nokia, since they would already have experienced the brand,” Singh says.
Awaiting an upgrade
Nokia’s plan to tap the entry-level smartphone user base via feature phones is rather ambitious. “The entry-level smartphone space has the presence of several other players who have been building brand salience for some time now,” says Navkendar Singh, research director, IDC.
Itel, for instance, was not only a leader in the feature phone segment in Q3 of 2020, but also in the entry-level sub-Rs 4,000 smartphone segment, according to Counterpoint Research.
Distribution is a crucial lever to gain market share in this space, say experts. Nokia, it seems, has a lot of ground to cover in that regard, as it is present only in 55% of the country’s overall mobile phone retail network comprising two lakh stores.
The premium positioning could pose another challenge, since over 60% of India’s feature phone market operates in the sub-Rs 1,000 segment. “Nokia phones come with 4G technology, but the average selling price of the phones is 20-30% higher than the market average,” notes Ankit Malhotra, analyst at Counterpoint Research.